Atmos Energy : Analyst Update May 2026

Published: 2026-05-15 17:15:34 ET ATO

Published on 05/15/2026 at 05:15 pm EDT

May 2026

Eight-state distribution territory

Business Mix

~38% Pipeline & Storage

~62%

Distribution

2026 Estimated Net Income

Intrastate pipeline system

Diversified LDC platform in 8 states

Favorably positioned pipeline spans Texas shale gas supply basins

Largest pure-play natural gas LDC with over 3.4 million customers in 8 states

~76,000 miles of distribution and transmission mains

~65% of distribution rate base located in Texas

Blended allowed ROE of 9.8%

96% of rate base covered by all fuels legislation

Constructive regulatory mechanisms reduce lag

~13 Bcf of working storage capacity

~5,700 miles of intrastate pipeline

Spans multiple key shale gas formations

Connection to major market hubs

~53 Bcf of working storage capacity

Allowed ROE of 11.45%

Margin derived from tariff-based rates primarily serving Mid-Tex and other LDCs

Attractive pure-play total return supported by strong financial foundation

Safety-driven, organic growth strategy supports 6% - 8% earnings per share and dividend per share growth through Fiscal 2030

100% of earnings from fully regulated, leading natural gas delivery platform

24 consecutive years of EPS growth; 42 consecutive years of dividend growth

Strong investment-grade credit ratings/liquidity

Diversified and growing jurisdictional footprint

Regulated distribution assets in 8 states serving over 3.4 million customers

96% of rate base in states that offer policy support for investment in natural gas infrastructure

Strong customer growth

Favorably positioned regulated pipeline spans Texas shale gas supply basins

Transparent Capital Spending Horizon

Comprehensive risk-based replacement program

Further enhance resiliency and supply reliability while reducing methane emissions

Support strong customer growth in our existing footprint

Constructive Regulation Focused on Safety and Reliability

Annual filing mechanisms in most jurisdictions offer regular, consistent rate adjustments

Earning on >90% of annual capex within 6 months; ~99% within 12 months

Significant percentage of revenue earned through fixed or tariff-based charges

Sustainability Integrated Into Strategy

Formal Board of Director oversight over sustainability

Comprehensive plan to reduce environmental impact from operations

Safely providing reliable, efficient and abundant natural gas with a lower carbon footprint than electricity

Investing in the communities we serve

Constructive Regulatory Mechanisms Support Efficient Conversion of Safety and Reliability Investments into Financial Results

~ $26 billion in capital investment through 2030; 85% allocated to safety and reliability

Constructive rate mechanisms that reduce regulatory lag

6% - 8% Consolidated EPS growth

Rate Base

$21.4B

$18.8B

~90%

$42.0B

Annual Capex Recovery

Earnings per Share

$10.80 -

$8.40 -

$8.50

$7.46

$11.20

FY2024 FY2025 FY2030E

FY2025 FY2026E FY2030E

~90% of Annual Capital Spend Begins to Earn Within Six Months

Regulatory Mechanisms

Recovery Method

Service Territory Detail

CapEx

Jurisdiction

Infrastructure

Deferral/ Forward-Looking

Annual Filing

General Case

Meters (000s)

Rate Base1

2026E ($MM)

($MM)

% of Total

Texas

Mid-Tex

8.209/7.7102

✓

RRM/DARR/ GRIP2

1,830

9,600

2,070-2,100

APT

GRIP2/7.7102

✓

GRIP2

5,400

970-1,000

West Texas

8.209/7.7102

✓

RRM/GRIP2

316

1,400

220-240

Louisiana

RSC

✓

RSC

361

1,500

205-235

Mississippi

SRF

✓

250

1,300

200-230

Kentucky

PRP

✓

PRP

✓

176

720

80-100

Tennessee

ARM

✓

ARM

164

700

90-100

Kansas

GSRS/SIP

✓

140

400

55-65

Colorado

SSIR

✓

SSIR

✓

131

330

1.5

45-55

Virginia

SAVE

✓

SAVE

✓

100

0.5

10-20

Represents an estimate of rate base as of September 30, 2025

Requires a rate case every 5 years

Ongoing Modernization Supported By Efficient Recovery Mechanisms

Constructive Regulation Supports

Constructive Regulation Provides

System Modernization

Risk models

Pipe prioritization

Pipe replacement

Operation & maintenance costs related to federal regulations

System Monitoring

Underground Storage

Reduced Regulatory Lag

Annual mechanisms / Infrastructure mechanisms

Forward-looking test periods

Expense deferrals

Revenue Stability

Base charges - ~51% of residential distribution revenue1

WNA - covers 98% of distribution revenue1

Bad debt recovery covers approximately 89% of distribution customers, insulating revenue from the commodity portion of bad debt expense

Pipeline & Storage segment - tariff-based revenue

More predictable earnings and cash flow

Regular, consistent rate adjustments

Smaller annual impact to customer bills

1. Revenue excluding gas costs

96% of Rate Base in states that offer policy support for investment in natural gas infrastructure

26 states have passed "All Fuels" legislation

Atmos Jurisdictions (Passed)

Passed

Diversified LDC Platform in Eight States

Largest pure-play natural gas LDC with over 3.4 million customers

Largest Natural Gas Distributor in Texas with ~ 2.1 million customers

~76,000 miles of distribution and transmission mains

Connected to 38 different pipelines across 8 states providing supplier diversity

Blended allowed ROE of 9.8%

Constructive regulatory mechanisms reduce lag

~69% of revenues earned in the first 6 months of the fiscal year

~$16.0 billion rate base as of September 30, 2025

Represented 62% of consolidated net income in Fiscal 2025

~$26 Billion Capital Plan Through 2030; > 85% Focused On Safety and Reliability

Replace 5,500 - 6,000 miles of distribution system pipe through 2030

6% - 8% of total system

Replace 120,000-170,000 steel service lines through 2030

20% - 25% reduction from Fiscal 2024 Inventory2

Install wireless meter reading

Currently ~78% billing WMR coverage

Support Customer Growth

1750

1500

1250

1000

750

500

250

1,200

1,000

Thousands

800

600

400

Distribution Miles Replaced1

2017 2018 2019 2020 2021 2022 2023 2024 2025 2030E

Inventory of Steel Service Lines2

1,167

647

~500-530

200

Fiscal year basis

2024 DOT Report

2012 2024 2030E

APT is a Favorably Positioned Intrastate Pipeline that Spans Texas Shale Gas Supply Basins

Regulated by the Railroad Commission of Texas

Established to provide gas transportation service for Mid-Tex and other LDCs

100% of LDC revenue derived from tariff-based rates

~5,700 miles of intrastate pipeline

Spans multiple key shale gas formations

Connections at all 3 Texas Hubs - Waha, Katy & Carthage

Transported approximately 904 Bcf in Fiscal 2025

Average throughput of 2.5 Bcf/d

Five storage facilities with 53 Bcf of working capacity

Allowed ROE of 11.45%

Majority of revenue is derived from tariff-based rates primarily serving Mid-Tex and other LDCs

~$5.4 billion rate base as of September 30, 2025

Represented ~36% of consolidated net income in Fiscal 2025

~$6 Billion Capital Plan for APT Through 2030

Pipeline Integrity Management

Upgrading pigging facilities

Replacing valves, fittings, and pipe to allow In-Line Inspection tools to travel through pipeline

Prioritized replacement based on risk assessment

Supply Reliability and Growth

Replacing 400-550 miles APT transmission pipe through 2030

Line S-2 east of Dallas

WA Loop - West of Fort Worth

Permian Highway Connector

Bethel to Groesbeck line

Bethel Cavern upgrade

100%

75%

50%

25%

Approximate Percentage of APT Transmission Pipe Capable of In-Line Inspection

2012 2025 2030

90%

95%

~1,300 ILI

Miles Upgraded

~200 ILI

Miles Upgraded

65%

69%

50%

Significant APT Capital Projects

1. Reduction from 2017 values for EPA-reported distribution system mains and services

As of May 15, 2026

Page 14

AtmoSpirit, our unique culture, introduced in 1998

Foundation for teamwork, trust & respect

Culture

Strong Corporate Governance

Board of Directors

Corporate Responsibility, Sustainability, & Safety Committee

Safety

Comprehensive training programs

Emphasis on technology and innovation

Focused on Students, Community Heroes and Our Most Vulnerable Neighbors

Investing employee and company time and financial resources

Reduce Environmental Impact

Comprehensive plan addresses all areas of the company

Goal to reduce methane emissions by 50% by 2035 from 2017 levels1

Focus on Safety and Risk Mitigation

Affordable and Reliable service

Strong Customer Service Focus

Providing Value to Customers

Supporting Communities

Formal Board of Director Oversight Over Sustainability

Diverse Board & Senior Leadership

Accountable to Shareholders

Environmental Strategy Overview

Atmos Energy's comprehensive environmental strategy is focused on reducing our Scope 1, 2, and 3 emissions and environmental impact from our operations in five key focus areas: Operations, Fleet, Facilities, Gas Supply, and Customers

We are implementing operating practices and solutions to reduce carbon from our operations through:

Ongoing system modernization work

Reducing third-party damage to our system

Improving monitoring and measuring of methane emissions

Expanding supply options and opportunities including renewable natural gas (RNG)

Expanding customer energy efficiency programs

Exploring clean energy technologies through research and development

Collaboration with our legislators, regulators, customers, and suppliers

Future carbon reduction targets will be established based upon existing legislation, regulation, and technologies

For more information, see our latest CRS report: atmosenergy.com/sustainability/

The ONE Future Coalition is a group of more than 50 natural gas companies working together to voluntarily reduce methane emissions across the Natural Gas value chain to 1% (or less) by 2025. ONE Future is actively developing the next phase of methane-reduction goals. In 2024, overall methane intensity decreased to 0.28%, a 15.4% decrease in intensity

from 2023.

Supporting research and development initiatives to further reduce emissions

Accelerating the commercial deployment of low- and zero-carbon technologies

from 2030 to scale through 2050 for economy-wide deep decarbonization

The Coalition for Renewable Natural Gas is a public policy advocate and education platform for the RNG industry in North America.

Sustainable Methane Abatement & Recycling Timeline (SMART) is an initiative to capture and control methane from 43,000+ organic waste sites in North America by 2050, achieving significant benchmarks by 2025, 2030 and 2040.

Residential use of natural gas remains competitive

Average Monthly Customer Bill

Key Assumptions

$140 • Normal weather and

consumption

$120

$100

$80

$60

$40

$121

~$26 billion of CAPEX spending through 2030

Commodity pricing

FY 26-30: $2.75 to $3.75

Delivery cost/Securitization

FY26 - FY30: $5.00 - $6.00

Purchased gas cost accounts for ~38% of the customer bill in FY26; dropping to ~27% by FY30

$80

$53

$20

Natural Gas Price Advantage Over Electricity

Electricity1 vs Natural Gas2 - kWh Equivalent

16.15

14.77

13.88

14.34

13.38

12.75

8.37

7.52

6.33

3.87

4.43

4.12

4.31

4.44

15.61 15.79

Colorado Kansas Kentucky Louisiana Mississippi Tennessee Texas Virginia

-2

Natural Gas is ~2x - 4x less expensive in Atmos Energy's states vs. electricity

US Energy Information Agency, https://www.eia.gov residential customer electric rates for the twelve months ending February 2026 https://www.eia.gov/electricity/monthly/epm_table_grapher.php?t=epmt_5_6_a

Represents Atmos Energy's average residential customer rates for the twelve months ending February 2026

Residential Gas and Electric Bill Median Income Wallet Share by Jurisdiction

2023 Wallet Share 2024 Wallet Share

Gas - ATO

Electric Gas - ATO

Electric

Tennessee2

0.66%

2.66%

0.62%

2.49%

Louisiana

0.85%

2.95%

0.95%

2.74%

Virginia

0.90%

2.02%

0.93%

2.19%

Texas

1.01%

2.10%

1.06%

1.97%

Kansas

1.00%

1.65%

0.90%

1.70%

Kentucky

1.06%

2.33%

0.85%

2.38%

Colorado

1.14%

1.09%

0.76%

1.17%

Mississippi

1.41%

3.53%

1.46%

3.39%

ATO Average

Gas Industry Average

Electric Industry Average

1.1% --

1.0% --

1.2%

0.9%

2.0%

The chart above reflects 2024 and 2023 US Gas Utility Data: Wallet Share % for Utilities with 50,000+ customers and Atmos Virginia, based on data from Atmos Energy Corporation, Energy Information Administration, U.S. Census Bureau - FRED Federal Reserve Bank of St. Louis

Per the Office of Policy Development, "Low Income" is defined as 80% of "Median Income" for the service territory, subject to adjustments for service territories with unusually high or low income and housing cost.

Tennessee reflects only one investor-owned electric utility with approximately 43,000 customers.

Residential Gas and Electric Bill Low Income Wallet Share by Jurisdiction

2023 Wallet Share 2024 Wallet Share

Gas - ATO

Electric Gas - ATO

Electric

Tennessee2

0.82%

3.33%

0.77%

3.12%

Louisiana

1.07%

3.69%

1.19%

3.43%

Virginia

1.13%

2.53%

1.16%

2.73%

Texas

1.26%

2.62%

1.33%

2.46%

Kansas

1.25%

2.06%

1.13%

2.13%

Kentucky

1.32%

2.92%

1.07%

2.98%

Colorado

1.43%

1.36%

0.95%

1.46%

Mississippi

1.77%

4.41%

1.83%

4.24%

ATO Average

Gas Industry Average

Electric Industry Average

1.3% --

1.4%

1.2%

2.5%

Tennessee reflects only one investor-owned electric utility with approximately 43,000 customers.

2026

Disclaimer

AEC - Atmos Energy Corporation published this content on May 15, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on May 15, 2026 at 21:14 UTC.