Debt

9 Months Ended

Jun. 30, 2023

Debt Disclosure [Abstract]

Debt

DebtThe nature and terms of our debt instruments and credit facilities are described in detail in Note 7 to the consolidated financial statements in our Annual Report on Form 10-K for the fiscal year ended September 30, 2022. Other than as described below, there were no material changes in the terms of our debt instruments during the nine months ended June 30, 2023.

Long-term debt at June 30, 2023 and September 30, 2022 consisted of the following:

	June 30, 2023		September 30, 2022
	(In thousands)
Unsecured 0.625% Senior Notes, due March 2023	$	—	$	1,100,000
Unsecured 3.00% Senior Notes, due June 2027	500,000		500,000
Unsecured 2.625% Senior Notes, due September 2029	500,000		500,000
Unsecured 1.50% Senior Notes, due January 2031	600,000		600,000
Unsecured 5.45% Senior Notes, due October 2032	300,000		—
Unsecured 5.95% Senior Notes, due October 2034	200,000		200,000
Unsecured 5.50% Senior Notes, due June 2041	400,000		400,000
Unsecured 4.15% Senior Notes, due January 2043	500,000		500,000
Unsecured 4.125% Senior Notes, due October 2044	750,000		750,000
Unsecured 4.30% Senior Notes, due October 2048	600,000		600,000
Unsecured 4.125% Senior Notes, due March 2049	450,000		450,000
Unsecured 3.375% Senior Notes, due September 2049	500,000		500,000
Unsecured 2.85% Senior Notes, due February 2052	600,000		600,000
Unsecured 5.75% Senior Notes, due October 2052	500,000		—
Floating-rate Senior Notes, due March 2023	—		1,100,000
Medium-term note Series A, 1995-1, 6.67%, due December 2025	10,000		10,000
Unsecured 6.75% Debentures, due July 2028	150,000		150,000
Finance lease obligations	50,766		51,850
Total long-term debt	6,610,766		8,011,850
Less:
Original issue discount on unsecured senior notes and debentures	6,188		3,704
Debt issuance cost	49,420		46,042
Current maturities of long-term debt	1,540		2,201,457
Total long-term debt, net	$	6,553,618	$	5,760,647

On October 3, 2022, we completed a public offering of $500 million of 5.75% senior notes due October 2052, with an effective interest rate of 4.50%, after giving effect to the offering costs and settlement of our interest rate swaps, and $300 million of 5.45% senior notes due October 2032, with an effective interest rate of 5.57%, after giving effect to the offering costs. The net proceeds from the offering, after the underwriting discount and offering expenses, of $789.4 million were used for general corporate purposes.

Short-term debt

We utilize short-term debt to provide cost-effective, short-term financing until it can be replaced with a balance of long-term debt and equity financing that achieves the Company’s desired capital structure. Our short-term borrowing requirements are driven primarily by construction work in progress and the seasonal nature of the natural gas business.

Our short-term borrowing requirements are satisfied through a combination of a $1.5 billion commercial paper program and four committed revolving credit facilities with third-party lenders that provide $2.5 billion of total working capital funding.

Our commercial paper program is supported by a five-year unsecured $1.5 billion credit facility that expires on March 31, 2027. This facility bears interest at a base rate or at a SOFR-based rate for the applicable interest period, plus a margin ranging from zero percent to 0.25 percent for base rate advances or a margin ranging from 0.75 percent to 1.25 percent for SOFR-based advances, based on the Company’s credit ratings. Additionally, the facility contains a $250 million accordion feature, which provides the opportunity to increase the total committed loan to $1.75 billion. At June 30, 2023, there were no amounts outstanding under our commercial paper program. At September 30, 2022, there was $185.0 million outstanding under our commercial paper program.

We also have a $900 million three-year unsecured revolving credit facility, which expires March 31, 2025 and is used to provide additional working capital funding. This facility bears interest at a base rate or at a SOFR-based rate for the applicable interest period, plus a margin ranging from zero percent to 0.25 percent for base rate advances or a margin ranging from 0.75 percent to 1.25 percent for SOFR-based advances, based on the Company's credit ratings. Additionally, the facility contains a

$100 million accordion feature, which provides the opportunity to increase the total committed loan to $1.0 billion. At June 30, 2023 and September 30, 2022, there were no borrowings outstanding under this facility.

Additionally, we have a $50 million 364-day unsecured facility, which was renewed April 1, 2023 and is used to provide working capital funding. There were no borrowings outstanding under this facility as of June 30, 2023 and September 30, 2022.

Finally, we have a $50 million 364-day unsecured revolving credit facility, which was renewed March 31, 2023 and is used to issue letters of credit and to provide working capital funding. At June 30, 2023, there were no borrowings outstanding under this facility; however, outstanding letters of credit reduced the total amount available to us to $44.4 million.

On March 3, 2023, we entered into a term loan agreement for a $2.02 billion senior unsecured term loan facility that would have matured December 31, 2023. The proceeds from the facility, along with cash on hand, were used to repay at maturity on March 9, 2023 our outstanding $1.1 billion senior notes and $1.1 billion floating-rate senior notes. Under the terms of the facility, we were required to prepay the facility prior to maturity upon receiving proceeds from the issuance of certain securities that were part of a utility recovery securitization transaction authorized by the state of Texas. On March 23, 2023, we received those proceeds (see Note 8), and on March 24, 2023 we prepaid the term loan facility, thus terminating the term loan agreement and all obligations thereunder.

Debt covenants

The availability of funds under these credit facilities is subject to conditions specified in the respective credit agreements, all of which we currently satisfy. These conditions include our compliance with financial covenants and the continued accuracy of representations and warranties contained in these agreements. We are required by the financial covenants in each of these facilities to maintain, at the end of each fiscal quarter, a ratio of total-debt-to-total-capitalization of no greater than 70 percent. At June 30, 2023, our total-debt-to-total-capitalization ratio, as defined in the agreements, was 39 percent. In addition, both the interest margin and the fee that we pay on unused amounts under certain of these facilities are subject to adjustment depending upon our credit ratings.

These credit facilities and our public indentures contain usual and customary covenants for our business, including covenants substantially limiting liens, substantial asset sales and mergers. Additionally, our public debt indentures relating to our senior notes and debentures, as well as certain of our revolving credit agreements, each contain a default provision that is triggered if outstanding indebtedness arising out of any other credit agreements in amounts ranging from in excess of $15 million to in excess of $100 million becomes due by acceleration or if not paid at maturity. We were in compliance with all of our debt covenants as of June 30, 2023. If we were unable to comply with our debt covenants, we would likely be required to repay our outstanding balances on demand, provide additional collateral or take other corrective actions.