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Mar 31, 2023
Southwest Gas Q1 2023 Earnings Report
Delivered strong financial results at both the utility and Centuri during the quarter, with constructive new rates in place for Arizona utility customers and exciting new offshore wind and natural gas contracts at Centuri.
Key Takeaways
Southwest Gas Holdings, Inc. reported strong first quarter 2023 financial results with utility earnings up $23 million and Centuri results up approximately $12 million over the same period. Consolidated net earnings were $0.67 per diluted share (adjusted $1.69 per diluted share). The company reaffirmed its 2023 guidance.
Utility earnings up $23 million Q1 2023 over Q1 2022 and Centuri results up approximately $12 million over same period.
Consolidated net earnings of $0.67 per diluted share (and adjusted consolidated net earnings of $1.69 per diluted share) for the first quarter of 2023, compared to consolidated net earnings of $1.58 per diluted share (and adjusted consolidated earnings of $1.74 per diluted share) for the first quarter of 2022.
Completed sale of MountainWest and proceeds used to pay off $1.1 billion of total debt.
Advanced Centuri spin with Internal Revenue Service (“IRS”) private letter ruling (“PLR”) and Arizona Corporation Commission (“ACC”) filings.
Revenue by Segment
Forward Guidance
Reaffirms Natural Gas Distribution Segment Guidance and Outlook:
Positive Outlook
- 2023 net income guidance of $205 - $215 million (assumes $3 - $5 million of COLI earnings)
- 2023 capital expenditures in support of customer growth, system improvements, and pipe replacement programs of $665 - $685 million
- 3 - Year capital expenditures of approximately $2.0 billion
- 3 - Year utility rate base compound annual growth rate of 5% - 7%
- 2023 revenues of $2.8 billion to $3.0 billion
Challenges Ahead
- 2023 adjusted EBITDA margin of 9.5% - 11.0%
- 2023 - 2026 adjusted EBITDA CAGR 9% - 11% (adjusted EBITDA excludes costs of strategic review, one-time acquisition costs and non-cash stock-based compensation expense)
- Strategic Alternatives Review Process Update Southwest Gas is actively executing on its plans to simplify the Company’s business portfolio in the first quarter of 2023 and position Southwest Gas as a pure-play utility.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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