UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form 8-K

Current Report Pursuant to Section 13 or
15(d) of the Securities Exchange Act of 1934

February 7, 2017
Date of Report (Date of earliest event reported)

ATMOS ENERGY CORPORATION
(Exact Name of Registrant as Specified in its Charter)



TEXAS AND VIRGINIA
1-10042
75-1743247
---------------------------------
------------------------
----------------------
(State or Other Jurisdiction
(Commission File
(I.R.S. Employer
of Incorporation)
Number)
Identification No.)

1800 THREE LINCOLN CENTRE,
 
5430 LBJ FREEWAY, DALLAS, TEXAS
75240
----------------------------------------------------
-----------------
(Address of Principal Executive Offices)
(Zip Code)

(972) 934-9227
------------------------------
(Registrant's Telephone Number, Including Area Code)

Not Applicable
---------------------------
(Former Name or Former Address, if Changed Since Last Report)



Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

□ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
□ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
□ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
□ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))



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Item 2.02.
Results of Operations and Financial Condition.

On Tuesday, February 7, 2017, Atmos Energy Corporation (the “Company”) issued a news release in which it reported the Company’s financial results for the 2017 fiscal year first quarter, which ended December 31, 2016, and that certain of its officers would discuss such financial results in a conference call on Wednesday, February 8, 2017 at 8:00 a.m. Eastern Time. In the release, the Company also announced that the call would be webcast live and that slides for the webcast would be available on its website for all interested parties.

A copy of the news release is furnished as Exhibit 99.1. The information furnished in this Item 2.02 and in Exhibit 99.1 shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall such information be deemed to be incorporated by reference into any of the Company’s filings under the Securities Act of 1933 or the Securities Exchange Act of 1934.

Item 9.01.
Financial Statements and Exhibits.

(d)    Exhibits
 
 
 
 
 
 
 
Exhibit Number
Description
 
 
99.1
  
News Release dated February 7, 2017 (furnished under Item 2.02)
 
 
 
 
 















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SIGNATURE


Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 
ATMOS ENERGY CORPORATION
 
             (Registrant)
 
 
 
 
DATE: February 7, 2017
By: /s/ CHRISTOPHER T. FORSYTHE                        
       Christopher T. Forsythe
       Senior Vice President and
       Chief Financial Officer
 
 

























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INDEX TO EXHIBITS


Exhibit Number
Description
 
99.1
News Release dated February 7, 2017 (furnished under Item 2.02)

 
 
 
 











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Exhibit 99.1
G528915G02G72A09.JPG
 
 
 
News Release
Analysts and Media Contact:
Susan Giles (972) 855-3729

Atmos Energy Corporation Reports Earnings for Fiscal 2017 First Quarter;
Reaffirms Fiscal 2017 Guidance

DALLAS ( February 7, 2017 ) - Atmos Energy Corporation (NYSE: ATO) today reported consolidated results for its fiscal 2017 first quarter ended December 31, 2016 .

Fiscal 2017 first quarter consolidated net income was $125.0 million , or $1.19 per diluted share, compared with consolidated net income of $102.9 million , or $1.00 per diluted share in the prior-year quarter.

Fiscal 2017 first quarter net income from continuing operations was $114.0 million , or $1.08 per diluted share, and income from discontinued operations was $11.0 million , or $0.11 per diluted share. In the prior-year quarter, net income from continuing operations was $101.5 million , or $0.99 per diluted share, and income from discontinued operations was $1.3 million , or $0.01 per diluted share.

The company's Board of Directors has declared a quarterly dividend of $0.45 per common share. The indicated annual dividend for fiscal 2017 is $1.80, which represents a 7.1 percent increase over fiscal 2016.

“Our first quarter results reflect the positive execution of our growth strategy,” said Kim Cocklin, Chief Executive Officer of Atmos Energy Corporation. “Ongoing capital investments made to our infrastructure have enhanced the safe and reliable delivery of natural gas to our customers and provided a steady return to shareholders. In addition, we are pleased that Atmos Energy has become a fully regulated, pure-play natural gas utility after closing on the sale of our nonregulated natural gas marketing business in January. Fiscal 2017 earnings from continuing operations are still expected to range from between $3.45 and $3.65 per diluted share,” Cocklin concluded.

Results for the Three Months Ended December 31, 2016
Distribution gross profit increased $23.8 million to $359.3 million for the three months ended December 31, 2016 , compared with $335.5 million in the prior-year period. Gross profit reflects a net $15.9 million increase in rates, primarily in the Mid-Tex, Louisiana and West Texas Divisions. In addition, transportation gross profit primarily in the Kentucky/Mid-States and West Texas

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Divisions increased $2.0 million. Finally, customer growth primarily in the Mid-Tex Division contributed an incremental $1.7 million in gross profit.
Pipeline and storage gross profit increased $10.6 million to $109.6 million for the three months ended December 31, 2016 , compared with $99.0 million in the prior-year period. This increase primarily is attributable to a $10.8 million increase in revenue from the Gas Reliability Infrastructure Program (GRIP) filings approved in fiscal 2016.

Continuing operation and maintenance expense for the three months ended December 31, 2016 , was $124.9 million , compared with $119.8 million for the prior-year period. This increase was primarily driven by increased pipeline maintenance spending.

In January 2017, the company completed the sale of its natural gas marketing business. Accordingly, the results of operations for the divested business have been presented as discontinued operations. Net income from discontinued operations increased $9.7 million to $11.0 million for the three months ended December 31, 2016 , compared with $1.3 million in the prior-year period. The increase largely reflects the recognition of a net $6.6 million noncash gain from unwinding hedge accounting for certain of the natural gas marketing business's financial positions as a result of the sale.

Capital expenditures increased to $298.0 million for the three months ended December 31, 2016 , compared with $290.4 million in the prior-year quarter driven by a planned increase in spending for infrastructure replacements and enhancements.

For the three months ended December 31, 2016 , the company generated operating cash flow of $117.0 million , a $46.8 million increase compared with the three months ended December 31, 2015 . The year-over-year increase primarily reflects favorable deferred gas cost recoveries attributable to higher sales volumes than in the prior-year quarter.

The debt capitalization ratio at December 31, 2016 was 48.7 percent , compared with 48.5 percent at September 30, 2016 and 49.5 percent at December 31, 2015 . At December 31, 2016 , there was $940.7 million of short-term debt outstanding, compared with $829.8 million at September 30, 2016 and $763.2 million at December 31, 2015 . Short-term debt balances fluctuate due to the seasonal nature of the natural gas business and the timing of spending year over year.

Outlook

The leadership of Atmos Energy remains focused on enhancing system safety and reliability through infrastructure investment while delivering shareholder value and consistent earnings growth. Atmos Energy continues to expect fiscal 2017 earnings from continuing operations to be in the range of $3.45 to $3.65 per diluted share. Net income from continuing operations is expected to be in the range of $365 million to $390 million. Capital expenditures for fiscal 2017 are expected to range between $1.1 billion and $1.25 billion.


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Conference Call to be Webcast February 8, 2017
 
Atmos Energy will host a conference call with financial analysts to discuss the fiscal 2017 first quarter financial results on Wednesday, February 8, 2017 , at 8:00 a.m. Eastern Time. The domestic telephone number is 877-485-3107 and the international telephone number is 201-689-8427. Kim Cocklin, Chief Executive Officer, Mike Haefner, President and Chief Operating Officer and Chris Forsythe, Senior Vice President and Chief Financial Officer will participate in the conference call. The conference call will be webcast live on the Atmos Energy website at www.atmosenergy.com . A playback of the call will be available on the website later that day.


Highlights and Recent Developments

Senior Management Changes
On January 19, 2017, Atmos Energy announced the departure of Bret J. Eckert, Senior Vice President and Chief Financial Officer, effective February 1, 2017 and the appointment of Christopher T. Forsythe, Vice President and Controller, to succeed him, also effective February 1, 2017.

On January 19, 2017, Atmos Energy also announced the retirement of Louis P. Gregory, Senior Vice President, General Counsel and Corporate Secretary, effective February 1, 2017. Gregory's successor will be named at a later date.

On November 30, 2016, Atmos Energy announced two promotions to its senior management team, effective January 1, 2017. Kevin Akers, President of the Kentucky/Mid-States Division was promoted to Senior Vice President, Safety and Enterprise Services and Matt Robbins was promoted from Vice President, Human Resources to Senior Vice President, Human Resources.

This news release should be read in conjunction with the attached unaudited financial information.
Forward-Looking Statements
The matters discussed in this news release may contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical fact included in this news release are forward-looking statements made in good faith by the company and are intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. When used in this news release or in any of the company's other documents or oral presentations, the words “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “goal,” “intend,” “objective,” “plan,” “projection,” “seek,” “strategy” or similar words are intended to identify forward-looking statements. Such forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those discussed in this news release, including the risks and uncertainties relating to regulatory trends and decisions, the company's ability to continue to access the capital markets and the other factors discussed in the company's reports filed with the Securities and Exchange Commission. These factors include the risks and uncertainties discussed in the company's Annual Report on Form 10-K for the fiscal year ended September 30, 2016 . Although the company believes these forward-looking

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statements to be reasonable, there can be no assurance that they will approximate actual experience or that the expectations derived from them will be realized. The company undertakes no obligation to update or revise forward-looking statements, whether as a result of new information, future events or otherwise.
About Atmos Energy
Atmos Energy Corporation, headquartered in Dallas, is the country's largest natural-gas-only distributor, serving over three million natural gas distribution customers in over 1,400 communities in eight states from the Blue Ridge Mountains in the East to the Rocky Mountains in the West. Atmos Energy also manages company-owned natural gas pipeline and storage assets, including one of the largest intrastate natural gas pipeline systems in Texas. For more information, visit www.atmosenergy.com .

 
 
 
 
 

 
 
 
 
 

 



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Atmos Energy Corporation
Financial Highlights (Unaudited)
 

 
 
 
 
 
Statements of Income
 
Three Months Ended 
 December 31
(000s except per share)
 
2016
 
2015
Gross Profit:
 
 
 
 
Distribution segment
 
$
359,310

 
$
335,452

Pipeline and storage segment
 
109,597

 
98,975

Intersegment eliminations
 
(44
)
 

Gross profit
 
468,863

 
434,427

Operation and maintenance expense
 
124,938

 
119,828

Depreciation and amortization
 
76,958

 
70,656

Taxes, other than income
 
57,049

 
51,214

Total operating expenses
 
258,945

 
241,698

Operating income
 
209,918

 
192,729

Miscellaneous expense
 
(994
)
 
(879
)
Interest charges
 
31,030

 
29,537

Income from continuing operations before income taxes
 
177,894

 
162,313

Income tax expense
 
63,856

 
60,767

Income from continuing operations
 
114,038

 
101,546

Income from discontinued operations, net of tax
 
10,994

 
1,315

Net Income
 
$
125,032

 
$
102,861

Basic and diluted net income per share
 
 
 
 
Income per share from continuing operations
 
$
1.08

 
$
0.99

Income per share from discontinued operations
 
0.11

 
0.01

Net income per share - basic and diluted
 
$
1.19

 
$
1.00

Cash dividends per share
 
$
0.45

 
$
0.42

Basic and diluted weighted average shares outstanding
 
105,284

 
102,713



 
 
 
 
 
 
 
Three Months Ended 
 December 31
Summary Net Income by Segment (000s)
 
2016
 
2015
Distribution
 
$
85,364

 
$
73,936

Pipeline and storage
 
28,674

 
27,610

Income from continuing operations
 
114,038

 
101,546

Income from discontinued operations, net of tax
 
10,994

 
1,315

Consolidated net income
 
$
125,032

 
$
102,861













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Atmos Energy Corporation
Financial Highlights, continued (Unaudited)
 
Condensed Balance Sheets
 
December 31,
 
September 30,
(000s)
 
2016
 
2016
Net property, plant and equipment
 
$
8,552,962

 
$
8,268,606

Cash and cash equivalents
 
44,624

 
47,534

Accounts receivable, net
 
458,813

 
215,880

Gas stored underground
 
163,763

 
179,070

Current assets of disposal group classified as held for sale
 
235,482

 
151,117

Other current assets
 
76,750

 
88,085

Total current assets
 
979,432

 
681,686

Goodwill
 
729,673

 
726,962

Noncurrent assets of disposal group classified as held for sale
 

 
28,616

Deferred charges and other assets
 
317,088

 
305,019

 
 
$
10,579,155

 
$
10,010,889

 
 
 
 
 
Shareholders' equity
 
$
3,698,975

 
$
3,463,059

Long-term debt
 
2,314,199

 
2,188,779

Total capitalization
 
6,013,174

 
5,651,838

Accounts payable and accrued liabilities
 
268,647

 
196,485

Current liabilities of disposal group classified as held for sale
 
109,298

 
72,900

Other current liabilities
 
381,123

 
439,085

Short-term debt
 
940,747

 
829,811

Current maturities of long-term debt
 
250,000

 
250,000

Total current liabilities
 
1,949,815

 
1,788,281

Deferred income taxes
 
1,725,433

 
1,603,056

Noncurrent liabilities of disposal group classified as held for sale
 

 
316

Deferred credits and other liabilities
 
890,733

 
967,398

 
 
$
10,579,155

 
$
10,010,889


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Atmos Energy Corporation
Financial Highlights, continued (Unaudited)
 
Condensed Statements of Cash Flows
 
Three Months Ended 
 December 31
(000s)
 
2016
 
2015
Cash flows from operating activities
 
 
 
 
Net income
 
$
125,032

 
$
102,861

Depreciation and amortization
 
77,143

 
71,239

Deferred income taxes
 
67,241

 
59,299

Discontinued cash flow hedging for natural gas marketing commodity contracts
 
(10,579
)
 

Other
 
4,842

 
3,471

Changes in assets and liabilities
 
(146,716
)
 
(166,729
)
Net cash provided by operating activities
 
116,963

 
70,141

Cash flows from investing activities
 
 
 
 
Capital expenditures
 
(297,962
)
 
(290,412
)
Acquisition
 
(85,714
)
 

Available-for-sale securities activities, net
 
(10,263
)
 
(2,263
)
Other, net
 
1,802

 
2,382

Net cash used in investing activities
 
(392,137
)
 
(290,293
)
Cash flows from financing activities
 
 
 
 
Net increase in short-term debt
 
110,936

 
305,309

Proceeds from issuance of long-term debt, net of discount
 
125,000

 

Net proceeds from equity offering
 
49,400

 

Issuance of common stock through stock purchase and employee retirement plans
 
8,998

 
8,729

Interest rate agreements cash collateral
 
25,670

 

Cash dividends paid
 
(47,740
)
 
(43,636
)
Net cash provided by financing activities
 
272,264

 
270,402

Net increase (decrease) in cash and cash equivalents
 
(2,910
)
 
50,250

Cash and cash equivalents at beginning of period
 
47,534

 
28,653

Cash and cash equivalents at end of period
 
$
44,624

 
$
78,903

 
 
 
Three Months Ended 
 December 31
Statistics
 
2016
 
2015
Consolidated distribution throughput (MMcf as metered)
 
110,605

 
104,465

Consolidated pipeline and storage transportation volumes (MMcf)
 
134,976

 
129,159

Distribution meters in service
 
3,202,106

 
3,167,702

Distribution average cost of gas
 
$
5.31

 
$
4.35

###


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