SOUTHWEST GAS CORP

CONDENSED CONSOLIDATED BALANCE SHEETS

(Thousands of dollars, except par value)

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share amounts)

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(In thousands, except per share amounts)

CONDENSED CONSOLIDATED BALANCE SHEETS

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

Note 1 – Background and Organization

Nature of Operations. The Company, a Delaware corporation, is a holding company owning all of the shares of common stock of Southwest Gas; and until April 22, 2024, all of the shares of common stock of Centuri. The Company’s common stock trades under the ticker symbol “SWX.”

Southwest Gas is engaged in the business of purchasing, distributing, and transporting natural gas for customers in portions of Arizona, Nevada, and California. Public utility rates, practices, facilities, and service territories of Southwest Gas are subject to regulatory oversight. The timing and amount of rate relief can materially impact results of operations. Natural gas purchases and the timing of related recoveries can materially impact liquidity. While mechanisms exist in all states in which Southwest Gas operates, which decouple authorized operating cost recovery and profitability from the volume of natural gas sold, thereby also incentivizing energy conservation, results for the natural gas distribution segment are higher during winter periods due to the seasonality incorporated in its regulatory rate structures.

Centuri is a strategic utility infrastructure services company dedicated to partnering with North America’s gas and electric providers to build and maintain the energy network that powers millions of homes across the U.S. and Canada. Centuri derives revenue primarily from installation, replacement, repair, and maintenance of energy networks. Centuri operates through a family of complementary companies in the U.S. and Canada. Utility infrastructure services activity is seasonal in many of Centuri’s operating areas. Peak periods are the summer and fall months in colder climate areas, such as the northeastern and midwestern U.S. and in Canada. In warmer climate areas, such as the southwestern and southeastern U.S., utility infrastructure services activity continues year round.

As part of a simplification strategy, the Company previously communicated that it would pursue a separation of Centuri. In April 2024, the Company and Centuri announced the completion of an IPO of Centuri Holdings, Inc. common stock. Following the Centuri IPO, the Company owned approximately 81% of Centuri. In May 2025, and again in June 2025, the Company and Centuri completed secondary public offerings of Centuri common stock owned by the Company. The Company also completed a private placement of Centuri stock as part of the May 2025 transaction. At June 30, 2025, the Company owned 53.3% of Centuri. In July 2025, the Company closed on an additional private placement offering. Following this additional private placement, the Company owns 52.1% of Centuri. Centuri continues to be consolidated as part of these financial statements, and will continue to be consolidated until such time as the conditions for consolidation are no longer met. See also Note 7 - Centuri Separation.

Note 2 – Summary of Significant Accounting Policies

Basis of Presentation. The condensed consolidated financial statements of the Company and Southwest Gas included herein have been prepared pursuant to the rules and regulations of the SEC. The year-end 2024 condensed consolidated balance sheet data was derived from audited financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations.

The preparation of the condensed consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities, as of the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. In the opinion of management, all adjustments, consisting of normal recurring items and estimates necessary for a fair statement of results for the interim periods, have been made.

Centuri and the Company do not always have the same basis of presentation, which could result in differences between the amounts presented in the Company’s financial information related to Centuri, and amounts included in Centuri’s separate publicly filed financial information.

Certain items in the prior period financial statements have been reclassified to conform to the current year presentation. Such reclassifications did not affect revenue, operating income, net income, or cash flows.

These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto of Southwest Gas and the Company included in our 2024 Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

Other Property and Investments. Other property and investments on Southwest Gas’ and the Company’s Condensed Consolidated Balance Sheets includes:

Cash Flow Supplemental Information. Cash flows from investing and financing activities exclude the impacts of certain items that while reflected on the balance sheets had no impact on cash flows. For instance, capital expenditures that were not yet paid, thereby remaining in Accounts payable or Other current liabilities have been excluded from cash flows, amounts related to which declined by approximately $5.8 million and $4.0 million for the Company and Southwest Gas, respectively, during the six months ended June 30, 2025; and declined approximately $8.5 million for the Company and increased by approximately $2.2 million for Southwest during the six months ended June 30, 2024.

Prepaid and other current assets. Prepaid and other current assets for the Company and Southwest Gas include, among other things, $57.1 million and $32.4 million related to a regulatory asset associated with the Arizona decoupling mechanism as of June 30, 2025 and December 31, 2024, respectively.

Goodwill. Goodwill is assessed as of October 1 each year for impairment, or more frequently, if circumstances indicate an impairment to the carrying value of goodwill may have occurred. The Company’s reporting units for goodwill are its operating segments, which are also its reportable segments. Since December 31, 2024, management qualitatively assessed whether events during the first six months of 2025 indicated it was more likely than not that the fair value of our reporting units was less than their carrying value, which if the case, could be an indication of a goodwill impairment. Through management’s assessments, no impairment was deemed to have occurred in the continuing segments of the Company. Goodwill in the Natural Gas Distribution and Utility Infrastructure Services segments is included in the respective Condensed Consolidated Balance Sheets as follows:

Other Current Liabilities. Management recognizes in its balance sheets various liabilities that are expected to be settled through future cash payment within the next twelve months, including amounts payable under regulatory mechanisms, customary accrued expenses for employee compensation and benefits, declared but unpaid dividends, and miscellaneous other accrued liabilities. Other current liabilities for the Company include $44.6 million and $44.5 million of dividends declared as of June 30, 2025 and December 31, 2024, respectively.

Other Income (Deductions). The following table provides the composition of significant items included in Other income (deductions) in Southwest Gas’ and the Company’s Condensed Consolidated Statements of Income:

Interest income primarily relates to Southwest Gas’ regulatory asset balances, including its deferred purchased gas cost mechanisms. Interest income is earned on asset balances and interest expense is incurred on liability balances. Corporate and administrative costs are those incurred directly by the parent entity, Southwest Gas Holdings. Refer also to Note 3 – Components of Net Periodic Benefit Costfor details regarding Other components of net periodic benefit cost.

Redeemable Noncontrolling Interest. Certain members of Riggs Distler management continue to hold a 0.80% interest in Drum, the parent of Riggs Distler, as of June 30, 2025, which is redeemable, subject to certain rights based on the passage of time or upon the occurrence of certain triggering events.

The following depicts changes to the balance of the redeemable noncontrolling interest in Drum:

EPS. Basic EPS in each period of this report were calculated by dividing net income attributable to the Company by the weighted-average number of shares during those periods. Diluted EPS includes additional weighted-average common stock equivalents (performance stock units and restricted stock units). Unless otherwise noted, the term EPS refers to Basic EPS. A reconciliation of the denominator used in Basic and Diluted EPS calculations is shown in the following table:

(1) The number of securities included 144,000 performance stock units during the three months ended June 30, 2024. During the six months ended June 30, 2025 and June 30, 2024, respectively, the number of securities included 124,000 and 140,000 performance stock units, the total of which was derived by assuming that target performance will be achieved during the relevant performance period.

(2) The number of anti-dilutive restricted stock units excluded from the calculation of diluted shares during the three months ended June 30, 2025 is 161,000.

Income Taxes. The Company’s effective tax rate was 124.4% for the three months ended June 30, 2025, compared to 17.1% for the corresponding period in 2024, primarily due to pre-tax income differences, the amortization of excess deferred income taxes, nondeductible Centuri IPO costs, and the sale of Centuri shares, which includes the establishment of the outside basis difference deferred tax liability and state income tax deferred tax assets. The Company’s effective tax rate was 44.8% for thesix months ended June 30, 2025, compared to 16.5% for the corresponding period in 2024, primarily dueto pre-tax income differences, amortization of excess deferred income taxes, and the sale of Centuri shares, which includes the establishment of the outside basis difference deferred tax liability and state income tax deferred tax assets (See Note 7 - Centuri Separation).

Southwest Gas’ effective tax rate was 12.3% for the three months ended June 30, 2025, compared to 6.3% for the corresponding period in 2024, primarily due to pre-tax income differences and the amortization of excess deferred income taxes. Southwest’s effective tax ratewas 19.0% for the six months ended June 30, 2025, compared to 16.4% in the corresponding period in 2024 primarily due to the amortization of excess accumulated deferred income taxes and the impacts of COLI.

On July 4, 2025, the OBBBA was signed into law, which makes permanent many of the tax provisions enacted in 2017 as part of the Tax Cuts and Jobs Act that were set to expire at the end of 2025. In addition, the OBBBA makes changes to certain U.S. corporate tax provisions, but many are generally not effective until 2026. The Company is currently evaluating the impact of the new legislation but does not expect it to have a material impact on the results of operations.

Recent Accounting Standards Updates.

Recently issued accounting pronouncements that will be effective in 2025 and thereafter:

In December 2023, the FASB issued ASU 2023-09 “Income Taxes (Topic 740): Improvements to Income Tax Disclosures.” The update, among other amendments, provides for enhanced disclosures primarily related to changes in the effective income tax rate reconciliation and information regarding income taxes paid. The update is effective for annual periods beginning after December 15, 2024. Management is evaluating the impacts this update might have on the Company’s and Southwest Gas’ disclosures.

In November 2024, the FASB issued ASU 2024-03 “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses.” The update requires disclosure of disaggregated information about certain income statement expense line items in the notes to the financial statements. The update is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027; early adoption is permitted. The update should be applied prospectively; however, retrospective application is also permitted. Management is evaluating the impacts this update might have on the Company’s and Southwest Gas’ disclosures.

Note 3 – Components of Net Periodic Benefit Cost

The components of Southwest Gas' net periodic benefit cost for its QRP, SERP, and PBOP for the three and six months ended June 30, 2025 and 2024 are presented in the following tables.

Note 4 – Revenue

The following information about the Company’s revenues is presented by segment. Southwest Gas encompasses the natural gas distribution segment and Centuri encompasses the utility infrastructure services segment.

Natural Gas Distribution Segment:

Southwest Gas’ operating revenues, but not its profits, are directly impacted by variability between comparative periods in the cost of natural gas procured for customers as such costs are incorporated in customer rates. When incorporated (for customers other than those taking transportation-only service), such costs are passed along to customers, generally dollar-for-dollar without markup. Southwest Gas’ revenues overall, reflected on the Condensed Consolidated Statements of Income of both the

Company and Southwest Gas, include revenue from contracts with customers, which is shown below, disaggregated by customer type, in addition to other categories of revenue:

(1) Amounts include late fees and other miscellaneous revenues, and may also include the impact of certain regulatory mechanisms.

Utility Infrastructure Services Segment:

During 2024, Utility infrastructure services segment management, in connection with Centuri’s planned separation, changed its service type revenue classification to align with changes in its organization structure, and as a result, prior year “other” revenue has been recast into gas infrastructure services to reflect these changes, with no impact to revenue overall. The following tables display Centuri’s revenue, reflected as Utility infrastructure services revenues on the Condensed Consolidated Statements of Income of the Company, representing revenue from contracts with customers, disaggregated by service and contract types:

*The three months ended June 30, 2024 were previously presented as: Gas infrastructure services of $381,676, Electric power infrastructure services of $284,723, and Other of $5,676. The six months ended June 30, 2024 were previously presented as: Gas infrastructure services of $642,902, Electric power infrastructure services of $545,189, and Other of $12,007.

The following table provides information about contracts receivable and revenue earned on contracts in progress in excess of billings (contract assets), both of which are included within Accounts receivable, net of allowances, as well as amounts billed in

excess of revenue earned on contracts (contract liabilities) at Centuri, which are included in Other current liabilities as of June 30, 2025 and December 31, 2024 on the Company’s Condensed Consolidated Balance Sheets:

Revenue earned on contracts in progress in excess of billings that are not expected to be recognized within a year from the financial statement date are not included in the table above, and were $27.8 million as of June 30, 2025, and $23.9 million as of December 31, 2024. These non-current balances were included in Deferred charges and other assets on the Company’s Condensed Consolidated Balance Sheets.

These contract assets primarily relate to Centuri’s right to consideration for work completed but not billed and/or approved for billing at the reporting date, and are transferred to contracts receivable when the rights become unconditional. The increase in contract assets (current and non-current) of$80.3 million from December 31, 2024 was due to incremental work performed for which milestones had not yet been met to trigger billing.

As of June 30, 2025, Centuri had recorded$42.3 million in net recovery claims with customers. Net recovery claims occur when there is a dispute regarding a change in the scope of work and associated price for work already performed. Centuri records estimated claims as variable consideration based on the most likely amount it expects to receive, and to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved.

The amounts billed in excess of revenue earned primarily relate to the advance consideration received from customers for which work has not yet been completed. The increase in the contract liability balance from December 31, 2024 to June 30, 2025 of $7.8 million was due to amounts received for services not yet performed, net of $17.6 million in revenue recognized that was included in the balance as of December 31, 2024.

For contracts where payment is expected to be collected less than one year from when services are performed (as determined at contract inception), Centuri uses the practical expedient and does not consider/compute an interest component based on the time value of money. Further, because of the short duration of these contracts, the Company has not disclosed the transaction price for the remaining performance obligations as of the end of each reporting period or when the Company expects to recognize the revenue.

As of June 30, 2025, Centuri had 43 fixed price contracts with an original duration of more than one year. The aggregate amount of the transaction price allocated to the unsatisfied performance obligations of these contracts as of June 30, 2025 was $202.8 million. Centuri expects to recognize the remaining performance obligations over approximately the next 2.5 years; however, the timing of that recognition is largely within the control of the customer, including when the necessary equipment and materials required to completethe work are provided by the customer.

Utility infrastructure services contracts receivable consists of the following:

In September 2024, Centuri entered into athree-year Securitization Facility for an aggregate amount of up to $125 million with PNC, to enhance Centuri’s financial flexibility by providing additional liquidity. Under the Securitization Facility, certain designated subsidiaries of Centuri have sold and/or contributed, and will continue to sell and/or contribute, their trade accounts receivable and contract assets generated in the ordinary course of business to an indirect wholly owned bankruptcy-remote SPE of Centuri created specifically for this purpose.

The total outstanding balance of accounts receivable that have been sold and derecognized was $125 million as of both June 30, 2025 and December 31, 2024, respectively. Centuri hadno unused capacity on the Securitization Facility as of June 30, 2025. Additionally, the SPE owned unsold accounts receivable and contract assets of $25.2 million and $104.3 million,

respectively, as of June 30, 2025, and $45.2 million and $78.3 million, respectively, as of December 31, 2024, which were not sold to PNC. These balances are primarily included in Accounts receivable, net of allowances in the Company’s Condensed Consolidated Balance Sheet, with certain non-current balances included in Deferred charges and other assets. During the three and six months ended June 30, 2025, Centuri incurred $1.7 million and $3.5 million, respectively, in yield fees on the Securitization Facility, which were recorded in Net interest deductions on the Company’s Condensed Consolidated Statements of Income.

Note 5 – Debt

Long-Term Debt

Long-term debt is recognized in the Company’s and Southwest Gas’ Condensed Consolidated Balance Sheets generally at the carrying value of the obligations outstanding. Details surrounding the fair value and individual carrying values of instruments are provided in the table that follows.

Southwest Gas has a $400 million revolving credit facility that is scheduled to expire in August 2029. In June 2025, Southwest Gas amended this revolving credit agreement, which among other things, added a swingline loan sub-facility in an aggregate principal amount at any time outstanding not to exceed $30 million and added a one-week interest period option with an interest rate equal to Daily Simple SOFR plus 0.03839% plus the applicable margin. At June 30, 2025, the applicable margin is 1.125% for loans bearing interest with reference to SOFR and 0.125% for loans bearing interest with reference to the alternative base rate. At June 30, 2025, no borrowings were outstanding on the long-term portion (including under the commercial paper program), nor under the short-term portion of the facility.

In July 2025, Centuri amended its second amended and restated credit agreement, which among other things, updated the change in control provision to permit Southwest Gas Holdings to dispose of its ownership in Centuri below 51% without triggering an event of default, refinanced and replaced in full the existing term loan facility with an $800 million term loan facility with a maturity date of July 9, 2032, $93.6 million of which is comprised of new term loans used to refinance existing indebtedness and $706.4 million of which was used to refinance existing term loans. In addition, the senior secured revolving credit facility increased from $400 million to $450 million, and extended the maturity date of the senior secured revolving credit facility from August 27, 2026 to July 9, 2030. The amendment also decreased the interest rate margin applicable to term loans by 0.25% to 2.25% for SOFR Loans and 1.25% for Base Rate Loans.

Short-Term Debt

In June 2025, Southwest Gas Holdings entered into a new $300 million revolving credit agreement that matures in August 2029, replacing Southwest Gas Holdings’ existing $300 million credit facility that was set to expire in December 2026. At June 30, 2025, the applicable margin is 1.25% for loans bearing interest to SOFR and 0.25% for loans bearing interest with reference to the alternative base. Southwest Gas Holdings has a one-week interest period option with an interest rate equal to Daily Simple SOFR plus 0.03839% plus the applicable margin. Southwest Gas Holdings is also required to pay a commitment fee on the unfunded portion of the commitments which ranges from 0.075% to 0.200%. The revolving credit agreement also

contains a swingline loan sub-facility in an aggregate principal amount at any time outstanding not to exceed $30 million. At June 30, 2025, there was $35.0 million outstanding under this credit facility.

In August 2024, Southwest Gas Holdings entered into a $550 million term loan that had been set to mature in July 2025. In June 2025, Southwest Gas Holdings entered into a second amended and restated term loan credit agreement, extending the maturity date of this agreement to June 2026 and excluding Centuri and its subsidiaries from certain material representations, covenants, and events of default. Prior to the execution of the amendment, Southwest Gas Holdings prepaid a portion of the indebtedness, decreasing the balance from $550 million to $225 million, utilizing proceeds received from the Centuri separation transactions. See Note 7 - Centuri Separation.

The weighted average interest rate of all short-term borrowings is 5.56% and 5.63% at June 30, 2025 and December 31, 2024, respectively.

Note 6 – Segment Information

The Company hastwo reportable segments: the natural gas distribution segment (Southwest Gas) and the utility infrastructure services segment (Centuri). Our reportable segments are based on the nature of their activities.

In order to reconcile to net income as disclosed in the Condensed Consolidated Statements of Income, an Other column is included below associated with certain unallocated expenses that represent the corporate and administrative activities associated with Southwest Gas Holdings, such as costs related to the Centuri separation and net interest deductions.

Approximately 99% of the total Company’s long-lived assets are in the U.S. with the remainder in Canada.

Segment information is presented in a similar manner to how the CODM, the Company’s CEO and President, reviews operating results in assessing performance and allocating resources. The CODM evaluates the performance of the reportable segments based on each segment’s net income (loss). The CODM considers budget-to-actual variances when making decisions about allocating capital and personnel to the segments. The CODM also uses net income (loss) to assess the return on assets of each segment including margin earned and in the compensation of certain employees. The CODM reviews capital expenditures by reportable segment rather than by any individual or total asset amount.

Centuri accounts for services provided to Southwest Gas at contractual prices. Accounts receivable for these services, which are not eliminated during consolidation, are presented in the table below:

(1) The primary change in this balance relates to certain accounts receivable balances sold by Centuri as part of its Securitization Facility described in Note 4 – Revenue.

The following table presents the amount of revenues by geographic area:

(1) Revenues are attributed to countries based on the location of customers.

The financial information pertaining to the natural gas distribution and utility infrastructure services segments are as follows:

Note 7 - Centuri Separation

In April 2024, the Company and Centuri announced the completion of the Centuri IPO. After completion of the Centuri IPO, the Company owned approximately 81% of all ownership interests in Centuri.

In May 2025, the Company and Centuri completed a secondary public offering of 9,000,000 shares of Centuri’s common stock owned by the Company at a price of $17.50 per share. The Company granted the underwriters a 30-day option to purchase up to an additional 1,350,000 shares of its common stock, which was exercised. In addition, the Company announced the concurrent private placement of an additional 2,857,142 shares at a price equal to the public offering price, with Icahn Partners LP and Icahn Partners Master Fund LP, investment entities associated with Carl C. Icahn. The net proceeds to the Company from the secondary public offering and concurrent private placement, after deducting underwriting discounts and commissions of $6.6 million and other fees, were approximately $224.6 million. Centuri did not receive any of the proceeds from the sale of the secondary offering or private placement. The Company used the proceeds for the repayment of outstanding indebtedness (see Note 5 – Debt).

In June 2025, the Company and Centuri completed an additional secondary public offering of 9,750,000 shares of Centuri’s common stock owned by the Company at a price of $20.75 per share. The Company granted the underwriters a 30-day option to purchase up to an additional 1,462,500 shares of its common stock, which was exercised. The net proceeds to the Company from the public offering, after deducting underwriting discounts and commissions of $8.6 million and other fees, were approximately $224.1 million. Centuri did not receive any of the proceeds from the sale. The Company used the proceeds for

the repayment of outstanding indebtedness(see Note 5 – Debt). After completion of the offering, the Company owned approximately 53.3% of all ownership interests in Centuri. In addition, the Company closed the concurrent private placement of an additional 1,060,240 shares at a price equal to the Centuri public offering price, with Icahn Partners LP and Icahn Partners Master Fund LP, investment entities associated with Carl C. Icahn, in July 2025. The net proceeds to the Company from the concurrent private placement were approximately $22.0 million. Centuri did not receive any of the proceeds from the sale of the private placement; the Company used the proceeds for the repayment of outstanding indebtedness. After completion of the private placement, the Company owns 52.1% of all ownership interests in Centuri and continues to consolidate the financial results of Centuri. The Company intends to fully dispose of its ownership in Centuri in one or more disposition transactions, including by way of sales of its shares of Centuri common stock, one or more exchange offers for Company shares, or any combination thereof.

The difference between the fair value of proceeds from the offerings/private placements and the carrying value of the noncontrolling interest is reflected as an increase in Additional paid-in capital of the Company.

The following reflects the effects of changes in the Company’s ownership interest in Centuri on the Company’s equity:

During the second quarter 2025, following the sale of Centuri common stock, the Company was no longer eligible to include Centuri in its consolidated federal and certain state income tax returns (tax deconsolidation) and the Company’s tax-free spin protection plan expired. As such, the Company could no longer assert the ability to complete a tax-free disposition of its investment in Centuri. This event required the Company to recognize a previously unrecorded deferred tax liability related to the outside basis of its investment in Centuri. Recognizing this liability resulted in a charge of approximately $52.4 million to income tax expense.

In addition, the Company recorded approximately $7.0 million in deferred tax assets reflecting state income tax assets, which are now expected to be utilized in connection with the disposition of Centuri shares. The combined effect of these items resulted in a net charge to income tax expense of approximately $45.4 million.

On February 24, 2025, the Company entered into a Tax Assets Agreement with Centuri. The Tax Assets Agreement addresses the Company’s arrangements with Centuri with respect to certain Tax Assets that each company will retain following any deconsolidation for U.S. federal and relevant state income tax laws. Under the terms of the Tax Assets Agreement, it is anticipated that the Company will contribute certain Tax Assets to Centuri, which will be treated as a deemed capital contribution. This amount is currently estimated to be approximately $30.2 million and will be finalized upon the filing of the 2024 and 2025 final consolidated or combined federal and state income tax returns.