Thank you, Kayla. Good morning, everyone, and thank you for joining our fiscal 2026 second quarter earnings call.

With me today are Kevin Akers, President and Chief Executive Officer, and Chris Forsythe, Senior Vice President and Chief Financial Officer. Our earnings release and conference call slide presentation, which we will reference in our prepared remarks, are available at atmosenergy.com under the Investor Relations tab.

As we review these financial results and discuss future expectations, please keep in mind that some of our discussion might contain forward-looking statements within the meaning of the Securities Act and the Securities Exchange Act. Our forward-looking statements and projections could differ materially from actual results.

The factors that could cause such material differences are outlined on slide 29 and are more fully described in our SEC filings. With that, I will turn the call over to Kevin Akers, our President and CEO.

Kevin?

Thank you, Jennifer, and good morning, everyone. We appreciate your interest in Atmos Energy.

Yesterday, we reported year-to-date fiscal '26 net income of $985 million, or $5.92 per diluted share, and we updated our earnings per share guidance range to $8.40 to $8.50. Our capital expenditures for the first half of the fiscal year totaled $2 billion, with over 89% of those investments focused on enhancing the safety and reliability of our distribution, transmission, and underground storage systems.

Across our service territories, we continue to see steady customer growth. For the 12 months ending March 31st, 2026, we added over 51,000 new customers, with over 39,000 of those new customers located here in Texas.

During the second quarter, we added over 800 commercial customers and four new industrial customers. This continued demand from all customer classes demonstrates the value and vital role natural gas plays in economic development across our service territories.

In APT, we continue to work to enhance the safety, reliability, versatility, and supply diversification of our system, as well as support the continued growth we are seeing in the local distribution companies behind APT's system. During the second quarter, we completed Phase 2 of the Line WA Project.

This project installed approximately 44 miles of 36-inch pipeline to the west of Fort Worth to support growth in this area of the DFW Metroplex. Additionally, APT enhanced supply optionality, reliability, and system versatility with the completion of five interconnect projects, and adding nearly 100,000 Mcf a day of additional natural gas supply to the APT system.

These investments further enhance APT's ability to serve the LDC customers behind our city gates. These LDC customers also benefit from APT's Rider REV tariff, which shares approximately 75% of APT's other revenue billed that is above a specified benchmark.

As a reminder, these revenues vary from year to year based upon available capacity on our pipeline and natural gas pricing dynamics in Texas. Over the last three years, these customers have received approximately $150 million in total as credit from the Rider REV tariff.

As you'll hear from Chris in a few minutes, natural gas pricing dynamics have positively impacted APT's other revenue billed in the first half of fiscal 2026, and are expected to favorably impact our financial results for the remainder of the fiscal year. Our customer support associates and service technicians continue to provide exceptional customer service, achieving customer satisfaction ratings of 97% for the first six months of the fiscal year.

Truly outstanding work by this team. Additionally, during the first half of the fiscal year, our customer advocacy team helped over 33,000 customers receive approximately $9.5 million in funding assistance.

Recently, we were named to the Forbes list of America's Best Large Employers, ranking as one of the top 100 employers overall and placing second among all utilities. This is the sixth consecutive year Atmos Energy has been named to this list.

This recognition reflects the continued dedication, focus, and effort of all Atmos Energy employees who safely deliver reliable and efficient natural gas to homes, businesses, and industries to fuel our energy needs now and in the future. Their commitment has us well positioned for the remainder of the fiscal year.

Now I'll turn the call over to Chris for his update.

Thank you, Kevin, and thank you to everyone for joining us this morning. As Kevin mentioned, earnings per share for the first six months of the fiscal year was $5.92, which represents a 12.5% increase over the prior-year period.

Our year-to-date results include $94 million, or 43 cents, from the impact of Texas House Bill 4384. Of this amount, $44 million was recognized in our distribution segment, and the remaining $50 million was recognized at APT.

During the second quarter, the Texas Railroad Commission completed its final rulemaking to codify Texas House Bill 4384 into Rule 77.102. As this rulemaking reduces lag in Texas by permitting gas utilities to defer post-in-service carrying costs, depreciation, and ad valorem taxes associated with non-eligible Rule 8.209 capital investments, such as new customer growth and system expansion.

Since adopting Rule 77.102 in late fiscal '25, we have been presenting the deferral of post-in-service carrying costs as reduction to interest expense to be consistent with Texas Rule 8.209. With the new rule now final, we have determined it is most appropriate to present the deferral of post-in-service carrying costs in the income statement line items where the incurred costs are classified: O&M and interest expense.

This updated presentation has been reflected in our fiscal second quarter and fiscal year-to-date results, which reduced reported O&M for the first six months of the fiscal year by $41 million. Our year-to-date performance was influenced by several additional factors.

Rate increases in both of our operating segments totaled $171 million. Operating income increased by an additional $32 million due to residential and commercial customer growth and increased customer load.

Finally, APT's through-system revenues, net of Rider REV, increased by about $16 million, or 8 cents. Substantially all of this increase reflected higher spreads realized during fiscal '26 compared to fiscal '25.

During the first six months of fiscal '26, the spreads we captured averaged $4.35 compared to $1.80 in the prior-year period, reflecting rising associated gas production, constrained takeaway capacity, and lower demand due to unseasonably warm weather during this past winter heating season. Excluding the impact of Rule 77.102 deferrals, consolidated O&M increased $27 million, reflecting higher employee-, compliance-, and safety-related spending in our distribution segment, and higher maintenance spending at APT.

From a regulatory perspective, since the beginning of the fiscal year, we have implemented $136 million in annualized operating income increases in our distribution segment. Currently, we have 13 filings in progress, seeking nearly $600 million in annualized operating income increases.

We expect to implement approximately 40% of this amount primarily during our third fiscal quarter. The largest filing we expect to implement during the second half of the fiscal year, APT's GRIP filing seeking $112 million in annualized operating income increases, is scheduled to be considered by the Texas Railroad Commission next Tuesday, May 12th.

Our equity capitalization as of March 31st was 61%, and we did not have any short-term debt outstanding. During the second quarter, we extended our four credit facilities that provide $3.1 billion in total liquidity.

At quarter end, we had $4.1 billion in available liquidity to support our operations. This amount includes approximately $890 million in net proceeds available under existing forward sale agreements, which is expected to satisfy the remainder of our anticipated fiscal '26 equity needs and a portion of our anticipated equity needs for fiscal '27.

As we reported last night, we have increased our fiscal '26 earnings per share guidance from an original range of $8.15 to $8.35 to a new range of $8.40 to $8.50. We expect the remaining contribution to fiscal '26 earnings per share to be recognized somewhat evenly by quarter in the back half of the fiscal year.

Two key items are driving the increase in our fiscal '26 guidance. First, our guidance reflects our expectations for the performance of APT's through-system business for the second half of the fiscal year.

As we've mentioned before, going into a fiscal year, we base our assumptions for this line of APT's business assuming revenues in line with our benchmark based on historical norms for available capacity on our system and pricing. Although we have recently seen some modest improvement at Waha, we anticipate natural gas pricing in the Permian will remain challenging for the remainder of our fiscal year.

As I mentioned earlier, this part of APT's business added 8 cents during the period. We currently anticipate that APT's through-system business will add an additional 8 to 12 cents for fiscal '26 results during the second half of the fiscal year.

Secondly, with final rulemaking completed and improved visibility into the timing of our capital spending in Texas for the remainder of the fiscal year, we believe the impact of implementing Rule 77.102 will be higher than originally planned. We estimate this impact will range from $155 million to $165 million for the entire fiscal year, including the deferral of incurred post-in-service carrying costs, depreciation, and ad valorem taxes.

We still anticipate our O&M to be in the range of $865 million to $885 million. We have reflected the estimated impact of Rule 77.102 deferrals in our O&M guidance.

However, we anticipate this decrease to be substantially offset by higher system monitoring, compliance, and employee costs. We anticipate our interest expense to be in a new range of $155 million to $160 million.

This increase is solely due to the reclassification of the 77.102 deferrals from interest into O&M that I mentioned earlier. Finally, we remain on track to spend approximately $4.2 billion in capital expenditures in fiscal '26.

We appreciate your time this morning and your interest in Atmos Energy. We'll now open up the call for questions.

At this time, I would like to remind everyone, in order to ask a question, press star, then the number 1 on your telephone keypad.

Your line is open. Hey, good morning, team.

It's Paul Zimbardo on for Julien. Thanks for taking the time.

Hey,

good morning.

Thank you. The first I had was just on the dividend increase, roughly 15% again.

Quite impressive and better than where you've been trending in the past. Just any thoughts on kind of how is sustainable?

Do you intend to kind of keep increasing above trend, and just overall thoughts on the dividend perspectively would be useful?

I think we've stated for a while now that we're going to grow the earnings per share at a 6% to 8% range, and commensurately grow the dividend. That's where we're going to continue to go as we move forward.

As a reminder, that 15% year-over-year is reflective of the dividend being rebased, in addition to rebasing the earnings per share because of the expected impact from Texas Rule 77.102.

Kind of converging back to where you were before after the rebase. Okay.

Yeah. Yeah.

Then

the other was just could you unpack a little bit more, I know you gave some detail on kind of the shift between O&M and interest expense, if you could give a little more details and just confirming that is kind of basically a one-for-one change, not a net earnings impact there?

Correct. It is not a net earnings impact.

It is a reclassification of how we present the deferral of the incurred post-in-service carrying costs at the end of the day. Originally, we had all of that in the interest expense line item.

With final rulemaking, we looked at the proper classification of that. Incurred post in-service carrying costs reflects all costs associated with the gas plant investment that is subject to the rulemaking that has not yet reflected in rates.

That includes O&M, interest, and other costs to present that deferral in the line item of the income statement where the costs were originally incurred and reported, if that makes sense.

No, that does make sense. Then if I can sneak in last one quick, you mentioned that there's been a pretty dramatic move in Waha.

Just any way that you would frame that kind of beyond 2026 for customers?

No, obviously we don't have a crystal ball out there. We'll continue to watch what happens over the next six months.

We're not even into the real heat here in Texas, the power gen load hasn't kicked in yet as well. As Chris said earlier, we have seen some moderation from some of the historic highs at Waha in the basis differential.

We're going to continue to monitor as we go through the next six months. We'll keep you updated on these calls as we move forward.

Thank you very much, team.

Thank you.

Hey, good morning. Thanks for the time today.

Good morning. How are you?

Great, thank you. Returning to the guidance raise, I know you parsed two different pieces there.

How do you think about that as a base for growth going forward? Obviously, that clarification on rulemaking for Texas 77.102, sounds like a new long-term view, but is that $8.40 to $8.50 a good clean base for the 6%

to 8%? At this point we think that's a pretty good base to think about fiscal '27 beyond as a launch point within that range.

Great, thank you for that. Then on the ATM, I think if I'm reading the disclosures correctly, you didn't price anything on the quarter.

I know you're a little bit ahead with having part of '27 addressed, but how are you thinking about activity there, or was there any hang-up on the quarter specifically, and just timing overall of ATM activity?

No, on the ATM activity, you're correct. We didn't price anything during the second quarter.

As you mentioned, we were fully priced for fiscal '26, got a pretty good portion already established for fiscal '27. We just wanted to kind of see what the market was doing.

As there's a lot of volatility in the second quarter with geopolitical events and economic news and whatnot, we decided to keep our powder dry for the quarter, but will evaluate as we move forward pricing opportunities so we can get further ahead on fiscal '27's equity needs at the right time.

Great, thanks for all of that.

Thank you.

Good morning, and thanks for taking my questions. Appreciate the disclosure around the commodity price movements in Waha.

Are you able to break out what the earnings contribution was this quarter and any early indications of what you were seeing last month? Good morning.

Breaking out the earnings for the quarter on just the APT through-system business?

Correct.

As I say, I look at it more on a year-over-year basis because we really just look at our performance in totality on a full fiscal year basis, and that was $16 million, or about 8 cents, year-over-year.

Okay. Given what we saw last month, would the monthly benefit be trending higher, given some of the commodity spread movements that we've seen?

As I mentioned kind of in wrapping up my comments around the guidance, we're anticipating another 8 to 12 cents in the second half of this fiscal year, which contemplates the activity you saw in the month of April.

Great. Then lastly, just in terms of the Dallas-Fort Worth area growth dynamics, what are you seeing on the ground in terms of kind of just customer growth and expansion of volumes across your footprint?

Again, as we talked about in my opening remarks, of the 53,000 or so we added for the last 12 months ending March, about 39,000-plus or so of that was here in Texas. Again, we continue to see good growth across all areas, good residential growth across Texas.

Again, on our opening remarks there, good commercial growth as well with what we've added year-to-date. The industrial side continues to show good positive results as well across the footprint, adding new industrial accounts, Kentucky, Tennessee, Virginia area as well.

Appreciate the time.

Thank you.

Hi, good morning. Thank you for taking my questions.

Good morning. Good morning.

I wanted to start on your comment about $8.40 to $8.50, the updated guidance range, being a good base or launch pad for 6% to 8% growth 2027 and beyond. Just can you maybe speak to how you're thinking about APT spreads, maybe normalizing when you get back out to 2027, and how we should think about that impact in '27 and beyond?

Is that sort of contemplated within sort of your 6% to 8% growth view off of the updated guidance range?

At this point, I would encourage us to let's get through the next six months and just see what the world brings. Again, we've seen where the spreads have been the previous six months.

We've got a short window into what it looks like here in the next few weeks. Again, we haven't even gotten into the heating season yet here.

We're going to let the market move through the next six months. We'll see what it presents itself.

As we get closer to the end of '26 and we're ready to talk about '27, we'll let you know what we think about the market and where the market currently stands and how we incorporate that into '27 and forward.

Understood. Thank you.

My second question is regarding your comment about the benefit from the Texas legislation, now the final rulemaking being higher than originally planned, sort of in that $155 to $165 million range for fiscal year '26. Can you, one, clarify, is that a pre-tax or post-tax amount?

It seems significantly higher than the original sort of maybe 40 cents annual run rate that you pointed to. How should we think about that benefit sort of beyond '26?

Should we see a similar, maybe even growing benefit as your capital plan grows in the out years?

To clarify, the $155 to $165 million impact from 77.102 for the full fiscal year is a pre-tax number. As I mentioned earlier, kind of going into the fiscal year, the rule was fairly new when we were establishing our budget and guidance.

There was certainly rulemaking that was going on that actually modified the rule a little bit from our original thinking. We've got a better handle on that going forward now, also visibility into our spending as I mentioned.

This is basically, as we talked about at the beginning of the fiscal year, a rebasing year because you're now layering in the impact of the new rule to eight all of APT spending and remainder of the distribution spending in Texas that didn't qualify under Rule 8.209. Going forward, we are still guiding in that 6% to 8% off of, as you mentioned earlier, a new range of $8.40 to $8.50.

In our five-year guidance is reflective of that as well. We feel confident we're not going to see another rebasing going into fiscal '27.

It's going to be more steady-state as we move forward.

Got it. Thank you for clarifying that.

We appreciate your interest in Atmos Energy, and thank you for joining us. A recording of this call is available for replay on our website through June 30th, 2026.

Have a good day.