ONE Gas Q2 Earnings Call Highlights

ONE Gas reported stronger second-quarter results, with adjusted EPS rising to $0.82 from $0.54 a year earlier despite weather that was 25% warmer.

The company maintained its $4.83–$4.95 full-year adjusted EPS guidance but now expects results in the upper half of that range.

Improved outlook reflects approximately $16 million in new-rate revenue, expanded benefits from Texas House Bill 4384, customer growth and capacity-release revenue.

The company estimates the Texas legislation will contribute about $0.42 to full-year adjusted EPS.

ONE Gas is advancing growth projects, including an El Paso manufacturing facility and an Oklahoma data center expected to enter service this quarter, while three contracted high-volume projects represent roughly $15 million in annual revenue and $175 million in capital.

Regulatory rate increases are also progressing in Oklahoma, Texas and Kansas.

ONE Gas reported higher second-quarter earnings and said it now expects full-year adjusted results to fall within the upper half of its previously issued 2026 guidance range, supported by new rates, Texas regulatory benefits, customer growth and cost discipline.

Adjusted net income for the second quarter was $52.1 million, or $0.82 per diluted share, compared with $32.7 million, or $0.54 per share, a year earlier.

GAAP earnings per share rose to $0.74 from $0.53.

Chief Executive Officer Sid McAnnally said adjusted earnings per share grew 16% in the first half from the prior-year period despite weather that was 25% warmer.

McAnnally said the company maintained average customer bills flat year over year while increasing its dividend.

The board declared a quarterly dividend of $0.68 per share, unchanged from the prior quarter.

The company maintained its full-year adjusted net income guidance of $306 million to $314 million and adjusted EPS guidance of $4.83 to $4.95.

However, Chief Financial Officer Chris Sighinolfi said ONE Gas now expects adjusted net income of $310 million to $314 million and adjusted EPS of $4.89 to $4.95.

Sighinolfi attributed the outlook in part to approximately $16 million of revenue from new rates during the quarter and greater-than-expected benefits from Texas House Bill 4384.

The Texas law allows gas utilities to defer depreciation expense and ad valorem taxes, while accruing carrying costs on eligible capital projects between their in-service dates and inclusion in customer rates.

ONE Gas now expects House Bill 4384 to contribute about $0.42 to full-year adjusted EPS.

Sighinolfi said the benefit can fluctuate quarterly based on the timing and amount of eligible capital placed into service.

He said the second quarter generally represents a larger share of the annual benefit due to the cadence of the company’s annual Gas Reliability Infrastructure Program, or GRIP, filing.

The company also benefited from capacity-release revenue after warm winter weather reduced gas storage withdrawals.

ONE Gas ended the first quarter with storage inventory about 25% above plan, allowing it to release capacity during the refill season.

The company recognized about $900,000 of related revenue during the second quarter and $2.8 million year to date, with an estimated additional $1.2 million opportunity through the injection season.

Oklahoma Natural Gas filed a performance-based rate change application in February seeking a $28.7 million increase.

An administrative law judge recommended approval as filed following a June hearing, and interim rates subject to refund began in late June.

Texas Gas Service requested a $36.9 million revenue increase in its March GRIP filing.

The Texas Railroad Commission approved the request i...