EX-99.1 2 ogsye2014earningsreleasene.htm 2014 YEAR-END EARNINGS NEWS RELEASE OGS YE 2014 Earnings Release News Release
Exhibit 99.1


Feb. 18, 2015
 
Analyst Contact:
Andrew Ziola
918-947-7163
 
 
Media Contact:
Jennifer Rector
918-947-7571

ONE Gas Announces Fourth-quarter
and Full-year 2014 Financial Results

Affirms 2015 Financial Guidance

TULSA, Okla. - Feb. 18, 2015 - ONE Gas, Inc. (NYSE: OGS) today announced financial results for its fourth quarter and full year 2014 and affirmed its 2015 financial guidance.

Highlights include:

Fourth-quarter 2014 net income was $36.6 million, or $0.69 per diluted share, compared with $30.3 million, or $0.58 per diluted share, in the fourth quarter 2013;
Full-year 2014 net income was $109.8 million, or $2.07 per diluted share, compared with $99.2 million, or $1.90 per diluted share, in 2013;
Increasing its quarterly dividend 7 percent to 30 cents per share, or $1.20 per share on an annualized basis, payable on Mar. 2, 2015, to shareholders of record at the close of business on Feb. 20, 2015; and
Full-year 2014 capital expenditures were $297.1 million, compared with $292.1 million in 2013.

“We are pleased with our first full-year financial results following our successful transition into an independent company. Investments in our system led to new rates primarily in Oklahoma and Texas, generating strong results for 2014,” said Pierce H. Norton II, ONE Gas president and chief executive officer.

“As we begin our second year as a stand-alone company, we are confident in our business strategy which is focused on investing in our system and serving our customers,” said Norton. “I’m very proud of and want to acknowledge our 3,300 employees, who are committed every day to providing safe and reliable service to more than 2 million customers across our three states. They have worked diligently throughout the year to make us successful while maintaining the high service standards our customers expect from us.”


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ONE Gas Announces Fourth-quarter and Full-year 2014 Financial Results;
Affirms 2015 Guidance

Feb. 18, 2015

Page 2

FOURTH-QUARTER 2014 FINANCIAL PERFORMANCE

ONE Gas reported operating income of $70.0 million in the fourth quarter 2014, compared with $65.0 million in the fourth quarter 2013.

Net margin was relatively unchanged compared with fourth quarter 2013, reflecting:

A $3.3 million increase from new rates primarily in Oklahoma;
A $1.3 million increase attributed to residential customer growth;
A $1.1 million increase in compressed natural gas (CNG) revenue;
A $0.8 million increase from higher volumes due primarily to weather-sensitive transportation customers;
A $3.6 million decrease in rider and surcharge recoveries due to a lower ad-valorem surcharge in Kansas and the expiration of the take-or-pay rider in Oklahoma, both of which were offset by lower amortization expense; and
A $2.7 million decrease due primarily to warmer weather in all three states compared with colder-than-normal weather in the fourth quarter 2013, net of weather normalization.

Fourth-quarter 2014 operating costs were $122.5 million, compared with $114.1 million in the fourth quarter 2013, which primarily reflects:

A $4.7 million increase in employee-related expenses resulting from higher labor and compensation costs;
A $3.7 million increase in insurance, information technology and rent expenses;
A $3.3 million increase in outside service expenses related primarily to pipeline maintenance activities and costs associated with the separation from ONEOK (NYSE: OKE);
A $0.8 million increase in bad debt expense; and
A $2.2 million decrease in benefit expenses related primarily to lower pension and other post-retirement benefit costs resulting from an annual change in the estimated discount rate.
    
Fourth-quarter 2014 depreciation and amortization was $31.7 million, compared with $44.6 million in the fourth quarter 2013. This decrease was due primarily to the settlement agreement approved by the Kansas Corporation Commission (KCC) authorizing the separation of Kansas Gas Service assets to ONE Gas from ONEOK, whereby Kansas Gas Service agreed to expense a $10.2 million regulatory asset in the fourth quarter 2013 related to a transaction cost recovery; lower rider and surcharge recoveries from lower ad-valorem taxes in Kansas; and the expiration of the take-or-pay rider in Oklahoma. These decreases were offset partially by higher depreciation expense from capital expenditures.

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ONE Gas Announces Fourth-quarter and Full-year 2014 Financial Results;
Affirms 2015 Financial Guidance

Feb. 18, 2015

Page 3

Key Statistics: More detailed information is listed on page 13 in the tables.

Actual heating degree days across the company’s service areas were 3,875 in the fourth quarter 2014, 2 percent warmer than normal and 14 percent warmer than the same period last year;
Actual heating degree days in the Oklahoma service area were 1,339 in the fourth quarter 2014, 3 percent colder than normal and 14 percent warmer than the same period last year;
Actual heating degree days in the Kansas service area were 1,848 in the fourth quarter 2014, 2 percent warmer than normal and 11 percent warmer than the same period last year;
Actual heating degree days in the Texas service area were 688 in the fourth quarter 2014, 8 percent warmer than normal and 19 percent warmer than the same period last year;
Residential natural gas sales volumes were 40.5 billion cubic feet (Bcf) in the fourth quarter 2014, down 7 percent compared with the same period last year;
Total natural gas sales volumes were 53.1 Bcf in the fourth quarter 2014, down 7 percent compared with the same period last year;
Natural gas transportation volumes were 54.5 Bcf in the fourth quarter 2014, relatively unchanged compared with the same period last year; and
Total natural gas volumes delivered were 107.6 Bcf in the fourth quarter 2014, down 3 percent compared with the same period last year.

FULL-YEAR 2014 FINANCIAL PERFORMANCE

Full-year 2014 operating income was $225.3 million, compared with $220.3 million in 2013.

Net margin increased $14.0 million compared with last year, which primarily reflects:

A $16.8 million increase from new rates primarily in Texas and Oklahoma;
A $5.6 million increase attributed to residential customer growth;
A $4.7 million increase from higher volumes due primarily to weather-sensitive transportation customers;
A $2.8 million increase in CNG revenue and higher line extension revenue from commercial and industrial customers in Oklahoma;
A $12.8 million decrease in rider and surcharge recoveries due to a lower ad-valorem surcharge in Kansas and the expiration of the take-or-pay rider in Oklahoma, both of which were offset by lower amortization expense; and
A $3.7 million decrease due primarily to warmer weather in all three states, compared with colder-than-normal weather in 2013, net of weather normalization.

2014 operating costs were $476.0 million, compared with $447.9 million in 2013, which primarily reflects:


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ONE Gas Announces Fourth-quarter and Full-year 2014 Financial Results;
Affirms 2015 Financial Guidance

Feb. 18, 2015

Page 4

A $13.0 million increase in outside service expenses related primarily to $6.8 million of costs associated with the separation from ONEOK and $3.7 million in pipeline maintenance activities;
A $12.6 million increase in insurance, information technology and rent expenses;
An $11.0 million increase in employee-related expenses resulting from higher labor and compensation costs;
A $1.7 million increase in bad debt expense; and
An $8.0 million decrease in benefit expenses related primarily to lower pension and other post-retirement benefit costs resulting from an annual change in the estimated discount rate.

Full-year 2014 depreciation and amortization was $125.7 million, compared with $144.8 million in 2013. This decrease was due primarily to the settlement agreement approved by the KCC authorizing the separation of Kansas Gas Service assets to ONE Gas from ONEOK, whereby Kansas Gas Service agreed to expense a $10.2 million regulatory asset in the fourth quarter 2013 related to a transaction cost recovery; lower surcharge recoveries from lower ad-valorem taxes in Kansas; and the expiration of the take-or-pay rider in Oklahoma. These decreases were offset partially by higher depreciation expense from capital expenditures.

Full-year 2014 capital expenditures were $297.1 million, compared with $292.1 million for the same period last year, reflecting an increase in information technology hardware and software. More than 60 percent of total capital expenditures were related to system integrity and replacement projects.

Full-year 2014 interest expense was $45.8 million, compared with $61.4 million in 2013. This significant decrease was due to the company’s separation from ONEOK and initial debt offering as a stand-alone company. In January 2014, ONE Gas completed a private placement of senior notes, consisting of $300 million of 2.07 percent senior notes due 2019, $300 million of 3.61 percent senior notes due 2024 and $600 million of 4.658 percent notes due 2044.

The company ended the fourth quarter 2014 with $11.9 million of cash and cash equivalents, $42.0 million of commercial paper outstanding and $1.0 million in letters of credit, leaving $657 million of credit available under its $700 million credit facility. The total debt-to-capitalization ratio at Dec. 31, 2014, was approximately 41 percent.
 
> View earnings tables

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ONE Gas Announces Fourth-quarter and Full-year 2014 Financial Results;
Affirms 2015 Financial Guidance

Feb. 18, 2015

Page 5

REGULATORY ACTIVITY

Kansas

In November 2014, the KCC approved a request from Kansas Gas Service for an increase in base rates of approximately $3.5 million under the Gas System Reliability Surcharge (GSRS) rider, which became effective on December 1, 2014. GSRS is a capital-recovery mechanism that allows for a rate adjustment providing recovery of and a return on incremental safety-related and government-mandated capital investments made between rate cases.

Texas

In February 2015, Texas Gas Service filed requests for interim rate relief under the Gas Reliability Infrastructure Program (GRIP) statute with the City of Austin, Texas, and surrounding communities for approximately $3.7 million. If approved by the cities, new rates will become effective in April 2015. GRIP is a capital-recovery mechanism that allows for an interim rate adjustment providing recovery of and a return on incremental capital investments made between rate cases.

2015 FINANCIAL GUIDANCE AFFIRMED

ONE Gas affirmed its 2015 financial guidance, with net income expected to be in the range of $108 million to $118 million.

Capital expenditures are expected to be approximately $300 million in 2015. More than 70 percent of these expenditures are targeted for system integrity and replacement projects.

EARNINGS CONFERENCE CALL AND WEBCAST

The ONE Gas executive management team will conduct a conference call on Thursday, Feb. 19, 2015, at 11 a.m. Eastern Standard Time (10 a.m. Central Standard Time). The call also will be carried live on the ONE Gas website.

To participate in the telephone conference call, dial 877-397-0298, pass code 5960018, or log on to www.onegas.com.

If you are unable to participate in the conference call or the webcast, a replay will be available on the ONE Gas website, www.onegas.com, for 30 days. A recording will be available by phone for seven days. The playback call may be accessed at 888-203-1112, pass code 5960018.


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ONE Gas Announces Fourth-quarter and Full-year 2014 Financial Results;
Affirms 2015 Financial Guidance

Feb. 18, 2015

Page 6

LINK TO EARNINGS TABLES:

http://www.onegas.com/~/media/OGS/Earnings/2014/OGS_Q4Earnings-0rRe7$w.ashx
---------------------------------------------------------------------------------------------------------------------
ONE Gas, Inc. (NYSE: OGS) is a natural gas distribution company and the successor to the company founded in 1906 as Oklahoma Natural Gas Company, which became ONEOK, Inc. (NYSE: OKE) in 1980. On Jan. 31, 2014, ONE Gas officially separated from ONEOK into a stand-alone, 100 percent regulated, publicly traded natural gas utility.

ONE Gas trades on the New York Stock Exchange under the symbol "OGS," and is included in the S&P MidCap 400 Index.

ONE Gas provides natural gas distribution services to more than 2 million customers in Oklahoma, Kansas and Texas. ONE Gas is one of the largest publicly traded, 100 percent regulated, natural gas utilities in the United States.

ONE Gas is headquartered in Tulsa, Okla., and its companies include the largest natural gas distributor in Oklahoma and Kansas, and the third largest in Texas, in terms of customers.

Its largest natural gas distribution markets by customer count are Oklahoma City and Tulsa, Okla.; Kansas City, Wichita and Topeka, Kan.; and Austin and El Paso, Texas. ONE Gas serves residential, commercial, industrial, transportation and wholesale customers in all three states.

For more information, visit the website at http://www.ONEGas.com. For the latest news about ONE Gas, follow us on Twitter @ONEGasInc.

Some of the statements contained and incorporated in this news release are forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. The forward-looking statements relate to our anticipated financial performance, liquidity, management’s plans and objectives for our future operations, our business prospects, the outcome of regulatory and legal proceedings, market conditions and other matters. We make these forward-looking statements in reliance on the safe harbor protections provided under the Private Securities Litigation Reform Act of 1995. The following discussion is intended to identify important factors that could cause future outcomes to differ materially from those set forth in the forward-looking statements.
Forward-looking statements include the items identified in the preceding paragraph, the information concerning possible or assumed future results of our operations and other statements contained or incorporated in this news release identified by words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “should,” “goal,” “forecast,” “guidance,” “could,” “may,” “continue,” “might,” “potential,” “scheduled,” and other words and terms of similar meaning.
One should not place undue reliance on forward-looking statements, which are applicable only as of the date of this news release. Known and unknown risks, uncertainties and other factors may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by forward-looking statements. Those factors may affect our operations, markets, products, services and prices. In addition to any assumptions and other factors referred to specifically in connection with the forward-looking statements, factors that could cause our actual results to differ materially from those contemplated in any forward-looking statement include, among others, the following:
our ability to recover operating costs and amounts equivalent to income taxes, costs of property, plant and equipment and regulatory assets in our regulated rates;
our ability to manage our operations and maintenance costs;
changes in regulation, including the application of market rates by state and local agencies;
the economic climate and, particularly, its effect on the natural gas requirements of our residential and commercial industrial customers;
competition from alternative forms of energy, including, but not limited to, solar power, wind power, geothermal energy and biofuels;

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ONE Gas Announces Fourth-quarter and Full-year 2014 Financial Results;
Affirms 2015 Financial Guidance

Feb. 18, 2015

Page 7


variations in weather, including seasonal effects on demand, the occurrence of storms and disasters, and climate change;
indebtedness could make us more vulnerable to general adverse economic and industry conditions, limit our ability to borrow additional funds and/or place us at competitive disadvantage compared with competitors;
our ability to secure reliable, competitively priced and flexible natural gas supply;
the mechanical integrity of facilities operated;
operational hazards and unforeseen operational interruptions;
adverse labor relations;
the effectiveness of our strategies to reduce earnings lag, margin protection strategies and risk mitigation strategies;
our ability to generate sufficient cash flows to meet all of our cash needs;
changes in the financial markets during the periods covered by the forward-looking statements, particularly those affecting the availability of capital and our ability to refinance existing debt and fund investments and acquisitions;
actions of rating agencies, including the ratings of debt, general corporate ratings and changes in the rating agencies’ ratings criteria;
changes in inflation and interest rates;
our ability to purchase and sell assets at attractive prices and on other attractive terms;
our ability to recover the costs of natural gas purchased for our customers;
impact of potential impairment charges;
volatility and changes in markets for natural gas;
possible loss of LDC franchises or other adverse effects caused by the actions of municipalities;
payment and performance by counterparties and customers as contracted and when due;
changes in regulation of natural gas distribution services, particularly those in Oklahoma, Kansas and Texas;
changes in law resulting from new federal or state energy legislation;
changes in environmental, safety, tax and other laws to which we and our subsidiaries are subject;
advances in technology;
population growth rates and changes in the demographic patterns of the markets we serve;
acts of nature and the potential effects of threatened or actual terrorism, including cyber attacks and war;
the sufficiency of insurance coverage to cover losses;
the effects of our strategies to reduce tax payments;
the effects of litigation and regulatory investigations, proceedings, including our rate cases, or inquiries;
changes in accounting standards and corporate governance;
our ability to attract and retain talented management and directors;
the results of financing efforts, including our ability to obtain financing on favorable terms, which can be affected by various factors, including our credit ratings and general economic conditions;
declines in the market prices of debt and equity securities and resulting funding requirements for our defined benefit pension plans;
the ability to successfully complete merger, acquisition or divestiture plans, regulatory or other limitations imposed as a result of a merger, acquisition or divestiture, and the success of the business following a merger, acquisition or divestiture;
the final resolutions or outcomes with respect to our contingent and other corporate liabilities related to the natural gas distribution business and any related actions for indemnification made pursuant to the Separation and Distribution Agreement;
our ability to operate effectively as a separate, publicly traded company; and
the costs associated with increased regulation and enhanced disclosure and corporate governance requirements pursuant to the Dodd-Frank Wall Street Reform and the Consumer Protection Act of 2010.

These factors are not necessarily all of the important factors that could cause actual results to differ materially from those expressed in any of our forward-looking statements. Other factors could also have material adverse effects on our future results. These and other risks are described in greater detail in Item 1A, Risk Factors, in our Annual Report. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by these factors. Other than as required under securities laws, we undertake no obligation to update


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ONE Gas Announces Fourth-quarter And Full-year 2014 Financial Results;
Affirms 2015 Financial Guidance

Feb. 18, 2015

Page 8


publicly any forward-looking statement whether as a result of new information, subsequent events or change in circumstances, expectations or otherwise.    
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ONE Gas Announces Fourth-quarter And Full-year 2014 Financial Results;
Affirms 2015 Financial Guidance

Feb. 18, 2015

Page 9

ONE Gas, Inc.
 
 
 
 
 
 
 
 
STATEMENTS OF INCOME
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
Years Ended
 
 
December 31,
 
December 31,
(Unaudited)
 
2014
 
2013
 
2014
 
2013
 
 
(Thousands of dollars, except per share amounts)
 
 
 
 
 
 
 
 
 
Revenues
 
$
514,368

 
$
522,686

 
$
1,818,906

 
$
1,689,952

Cost of natural gas
 
290,192

 
299,032

 
991,949

 
876,944

Net margin
 
224,176

 
223,654

 
826,957

 
813,008

Operating expenses
 
 
 
 
 
 

 
 

Operations and maintenance
 
111,532

 
100,797

 
420,686

 
393,072

Depreciation and amortization
 
31,727

 
44,640

 
125,722

 
144,758

General taxes
 
10,907

 
13,203

 
55,255

 
54,830

Total operating expenses
 
154,166

 
158,640

 
601,663

 
592,660

Operating income
 
70,010

 
65,014

 
225,294

 
220,348

Other income
 
620

 
2,256

 
1,625

 
6,165

Other expense
 
(1,120
)
 
(1,700
)
 
(2,949
)
 
(3,680
)
Interest expense
 
(9,956
)
 
(15,664
)
 
(45,842
)
 
(61,366
)
Income before income taxes
 
59,554

 
49,906

 
178,128

 
161,467

Income taxes
 
(22,947
)
 
(19,588
)
 
(68,338
)
 
(62,272
)
Net income
 
$
36,607

 
$
30,318

 
$
109,790

 
$
99,195

 
 
 
 
 
 
 
 
 
Earnings per share
 
 
 
 
 
 
 
 
Basic
 
$
0.70

 
$
0.58

 
$
2.10

 
$
1.90

Diluted
 
$
0.69

 
$
0.58

 
$
2.07

 
$
1.90

 
 
 
 
 
 
 
 
 
Average shares (thousands)
 
 
 
 
 
 
 
 
Basic
 
52,398

 
52,319

 
52,364

 
52,319

Diluted
 
53,241

 
52,319

 
52,946

 
52,319

Dividends declared per share of stock
 
$
0.28

 
$

 
$
0.84

 
$



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ONE Gas Announces Fourth-quarter And Full-year 2014 Financial Results;
Affirms 2015 Financial Guidance

Feb. 18, 2015

Page 10

ONE Gas, Inc.
 
 
 
 
BALANCE SHEETS
 
 
 
 

 

 

 
 
December 31,
 
December 31,
(Unaudited)
 
2014
 
2013
Assets
 
(Thousands of dollars)
Property, plant and equipment
 
 

 
 

Property, plant and equipment
 
$
4,850,201

 
$
4,534,074

Accumulated depreciation and amortization
 
1,556,481

 
1,489,216

Net property, plant and equipment
 
3,293,720

 
3,044,858

Current assets
 
 
 
 
Cash and cash equivalents
 
11,943

 
3,171

Accounts receivable, net
 
326,749

 
356,988

Income tax receivable
 
43,800

 

Natural gas in storage
 
185,300

 
166,128

Regulatory assets
 
50,193

 
21,657

Other current assets
 
49,516

 
54,240

Total current assets
 
667,501

 
602,184

Goodwill and other assets
 
 

 
 

Regulatory assets
 
478,723

 
23,822

Goodwill
 
157,953

 
157,953

Other assets
 
51,313

 
17,658

Total goodwill and other assets
 
687,989

 
199,433

Total assets
 
$
4,649,210

 
$
3,846,475


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ONE Gas Announces Fourth-quarter And Full-year 2014 Financial Results;
Affirms 2015 Financial Guidance

Feb. 18, 2015

Page 11

ONE Gas, Inc.
 
 
 
 
BALANCE SHEETS
 
 
 
 
(Continued)
 

 

 
 
December 31,
 
December 31,
(Unaudited)
 
2014
 
2013
Equity and Liabilities
 
(Thousands of dollars)
Equity and long-term debt
 

 

Common stock, $0.01 par value:
authorized 250,000,000 shares; issued and outstanding 52,083,859 shares at December 31,
2014; authorized 1,000 shares, issued and outstanding 100 shares at December 31, 2013
 
$
521

 
$

Paid-in capital
 
1,758,796

 

Retained earnings
 
39,894

 

Accumulated other comprehensive income (loss)
 
(5,174
)
 

Owner’s net investment
 

 
1,239,023

Total equity
 
1,794,037

 
1,239,023

Long-term debt, excluding current maturities
 
1,201,311

 
1,318

Long-term line of credit with ONEOK
 

 
1,027,631

Total equity and long-term debt
 
2,995,348

 
2,267,972

Current liabilities
 
 
 
 
Current maturities of long-term debt
 
6

 
6

Notes payable
 
42,000

 

Short-term note payable to ONEOK
 

 
444,960

Affiliate payable
 

 
22,403

Accounts payable
 
159,064

 
169,500

Accrued taxes other than income
 
44,742

 
32,426

Accrued liabilities
 
26,019

 
4,791

Customer deposits
 
60,003

 
57,360

Regulatory liabilities
 
32,467

 
17,796

Other current liabilities
 
28,132

 
19,835

Total current liabilities
 
392,433

 
769,077

Deferred credits and other liabilities
 
 

 
 

Deferred income taxes
 
894,585

 
743,452

Employee benefit obligations
 
287,779

 

Other deferred credits
 
79,065

 
65,974

Total deferred credits and other liabilities
 
1,261,429

 
809,426

Commitments and contingencies
 


 


Total liabilities and equity
 
$
4,649,210

 
$
3,846,475



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ONE Gas Announces Fourth-quarter And Full-year 2014 Financial Results;
Affirms 2015 Financial Guidance

Feb. 18, 2015

Page 12

ONE Gas, Inc.
 
 
 
 
STATEMENTS OF CASH FLOWS
 
 

 
Years Ended December 31,
(Unaudited)
 
2014
 
2013
 
 
 
Operating activities
 
 
 
 
Net income
 
$
109,790

 
$
99,195

Adjustments to reconcile net income to net cash provided by operating activities:
 


 


Depreciation and amortization
 
125,722

 
144,758

Deferred income taxes
 
49,935

 
62,205

Share-based compensation expense
 
7,613

 

Provision for doubtful accounts
 
7,195

 
5,460

Changes in assets and liabilities:
 
 

 
 

Accounts receivable
 
23,044

 
(102,142
)
Income tax receivable
 
(43,800
)
 

Natural gas in storage
 
(19,172
)
 
(63,139
)
Asset removal costs
 
(47,125
)
 
(46,567
)
Affiliate payable
 

 
(8,140
)
Accounts payable
 
(6,881
)
 
37,241

Accrued taxes other than income
 
12,316

 
2,449

Accrued liabilities
 
21,228

 
(5,443
)
Customer deposits
 
2,643

 
(727
)
Regulatory assets and liabilities
 
30,067

 
29,436

Employee benefit obligation
 
(10,102
)
 

Other assets and liabilities
 
(15,810
)
 
(378
)
Cash provided by operating activities
 
246,663

 
154,208

Investing activities
 
 

 
 

Capital expenditures
 
(297,103
)
 
(292,080
)
Proceeds from sale of assets
 

 
1,327

Cash used in investing activities
 
(297,103
)
 
(290,753
)
Financing activities
 
 

 
 

Settlement of short-term notes payable to ONEOK, net
 

 
150,851

Borrowings on notes payable, net
 
42,000

 

Issuance of debt, net of discounts
 
1,199,994

 

Long-term debt financing costs
 
(11,087
)
 

Cash payment to ONEOK upon separation
 
(1,130,000
)
 

Issuance of common stock
 
2,001

 

Dividends paid
 
(43,696
)
 

Repayment of long-term debt
 

 
(206
)
Distributions to ONEOK
 

 
(14,969
)
Cash provided by financing activities
 
59,212

 
135,676

Change in cash and cash equivalents
 
8,772

 
(869
)
Cash and cash equivalents at beginning of period
 
3,171

 
4,040

Cash and cash equivalents at end of period
 
$
11,943

 
$
3,171

Supplemental cash flow information:
 
 

 
 

Cash paid for interest, net of amounts capitalized
 
$
21,066

 
$

Cash paid to ONEOK for interest, net of amounts capitalized
 
$

 
$
61,366

Cash paid for income taxes
 
$
44,603

 
$

Cash paid to ONEOK for income taxes
 
$

 
$
67



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ONE Gas Announces Fourth-quarter And Full-year 2014 Financial Results;
Affirms 2015 Financial Guidance

Feb. 18, 2015

Page 13

ONE Gas, Inc.
 
 
 
 
 
 
 
 
 
 
 
 
INFORMATION AT A GLANCE
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
Years Ended
 
 
December 31,
 
December 31,
(Unaudited)
 
2014
 
2013
 
2014
 
2013
 
 
 
(Millions of dollars, except as noted)
Financial
 
 
 
 
 
 
 
 
 
 
 
 
Net margin
 
$
224.2

 
$
223.7

 
$
827.0

 
$
813.0

Operating costs
 
$
122.5

 
$
114.1

 
$
476.0

 
$
447.9

Depreciation and amortization
 
$
31.7

 
$
44.6

 
$
125.7

 
$
144.8

Operating income
 
$
70.0

 
$
65.0

 
$
225.3

 
$
220.3

Capital expenditures
 
$
72.5

 
$
85.7

 
$
297.1

 
$
292.1

 
 
 
 
 
 
 
 
 
 
 
 
 
Net margin on natural gas sales
 
$
186.8

 
$
188.3

 
$
688.2

 
$
681.6

Transportation revenues
 
$
27.4

 
$
26.9

 
$
102.3

 
$
98.7

Net margin, excluding other revenues
 
$
214.2

 
$
215.2

 
$
790.5

 
$
780.3

 
 
 
 
 
 
 
 
 
 
 
 
 
Volumes (Bcf)
 
 
 
 
 
 
 
 
 
 
 
 
Natural gas sales
 
 
 
 
 
 
 
 
 
 
 
 
Residential
 
 
40.5

 
 
43.7

 
 
125.3

 
 
122.9

Commercial and industrial
 
 
11.7

 
 
12.2

 
 
38.6

 
 
37.0

Wholesale and public authority
 
 
0.9

 
 
1.3

 
 
2.5

 
 
4.4

Total volumes sold
 
 
53.1

 
 
57.2

 
 
166.3

 
 
164.2

Transportation
 
 
54.5

 
 
54.2

 
 
213.5

 
 
205.9

Total volumes delivered
 
 
107.6

 
 
111.4

 
 
379.8

 
 
370.1

 
 
 
 
 
 
 
 
 
 
 
 
 
Average number of customers (in thousands)
 
 
 
 
 
 
 
 
 
 
 
 
Residential
 
 
1,953

 
 
1,939

 
 
1,955

 
 
1,944

Commercial and industrial
 
 
155

 
 
154

 
 
156

 
 
155

Wholesale and public authority
 
 
3

 
 
3

 
 
4

 
 
3

Transportation
 
 
12

 
 
12

 
 
12

 
 
12

Total customers
 
 
2,123

 
 
2,108

 
 
2,127

 
 
2,114

 
 
 
 
 
 
 
 
 
 
 
 
 
Heating Degree Days
 
 
 
 
 
 
 
 
 
 
 
 
Actual degree days
 
 
3,875

 
 
4,487

 
 
10,615

 
 
11,036

Normal degree days
 
 
3,948

 
 
3,967

 
 
9,965

 
 
9,970

Percent colder (warmer) than normal weather
 
 
(1.8
)%
 
 
13.1
%
 
 
6.5
 %
 
 
10.7
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Statistics by State
 
 
 
 
 
 
 
 
 
 
 
 
Oklahoma
 
 
 
 
 
 
 
 
 
 
 
 
Average number of customers (in thousands)
 
 
853

 
 
847

 
 
853

 
 
847

Actual degree days
 
 
1,339

 
 
1,564

 
 
3,720

 
 
3,848

Normal degree days
 
 
1,305

 
 
1,305

 
 
3,317

 
 
3,317

Percent colder (warmer) than normal weather
 
 
2.6
 %
 
 
19.8
%
 
 
12.1
 %
 
 
16.0
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Kansas
 
 
 
 
 
 
 
 
 
 
 
 
Average number of customers (in thousands)
 
 
631

 
 
627

 
 
634

 
 
633

Actual degree days
 
 
1,848

 
 
2,075

 
 
5,179

 
 
5,246

Normal degree days
 
 
1,895

 
 
1,895

 
 
4,860

 
 
4,860

Percent colder (warmer) than normal weather
 
 
(2.5
)%
 
 
9.5
%
 
 
6.6
 %
 
 
7.9
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Texas
 
 
 
 
 
 
 
 
 
 
 
 
Average number of customers (in thousands)
 
 
639

 
 
634

 
 
640

 
 
634

Actual degree days
 
 
688

 
 
848

 
 
1,716

 
 
1,942

Normal degree days
 
 
748

 
 
767

 
 
1,788

 
 
1,793

Percent colder (warmer) than normal weather
 
 
(8.0
)%
 
 
10.6
%
 
 
(4.0
)%
 
 
8.3
%