ONE Gas Reports Mixed Q3 Results, Revenue Decline in Nine-Month Period

ONE Gas, Inc. reported its financial results for the third quarter and the nine months ended September 30, 2024, highlighting a mixed performance in revenue and profitability compared to the previous fiscal period. The company serves approximately 2.3 million customers across Oklahoma, Kansas, and Texas, primarily through its regulated public utility segment.

For the three months ended September 30, 2024, total revenues increased to $340.4 million from $335.8 million in the same period of 2023. Natural gas sales rose slightly to $289.2 million from $286.0 million, while transportation revenues also saw an uptick, reaching $30.5 million compared to $29.5 million. However, for the nine months ended September 30, 2024, total revenues decreased to $1.452 billion from $1.766 billion, with natural gas sales dropping significantly from $1.606 billion to $1.291 billion. This decline was attributed to lower sales volumes and market conditions.

Operating income for the third quarter improved to $59.5 million, up from $57.2 million, driven by new rate increases totaling $17.5 million. For the nine-month period, operating income rose to $274.8 million from $270.5 million, supported by a $43.3 million increase from new rates and a $5.1 million rise in residential sales due to customer growth. However, these gains were offset by rising costs, including $3.7 million in depreciation and $6.1 million in employee-related expenses for the quarter.

Net income for the third quarter was $19.2 million, or $0.34 per diluted share, down from $25.2 million, or $0.45 per diluted share, in the prior year. For the nine months, net income decreased to $145.8 million, or $2.56 per diluted share, from $160.5 million, or $2.87 per diluted share.

The company also reported a significant reduction in accrued unbilled natural gas sales revenues, which fell to $81.2 million from $191.4 million at the end of 2023. Additionally, the allowance for doubtful accounts decreased to $12.9 million from $16.1 million, indicating improved credit risk management.

Strategically, ONE Gas increased its credit facility capacity to $1.35 billion in October 2024 and issued an additional $250 million in senior notes due 2029. The company also declared a dividend of $0.66 per share, reflecting its commitment to returning value to shareholders. Regulatory developments included rate increases approved for Kansas Gas Service and Texas Gas Service, which are expected to enhance future revenue streams.

Overall, while ONE Gas experienced revenue declines in the nine-month period, strategic rate adjustments and cost management efforts contributed to a stable operating income and ongoing financial resilience.