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ONE Gas' (OGS) Q1 Earnings Beat Estimates, Revenues Up Y/Y

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ONE Gas Inc. (OGS - Free Report) reported first-quarter 2021 earnings of $1.79 per share, beating the Zacks Consensus Estimate of $1.78 by 0.6%.

The bottom line also improved 4.1% from the year-ago earnings, primarily owing to new rates and residential customer growth.

Total Revenues

The company recorded revenues of $625.3 million for the first quarter, which surpassed the Zacks Consensus Estimate of $544 million by 14.9%. The top line also improved 18.4% from the year-ago level.

ONE Gas, Inc. Price, Consensus and EPS Surprise

ONE Gas, Inc. Price, Consensus and EPS Surprise

ONE Gas, Inc. price-consensus-eps-surprise-chart | ONE Gas, Inc. Quote

Quarterly Highlights

Residential natural gas sales volume for the first quarter was 63 billion cubic feet (Bcf), up 14.1% year over year. Total volumes delivered were 146.9 Bcf, up 6.4% from the year-ago period due to improving commercial and industrial sales volume.

Total operating expenses for the reported quarter increased 7.2% from the year-ago figure to $180.9 million.

Operating income for the reported quarter decreased 2.2% year over year to $130.3 million.

For first-quarter 2021, ONE Gas’ customer base rose 1.08% from the year-ago period, primarily due to additions to the residential customer group.

It incurred net interest expenses of $15.4 million, down 1.9% from the prior-year figure.

Capital expenditures and asset removal costs were $109 million for the reported quarter compared with $123.4 million in the year-ago period. The decrease was due to a difference in the timing of capital projects between the two periods.

Financial Highlights

As of Mar 31, 2021, ONE Gas had cash and cash equivalents of $704.9 million compared with $8 million at 2020-end.

Long-term debt (excluding current maturities) was $4,082.7 million as of Mar 31, 2021 compared with $1,582.2 million at 2020-end.

Cash provided by (used in) operating activities during first-quarter 2021 was ($1659.3) million against $182.7 million in the first quarter of 2020.

Guidance

ONE Gas reaffirmed 2021 net income guided range of $198-$210 million and earnings per share expectation in the $3.68-$3.92 band. The midpoint of its EPS guidance is $3.80, higher than the current Zacks Consensus Estimate of $3.79 for the period.

Capital expenditure is expected to be $540 million for 2021, of which more than 70% will be targeted for system integrity and the balance will be used primarily for customer growth.

Zacks Rank

Currently, ONE Gas carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Upcoming Releases

Sempra Energy (SRE - Free Report) is scheduled to release first-quarter 2021 operating earnings on May 5. The Zacks Consensus Estimate for the quarter’s earnings is pegged at $2.60 per share.

Atmos Energy Corporation (ATO - Free Report) is scheduled to release fiscal second-quarter 2021 operating earnings on May 5. The Zacks Consensus Estimate for quarterly earnings is pegged at $2.03 per share.

Spire Inc. (SR - Free Report) is scheduled to release fiscal second-quarter 2021 operating earnings on May 7. The Zacks Consensus Estimate for the to-be-reported quarter’s earnings is pegged at $3.05 per share.

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