Delivered 8.5% Twelve-month-ended Utility ROE Filed Rate Cases in AZ and NV Requesting a Total of $172 Million in Additional Revenue Strong Shipper Interest Supports Potential Phased Growth Beyond Great Basin's 2028 Expansion Pending California Rate Case Decision Creates Temporary Q1 Impact with Full Year Earnings Guidance Unchanged LAS VEGAS , May 5, 2026 /PRNewswire/ -- Southwest Gas Holdings, Inc. (NYSE: SWX ) ("Southwest Gas Holdings" or "Company") today reported results for its first quarter ended March 31, 2026. This earnings press release should be read in conjunction with the Form 10-Q and earnings slides, which are concurrently being posted at www.swgasholdings.com . "Today, we reported solid first quarter results, driven by continued growth and last year's constructive rate case outcome authorizing recovery of the investments we made in Arizona to serve our customers, and significantly lower interest expense due to the payoff of previously outstanding corporate and administrative debt," said Karen Haller, President and Chief Executive Officer of Southwest Gas Holdings. "We began the year by making meaningful progress on our strategic priorities, including the filing of two general rate cases in our largest jurisdictions. In Arizona, we filed a general rate case requesting a formula rate mechanism. In Nevada, we submitted a general rate case and look forward to the Public Utilities Commission of Nevada's final order on the rulemaking process that will define the state's alternative ratemaking framework. While the delayed California rate case decision negatively affected reported first quarter earnings, the previously authorized memorandum account we use to track the impacts of the delayed decision gives us confidence to affirm our full-year earnings guidance. "At Great Basin, we recently completed an open season for available capacity associated with the 2028 expansion project where we received bids totaling nearly 2.5 billion cubic feet per day of incremental capacity. These bids included requests for service by 2028, but also for phased-in service through 2035. While we work with shippers to convert these expressions of interest into binding precedent agreements, we are also continuing to advance preparations for our Federal Energy Regulatory Commission certificate application later this year, having made steady progress on field surveys, public outreach, and engineering design efforts," Haller continued. SOUTHWEST GAS HOLDINGS, INC. SUMMARY OPERATING RESULTS Summary Financial Results Three Months Ended March 31, (In thousands, except per share items) 2026 2025 Results of Consolidated Operations Contribution to net income - natural gas distribution $ 137,771 $ 142,942 Contribution to net income - corporate and administrative 603 (8,654) Income from continuing operations, net of taxes 138,374 134,288 Income (loss) from discontinued operations, net of taxes (1) — (20,418) Net income attributable to Southwest Gas Holdings $ 138,374 $ 113,870 Consolidated earnings per diluted share $ 1.91 $ 1.58 Consolidated earnings per diluted share from continuing operations $ 1.91 $ 1.86 Weighted average diluted shares 72,566 72,138 (1) Including the impacts of noncontrolling interests. All items related to the disposition of Centuri are included in discontinued operations. (2) There were no adjustments for the three months ended March 31, 2026. Recent Operational and Financial Highlights Southwest Gas Holdings' quarter-over-quarter earnings per share from continuing operations improved 2.7% when compared to 2025; Southwest Gas Corporation ("Southwest Gas", "Utility", "Natural Gas Distribution" segment) delivered Utility return on period-end equity of 8.5% and Adjusted Utility return on period-end equity of 8.0% over the 12 months ended March 31, 2026. Final decision in California general rate case to make up for delayed recognition of expected California margin and related Utility return in 2026; Southwest Gas filed an Arizona general rate case requesting to increase revenues by approximately $101 million to reflect the investments we made to serve our customers. We expect new rates to become effective April 2027 and we are also requesting to transition cost recovery to a formula rate model with an Annual Rate Adjustment Mechanism; Southwest Gas filed a Nevada general rate case requesting to increase revenues by approximately $71 million to reflect the investments we made to serve our customers. We expect new rates to become effective October 2026; rulemaking process for alternative ratemaking ongoing; Great Basin Gas Transmission Company ("Great Basin") completed an open season in April 2026 for available capacity for the 2028 expansion project. Refer to the Great Basin Expansion Project Update section below. Southwest Gas invested $186.3 million in capital expenditures (on an accrual basis) during the quarter to strengthen and modernize infrastructure to support new and existing customer demand; Southwest Gas achieved gross margin of $298.9 million and operating margin of $477.0 million for the three months ended March 31, 2026; As of March 31, 2026, the Company had $484.8 million of cash on hand, and nearly $1.2 billion in available liquidity; and The Company increased its quarterly common stock dividend to $0.645 per share, representing a 4% increase over the 2025 dividend rate. Great Basin Expansion Project Updates Great Basin completed an open season in April 2026 for available capacity associated with the 2028 Great Basin expansion project. The available capacity offered in the open season was approximately 0.3 billion cubic feet ("Bcf") per day, in addition to the 0.6 Bcf per day of currently contracted demand. The open season was significantly oversubscribed, with expressions of interest totaling approximately 2.5 Bcf per day, and requested in-service dates ranging from 2028 through 2035. All expressions of interest remain subject to the successful negotiation of binding precedent agreements ("BPAs") and the posting of required surety. The expressions of interest received during the open season reflect incremental demand across multiple potential in-service periods: Approximately 1.0 Bcf per day targeting 2028 - 2029. Approximately 1.5 Bcf per day requesting phased-in service dates between 2030 - 2035. The 2028 expansion project is currently designed to support up to 1.0 Bcf per day of capacity. Depending on the successful execution of BPAs and posting of surety, incremental 2028-2029 demand could: require design changes within the existing corridor and, depending on scope changes, result in potential changes to previously disclosed capital investment and margin estimates. The Company will continue to evaluate design requirements as commercial milestones are achieved and does not expect the base capital assumptions of $1.7 billion for the 2028 expansion project to change materially if total 2028-2029 contracted demand settles at or below 1.0 Bcf per day. Incremental demand beyond the 1.0 Bcf level will be evaluated separately and is not expected to be incorporated into guidance until BPAs are executed and any potential re-designs are finalized. Preparations for the Federal Energy Regulatory Commission (FERC) certificate (CPCN) application, expected to be filed later in 2026, are progressing as planned, including field surveys, public outreach, and engineering and design development. The current FERC filing schedule is not expected to be impacted by the incremental demand received. Shippers participating in the open season are required to execute minimum twenty-year BPAs and post surety in order to maintain the planned project schedule and associated regulatory timeline. For future potential in-service dates beyond the 2028 expansion project, the demand requested will likely require separate project phases as well as independent regulatory approvals and construction timelines. Earnings Reconciliation Table The table below provides a reconciliation of net income attributable to Southwest Gas Holdings for the three months ended March 31, 2026, from the same period in 2025 (items are in millions and are before related income tax impact unless otherwise noted): Three Months Ended Net income attributable to Southwest Gas Holdings – March 31, 2025 $ 113.9 Increase (decrease) in Southwest Gas net income: Operating Margin (1) 15.1 Operations and maintenance expenses (2.1) Depreciation and amortization (5.9) Other income and deductions, net (3.6) Interest expense, net (1.0) Other (includes taxes other than income taxes) (1.3) Income tax expense (6.4) Total decrease in Southwest Gas net income (5.2) Improvement in corporate and administrative results (2) 9.3 Increase in income from continuing operations 4.1 Decrease in loss from discontinued operations (3) 20.4 Net income attributable to Southwest Gas Holdings – March 31, 2026 $ 138.4 (1) For a reconciliation of non-GAAP financial measures to their comparable GAAP measures, see the tables later in this press release. (2) Corporate and Administrative improved from a net loss in the three months ended March 31, 2025 to net income in the three months ended March 31, 2026. (3) Including the impacts of noncontrolling interests. All items related to the disposition of Centuri are included in discontinued operations. Southwest Gas Holdings' net income from continuing operations was ... Full story available on Benzinga.com
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