Spire(SR) - 2025 Q2 - Quarterly Report

Financial Performance - Operating revenues for the three months ended March 31, 2025, were $1,051.3 million, a decrease of 6.8% compared to$ 1,128.5 million for the same period in 2024[9]. - Net income for the three months ended March 31, 2025, was $209.3 million, slightly up from$ 204.3 million in the same period of 2024, representing a 0.5% increase[11]. - Operating income for the six months ended March 31, 2025, was $455.2 million, an increase of 4.0% from$ 437.8 million for the same period in 2024[9]. - Total operating expenses for the three months ended March 31, 2025, were $744.9 million, down 10.2% from$ 829.9 million in the same period of 2024[9]. - Basic earnings per common share for the three months ended March 31, 2025, were $3.52, compared to$ 3.59 for the same period in 2024, reflecting a decrease of 1.9%[9]. - The company reported a comprehensive income of $207.6 million for the three months ended March 31, 2025, compared to$ 210.8 million for the same period in 2024[11]. - Net income for the six months ended March 31, 2025, was $290.6 million, slightly up from$ 289.4 million for the same period in 2024, indicating stable performance[24]. - Adjusted earnings for the three months ended March 31, 2025, were $214.4 million, compared to$ 196.6 million for the same period in 2024, reflecting an increase of about 9.4%[115]. - Adjusted earnings for the six months ended March 31, 2025, were $295.5 million, up from$ 279.3 million in 2024, representing a growth of 5.9%[117]. Assets and Liabilities - Total assets as of March 31, 2025, were $11,346.7 million, an increase of 4.5% from$ 10,860.7 million as of March 31, 2024[14]. - Long-term debt (less current portion) as of March 31, 2025, was $3,348.5 million, a decrease of 9.6% from$ 3,704.4 million as of March 31, 2024[17]. - Total assets as of March 31, 2025, amounted to $6,127.4 million, up from$ 5,754.9 million as of March 31, 2024, indicating a growth of 6.5%[30]. - Total shareholder's equity increased to $2,205.0 million as of March 31, 2025, compared to$ 1,963.7 million as of March 31, 2024, reflecting a growth of 12.3%[33]. - Long-term debt (less current portion) was $1,803.8 million as of March 31, 2025, compared to$ 1,486.2 million as of March 31, 2024, indicating an increase of 21.3%[33]. - Total liabilities at fair value were reported at $39.2 million, with$ 23.4 million classified under Level 1 and $42.7 million under Level 2[102]. Cash Flow and Capital Expenditures - Cash and cash equivalents increased to$ 15.2 million as of March 31, 2025, compared to $4.5 million as of March 31, 2024[14]. - Capital expenditures for the six months ended March 31, 2025, were$ 479.2 million, an increase from $409.3 million in the prior year, indicating a focus on investment in growth[24]. - Net cash provided by operating activities for the six months ended March 31, 2025, was$ 453.8 million, down from $559.4 million in the same period of 2024, suggesting a decrease in operational efficiency[24]. - Cash and cash equivalents at the end of the period were$ 3.3 million, an increase from $1.5 million at the beginning of the period[45]. - Capital expenditures for the six months ended March 31, 2025, totaled$ 322.1 million, compared to $255.1 million in 2024, representing an increase of 26.3%[39]. Shareholder Equity and Dividends - Total shareholders' equity increased to$ 3,508.7 million as of March 31, 2025, compared to $3,390.3 million a year earlier, reflecting a growth of approximately 3.5%[21]. - The company declared dividends of$ 90.0 million on common stock and $7.4 million on preferred stock during the six months ended March 31, 2025[24]. - Common stock issued during the six months ended March 31, 2025, amounted to 1,206,134 shares, raising$ 74.8 million, compared to 4,490,282 shares issued in the same period of 2024, which raised $286.0 million[21]. Segment Performance - The Gas Utility segment remains the core business segment, contributing significantly to revenue and earnings, with operations in Missouri and Alabama[57]. - Revenues from external customers in the Gas Utility segment for the three months ended March 31, 2025, were$ 970.1 million, down from $1,072.4 million in the same period of 2024, a decrease of about 9.5%[115]. - The Gas Marketing segment generated revenues of$ 53.6 million for the three months ended March 31, 2025, compared to $46.0 million in the same period of 2024, an increase of about 16.5%[115]. - The Midstream segment reported revenues of$ 27.1 million for the three months ended March 31, 2025, up from $10.0 million in the same period of 2024, representing a significant increase of approximately 171%[115]. Regulatory and Market Environment - The company’s regulatory environment supports the continued use of regulatory accounting principles, ensuring recoverability of regulatory assets and liabilities[59]. - Spire Missouri's proposed general rate case includes a base rate increase request of$ 289.5 million, reflecting a 32% increase in rate base since the last filing[81]. - The Infrastructure System Replacement Surcharge (ISRS) allows Spire Missouri to recover $53.6 million from customers for eligible capital projects through August 2024[81]. - The common equity ratio assumed in Spire's rate case filing is 55.0%, with a proposed return on equity of 10.5%[81]. Challenges and Future Outlook - The company faces challenges including volatility in gas prices and potential disruptions from severe weather events, which could affect operational margins and competitive positioning[143]. - Future outlook indicates a cautious approach due to fluctuating commodity prices, particularly in natural gas, which has seen a significant drop[103]. - The company plans to explore potential mergers and acquisitions to strengthen its market position and diversify its offerings[103].