September 29, 2016 7:14 AM ET

Gas Utilities

Company Overview of Atmos Energy Corporation

Company Overview

Atmos Energy Corporation, together with its subsidiaries, engages in the distribution, transmission, and storage of natural gas in the United States. It operates in three segments: Regulated Distribution, Regulated Pipeline, and Nonregulated. The Regulated Distribution segment is involved in regulated natural gas distribution and related sales operations. This segment distributes natural gas to approximately three million residential, commercial, public authority, and industrial customers. As of September 30, 2015, it owned approximately 70,218 miles of underground distribution and transmission mains. The Regulated Pipeline segment engages in the pipeline and storage operations. This segment...

Three Lincoln Centre

Suite 1800

5430 LBJ Freeway

Dallas, TX 75240

United States

Founded in 1906

4,753 Employees

Phone:

972-934-9227

Key Executives for Atmos Energy Corporation

Chief Executive Officer and Director
Age: 65
Total Annual Compensation: $938.6K
President, Chief Operating Officer and Director
Age: 56
Total Annual Compensation: $426.7K
Chief Financial Officer and Senior Vice President
Age: 49
Total Annual Compensation: $422.6K
Senior Vice President, General Counsel and Corporate Secretary
Age: 61
Total Annual Compensation: $372.8K
Senior Vice President of Safety & Enterprise Services
Age: 53
Total Annual Compensation: $357.4K
Compensation as of Fiscal Year 2015.

Atmos Energy Corporation Key Developments

Atmos Energy Corporation Enters into $200 Million Term Loan Agreement with Branch Banking and Trust Company as Administrative Agent and Syndicate of Three Lenders

On September 22, 2016, Atmos Energy Corporation entered into a $200 million Term Loan Agreement with Branch Banking and Trust Company as Administrative Agent, and a syndicate of three lenders. The Term Loan will be used to refinance existing indebtedness and for working capital, capital expenditures and other general corporate purposes. Borrowings under the Term Loan will bear interest at a rate dependent upon the company's credit ratings at the time of such borrowing and based, at the company's election, on a base rate or LIBOR for the applicable interest period. In the case of borrowings based either on the base rate or on LIBOR, an applicable margin ranging from 0.000% to 1.150% per annum would be added, based on the company's then current credit ratings. The base rate is defined as the highest of the per annum rate of interest established by BB&T as its prime lending rate at the time of such borrowing, the Federal Funds Rate, as in effect at the time of borrowing, plus one-half of 0.50% per annum, or the one-month LIBOR plus 1.00%. Based on the current prime lending rate charged by BB&T, the current Federal Funds Rate, the one-month LIBOR and the company's current credit ratings, borrowings at the base rate would bear interest at 3.500% per annum, plus an applicable margin of 0.000% per annum, or an effective total interest rate of 3.500% per annum. Based upon the current LIBOR for a one-month period and the company's current credit ratings, borrowings at LIBOR would bear interest at 0.520% per annum, plus an applicable margin of 0.900% per annum, or an effective total interest rate of 1.420% per annum. The company must also pay commitment fees quarterly in arrears on the average daily unused portion of the Term Loan at rates ranging from 0.060% to 0.175% per annum, dependent upon the company's credit ratings. Based upon the company's current credit ratings, the commitment fee would be at the rate of 0.100%. The Term Loan will expire on September 22, 2019, at which time all outstanding amounts under the Term Loan will be due and payable. The Term Loan contains usual and customary covenants for transactions of this type, including covenants limiting liens, substantial asset sales and mergers. In addition, the Term Loan provides that during the term of the facility, the company's debt to capitalization ratio as of the last day of each of its fiscal quarters shall be less than or equal to 0.70 to 1.00, excluding from the calculation of debt any pension and other post-retirement benefits liability adjustments recorded in accordance with generally accepted accounting principles; and an amount of hybrid securities, as defined in the Term Loan, not to exceed a total of 15% of total capitalization.

Texas Victims of 2015 Natural Gas Explosion Sues Atmos Energy Corporation

Attorneys for Adelmira Chavez, whose home in Waxahachie, Texas, was demolished by a natural gas explosion last year, have filed a lawsuit against Atmos Energy Corp. based on claims that the company failed to act on reports of a severed gas line after gas service in the Saddlebrook Estates neighborhood was disrupted for four days prior to the explosion. More than 20 other Saddlebrook Estates residents who suffered physical injuries, emotional trauma or property damage are pressing claims against Atmos in the same lawsuit. The lawsuit, filed in the 40thState District Court in Ellis County, also claims that Dallas-based Atmos negligently located and installed excess flow valves during construction of the new residential subdivision. If properly located on the gas service line, the valve would have immediately shut off the leaking gas when the break occurred. Expert reports and other documents filed in the case indicate that the explosion resulted from an Atmos gas line being cut by contractors who were working to install underground fiber optic cable for Dallas-based AT&T. Although no specific details are being provided, a resolution has been reached with AT&T and its contractor, Burleson, Texas-based Circle L Construction.

Atmos Energy Corporation Announces Unaudited Consolidated Earnings Results for the Third Quarter and Nine Months Ended June 30, 2016; Provides Earnings Guidance for the Fourth Quarter and Full Year 2016

Atmos Energy Corporation announced unaudited consolidated earnings results for the third quarter and nine months ended June 30, 2016. For the quarter, the company's consolidated net income was $71.2 million, or $0.69 per diluted share, compared with consolidated net income of $56.3 million, or $0.55 per diluted share in the prior-year quarter. Operating income was $137,164,000 compared to $117,607,000 a year ago. Income before income taxes was $110,299,000 compared to $90,286,000 a year ago. Diluted earnings per share, excluding mark-to-market gains, increased to $0.67 during the quarter. For the nine months ended June 30, 2016, consolidated net income was $315.9 million, or $3.06 per diluted share, compared with net income of $291.6 million, or $2.86 per diluted share for the same period last year. Capital expenditures increased to $796.0 million for the nine months ended June 30, 2016, compared with $667.5 million in the prior-year period driven by a planned increase in spending in the company's regulated operations. For the nine months ended June 30, 2016, the company generated operating cash flow of $624.6 million, a $93.0 million decrease compared with the nine months ended June 30, 2015. The year-over-year decrease primarily reflects the timing of deferred gas cost recoveries. Operating income was $583,385,000 compared to $555,542,000 a year ago. Income before income taxes was $496,583,000 compared to $467,742,000 a year ago. Capital spending increased by about $129 million in the first nine months compared to year ago, primarily due to planned increases of spending in both of regulated segments. Diluted earnings per share, excluding mark-to-market gains, increased to $2.98 for the current nine months. For the fourth quarter of 2016, the company poised to deliver earnings per diluted share in the range of $3.25 to $3.35. Fiscal 2016 earnings guidance remains in the range of $3.25 to $3.35 per diluted share, excluding net unrealized margins. Net income from regulated operations is expected to be in the range of $320 million to $335 million. Net income from non regulated operations is expected to be in the range of $14 million to $19 million, excluding net unrealized margins. Capital expenditures for fiscal 2016 are now expected to be at the top end of the previously announced range, approximating $1.1 billion. The company continues to expect fiscal 2016 earnings per diluted share to range between $2.25 and $3.35, excluding net unrealized margins at September 30.

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Recent Private Companies Transactions

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