Core Viewpoint - Southwest Gas Holdings Inc. (SWX) is implementing systematic investment plans and accretive acquisitions to enhance its performance, supported by consistent customer growth in its natural gas segment [1] Group 1: Investment Plans and Financials - The company plans a capital investment of $2.4 billion from 2024 to 2026, with $750 million invested in 2023, reflecting a 6% increase from 2022 [2] - The expected capital expenditure for 2024 is $830 million, aimed at supporting customer growth, system improvements, and pipe replacement programs [2] - New natural gas rates, rising demand from an expanding customer base, and efficient expense management are anticipated to boost net income [4] Group 2: Customer Base and Demand - SWX has a diversified and growing customer base across Arizona, Nevada, and California, having installed 41,000 first-time meter sets in the year ending September 30, 2024 [3] - The ongoing increase in the customer base is expected to drive demand and enhance company performance [3] Group 3: Performance Expectations - The company anticipates a rate base growth of 6.5-7.5% over the next three years, with plans to achieve flat operation and maintenance (O&M) expenses per customer during 2024-2026 [5] - Improvements in economic conditions and strong demographics are expected to further drive performance [5] Group 4: Risks and Dependencies - SWX's reliance on interstate pipelines for natural gas transportation poses risks; any interruption in service could impact its ability to meet customer demand [6] - The company does not own significant assets beyond its operating subsidiaries, making it dependent on these units for financial needs [7] Group 5: Stock Performance - Over the past year, SWX shares have increased by 24.7%, slightly outperforming the industry growth of 24.6% [8]

Financial Data and Key Metrics Changes - The company expects full-year utility net income to finish within the top half of the guidance range of $233 million to $243 million [9] - Consolidated adjusted EPS was $0.09 per share during Q3 2024, reflecting a decrease of $0.08 per share compared to Q3 2023 [33] - The utility operating margin increased by nearly $23 million compared to the same period last year, driven by increased rate relief and customer growth [39] Business Line Data and Key Metrics Changes - The utility experienced strong growth with approximately 41,000 new meter sets added during the last 12 months [16] - Centuri's consolidated results were lower for the quarter due to lower volumes of MSA and bid work, and operational issues led to higher costs [34][37] - The utility's O&M increased by $7 million primarily related to leak survey and line locating activities, but the company aims to keep O&M costs flat on a per-customer basis through 2026 [40] Market Data and Key Metrics Changes - Economic activity and demand for natural gas service remain strong, particularly driven by projects like the TSMC Semiconductor Manufacturing Facility in North Phoenix [26] - The surrounding area of the TSMC project is forecasted to see a 95% increase in population over the next 25 years, which would significantly increase the customer base for Southwest Gas [27] - The company is fielding inquiries for large-scale data center developments in Arizona and Nevada, indicating strong potential for future growth [29] Company Strategy and Development Direction - The company is focused on becoming a premier fully regulated natural gas utility and is progressing with the separation of Centuri [6][12] - The strategic priorities include optimizing utility operations and maintaining a strong investment-grade balance sheet while executing on regulatory strategies [55] - The company reaffirms its expected rate base compound annual growth rate of 6.5% to 7.5% from 2024 to 2026 [53] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the future, citing strong regional economic outlook and positive regulatory outcomes [50] - The company is optimistic about achieving a flat O&M per customer trend and expects net income growth to be nonlinear due to regulatory cycles [52] - Management highlighted the importance of ongoing regulatory discussions and the potential for constructive outcomes in rate cases [22][23] Other Important Information - The company finished Q3 2024 with over $450 million in cash and nearly $1 billion in liquidity, indicating strong financial health [15][33] - The company does not expect to issue equity this year due to strong cash balances and ongoing collections [63] - The company is committed to maintaining a competitive dividend while evaluating Centuri's separation options [53] Q&A Session Summary Question: Timing of future separation update for Centuri - Management stated there is no specific timeframe for the separation, but the appointment of a new CEO at Centuri is a positive step forward [57] Question: Settlement backdrop in Arizona rate case - Management indicated that the staff is supportive of the proposed system improvement mechanism, and discussions have been constructive [58][60] Question: Changes in financing plan - The change in the financing plan is primarily due to the collection of the PGA and strong cash balances, leading to no need for equity issuance this year [63][64] Question: Impact of recent elections on regulatory environment - Management does not anticipate any significant impact on the procedural schedule or settlement opportunities due to the recent elections [66][67]

Earnings Conference Call Third Quarter 2024 Results November 6, 2024 Safe Harbor Statement Forward-Looking Statements Unless context otherwise requires, in this presentation, references to "we", "us" and "our" are to Southwest Gas Holdings, Inc. (NYSE: SWX) ("Southwest Gas" or the "Company" or "SWX") together with its current and former consolidated subsidiaries, which include, among others, Southwest Gas Corporation ("Southwest", "SWG", "Utility" or "Natural Gas Distribution" segment), MountainWest Pipelin ...

Core Insights - Southwest Gas Holdings Inc. (SWX) reported third-quarter 2024 operating earnings of 9 cents per share, exceeding the Zacks Consensus Estimate of 7 cents by 28.6%, but down 47.1% from 17 cents in the same quarter last year [1] - Total operating revenues were $1.08 billion, missing the Zacks Consensus Estimate of $1.13 billion by 4.8%, and decreased 7.7% from $1.17 billion in the prior-year quarter [2] Financial Performance - Utility infrastructure service expenses were $644.9 million, a decrease of 5.9% from $685.7 million in the year-ago quarter [3] - Total operating income was $41.9 million, down from $52.9 million in the year-ago quarter [3] - Cash and cash equivalents as of September 30, 2024, were $456.6 million, significantly up from $106.5 million as of December 31, 2023 [4] - Long-term debt, less current maturities, was $4.38 billion as of September 30, 2024, down from $4.61 billion as of December 31, 2023 [4] - Net cash provided by operating activities in the first nine months of 2024 was $1.15 billion, compared to $0.2 billion in the year-ago period [4] Future Outlook - Southwest Gas anticipates net income for the Natural Gas Distribution segment in 2024 to be between $233 million and $243 million [5] - Capital expenditure is expected to be $830 million for 2024, aimed at supporting customer growth, system improvements, and pipe replacement programs [5] - Projected capital expenditure for 2024-2026 is $2.4 billion, with a utility rate base expected to grow at a CAGR of 6.5-7.5% [5] Market Position - Southwest Gas currently holds a Zacks Rank 3 (Hold) [6]

Company Performance - Southwest Gas reported quarterly earnings of $0.09 per share, exceeding the Zacks Consensus Estimate of $0.07 per share, but down from $0.10 per share a year ago, representing an earnings surprise of 28.57% [1] - The company posted revenues of $1.08 billion for the quarter ended September 2024, missing the Zacks Consensus Estimate by 4.82%, compared to $1.17 billion in revenues a year ago [2] - Over the last four quarters, Southwest Gas has surpassed consensus EPS estimates two times and topped consensus revenue estimates two times [2] Market Comparison - Southwest Gas shares have increased by approximately 16.2% since the beginning of the year, while the S&P 500 has gained 21.2% [3] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $1.12 on revenues of $1.38 billion, and for the current fiscal year, it is $3.13 on revenues of $5.28 billion [7] - The Zacks Rank for Southwest Gas is currently 3 (Hold), indicating that the shares are expected to perform in line with the market in the near future [6] Industry Context - The Utility - Gas Distribution industry is currently in the top 37% of over 250 Zacks industries, suggesting that companies in the top 50% of Zacks-ranked industries outperform those in the bottom 50% by more than 2 to 1 [8]

Customer Base and Operations - As of September 30, 2024, Southwest had 2,248,000 natural gas customers, with 1,205,000 in Arizona, 837,000 in Nevada, and 206,000 in California[75]. - There were approximately 41,000 first-time meter sets over the past 12 months, comparable to the previous year[78]. Financial Performance - The operating margin for the twelve months ended September 30, 2024, was $1.3 billion, with 53% earned in Arizona, 35% in Nevada, and 12% in California[75]. - Utility infrastructure services revenues for Q3 2024 were $720 million, reflecting a decrease of $54.8 million, or 7%, compared to Q3 2023[79]. - Operating income for utility infrastructure services in Q3 2024 was $41.9 million, a decrease of $11 million compared to Q3 2023[79]. - Regulated operations revenues for Q3 2024 were $359,131,000, a decrease of 9% from $394,603,000 in Q3 2023[80]. - For the first nine months of 2024, regulated operations revenues were $1,922,157,000, up from $1,797,348,000 in the same period of 2023[82]. - Operating margin for the nine-month period increased by $43 million, reaching $937,969,000, with significant contributions from customer growth and rate relief[82]. - Net income (loss) for the first nine months of 2024 was $(17.1) million, compared to $28.8 million in the same period of 2023, indicating a substantial decline in profitability[85]. Expenses and Costs - Operations and maintenance expense rose by $7.5 million, or 6%, totaling $129,736,000, primarily due to increased labor-related costs and higher insurance expenses[80]. - Net interest deductions increased by approximately $6.5 million, totaling $42,312,000, due to regulatory treatment associated with industrial development revenue bonds[81]. - Utility infrastructure services expenses decreased by $40.8 million, or 6%, driven by lower volumes of infrastructure services provided[84]. - Depreciation and amortization expense for the nine-month period increased by approximately $1.9 million, or 1%, due to a $710 million increase in average gas plant in service[82]. - Depreciation and amortization expense decreased by $9.1 million between the current and prior-year nine-month periods, attributed to fully depreciated small tools and more efficient asset utilization[85]. Cash Flow and Investments - The company finished Q3 2024 with over $450 million in cash and does not expect to issue equity in 2024[79]. - Cash flows from consolidated operating activities increased by $956 million in the first nine months of 2024 compared to the same period in 2023, primarily due to the collection of previously deferred purchased gas costs[97]. - Construction expenditures for the natural gas distribution segment were $644 million during the nine-month period ended September 30, 2024, with approximately 55% allocated to replacing existing pipeline facilities[99]. - Management estimates that natural gas segment construction expenditures will total approximately $2.4 billion over the three years ending December 31, 2026, with about $830 million expected in 2024[99]. Regulatory and Rate Cases - Southwest filed a 2024 Arizona rate case application proposing a revenue increase of approximately $126 million to reflect significant capital investments and align rates with current operations[87]. - In Nevada, Southwest's general rate case resulted in an approved annual revenue increase of $59 million, effective April 2024, with a return on common equity of 9.5%[89]. - Southwest proposed a statewide revenue increase of approximately $49 million in its California general rate case filed in September 2024, with a requested return on common equity of 11.35%[90]. - Great Basin Gas Transmission Company requested an overall annual revenue increase of approximately $16 million in its general rate case, with rates effective September 2024, subject to refund[92]. Debt and Financing - The company extended its $550 million term loan credit agreement, now maturing on July 31, 2025, with a 17.5 basis point reduction in the applicable spread[79]. - The company has a credit facility with a borrowing capacity of $300 million that expires in December 2026, with $113 million outstanding as of September 30, 2024[101]. - Centuri completed an IPO in April 2024, raising approximately $328 million, which was primarily used to repay outstanding amounts under its credit facilities[102]. Future Outlook and Risks - The company plans to continue requesting regulatory support for projects aimed at improving system flexibility and reliability, with significant replacement activities expected to continue beyond the next few years[99]. - Future operating cash flows and results of operations are forecasted to be influenced by regulatory rate proceedings and recovery of costs from gas infrastructure replacement programs[104]. - The company faces risks related to customer growth rates, housing market conditions, and inflation, which could materially affect financial results[105]. - Management's ability to finance and assimilate acquired businesses is crucial for future growth and operational efficiency[105].

Release Date November 6, 2024 Southwest Gas Holdings, Inc. Reports Third Quarter 2024 Financial Results; Expects Utility Net Income Within Top Half of Guidance Range Delivers Strong Utility Earnings with 9% Year-to-Date Earnings Growth Year-over-Year Utility Files California Rate Case; Advances Arizona Rate Case Margin Improvement From Nevada Rate Case Outcome LAS VEGAS – November 6, 2024 – Southwest Gas Holdings, Inc. (NYSE: SWX) ("Southwest Gas" or the "Company") today reported third quarter 2024 consolid ...

Core Viewpoint - Southwest Gas Holdings, Inc. reported strong utility earnings with a 9% year-to-date earnings growth year-over-year, driven by regulatory priorities and disciplined business management efforts [2][4]. Financial Performance - The company reported third quarter 2024 consolidated net income of $0.3 million, or less than one cent per diluted share, compared to $3.2 million, or $0.04 per diluted share, in the third quarter of 2023 [1]. - Adjusted consolidated net income for the third quarter of 2024 was $6.8 million, or $0.09 per diluted share, down from $12.6 million, or $0.17 per diluted share, in the same period last year [1][25]. - The natural gas distribution segment recorded a net income of $0.6 million in Q3 2024, a significant improvement from a net loss of $3.3 million in Q3 2023 [10][12]. Operational Highlights - The utility achieved a twelve-month utility gross margin of $0.7 billion and a record utility operating margin of $1.3 billion [8]. - Approximately 41,000 new meter sets were added to the customer count over the last 12 months, representing a 1.9% increase [8]. - The company made a capital investment of $644 million year-to-date to enhance safety and reliability of the distribution infrastructure [8]. Regulatory Developments - Southwest Gas filed a rate case in California and is advancing its Arizona general rate case, reflecting significant investments made on behalf of customers [3][4]. - The company continues to see positive impacts from the recovery of investments in Nevada, enhancing safety and reliability for its growing customer base [3]. Segment Performance - The utility infrastructure services segment recorded a net income of $10 million and adjusted net income of $16 million in Q3 2024, compared to $18 million and $23.4 million in Q3 2023, respectively [15]. - Year-to-date 2024, the utility infrastructure services segment reported a net loss of $21.2 million, a decline from a net income of $24.9 million in the same period of 2023 [17]. Future Outlook - The company expects 2024 utility net income to finish within the top half of its guidance range of $233 million to $243 million [14]. - Capital expenditures for 2024 are projected to be approximately $830 million, supporting customer growth and system improvements [14].

Company to Host Earnings Conference Call on November 6, 2024LAS VEGAS, Oct. 23, 2024 /PRNewswire/ -- Southwest Gas Holdings, Inc. (NYSE: SWX) ("Southwest Gas" or the "Company") will hold its third quarter earnings conference call and webcast on November 6, 2024, at 11:00 AM ET, following its news release to be issued before the markets open that day.The conference call will be webcast live on the Company's website at www.swgasholdings.com.Date: Wednesday, November 6, 2024 Time: 11:00 AM ET Telephone number: ...

A month has gone by since the last earnings report for Southwest Gas (SWX) . Shares have added about 0.6% in that time frame, underperforming the S&P 500. Will the recent positive trend continue leading up to its next earnings release, or is Southwest Gas due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers. Southwest Gas Q2 Earnings Lag Estimates, Revenu ...