ONE Gas (OGS) Issues 2021 Financial Guidance; Updates 2020 Financial Guidance

ONE Gas, Inc. (NYSE: OGS) today announced that its 2021 net income is expected to be in the range of $198 million to $210 million, with earnings per diluted share of $3.68 to $3.92. The midpoint of 2021 guidance for ONE Gas (the Company) is net income of $204 million, and earnings per diluted share of $3.80.

(*Consensus sees FY 21 EPS of $3.85)

The Company also updated its 2020 guidance to earnings of $3.66 to $3.70 per diluted share from the previous range of $3.44 to $3.68 per diluted share.

(*Consensus sees FY 20 EPS of $3.61)

The Company's 2021 earnings guidance includes the benefit of new rates and customer growth, offset by higher operating expenses, including depreciation expense from capital investments, and assumes normal weather. This guidance does not assume the Company will record any regulatory assets for COVID-19 during 2021.

Capital expenditures, including asset removal costs, are expected to be approximately $540 million in 2021, with nearly 70% of these expenditures targeted for system integrity and the balance primarily for customer growth. The anticipated average rate base for 2021 is $4.23 billion, calculated consistent with utility ratemaking in each jurisdiction.

Net income is expected to increase by an average of 6% to 8% annually between 2020 and 2025, with diluted earnings per share of 5% to 7%; however, the nature and timing of regulatory filings, particularly full rate cases, as well as equity issuances, will impact the growth rate in any individual year.

Capital expenditures, including asset removal costs, are expected to be in the range of $540 million to $640 million per year between 2021 and 2025, or approximately $3.0 billion for the five-year period, leading to rate base growth averaging 7% to 8% per year between 2020 and 2025.

The average annual dividend growth rate is expected to be 6% to 8% between 2020 and 2025, with a target dividend payout ratio of 55% to 65% of net income, subject to board of directors' approval.

Additional information can be found in the 2021 Financial Guidance investor presentation on the ONE Gas website at https://www.onegas.com/investors/financials-and-filings/guidance.

Guidance estimates may be impacted by the variables in the forward-looking statements listed below.

ONE Gas, Inc. (NYSE: OGS) is a 100% regulated natural gas utility, and trades on the New York Stock Exchange under the symbol "OGS." ONE Gas is included in the S&P MidCap 400 Index and is one of the largest natural gas utilities in the United States.

ONE Gas, headquartered in Tulsa, Oklahoma, provides natural gas distribution services to more than 2 million customers in Kansas, Oklahoma and Texas. Its divisions include Kansas Gas Service, the largest natural gas distributor in Kansas; Oklahoma Natural Gas, the largest in Oklahoma; and Texas Gas Service, the third largest in Texas, in terms of customers.

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