ATMOS ENERGY CORP

Previous wording

Our critical accounting policies are reviewed periodically by the Audit Committee of our Board of Directors. There were no significant changes to these critical accounting policies during the three months ended December 31, 2025.

Current wording

Our critical accounting policies are reviewed periodically by the Audit Committee of our Board of Directors. There were no significant changes to these critical accounting policies during the six months ended March 31, 2026.

Previous wording

During the three months ended December 31, 2025, we recorded net income of $403.0 million, or $2.44 per diluted share, compared to net income of $351.9 million, or $2.23 per diluted share for the three months ended December 31, 2024.

Current wording

During the six months ended March 31, 2026, we recorded net income of $984.9 million, or $5.92 per diluted share, compared to net income of $837.4 million, or $5.26 per diluted share for the six months ended March 31, 2025.

Previous wording

The 15 percent year-over-year increase in net income largely reflects positive rate outcomes driven by safety and reliability spending. Additionally, our results for the three months ended December 31, 2025 were favorably impacted by $35.2 million as a result of Texas legislation that became effective during the third quarter of fiscal 2025 related to infrastructure spending. These increases were partially offset by increased employee-related costs, depreciation and property tax expenses, and higher spending on safety and compliance related activities.

Current wording

The 18 percent year-over-year increase in net income largely reflects positive rate outcomes driven by safety and reliability spending. Additionally, our results for the six months ended March 31, 2026 were favorably impacted by $93.6 million as a result of Texas legislation that became effective during the third quarter of fiscal 2025 related to infrastructure spending. These increases were partially offset by increased depreciation and property tax expenses and higher spending on safety and compliance related activities.

Previous wording

During the three months ended December 31, 2025, we implemented, or received approval to implement, ratemaking regulatory actions which resulted in an increase in annual operating income of $122.5 million. Additionally, as of December 31, 2025, we had ratemaking efforts in progress seeking a total increase in annual operating income of $34.0 million.

Current wording

During the six months ended March 31, 2026, we implemented, or received approval to implement, ratemaking regulatory actions which resulted in an increase in annual operating income of $135.3 million. Additionally, as of March 31, 2026, we had ratemaking efforts in progress seeking a total increase in annual operating income of $599.2 million.

Previous wording

Capital expenditures for the three months ended December 31, 2025 were $1,033.3 million. Over 85 percent was invested to improve the safety and reliability of our distribution and transportation systems, with a significant portion of this investment incurred under regulatory mechanisms that reduce lag to six months or less.

Current wording

Capital expenditures for the six months ended March 31, 2026 were $2,036.9 million. Over 85 percent was invested to improve the safety and reliability of our distribution and transportation systems, with a significant portion of this investment incurred under regulatory mechanisms that reduce lag to six months or less.

Previous wording

During the three months ended December 31, 2025, we completed approximately $1.1 billion of long-term debt and equity financing. As of December 31, 2025, our equity capitalization was 59.9 percent. As of December 31, 2025, we had approximately $4.6 billion in total liquidity, consisting of $367.0 million in cash and cash equivalents, $1,088.9 million in funds available through equity forward sales agreements and $3,094.4 million in undrawn capacity under our credit facilities.

Current wording

During the six months ended March 31, 2026, we completed approximately $1.3 billion of long-term debt and equity financing. As of March 31, 2026, our equity capitalization was 60.9 percent. As of March 31, 2026, we had approximately $4.1 billion in total liquidity, consisting of $125.7 million in cash and cash equivalents, $890.1 million in funds available through equity forward sales agreements and $3,094.4 million in undrawn capacity under our credit facilities.

Previous wording

•a $5.8 million increase related to residential customer growth, primarily in our Mid-Tex Division, and increased industrial load.

Current wording

•a $4.0 million increase related to residential customer growth, primarily in our Mid-Tex Division, and increased industrial load.

Previous wording

Additionally, our distribution segment's income before income taxes for the three months ended December 31, 2025 was favorably impacted by $20.0 million as a result of Texas legislation that became effective during the third quarter of fiscal 2025 related to infrastructure spending.

Current wording

Additionally, our distribution segment's income before income taxes for the three months ended March 31, 2026 was favorably impacted by $24.1 million as a result of Texas legislation that became effective during the third quarter of fiscal 2025 related to infrastructure spending. This amount is reflected in the respective line items in which the costs are incurred, including operating expenses of $23.9 million and interest charges.

Previous wording

•a $47.7 million increase in rate adjustments, primarily in our Mid-Tex Division.

Current wording

•a $130.7 million increase in rate adjustments, primarily in our Mid-Tex Division.

Previous wording

•a $14.4 million increase in consumption, net of WNA.

Current wording

•a $14.6 million increase in consumption, net of WNA.

Previous wording

•an $8.7 million increase in system monitoring, line locating, and other compliance-related activities.

Current wording

•a $10.3 million increase in system monitoring, line locating, and other compliance-related activities.

Previous wording

The amounts described in the following sections represent the operating income that was requested or received in each rate filing, which may not necessarily reflect the stated amount referenced in the final order, as certain operating costs may have changed as a result of a commission’s or other governmental authority’s final ruling. During the first three months of fiscal 2026, we implemented, or received approval to implement, regulatory proceedings, resulting in a $122.5 million increase in annual operating income as summarized below. Our ratemaking outcomes include the refund (return) of excess deferred income taxes (EDIT) resulting from previously enacted tax reform legislation and do not reflect the true economic benefit of the outcomes because they do not include the corresponding income tax benefit.

Current wording

The amounts described in the following sections represent the operating income that was requested or received in each rate filing, which may not necessarily reflect the stated amount referenced in the final order, as certain operating costs may have changed as a result of a commission’s or other governmental authority’s final ruling. During the first six months of fiscal 2026, we implemented, or received approval to implement, regulatory proceedings, resulting in a $135.3 million increase in annual operating income as summarized below. Our ratemaking outcomes include the refund (return) of excess deferred income taxes (EDIT) resulting from previously enacted tax reform legislation and do not reflect the true economic benefit of the outcomes because they do not include the corresponding income tax benefit.

Previous wording

The following ratemaking efforts seeking $34.0 million in increased annual operating income were in progress as of December 31, 2025:

Current wording

The following ratemaking efforts seeking $487.0 million in increased annual operating income were in progress as of March 31, 2026:

Previous wording

(1) On January 9, 2026, we reached a settlement agreement for an operating income increase of $12.3 million pending final approval by the Kansas Corporation Commission. We anticipate rates will be implemented March 1, 2026.

Current wording

(1) On April 15, 2026, we reached a settlement agreement for an operating income increase of $10.8 million pending final approval by the Colorado Public Utilities Commission. We anticipate rates will be implemented during fiscal 2026.

Previous wording

(3) The Kansas Corporation Commission approved the Ad Valorem filing on January 8, 2026 with rates effective February 1, 2026.

Current wording

(2) The Kansas Corporation Commission approved the SIP filing on March 31, 2026, with rates effective April 1, 2026.

Previous wording

The following annual formula rate mechanisms were approved during the three months ended December 31, 2025:

Current wording

The following annual formula rate mechanisms were approved during the six months ended March 31, 2026:

Previous wording

A rate case is a formal request from Atmos Energy to a regulatory authority to increase rates that are charged to our customers. Rate cases may also be initiated when the regulatory authorities request us to justify our rates. This process is referred to as a “show cause” action. Adequate rates are intended to provide for recovery of the Company’s costs as well as a fair rate of return and ensure that we continue to deliver reliable, reasonably priced natural gas service safely to our customers. The following table summarizes the rate cases completed in our distribution segment during the three months ended December 31, 2025.

Current wording

A rate case is a formal request from Atmos Energy to a regulatory authority to increase rates that are charged to our customers. Rate cases may also be initiated when the regulatory authorities request us to justify our rates. This process is referred to as a “show cause” action. Adequate rates are intended to provide for recovery of the Company’s costs as well as a fair rate of return and ensure that we continue to deliver reliable, reasonably priced natural gas service safely to our customers. The following table summarizes the rate cases completed in our distribution segment during the six months ended March 31, 2026.

Previous wording

•a $20.2 million increase primarily due to rate adjustments from the GRIP filing approved in June 2025.

Current wording

•a $20.3 million increase primarily due to rate adjustments from the GRIP filing approved in June 2025.

Previous wording

•a $3.8 million increase due to higher capacity contracted by tariff-based customers due to their increased peak day demand.

Current wording

•a $3.9 million increase due to higher capacity contracted by tariff-based customers due to their increased peak day demand.

Previous wording

Additionally, our pipeline and storage segment's income before income taxes for the three months ended December 31, 2025 was favorably impacted by $15.2 million as a result of Texas legislation that became effective during the third quarter of fiscal 2025 related to infrastructure spending.

Current wording

Additionally, our pipeline and storage segment's income before income taxes for the three months ended March 31, 2026 was favorably impacted by $34.4 million as a result of Texas legislation that became effective during the third quarter of fiscal 2025 related to infrastructure spending. This amount is reflected in the respective line items in which the costs are incurred, including operating expenses of $30.4 million and interest charges.

Previous wording

•a $7.4 million increase in APT's through-system activities primarily associated with increased spreads.

Current wording

•a $16.0 million increase in APT's through-system activities primarily associated with increased spreads.

Previous wording

We also have an at-the-market (ATM) equity sales program under which we may issue and sell shares of our common stock up to an aggregate offering price of $1.7 billion (including shares of common stock that may be sold pursuant to forward sale agreements entered into in connection with the ATM equity sales program), which expires December 3, 2027. As of December 31, 2025, $827.1 million of equity was available for issuance under our existing ATM equity sales program. Additionally, as of December 31, 2025, we had $1.1 billion in available proceeds from outstanding forward sale agreements. Additional details are summarized in Note 8 to the condensed consolidated financial statements.

Current wording

We also have an at-the-market (ATM) equity sales program under which we may issue and sell shares of our common stock up to an aggregate offering price of $1.7 billion (including shares of common stock that may be sold pursuant to forward sale agreements entered into in connection with the ATM equity sales program), which expires December 3, 2027. As of March 31, 2026, $827.1 million of equity was available for issuance under our existing ATM equity sales program. Additionally, as of March 31, 2026, we had $890.1 million in available proceeds from outstanding forward sale agreements. Additional details are summarized in Note 8 to the condensed consolidated financial statements.

Previous wording

Cash flows from operating, investing, and financing activities for the three months ended December 31, 2025 and 2024 are presented below.

Current wording

Cash flows from operating, investing, and financing activities for the six months ended March 31, 2026 and 2025 are presented below.

Previous wording

For the three months ended December 31, 2025, we generated cash flow from operating activities of $308.1 million compared with $282.0 million for the three months ended December 31, 2024. Operating cash flow increased $26.0 million primarily due to the positive effects of successful rate case outcomes achieved in fiscal 2025.

Current wording

For the six months ended March 31, 2026, we generated cash flow from operating activities of $1,031.5 million compared with $1,205.0 million for the six months ended March 31, 2025. Operating cash flow decreased by $173.4 million primarily due to the timing of gas cost recoveries.

Previous wording

For the three months ended December 31, 2025, cash used for investing activities was $1,035.6 million compared to $888.9 million for the three months ended December 31, 2024. Capital spending in our distribution segment increased $178.9 million, primarily as a result of increased system modernization and customer growth spending. Capital spending in our pipeline and storage segment decreased $36.8 million primarily due to timing of spending for pipeline system safety and reliability in Texas.

Current wording

For the six months ended March 31, 2026, cash used for investing activities was $2,035.8 million compared to $1,717.5 million for the six months ended March 31, 2025. Capital spending in our distribution segment increased $301.1 million, primarily as a result of increased system modernization. Capital spending in our pipeline and storage segment increased $5.0 million primarily due to increased spending for pipeline system safety and reliability in Texas and system modernization.

Previous wording

For the three months ended December 31, 2025, our financing activities provided $895.3 million of cash compared with $887.5 million of cash provided by financing activities in the prior-year period.

Current wording

For the six months ended March 31, 2026, our financing activities provided $927.5 million of cash compared with $748.8 million of cash provided by financing activities in the prior-year period.

Previous wording

In the three months ended December 31, 2025, we received approximately $1.1 billion in net proceeds from the issuance of long-term debt and equity. We completed a public offering of $600 million of 5.45% senior notes due January 2056, and received net proceeds from the offering, after the underwriting discount and offering expenses, of $590.0 million. Additionally, during the three months ended December 31, 2025, we settled 3,683,384 shares that had been sold on a forward basis for net proceeds of $472.0 million. The net proceeds were used primarily to support capital spending and for other general corporate purposes. Cash dividends increased due to a 14.9 percent increase in our dividend rate and an increase in shares outstanding.

Current wording

In the six months ended March 31, 2026, we received approximately $1.3 billion in net proceeds from the issuance of long-term debt and equity. We completed a public offering of $600 million of 5.45% senior notes due January 2056, and received net proceeds from the offering, after the underwriting discount and offering expenses, of $590.0 million. Additionally, during the six months ended March 31, 2026, we settled 5,106,782 shares that had been sold on a forward basis for net proceeds of $671.6 million. The net proceeds were used primarily to support capital spending and for other general corporate purposes. Cash dividends increased due to a 14.9 percent increase in our dividend rate and an increase in shares outstanding.

Previous wording

In the three months ended December 31, 2024, we received approximately $1.0 billion in net proceeds from the issuance of long-term debt and equity. We completed a public offering of $650 million of 5.00% senior notes due December 2054, and received net proceeds from the offering, after the underwriting discount and offering expenses, of $639.4 million. Additionally, during the three months ended December 31, 2024, we settled 3,300,904 shares that had been sold on a forward basis for net proceeds of $379.5 million. The net proceeds were used primarily to support capital spending and for other general corporate purposes. Cash dividends increased due to an 8.1 percent increase in our dividend rate and an increase in shares outstanding.

Current wording

In the six months ended March 31, 2025, we received approximately $1.0 billion in net proceeds from the issuance of long-term debt and equity. We completed a public offering of $650 million of 5.00% senior notes due December 2054, and received net proceeds from the offering, after the underwriting discount and offering expenses, of $639.4 million. Additionally, during the six months ended March 31, 2025, we settled 3,300,904 shares that had been sold on a forward basis for net proceeds of $379.5 million. The net proceeds were used primarily to support capital spending and for other general corporate purposes. Cash dividends increased due to an 8.1 percent increase in our dividend rate and an increase in shares outstanding.

Previous wording

The following table summarizes our share issuances for the three months ended December 31, 2025 and 2024:

Current wording

The following table summarizes our share issuances for the six months ended March 31, 2026 and 2025:

Previous wording

Except as noted in Note 11 to the condensed consolidated financial statements, there were no significant changes in our contractual obligations and commercial commitments during the three months ended December 31, 2025.

Current wording

Except as noted in Note 11 to the condensed consolidated financial statements, there were no significant changes in our contractual obligations and commercial commitments during the six months ended March 31, 2026.

Previous wording

The following table shows the components of the change in fair value of our financial instruments for the three months ended December 31, 2025 and 2024:

Current wording

The following table shows the components of the change in fair value of our financial instruments for the three and six months ended March 31, 2026 and 2025:

Previous wording

The following tables present certain operating statistics for our distribution and pipeline and storage segments for the three months ended December 31, 2025 and 2024.

Current wording

The following tables present certain operating statistics for our distribution and pipeline and storage segments for the three and six months ended March 31, 2026 and 2025.