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What changed in Atmos Energy's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Atmos Energy's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+135 added−139 removedSource: 10-K (2025-11-14) vs 10-K (2024-11-18)

Top changes in Atmos Energy's 2025 10-K

135 paragraphs added · 139 removed · 119 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

31 edited+4 added−6 removed50 unchanged
Biggest changeThe following table summarizes our annual formula rate mechanisms with effective dates during the fiscal years ended September 30, 2024, 2023, and 2022: Division Jurisdiction Test Year Ended Increase (Decrease) in Annual Operating Income EDIT Impact Increase (Decrease) in Annual Operating Income Excluding EDIT Effective Date (In thousands) 2024 Filings: Louisiana Louisiana 12/2023 $ 35,645 $ (11,785) $ 23,860 07/01/2024 Mid-Tex ATM Cities 12/2023 17,104 — 17,104 06/07/2024 West Texas Amarillo, Lubbock, Dalhart and Channing 12/2023 7,344 — 7,344 06/07/2024 Kentucky/Mid-States Tennessee ARM 09/2023 18,570 (4,348) 14,222 06/01/2024 Mid-Tex DARR 09/2023 37,809 (14,782) 23,027 06/01/2024 West Texas Triangle 12/2023 1,300 — 1,300 06/01/2024 West Texas Environs 12/2023 1,379 — 1,379 06/01/2024 Mid-Tex Environs 12/2023 8,529 — 8,529 06/01/2024 Atmos Pipeline - Texas Texas 12/2023 82,440 — 82,440 05/14/2024 Colorado-Kansas Kansas SIP 12/2023 708 — 708 04/01/2024 Colorado-Kansas Colorado SSIR 12/2024 2,017 — 2,017 01/01/2024 Mississippi Mississippi - SIR 10/2024 10,969 — 10,969 12/01/2023 Mississippi Mississippi - SRF 10/2024 11,539 (472) 11,067 12/01/2023 Colorado-Kansas Kansas GSRS 09/2023 1,752 — 1,752 11/02/2023 Kentucky/Mid-States Kentucky PRP 09/2024 2,906 — 2,906 10/01/2023 Mid-Tex Mid-Tex Cities RRM 12/2022 98,585 185 98,770 10/01/2023 West Texas West Texas Cities RRM 12/2022 8,594 (112) 8,482 10/01/2023 Kentucky/Mid-States Virginia - SAVE 09/2024 573 — 573 10/01/2023 Total 2024 Filings $ 347,763 $ (31,314) $ 316,449 10 Table of Contents 2023 Filings: Louisiana Louisiana 12/2022 $ 14,466 $ 17 $ 14,483 07/01/2023 Mid-Tex DARR (1) 09/2022 17,345 51 17,396 06/14/2023 Mid-Tex ATM Cities 12/2022 12,825 — 12,825 06/09/2023 West Texas Amarillo, Lubbock, Dalhart and Channing 12/2022 6,938 — 6,938 06/09/2023 West Texas Triangle 12/2022 717 — 717 06/01/2023 West Texas Environs 12/2022 1,332 — 1,332 06/01/2023 Mid-Tex Environs 12/2022 5,983 — 5,983 06/01/2023 Kentucky/Mid-States Tennessee ARM 09/2022 14 (1,509) (1,495) 06/01/2023 Atmos Pipeline - Texas Texas 12/2022 84,931 — 84,931 05/17/2023 Colorado-Kansas Kansas SIP 12/2022 772 — 772 04/01/2023 Colorado-Kansas Colorado SSIR 12/2023 1,971 — 1,971 01/01/2023 Mississippi Mississippi - SIR 10/2023 8,560 — 8,560 11/01/2022 Mississippi Mississippi - SRF 10/2023 12,188 778 12,966 11/01/2022 Kentucky/Mid-States Kentucky PRP 09/2023 1,588 — 1,588 10/02/2022 Mid-Tex Mid-Tex Cities RRM 12/2021 81,402 (395) 81,007 10/01/2022 West Texas West Texas Cities RRM 12/2021 7,315 (41) 7,274 10/01/2022 Kentucky/Mid-States Virginia - SAVE 09/2023 477 — 477 10/01/2022 Total 2023 Filings $ 258,824 $ (1,099) $ 257,725 2022 Filings: Kentucky/Mid-States Tennessee ARM 09/2021 $ 2,466 $ — $ 2,466 07/01/2022 Louisiana Louisiana 12/2021 17,650 (10,389) 7,261 07/01/2022 West Texas Amarillo, Lubbock, Dalhart and Channing 12/2021 6,122 — 6,122 06/11/2022 West Texas Triangle 12/2021 1,549 — 1,549 06/11/2022 West Texas Environs 12/2021 1,221 — 1,221 06/11/2022 Mid-Tex ATM Cities 12/2021 12,815 — 12,815 06/10/2022 Mid-Tex Environs 12/2021 5,646 — 5,646 06/10/2022 Mid-Tex DARR (2) 09/2021 13,201 — 13,201 05/25/2022 Atmos Pipeline - Texas Texas 12/2021 78,750 — 78,750 05/18/2022 Colorado-Kansas Kansas SIP 12/2021 623 — 623 04/01/2022 Colorado-Kansas Kansas GSRS 09/2021 1,820 — 1,820 02/01/2022 Colorado-Kansas Colorado SSIR 12/2022 2,610 — 2,610 01/01/2022 Mid-Tex Mid-Tex Cities RRM 12/2020 21,673 33,851 55,524 12/01/2021 West Texas West Texas Cities RRM 12/2020 151 3,347 3,498 12/01/2021 Mississippi Mississippi - SIR 10/2022 8,354 2,123 10,477 11/01/2021 Mississippi Mississippi - SRF 10/2022 (5,624) 4,317 (1,307) 11/01/2021 Kentucky/Mid-States Virginia - SAVE 09/2022 327 — 327 10/01/2021 Total 2022 Filings $ 169,354 $ 33,249 $ 202,603 (1) The rate increase for this filing was approved based on the effective date herein; however, the new rates were implemented beginning September 1, 2023.
Biggest changeAnnual Formula Rate Mechanisms State Infrastructure Programs Formula Rate Mechanisms Colorado System Safety and Integrity Rider (SSIR) — Kansas Gas System Reliability Surcharge (GSRS), System Integrity Program (SIP) — Kentucky Pipeline Replacement Program (PRP) — Louisiana (1) Rate Stabilization Clause (RSC) Mississippi System Integrity Rider (SIR) Stable Rate Filing (SRF) Tennessee (1) Annual Rate Mechanism (ARM) Texas Gas Reliability Infrastructure Program (GRIP), (1) Dallas Annual Rate Review (DARR), Mid-Tex Rate Review Mechanism (RRM) Virginia Steps to Advance Virginia Energy (SAVE) — (1) Infrastructure mechanisms in Texas, Louisiana, and Tennessee allow for the deferral of all expenses associated with capital expenditures incurred pursuant to these rules, which primarily consists of interest, depreciation, and other taxes (Texas and Tennessee only), until the next rate proceeding (rate case or annual rate filing), at which time investment and costs would be recoverable through base rates. 9 Table of Contents The following table summarizes our annual formula rate mechanisms with effective dates during the fiscal years ended September 30, 2025, 2024, and 2023: Division Jurisdiction Test Year Ended Increase in Annual Operating Income EDIT Impact Increase (Decrease) in Annual Operating Income Excluding EDIT Effective Date (In thousands) 2025 Filings: Louisiana Louisiana 12/2024 $ 22,304 $ 1,473 $ 23,777 07/01/2025 Atmos Pipeline - Texas Texas 12/2024 77,206 — 77,206 06/17/2025 Kentucky/Mid-States Tennessee ARM 09/2024 1,432 — 1,432 06/01/2025 Mid-Tex DARR 09/2024 25,916 — 25,916 06/01/2025 Kentucky/Mid-States Kentucky PRP (1) 09/2025 3,248 — 3,248 05/29/2025 Colorado-Kansas Kansas SIP 12/2024 612 — 612 04/01/2025 Colorado-Kansas Colorado SSIR 12/2025 1,907 — 1,907 01/01/2025 Colorado-Kansas Kansas GSRS 09/2024 1,998 — 1,998 12/17/2024 Mississippi Mississippi - SIR 10/2025 23,995 — 23,995 11/04/2024 Mississippi Mississippi - SRF 10/2025 3,800 15 3,815 11/04/2024 Mid-Tex Mid-Tex Cities RRM 12/2023 112,144 645 112,789 10/01/2024 West Texas West Texas Cities RRM 12/2023 4,414 122 4,536 10/01/2024 Kentucky/Mid-States Virginia - SAVE 09/2025 748 — 748 10/01/2024 Total 2025 Filings $ 279,724 $ 2,255 $ 281,979 2024 Filings: Louisiana Louisiana 12/2023 $ 35,645 $ (11,785) $ 23,860 07/01/2024 Mid-Tex ATM Cities 12/2023 17,104 — 17,104 06/07/2024 West Texas Amarillo, Lubbock, Dalhart and Channing 12/2023 7,344 — 7,344 06/07/2024 Kentucky/Mid-States Tennessee ARM 09/2023 18,570 (4,348) 14,222 06/01/2024 Mid-Tex DARR 09/2023 37,809 (14,782) 23,027 06/01/2024 West Texas Triangle 12/2023 1,300 — 1,300 06/01/2024 West Texas Environs 12/2023 1,379 — 1,379 06/01/2024 Mid-Tex Environs 12/2023 8,529 — 8,529 06/01/2024 Atmos Pipeline - Texas Texas 12/2023 82,440 — 82,440 05/14/2024 Colorado-Kansas Kansas SIP 12/2023 708 — 708 04/01/2024 Colorado-Kansas Colorado SSIR 12/2024 2,017 — 2,017 01/01/2024 Mississippi Mississippi - SIR 10/2024 10,969 — 10,969 12/01/2023 Mississippi Mississippi - SRF 10/2024 11,539 (472) 11,067 12/01/2023 Colorado-Kansas Kansas GSRS 09/2023 1,752 — 1,752 11/02/2023 Kentucky/Mid-States Kentucky PRP 09/2024 2,906 — 2,906 10/01/2023 Mid-Tex Mid-Tex Cities RRM 12/2022 98,585 185 98,770 10/01/2023 West Texas West Texas Cities RRM 12/2022 8,594 (112) 8,482 10/01/2023 Kentucky/Mid-States Virginia - SAVE 09/2024 573 — 573 10/01/2023 Total 2024 Filings $ 347,763 $ (31,314) $ 316,449 10 Table of Contents 2023 Filings: Louisiana Louisiana 12/2022 $ 14,466 $ 17 $ 14,483 07/01/2023 Mid-Tex DARR (2) 09/2022 17,345 51 17,396 06/14/2023 Mid-Tex ATM Cities 12/2022 12,825 — 12,825 06/09/2023 West Texas Amarillo, Lubbock, Dalhart and Channing 12/2023 6,938 — 6,938 06/09/2023 West Texas Triangle 12/2022 717 — 717 06/01/2023 West Texas Environs 12/2022 1,332 — 1,332 06/01/2023 Mid-Tex Environs 12/2022 5,983 — 5,983 06/01/2023 Kentucky/Mid-States Tennessee ARM 09/2022 14 (1,509) (1,495) 06/01/2023 Atmos Pipeline - Texas Texas 12/2022 84,931 — 84,931 05/17/2023 Colorado-Kansas Kansas SIP 12/2022 772 — 772 04/01/2023 Colorado-Kansas Colorado SSIR 12/2023 1,971 — 1,971 01/01/2023 Mississippi Mississippi - SIR 10/2023 8,560 — 8,560 11/01/2022 Mississippi Mississippi - SRF 10/2023 12,188 778 12,966 11/01/2022 Kentucky/Mid-States Kentucky PRP 09/2023 1,588 — 1,588 10/02/2022 Mid-Tex Mid-Tex Cities RRM 12/2021 81,402 (395) 81,007 10/01/2022 West Texas West Texas Cities RRM 12/2021 7,315 (41) 7,274 10/01/2022 Kentucky/Mid-States Virginia - SAVE 09/2023 477 — 477 10/01/2022 Total 2023 Filings $ 258,824 $ (1,099) $ 257,725 (1) On October 2, 2024, we implemented the PRP rates subject to refund; on May 29, 2025, the Kentucky Public Service Commission issued a final order approving the PRP filing.
The combination of base load and peaking agreements, coupled with the withdrawal of gas held in storage, allows us the flexibility to adjust to changes in weather, which minimizes our need to enter into long-term firm commitments. We estimate our peak-day availability of natural gas supply to be approximately 5.3 Bcf.
The combination of base load and peaking agreements, coupled with the withdrawal of gas held in storage, allows us the flexibility to adjust to changes in weather, which minimizes our need to enter into long-term firm commitments. We estimate our peak-day availability of natural gas supply to be approximately 5.4 Bcf.
In addition, in accordance with and pursuant to such NYSE listing standards, our Chief Executive Officer during fiscal 2024, John K. Akers, certified to the New York Stock Exchange that he was not aware of any violations by the Company of NYSE corporate governance listing standards.
In addition, in accordance with and pursuant to such NYSE listing standards, our Chief Executive Officer during fiscal 2025, John K. Akers, certified to the New York Stock Exchange that he was not aware of any violations by the Company of NYSE corporate governance listing standards.
Through our annual formula rate mechanisms and infrastructure programs, we have the ability to begin recovering approximately 90 percent of our capital expenditures within six months and substantially all of our capital expenditures within twelve months. • Authorization in tariffs, statute or commission rules that allows us to defer certain elements of our cost of service such as depreciation, ad valorem taxes, pension costs, and certain safety related expenses, until they are included in rates. • WNA mechanisms in seven states that serve to minimize the effects of weather on approximately 97 percent of our distribution residential and commercial revenues. • The ability to recover the gas cost portion of bad debts in six states which represents approximately 89 percent of our distribution residential and commercial revenues. 6 Table of Contents The following tables provides a jurisdictional rate summary for our regulated operations as of September 30, 2024.
Through our annual formula rate mechanisms and infrastructure programs, we have the ability to begin recovering approximately 95 percent of our capital expenditures within six months and substantially all of our capital expenditures within twelve months. • Authorization in tariffs, statute or commission rules that allows us to defer certain elements of our incurred cost of service such as depreciation, ad valorem taxes, pension costs, and certain safety related expenses, until they are included in rates. • WNA mechanisms in seven states that serve to minimize the effects of weather on approximately 97 percent of our distribution residential and commercial revenues. • The ability to recover the gas cost portion of bad debts in six states which represents approximately 89 percent of our distribution residential and commercial revenues. 6 Table of Contents The following tables provides a jurisdictional rate summary for our regulated operations as of September 30, 2025.
We safely deliver reliable, efficient, and abundant natural gas through regulated sales and transportation arrangements to over 3.3 million residential, commercial, public authority, and industrial customers in eight states located primarily in the South. We also operate one of the largest intrastate pipelines in Texas based on miles of pipe.
We safely deliver reliable, efficient, and abundant natural gas through regulated sales and transportation arrangements to approximately 3.4 million residential, commercial, public authority, and industrial customers in eight states located primarily in the South. We also operate one of the largest intrastate pipelines in Texas based on miles of pipe.
We also target jobs fairs including those focused on minority, veteran, and women candidates and partner with local colleges and universities to identify and recruit qualified 13 Table of Contents applicants in each of the cities and towns we serve. Finally, we believe we offer a competitive benefits program to help retain our employees.
We also target jobs fairs including those focused on minority, veteran, and women candidates and partner with local colleges and universities to identify and recruit qualified applicants in each of the cities and towns we serve. Finally, we believe we offer a competitive benefits program to help retain our employees.
As a result of our ratemaking efforts in recent years, Atmos Energy has: • Formula rate mechanisms in place in four states that provide for an annual rate review and adjustment to rates. • Infrastructure programs in place in all of our states that provide for an annual adjustment to rates for qualifying capital expenditures.
As a result of our ratemaking efforts and legislative actions in our jurisdictions in recent years, Atmos Energy has: • Formula rate mechanisms in place in four states that provide for an annual rate review and adjustment to rates. • Infrastructure programs in place in all of our states that provide for an annual adjustment to rates for qualifying capital expenditures.
At September 30, 2024, we held 1,026 franchises having terms generally ranging from five to 35 years. A number of our franchises expire each year, which require renewal prior to the end of their terms. Historically, we have successfully renewed these franchises and believe that we will continue to be able to renew our franchises as they expire.
At September 30, 2025, we held 1,010 franchises having terms generally ranging from five to 35 years. A number of our franchises expire each year, which require renewal prior to the end of their terms. Historically, we have successfully renewed these franchises and believe that we will continue to be able to renew our franchises as they expire.
The principal means to compete against alternative fuels is lower prices, and natural gas historically has maintained its price advantage in the residential, commercial, and industrial markets. Our pipeline and storage operations have historically faced competition from other existing intrastate pipelines seeking to provide or arrange transportation, storage, and other services for customers.
The principal means to compete against 12 Table of Contents alternative fuels is lower prices, and natural gas historically has maintained its price advantage in the residential, commercial, and industrial markets. Our pipeline and storage operations have historically faced competition from other existing intrastate pipelines seeking to provide or arrange transportation, storage, and other services for customers.
We will also provide copies of all corporate governance documents free of charge upon request to Shareholder Relations at the address listed above.
We will also provide copies of all corporate governance documents free of charge upon request to Investor Relations at the address listed above.
(5) The Mid-Tex Cities approved the Formula Rate Mechanism filing with rates effective October 1, 2024, which included a rate base of $7.1 billion, an authorized return of 7.41%, a debt/equity ratio of 42/58 and an authorized ROE of 9.80%. (6) The Mid-Tex rate base represents a “system-wide,” or 100 percent, of the Mid-Tex Division’s rate base.
(5) The Mid-Tex Cities approved the Formula Rate Mechanism filing with rates effective October 1, 2025, which included a rate base of $8.3 billion, an authorized return of 7.42%, a debt/equity ratio of 42/58, and an authorized ROE of 9.80%. (6) The Mid-Tex rate base represents a “system-wide,” or 100 percent, of the Mid-Tex Division’s rate base.
Available Information Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and other reports, and amendments to those reports, and other forms that we file with or furnish to the Securities and Exchange Commission (SEC) at their website, www.sec.gov , are also available free of charge at our website, www.atmosenergy.com/company/publications-and-sec-filings , as soon as reasonably practicable, after we electronically file these reports with, or furnish these reports to, the SEC.
Available Information Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and other reports, and amendments to those reports, and other forms that we file with or furnish to the Securities and Exchange Commission (SEC) at their website, www.sec.gov , are also available free of charge at our website, www.investors.atmosenergy.com/financials/sec-filings/default.aspx , as soon as reasonably practicable, after we electronically file these reports with, or furnish these reports to, the SEC.
(2) The rate increase for this filing was approved based on the effective date herein; however, the new rates were implemented beginning September 1, 2022. 11 Table of Contents Rate Case Filings A rate case is a formal request from Atmos Energy to a regulatory authority to increase rates that are charged to customers.
(2) The rate increase for this filing was approved based on the effective date herein; however, the new rates were implemented beginning September 1, 2023. Rate Case Filings A rate case is a formal request from Atmos Energy to a regulatory authority to increase rates that are charged to customers.
We will also provide copies of these reports free of charge upon request to Shareholder Relations at the address and telephone number appearing below: Shareholder Relations Atmos Energy Corporation P.O.
We will also provide copies of these reports free of charge upon request to Investor Relations at the address and telephone number appearing below: 13 Table of Contents Investor Relations Atmos Energy Corporation P.O.
The Pipeline and Hazardous Materials Safety Administration (PHMSA), within the U.S. Department of Transportation, develops and enforces regulations for the safe, reliable, and environmentally sound operation of the pipeline transportation system. The PHMSA pipeline safety statutes provide for states to assume safety authority over intrastate natural transmission and distribution gas pipelines.
Department of Transportation, develops and enforces regulations for the safe, reliable, and environmentally sound operation of the pipeline transportation system. The PHMSA pipeline safety statutes provide for states to assume safety authority over intrastate natural transmission and distribution gas pipelines.
At September 30, 2024, we had 5,260 employees. We monitor our workforce data on a calendar year basis. As of December 31, 2023, the last date for which information is available, 61 percent of our employees worked in field roles and 39 percent worked in support/shared services roles.
At September 30, 2025, we had 5,487 employees. We monitor our workforce data on a calendar year basis. As of December 31, 2024, the last date for which information is available, 62 percent of our employees worked in field roles and 38 percent worked in support/shared services roles.
We currently have specific infrastructure programs in all of our distribution divisions with tariffs in place to permit the investment associated with these programs to have their surcharge rate adjusted annually to recover approved capital costs incurred in a prior test-year period.
We currently have specific infrastructure programs in all of our distribution divisions with tariffs in place to permit the investment associated with these programs to have their surcharge rate adjusted annually to recover approved capital costs incurred in a prior test-year period. The following table summarizes our annual formula rate mechanisms by state.
(2) On September 4, 2024, the State Corporation Commission of Virginia approved a rate increase of $0.7 million effective October 1, 2024. (3) On September 27, 2024, the Kentucky Public Service Commission approved a rate increase of $3.4 million effective October 2, 2024, subject to refund. (4) The Mid-Tex Cities approved a rate increase of $112.1 million.
(2) On August 22, 2025, the State Corporation Commission of Virginia approved a rate increase of $0.5 million effective October 1, 2025. (3) On September 15, 2025, the Kentucky Public Service Commission approved a rate increase of $7.2 million effective October 2, 2025, subject to refund. (4) The Mid-Tex Cities approved a rate increase of $138.5 million.
The peak-day demand for our distribution operations in fiscal 2024 was on January 15, 2024, when sales to customers reached approximately 4.3 Bcf. Currently, our distribution divisions utilize 34 pipeline transportation companies, both interstate and intrastate, to transport our natural gas.
The peak-day demand for our distribution operations in fiscal 2025 was on February 19, 2025, when sales to customers reached approximately 4.2 Bcf. Currently, our distribution divisions utilize 33 pipeline transportation companies, both interstate and intrastate, to transport our natural gas.
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.
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. The following tables summarize the annualized ratemaking outcomes we implemented in each of the last three fiscal years.
New rates were implemented on October 1, 2024. Our recent ratemaking activity is discussed in greater detail below. Annual Formula Rate Mechanisms As an instrument to reduce regulatory lag, formula rate mechanisms allow us to refresh our rates on an annual basis without filing a formal rate case.
We expect rates to be implemented during the first quarter of fiscal 2026. Our recent ratemaking activity is discussed in greater detail below. Annual Formula Rate Mechanisms As an instrument to reduce regulatory lag, formula rate mechanisms allow us to refresh our rates on an annual basis without filing a formal rate case.
Division Service Areas Communities Served Customer Meters Mid-Tex Texas, including the Dallas/Fort Worth Metroplex 550 1,804,265 Kentucky/Mid-States Kentucky 220 176,903 Tennessee 161,193 Virginia 23,777 Louisiana Louisiana 270 360,870 West Texas Amarillo, Lubbock, Midland 80 314,503 Mississippi Mississippi 110 251,147 Colorado-Kansas Colorado 170 129,727 Kansas 139,435 We operate in our service areas under terms of non-exclusive franchise agreements granted by the various cities and towns that we serve.
Division Service Areas Communities Served Customer Meters Mid-Tex Texas, including the Dallas/Fort Worth Metroplex 550 1,830,387 Kentucky/Mid-States Kentucky 220 176,494 Tennessee 163,667 Virginia 23,836 Louisiana Louisiana 270 360,589 West Texas Amarillo, Lubbock, Midland 80 316,036 Mississippi Mississippi 110 249,562 Colorado-Kansas Colorado 170 130,890 Kansas 140,542 We operate in our service areas under terms of non-exclusive franchise agreements granted by the various cities and towns that we serve.
Major suppliers during fiscal 2024 were Cima Energy, LP, ConocoPhillips Company, EnLink Gas Marketing LP, Enterprise Navitas Midstream Midland Basin LLC, Hartree Partners, L.P., Sequent Energy Management LLC, Symmetry Energy Solutions, LLC, Targa Gas Marketing LLC, Tenaska Marking Ventures, and Texla Energy Management, Inc.
Major suppliers during fiscal 2025 were ARM Energy Management LLC, Cima Energy, LP, ConocoPhillips Company, ECO Energy Natural Gas LLC, EnLink Gas Marketing LP, Sequent Energy Management LLC, Symmetry Energy Solutions, LLC, Targa Gas Marketing LLC, Tenaska Marking Ventures, and Texla Energy Management, Inc.
The following tables summarize the annualized ratemaking outcomes we implemented in each of the last three fiscal years. 8 Table of Contents Rate Action Annual Increase (Decrease) in Operating Income EDIT Impact Annual Increase (Decrease) in Operating Income Excluding EDIT (In thousands) 2024 Filings: Annual formula rate mechanisms $ 347,763 $ (31,314) $ 316,449 Rate case filings 29,458 (37,860) (8,402) Other ratemaking activity (971) — (971) Total 2024 Filings $ 376,250 $ (69,174) $ 307,076 2023 Filings: Annual formula rate mechanisms $ 258,824 $ (1,099) $ 257,725 Rate case filings 2,940 6,791 9,731 Other ratemaking activity 1,320 — 1,320 Total 2023 Filings $ 263,084 $ 5,692 $ 268,776 2022 Filings: Annual formula rate mechanisms $ 169,354 $ 33,249 $ 202,603 Rate case filings 5,938 7,379 13,317 Other ratemaking activity (370) — (370) Total 2022 Filings $ 174,922 $ 40,628 $ 215,550 The following ratemaking efforts seeking $218.0 million in annual operating income were initiated during fiscal 2024 but had not been completed or implemented as of September 30, 2024: Division Rate Action Jurisdiction Operating Income Requested (In thousands) Colorado-Kansas Infrastructure Mechanism Kansas (1) $ 1,998 Kentucky/Mid-States Infrastructure Mechanism Virginia (2) 748 Kentucky/Mid-States Infrastructure Mechanism Kentucky (3) 3,441 Kentucky/Mid-States Rate Case Kentucky 33,654 Mid-Tex Formula Rate Mechanism Mid-Tex Cities (4) 133,414 Mississippi Infrastructure Mechanism Mississippi (5) 21,830 Mississippi Formula Rate Mechanism Mississippi (5) 16,244 West Texas Formula Rate Mechanism West Texas Cities (6) 6,709 $ 218,038 (1) The staff of the Kansas Corporation Commission recommended approval of the GSRS filing on October 17, 2024, subject to commission approval.
Rate Action Annual Increase (Decrease) in Operating Income EDIT Impact Annual Increase (Decrease) in Operating Income Excluding EDIT (In thousands) 2025 Filings: Annual formula rate mechanisms $ 279,724 $ 2,255 $ 281,979 Rate case filings 53,732 (12,976) 40,756 Other ratemaking activity 111 — 111 Total 2025 Filings $ 333,567 $ (10,721) $ 322,846 2024 Filings: Annual formula rate mechanisms $ 347,763 $ (31,314) $ 316,449 Rate case filings 29,458 (37,860) (8,402) Other ratemaking activity (971) — (971) Total 2024 Filings $ 376,250 $ (69,174) $ 307,076 2023 Filings: Annual formula rate mechanisms $ 258,824 $ (1,099) $ 257,725 Rate case filings 2,940 6,791 9,731 Other ratemaking activity 1,320 — 1,320 Total 2023 Filings $ 263,084 $ 5,692 $ 268,776 The following ratemaking efforts seeking $231.1 million in annual operating income were initiated during fiscal 2025 but had not been completed or implemented as of September 30, 2025: 8 Table of Contents Division Rate Action Jurisdiction Operating Income Requested (In thousands) Colorado-Kansas Rate Case Kansas $ 15,977 Colorado-Kansas Infrastructure Mechanism Kansas (1) 1,949 Kentucky/Mid-States Infrastructure Mechanism Virginia (2) 550 Kentucky/Mid-States Infrastructure Mechanism Kentucky (3) 7,246 Mid-Tex Formula Rate Mechanism Mid-Tex Cities (4) 165,027 Mississippi Rate Case Mississippi (5) 40,301 $ 231,050 (1) The staff of the Kansas Corporation Commission recommended approval of the GSRS filing on October 17, 2025, subject to commission approval.
Division Jurisdiction Effective Date of Last Rate/GRIP Action Rate Base (thousands) (1) Authorized Rate of Return (1) Authorized Debt/ Equity Ratio (1) Authorized Return on Equity (1) Atmos Pipeline — Texas Texas 05/14/2024 $4,773,699 8.49% 40/60 11.45% Colorado-Kansas Colorado 05/14/2023 229,565 7.00% 42-45/55-58 9.3% - 9.6% Colorado SSIR 01/01/2024 52,820 7.00% / 3.97% 42/58 (4) Kansas 05/09/2023 295,070 (4) (4) (4) Kansas GSRS 11/02/2023 16,546 (4) (4) (4) Kansas SIP 04/01/2024 19,908 (4) (4) (4) Kentucky/Mid-States Kentucky 05/20/2022 568,506 6.82% 45/55 9.23% Kentucky-PRP 10/01/2023 40,504 6.94% 45/55 9.45% Tennessee 06/01/2024 554,053 7.64% 38/62 9.80% Virginia 12/01/2023 71,450 7.57% 39/61 9.90% Virginia-SAVE 10/01/2023 16,422 7.43% 42/58 9.20% Louisiana Louisiana 07/01/2024 1,227,842 7.43% 42/58 9.80% Mid-Tex Mid-Tex Cities (5) 10/01/2023 6,070,321 (6) 7.35% 42/58 9.80% Mid-Tex ATM Cities 06/07/2024 7,009,146 (6) 7.97% 40/60 9.80% Mid-Tex Environs 06/01/2024 7,009,154 (6) 7.97% 40/60 9.80% Mid-Tex — Dallas 06/01/2024 6,844,772 (6) 7.47% 40/60 9.80% Mississippi Mississippi (7) 12/01/2023 591,882 7.82% 39/61 10.34% Mississippi - SIR (7) 12/01/2023 472,676 7.82% 39/61 10.34% West Texas West Texas Cities (8) (10) 10/01/2023 965,289 (9) 7.35% 42/58 9.80% West Texas - ALDC 06/07/2024 1,062,054 (9) 7.35% 41/59 (4) West Texas - Environs 06/01/2024 1,059,604 (9) 7.97% 40/60 9.80% West Texas - Triangle 06/01/2024 65,124 7.71% 40/60 9.80% 7 Table of Contents Division Jurisdiction Bad Debt Rider (2) Formula Rate Infrastructure Mechanism Performance Based Rate Program (3) WNA Period Atmos Pipeline — Texas Texas No Yes Yes N/A N/A Colorado-Kansas Colorado No No Yes No N/A Kansas Yes No Yes Yes October-May Kentucky/Mid-States Kentucky Yes No Yes Yes November-April Tennessee Yes Yes Yes Yes October-April Virginia Yes No Yes No January-December Louisiana Louisiana No Yes Yes No December-March Mid-Tex Cities Texas Yes Yes Yes No November-April Mid-Tex — Dallas Texas Yes Yes Yes No November-April Mississippi Mississippi Yes Yes Yes No November-April West Texas Texas Yes Yes Yes No October-May (1) The rate base, authorized rate of return, authorized debt/equity ratio, and authorized return on equity presented in this table are those from the most recent approved regulatory filing for each jurisdiction.
Division Jurisdiction Effective Date of Last Rate/GRIP Action Rate Base (thousands) (1) Authorized Rate of Return (1) Authorized Debt/ Equity Ratio (1) Authorized Return on Equity (1) Atmos Pipeline — Texas Texas 06/17/2025 $5,237,614 8.49% 40/60 11.45% Colorado-Kansas Colorado 05/14/2023 229,565 7.00% 42-45/55-58 9.3% - 9.6% Colorado SSIR 01/01/2025 73,623 7.00% / 3.97% 42/58 (4) Kansas 05/09/2023 295,070 (4) (4) (4) Kansas GSRS 12/17/2024 38,932 (4) (4) (4) Kansas SIP 04/01/2025 25,707 (4) (4) (4) Kentucky/Mid-States Kentucky 05/12/2025 611,038 7.15% 46/54 9.75% Kentucky-PRP 05/29/2025 67,464 6.94% 45/55 9.45% Tennessee 06/01/2025 611,649 7.63% 39/61 9.80% Virginia 12/01/2023 71,450 7.57% 39/61 9.90% Virginia-SAVE 10/01/2024 21,436 7.57% 39/61 9.90% Louisiana Louisiana 07/01/2025 1,352,758 7.42% 42/58 9.80% Mid-Tex Mid-Tex Cities (5) 10/01/2024 7,146,843 (6) 7.41% 42/58 9.80% Mid-Tex ATM Cities 08/01/2025 7,953,622 (6) 7.59% 39/61 9.80% Mid-Tex Environs 08/01/2025 7,953,529 (6) 7.59% 39/61 9.80% Mid-Tex — Dallas 06/01/2025 7,973,771 (6) 7.52% 40/60 9.80% Mississippi Mississippi (7) 11/04/2024 592,236 7.80% (4) (4) Mississippi - SIR (7) 11/04/2024 629,687 7.80% (4) (4) West Texas West Texas Systemwide (8) 06/01/2025 1,231,651 7.59% 39/61 9.80% Division Jurisdiction Bad Debt Rider (2) Formula Rate Infrastructure Mechanism Performance Based Rate Program (3) WNA Period Atmos Pipeline — Texas Texas No Yes Yes N/A N/A Colorado-Kansas Colorado No No Yes No N/A Kansas Yes No Yes Yes October-May Kentucky/Mid-States Kentucky Yes No Yes Yes November-April Tennessee Yes Yes Yes Yes October-April Virginia Yes No Yes No January-December Louisiana Louisiana No Yes Yes No December-March Mid-Tex Cities Texas Yes Yes Yes No November-April Mid-Tex — Dallas Texas Yes Yes Yes No November-April Mississippi Mississippi Yes Yes Yes No November-April West Texas Texas Yes No Yes No October-May (1) The rate base, authorized rate of return, authorized debt/equity ratio, and authorized return on equity presented in this table are those from the most recent approved regulatory filing for each jurisdiction.
ITEM 1. Business. Overview and Strategy Atmos Energy Corporation, headquartered in Dallas, Texas, and incorporated in Texas and Virginia, is the country’s largest natural-gas-only distributor based on number of customers.
ITEM 1. Business. Overview and Strategy Atmos Energy Corporation, a natural gas-only distributor, is an S&P 500 company headquartered in Dallas and incorporated in Texas and Virginia.
We believe that our properties and operations comply with, and are operated in conformity with, applicable safety and environmental statutes and regulations. 12 Table of Contents There are no administrative or judicial proceedings arising under environmental quality statutes pending or known to be contemplated by governmental agencies which would have a material adverse effect on us or our operations.
There are no administrative or judicial proceedings arising under environmental quality statutes pending or known to be contemplated by governmental agencies which would have a material adverse effect on us or our operations. The Pipeline and Hazardous Materials Safety Administration (PHMSA), within the U.S.
The following table summarizes our recent rate case activity during the fiscal years ended September 30, 2024, 2023, and 2022: Division State Increase in Annual Operating Income EDIT Impact Increase (Decrease) in Annual Operating Income Excluding EDIT Effective Date (In thousands) 2024 Rate Case Filings: Atmos Pipeline - Texas Texas $ 27,024 $ (36,921) $ (9,897) 12/13/2023 Kentucky/Mid-States Virginia 2,434 (939) 1,495 12/01/2023 Total 2024 Rate Case Filings $ 29,458 $ (37,860) $ (8,402) 2023 Rate Case Filings: Colorado-Kansas Colorado $ 913 $ (54) $ 859 05/14/2023 Colorado-Kansas Kansas 2,027 6,845 8,872 05/09/2023 Total 2023 Rate Case Filings $ 2,940 $ 6,791 $ 9,731 2022 Rate Case Filings: Kentucky/Mid-States Kentucky (1) $ 5,938 $ 7,379 $ 13,317 05/20/2022 Total 2022 Rate Case Filings $ 5,938 $ 7,379 $ 13,317 (1) The rate case outcome for Kentucky is inclusive of the fiscal 2022 pipeline replacement program.
The following table summarizes our recent rate case activity during the fiscal years ended September 30, 2025, 2024, and 2023: 11 Table of Contents Division State Increase in Annual Operating Income EDIT Impact Increase (Decrease) in Annual Operating Income Excluding EDIT Effective Date (In thousands) 2025 Rate Case Filings: Mid-Tex ATM Cities Texas $ 4,439 $ 25 $ 4,464 08/01/2025 Mid-Tex Environs Texas 2,297 (174) 2,123 08/01/2025 West Texas Systemwide Texas 30,615 (4,343) 26,272 06/01/2025 Kentucky/Mid-States Kentucky (1) 16,381 (8,484) 7,897 05/12/2025 Total 2025 Rate Case Filings $ 53,732 $ (12,976) $ 40,756 2024 Rate Case Filings: Atmos Pipeline - Texas Texas $ 27,024 $ (36,921) $ (9,897) 12/13/2023 Kentucky/Mid-States Virginia 2,434 (939) 1,495 12/01/2023 Total 2024 Rate Case Filings $ 29,458 $ (37,860) $ (8,402) 2023 Rate Case Filings: Colorado-Kansas Colorado $ 913 $ (54) $ 859 05/14/2023 Colorado-Kansas Kansas 2,027 6,845 8,872 05/09/2023 Total 2023 Rate Case Filings $ 2,940 $ 6,791 $ 9,731 (1) On May 12, 2025, we implemented rates subject to refund; on August 11, 2025, the Kentucky Public Service Commission issued a final order.
(3) The performance-based rate program provides incentives to distribution companies to minimize purchased gas costs by allowing the companies and their customers to share the purchased gas costs savings. (4) A rate base, rate of return, return on equity, or debt/equity ratio was not included in the respective state commission’s final decision.
(4) A rate base, rate of return, return on equity, or debt/equity ratio was not included in the respective state commission’s final decision.
These rate bases, rates of return, debt/equity ratios, and returns on equity are not necessarily indicative of current or future rate bases, rates of return or returns on equity. (2) The bad debt rider allows us to recover from customers the gas cost portion of customer accounts that have been written off.
These rate bases, rates of return, debt/equity ratios, and returns on equity are not necessarily indicative of current or future rate bases, rates of return or returns on equity.
From time to time, we receive inquiries regarding various environmental matters.
From time to time, we receive inquiries regarding various environmental matters. We believe that our properties and operations comply with, and are operated in conformity with, applicable safety and environmental statutes and regulations.
Removed
(7) The Mississippi Public Service Commission approved a settlement at its meeting on November 4, 2024, which included a rate base of $1.2 billion and an authorized return of 7.80%. No debt/equity ratio or an authorized ROE was included in the commissions final order.
Added
(2) The bad debt rider allows us to recover from customers the gas cost portion of customer accounts that have been written off. 7 Table of Contents (3) The performance-based rate program provides incentives to distribution companies to minimize purchased gas costs by allowing the companies and their customers to share the purchased gas costs savings.
Removed
(8) The West Texas Cities includes all West Texas Division cities except Amarillo, Lubbock, Dalhart and Channing (ALDC). (9) The West Texas rate base represents a "system-wide," or 100 percent, of the West Texas Division's rate base.
Added
(7) The Mississippi SRF and SIR were filed jointly in a general rate case. On November 4, 2025, the Mississippi Public Service Commission issued a rate order in this case. We are required to file tariffs consistent with the final order by November 18, 2025, which we expect will determine the final impact to operating income and rate base.
Removed
(10) The West Texas Cities approved the Formula Rate Mechanism filing with rates effective October 1, 2024, which included a rate base of $1.1 billion, an authorized return of 7.41%, a debt/equity ratio of 42/58 and an authorized ROE of 9.80%.
Added
We expect rates to be implemented during the first quarter of fiscal 2026. The final order included an authorized return of 6.80%, a debt/equity ratio of 50/50, and an authorized ROE of 9.40%. (8) The West Texas Systemwide Statement of Intent filing included the West Texas RRM and the Amarillo, Lubbock, Dalhart and Channing (ALDC), Environs, and Triangle GRIP filings.
Removed
New rates were implemented October 1, 2024. (5) On November 4, 2024, the Mississippi Public Service Commission (MPSC) approved an increase in operating income of $24.0 million for the SIR filing and an increase in operating income of $3.8 million for the SRF filing. (6) The West Texas Cities approved a rate increase of $4.4 million.
Added
New rates were implemented October 1, 2025. (5) On November 4, 2025, the Mississippi Public Service Commission issued a rate order in this case. We are required to file tariffs consistent with the final order by November 18, 2025, which we expect will determine the final impact to operating income and rate base.
Removed
The following table summarizes our annual formula rate mechanisms by state. 9 Table of Contents Annual Formula Rate Mechanisms State Infrastructure Programs Formula Rate Mechanisms Colorado System Safety and Integrity Rider (SSIR) — Kansas Gas System Reliability Surcharge (GSRS), System Integrity Program (SIP) — Kentucky Pipeline Replacement Program (PRP) — Louisiana (1) Rate Stabilization Clause (RSC) Mississippi System Integrity Rider (SIR) Stable Rate Filing (SRF) Tennessee (1) Annual Rate Mechanism (ARM) Texas Gas Reliability Infrastructure Program (GRIP), (1) Dallas Annual Rate Review (DARR), Rate Review Mechanism (RRM) Virginia Steps to Advance Virginia Energy (SAVE) — (1) Infrastructure mechanisms in Texas, Louisiana, and Tennessee allow for the deferral of all expenses associated with capital expenditures incurred pursuant to these rules, which primarily consists of interest, depreciation, and other taxes (Texas only), until the next rate proceeding (rate case or annual rate filing), at which time investment and costs would be recoverable through base rates.
Removed
Other Ratemaking Activity The following table summarizes other ratemaking activity during the fiscal years ended September 30, 2024, 2023, and 2022: Division Jurisdiction Rate Activity Increase (Decrease) in Annual Operating Income Effective Date (In thousands) 2024 Other Rate Activity: Colorado-Kansas Kansas Ad Valorem (1) $ (971) 02/01/2024 Total 2024 Other Rate Activity $ (971) 2023 Other Rate Activity: Colorado-Kansas Kansas Ad Valorem (1) $ 1,320 02/01/2023 Total 2023 Other Rate Activity $ 1,320 2022 Other Rate Activity: Colorado-Kansas Kansas Ad-Valorem (1) $ (370) 02/01/2022 Total 2022 Other Rate Activity $ (370) (1) The Ad Valorem filing relates to property taxes that are either over or undercollected compared to the amount included in our Kansas service area's base rates.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeClimate change may result in a reduction in the demand for natural gas or cause shifts in the population of our service territories which could adversely impact the economic outlook for our service territories. These occurrences could adversely impact our financial results, growth, cash flows, and results of operations.
Biggest changeThe operations and financial results of the Company could be adversely impacted as a result of climate change. Climate change may result in a reduction in the demand for natural gas or cause shifts in the population of our service territories which could adversely impact the economic outlook for our service territories.
We constantly monitor and maintain our pipeline and distribution systems to ensure that natural gas is delivered safely, reliably, and efficiently through our network of more than 80,000 miles of distribution and transmission lines. As in recent years, natural gas distribution and pipeline companies are continuing to encounter increasing federal, state, and local oversight of the safety of their operations.
We constantly monitor and maintain our pipeline and distribution systems to ensure that natural gas is delivered safely, reliably, and efficiently through our network of more than 81,000 miles of distribution and transmission lines. As in recent years, natural gas distribution and pipeline companies are continuing to encounter increasing federal, state, and local oversight of the safety of their operations.
For example, the adoption of new regulations requiring more comprehensive or stringent safety standards could require installation of new or modified safety controls, new capital projects, or accelerated maintenance programs, all of which could require a potentially significant increase in operating costs. 15 Table of Contents Distributing, transporting, and storing natural gas involve risks that may result in accidents and additional operating costs.
For example, the adoption of new regulations requiring more comprehensive or stringent safety standards could require installation of new or modified safety controls, new capital projects, or accelerated maintenance programs, all of which could require a potentially significant increase in operating costs. Distributing, transporting, and storing natural gas involve risks that may result in accidents and additional operating costs.
In the normal course of business, as a regulated entity, we often need to place assets in service and establish historical test periods before rate cases that seek to adjust 14 Table of Contents our allowed returns to recover that investment can be filed. Further, the regulatory review process can be lengthy in the context of traditional ratemaking.
In the normal course of business, as a regulated entity, we often need to place assets in service and establish historical test periods before rate cases that seek to adjust our allowed returns to recover that investment can be filed. Further, the regulatory review process can be lengthy in the context of traditional ratemaking.
If customer growth slows or existing customers choose to conserve their use of gas or choose another energy product, reduced gas purchases and customer billings could adversely impact our business.
If customer 15 Table of Contents growth slows or existing customers choose to conserve their use of gas or choose another energy product, reduced gas purchases and customer billings could adversely impact our business.
Although we have taken steps to structure current and future transactions to comply with applicable current FERC regulations, changes in FERC regulations or their interpretation by FERC or additional regulations issued by FERC in the future could also adversely affect our business, financial condition, or financial results.
Although we have taken steps to structure current and future transactions to comply with applicable current FERC regulations, changes in FERC regulations or their 14 Table of Contents interpretation by FERC or additional regulations issued by FERC in the future could also adversely affect our business, financial condition, or financial results.
Such laws or regulations could adversely affect our business, results of operations, and cash flows if the costs we incur to comply with these laws or regulations are not recovered or if the cost of providing natural gas services becomes prohibitively expensive, leading to a reduction in the demand for natural gas or fuel-switching to alternate sources of energy. 17 Table of Contents The operations and financial results of the Company could be adversely impacted as a result of climate change.
Such laws or regulations could adversely affect our business, results of operations, and cash flows if the costs we incur to comply with these laws or regulations are not recovered or if the cost of providing natural gas services becomes prohibitively expensive, leading to a reduction in the demand for natural gas or fuel-switching to alternate sources of energy.
It could also result in more frequent and more severe weather events, such as hurricanes and tornadoes, which could increase our costs to repair damaged facilities and restore service to our customers or impact the cost of gas.
These occurrences could adversely impact our financial results, growth, cash flows, and results of operations. It could also result in more frequent and more severe weather events, such as hurricanes and tornadoes, which could increase our costs to repair damaged facilities and restore service to our customers or impact the cost of gas.
The Company is dependent on continued access to the credit and capital markets to execute our business strategy. Our long-term debt is currently rated as “investment grade” by Standard & Poor’s Corporation and Moody’s Investors Service, Inc. Similar to most companies, we rely upon access to both short-term and long-term credit and capital markets to satisfy our liquidity requirements.
The Company is dependent on continued access to the credit and capital markets to execute our business strategy. Our long-term debt is currently rated as “investment grade” by Standard & Poor’s Corporation and Moody’s Investors Service, Inc.
Failure to attract and retain a qualified workforce could adversely affect our results of operations. The competition for talent has become increasingly intense and we may experience increased employee turnover due to a tightening labor market.
Failure to attract and retain a qualified workforce could adversely affect our results of operations. The competition for talent has become increasingly intense.
Technology and Cybersecurity Risks The failure of technology may hinder the Company’s business operations and adversely affect its financial condition and results of operations. 16 Table of Contents The Company uses Company-owned information technology and technology hosted by third parties to support critical functions including scheduling and dispatching of service technicians, automated meter reading systems, customer care and billing, operational plant logistics, management reporting, and external financial reporting.
The Company uses Company-owned information technology and technology hosted by third parties to support critical functions including scheduling and dispatching of service technicians, automated meter reading systems, customer care and billing, operational plant logistics, management reporting, and external financial reporting.
Rapid increases in the costs of purchased gas would cause us to experience a significant increase in short-term or long-term debt. We must pay suppliers for gas when it is purchased, which can be significantly in advance of when these costs may be recovered through the collection of monthly customer bills for gas delivered.
We must pay suppliers for gas when it is purchased, which can be significantly in advance of when these costs may be recovered through the collection of monthly customer bills for gas delivered.
As cyber-attacks are becoming more sophisticated, U.S. government warnings have indicated that critical infrastructure assets, including pipeline infrastructure, may be specifically targeted by certain groups. In recent years, the U.S. government has issued directives that require critical pipeline owners to comply with mandatory reporting measures, designate a cybersecurity coordinator, provide vulnerability assessments, and ensure compliance with certain cybersecurity requirements.
In recent years, the U.S. government has issued directives that require critical pipeline owners to comply with mandatory reporting measures, designate a cybersecurity coordinator, provide vulnerability assessments, and ensure compliance with certain cybersecurity requirements.
If adverse credit conditions were to cause a significant limitation on our access to the private credit and public capital markets, we could see a reduction in our liquidity.
Similar to most companies, we rely upon access to both short-term and long-term credit and capital markets to 17 Table of Contents satisfy our liquidity requirements. If adverse credit conditions were to cause a significant limitation on our access to the private credit and public capital markets, we could see a reduction in our liquidity.
This would likely lead to slower collections and higher than normal levels of accounts receivable. This, in turn, could increase our financing requirements.
This would likely lead to slower collections and higher than normal levels of accounts receivable. This, in turn, could increase our financing requirements. Additionally, should economic conditions deteriorate, our industrial customers could seek alternative energy sources, which could result in lower transportation volumes.
Compliance with and changes in cybersecurity requirements have a cost and operational impact on our business, and failure to comply with such laws and regulations could adversely impact our reputation, results of operations, financial condition, and/or cash flows.
Compliance with and changes in cybersecurity requirements have a cost and operational impact on our business, and failure to comply with such laws and regulations could adversely impact our reputation, results of operations, financial condition, and/or cash flows. 16 Table of Contents As cyber-attacks are becoming more sophisticated, U.S. government warnings have indicated that critical infrastructure assets, including pipeline infrastructure, may be specifically targeted by certain groups.
Removed
Additionally, should economic conditions deteriorate, our industrial customers could seek alternative energy sources, which could result in lower transportation volumes. 18 Table of Contents Increased gas costs could adversely impact our customer base and customer collections and increase our level of indebtedness.
Added
Technology and Cybersecurity Risks The failure of technology may hinder the Company’s business operations and adversely affect its financial condition and results of operations.
Added
Increased gas costs could adversely impact our customer base and customer collections and increase our level of indebtedness. Rapid increases in the costs of purchased gas would cause us to experience a significant increase in short-term or long-term debt.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

4 edited+0 added−0 removed13 unchanged
Biggest changeThe RMCC is overseen by the Company’s Management Committee, which is comprised of the President and Chief Executive Officer, Senior Vice President and Chief Financial Officer, Senior Vice President, Utility Operations, Senior Vice President, General Counsel & Corporate Secretary and Senior Vice President, Human Resources.
Biggest changeThe RMCC is overseen by the Company’s Management Committee, which is comprised of the President and Chief Executive Officer, Senior Vice President and Chief Financial Officer, Senior Vice President, Utility Operations, Senior Vice President, General Counsel & Corporate Secretary, Senior Vice President, Human Resources, and Senior Advisor.
ITEM 1C. Cybersecurity. We continuously assess our risk of cyber threats to adapt quickly to the ever-changing challenges and risks surrounding cybersecurity. Atmos Energy has implemented policies, procedures, and controls to identify, protect, detect, and respond to cyberattacks or acts of online terrorism. Atmos Energy is also subject to the U.S.
ITEM 1C. Cybersecurity. We continuously assess our risk of cyber threats to adapt quickly to the ever-changing challenges and risks surrounding cybersecurity. Atmos Energy has implemented policies, procedures, and controls to identify, protect, detect, and respond to 18 Table of Contents cyberattacks or acts of online terrorism. Atmos Energy is also subject to the U.S.
This plan, which is periodically reviewed and tested, is supported by third parties to provide guidance and support to our cybersecurity management team. 19 Table of Contents We also address cybersecurity risks associated with third-party service providers, including those in our supply chain or who have access to our data or our information technology systems.
This plan, which is periodically reviewed and tested, is supported by third parties to provide guidance and support to our cybersecurity management team. We also address cybersecurity risks associated with third-party service providers, including those in our supply chain or who have access to our data or our information technology systems.
Additionally, our Board of Directors periodically engages with third-party advisors to provide further education about cybersecurity risks. 20 Table of Contents
Additionally, our Board of Directors periodically engages with third-party advisors to provide further education about cybersecurity risks. 19 Table of Contents

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe following table summarizes certain information regarding our underground gas storage facilities at September 30, 2024: State Working Capacity (Mcf) Base Gas (Mcf) (1) Total Capacity (Mcf) Maximum Daily Delivery Capability (Mcf) Distribution Segment Kentucky 7,956,991 9,562,283 17,519,274 146,660 Kansas 3,239,000 2,300,000 5,539,000 32,000 Mississippi 1,907,571 2,442,917 4,350,488 29,136 Total 13,103,562 14,305,200 27,408,762 207,796 Pipeline and Storage Segment Texas 53,083,549 19,678,025 72,761,574 2,460,000 Louisiana 411,040 256,900 667,940 56,000 Total 53,494,589 19,934,925 73,429,514 2,516,000 Total 66,598,151 34,240,125 100,838,276 2,723,796 (1) Base gas represents the volume of gas that must be retained in a facility to maintain reservoir pressure.
Biggest changeThe following table summarizes certain information regarding our underground gas storage facilities at September 30, 2025: State Working Capacity (Mcf) Base Gas (Mcf) (1) Total Capacity (Mcf) Maximum Daily Delivery Capability (Mcf) Distribution Segment Kentucky 7,956,991 9,562,283 17,519,274 151,719 Kansas 3,239,000 2,300,000 5,539,000 32,000 Mississippi 1,907,571 2,442,917 4,350,488 29,136 Total 13,103,562 14,305,200 27,408,762 212,855 Pipeline and Storage Segment Texas 52,761,317 20,155,025 72,916,342 1,653,000 Louisiana 411,040 256,900 667,940 56,000 Total 53,172,357 20,411,925 73,584,282 1,709,000 Total 66,275,919 34,717,125 100,993,044 1,921,855 (1) Base gas represents the volume of gas that must be retained in a facility to maintain reservoir pressure.
Through our pipeline and storage segment we owned 5,682 miles of gas transmission lines. Storage Assets We own underground gas storage facilities in several states to supplement the supply of natural gas in periods of peak demand.
Through our pipeline and storage segment we owned approximately 5,700 miles of gas transmission lines. Storage Assets We own underground gas storage facilities in several states to supplement the supply of natural gas in periods of peak demand.
ITEM 2. Properties. Distribution, transmission, and related assets In our distribution segment, we owned an aggregate of 74,596 miles of underground distribution and transmission mains throughout our distribution systems. These mains are located on easements or rights-of-way. We maintain our mains through a program of continuous inspection and repair and believe that our system of mains is in good condition.
Distribution, transmission, and related assets In our distribution segment, we owned an aggregate of approximately 76,000 miles of underground distribution and transmission mains throughout our distribution systems. These mains are located on easements or rights-of-way. We maintain our mains through a program of continuous inspection and repair and believe that our system of mains is in good condition.
The following table summarizes our contracted storage capacity at September 30, 2024: Segment Division/Company Maximum Storage Quantity (MMBtu) Maximum Daily Withdrawal Quantity (Mcf) (1) Distribution Segment Colorado-Kansas Division 6,343,728 147,692 Kentucky/Mid-States Division 8,175,103 226,320 Louisiana Division 2,594,875 177,765 Mid-Tex Division 6,000,000 190,000 Mississippi Division 5,799,536 222,764 West Texas Division 6,500,000 246,000 Total 35,413,242 1,210,541 Pipeline and Storage Segment Trans Louisiana Gas Pipeline, Inc. 1,500,000 71,250 Total Contracted Storage Capacity 36,913,242 1,281,791 (1) Maximum daily withdrawal quantity (MDWQ) amounts will fluctuate depending upon the season and the month.
The following table summarizes our contracted storage capacity at September 30, 2025: 20 Table of Contents Segment Division/Company Maximum Storage Quantity (MMBtu) Maximum Daily Withdrawal Quantity (Mcf) (1) Distribution Segment Colorado-Kansas Division 7,343,728 157,692 Kentucky/Mid-States Division 11,699,976 281,320 Louisiana Division 2,594,875 177,765 Mid-Tex Division 46,771,428 1,260,000 Mississippi Division 5,799,536 222,764 West Texas Division 6,500,000 246,000 Total 80,709,543 2,345,541 Pipeline and Storage Segment Trans Louisiana Gas Pipeline, Inc. 1,500,000 71,250 Total Contracted Storage Capacity 82,209,543 2,416,791 (1) Maximum daily withdrawal quantity (MDWQ) amounts will fluctuate depending upon the season and the month.
Added
ITEM 2. Properties. To manage the integrity and safety of our natural gas distribution and transmission systems, consistent with PHMSA regulations, we have integrity management programs that integrate information sources and data, identify risks to infrastructure integrity, rank risks, and designate measures and actions to reduce or mitigate risks as appropriate.
Added
These programs take into consideration numerous input factors and no single factor is determinative in our decision to take mitigative actions on our distribution or transmission pipeline systems.
Added
Based upon these programs, along with the oversight of state regulators responsible for adopting and enforcing the federal pipeline safety regulations, we believe that our distribution and transmission pipeline systems are suitable and adequate for our purposes.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Our stock trades on the New York Stock Exchange under the trading symbol “ATO.” The dividends paid per share of our common stock for fiscal 2024 and 2023 are listed below.
Biggest changeITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Our stock trades on the New York Stock Exchange under the trading symbol “ATO.” The dividends paid per share of our common stock was $3.48 for fiscal 2025. Dividends are payable at the discretion of our Board of Directors out of legally available funds.
We sold no securities during fiscal 2024 that were not registered under the Securities Act of 1933, as amended. 22 Table of Contents Performance Graph The performance graph and table below compares the yearly percentage change in our total return to shareholders for the last five fiscal years with the total return of the S&P 500 Stock Index (S&P 500) and the total return of the S&P 500 Utilities Industry Index.
We sold no securities during fiscal 2025 that were not registered under the Securities Act of 1933, as amended. 22 Table of Contents Performance Graph The performance graph and table below compares the yearly percentage change in our total return to shareholders for the last five fiscal years with the total return of the S&P 500 Stock Index (S&P 500) and the total return of the S&P 500 Utilities Industry Index.
The graph and table below assume that $100.00 was invested on September 30, 2019 in our common stock, the S&P 500 and the S&P 500 Utilities Industry Index, as well as a reinvestment of dividends paid on such investments throughout the period.
The graph and table below assume that $100.00 was invested on September 30, 2020 in our common stock, the S&P 500 and the S&P 500 Utilities Industry Index, as well as a reinvestment of dividends paid on such investments throughout the period.
The Board of Directors typically declares dividends in the same fiscal quarter in which they are paid. As of October 31, 2024, there were 8,968 holders of record of our common stock. Future payments of dividends, and the amounts of these dividends, will depend on our financial condition, results of operations, capital requirements, and other factors.
The Board of Directors typically declares dividends in the same fiscal quarter in which they are paid. As of October 31, 2025, there were 8,446 holders of record of our common stock. Future payments of dividends, and the amounts of these dividends, will depend on our financial condition, results of operations, capital requirements, and other factors.
Number of securities to be issued upon exercise of outstanding options, warrants and rights Weighted-average exercise price of outstanding options, warrants and rights Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (a) (b) (c) Equity compensation plans approved by security holders: 1998 Long-Term Incentive Plan 737,219 (1) $ — 407,966 Total equity compensation plans approved by security holders 737,219 — 407,966 Equity compensation plans not approved by security holders — — — Total 737,219 $ — 407,966 (1) Comprised of a total of 259,666 time-lapse restricted stock units, 215,515 director share units, and 262,038 performance-based restricted stock units at the target level of performance granted under our 1998 Long-Term Incentive Plan.
Number of securities to be issued upon exercise of outstanding options, warrants and rights Weighted-average exercise price of outstanding options, warrants and rights Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (a) (b) (c) Equity compensation plans approved by security holders: 1998 Long-Term Incentive Plan 703,176 (1) $ — 2,166,340 Total equity compensation plans approved by security holders 703,176 — 2,166,340 Equity compensation plans not approved by security holders — — — Total 703,176 $ — 2,166,340 (1) Comprised of a total of 229,681 time-lapse restricted stock units, 151,684 director share units, and 321,811 performance-based restricted stock units at the target level of performance granted under our 1998 Long-Term Incentive Plan.
Comparison of Five-Year Cumulative Total Return among Atmos Energy Corporation, S&P 500 Index and S&P 500 Utilities Industry Index Cumulative Total Return 9/30/2019 9/30/2020 9/30/2021 9/30/2022 9/30/2023 9/30/2024 Atmos Energy Corporation 100.00 85.77 81.21 96.19 102.59 138.10 S&P 500 Stock Index 100.00 115.15 149.70 126.54 153.89 209.84 S&P 500 Utilities Stock Index 100.00 95.03 105.49 111.38 103.56 146.87 23 Table of Contents The following table sets forth the number of securities authorized for issuance under our equity compensation plans at September 30, 2024.
Comparison of Five-Year Cumulative Total Return among Atmos Energy Corporation, S&P 500 Index and S&P 500 Utilities Industry Index Cumulative Total Return 9/30/2020 9/30/2021 9/30/2022 9/30/2023 9/30/2024 9/30/2025 Atmos Energy Corporation 100.00 94.68 112.14 119.61 161.00 202.67 S&P 500 Stock Index 100.00 130.01 109.89 133.65 182.23 214.30 S&P 500 Utilities Stock Index 100.00 111.01 117.20 108.98 154.55 171.86 23 Table of Contents The following table sets forth the number of securities authorized for issuance under our equity compensation plans at September 30, 2025.
Removed
Fiscal 2024 Fiscal 2023 Quarter ended: December 31 $ 0.805 $ 0.740 March 31 0.805 0.740 June 30 0.805 0.740 September 30 0.805 0.740 $ 3.22 $ 2.96 Dividends are payable at the discretion of our Board of Directors out of legally available funds.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeFor the Fiscal Year Ended September 30 2024 2023 2022 2024 vs. 2023 2023 vs. 2022 (In thousands, unless otherwise noted) Operating revenues $ 3,915,141 $ 4,099,690 $ 4,035,194 $ (184,549) $ 64,496 Purchased gas cost 1,620,515 2,061,920 2,210,302 (441,405) (148,382) Operating expenses 1,440,192 1,345,144 1,220,347 95,048 124,797 Operating income 854,434 692,626 604,545 161,808 88,081 Other non-operating income 30,106 24,988 6,946 5,118 18,042 Interest charges 117,086 77,185 49,921 39,901 27,264 Income before income taxes 767,454 640,429 561,570 127,025 78,859 Income tax expense 96,041 60,032 39,593 36,009 20,439 Net income $ 671,413 $ 580,397 $ 521,977 $ 91,016 $ 58,420 Consolidated distribution sales volumes — MMcf 283,977 289,948 292,266 (5,971) (2,318) Consolidated distribution transportation volumes — MMcf 156,389 152,963 152,709 3,426 254 Total consolidated distribution throughput — MMcf 440,366 442,911 444,975 (2,545) (2,064) Consolidated distribution average cost of gas per Mcf sold $ 5.71 $ 7.11 $ 7.56 $ (1.40) $ (0.45) Fiscal year ended September 30, 2024 compared with fiscal year ended September 30, 2023 Operating income for our distribution segment increased 23.4 percent.
Biggest changeReview of Financial and Operating Results Financial and operational highlights for our distribution segment for the fiscal years ended September 30, 2025, 2024, and 2023 are presented below. 27 Table of Contents For the Fiscal Year Ended September 30 2025 2024 2023 2025 vs. 2024 2024 vs. 2023 (In thousands, unless otherwise noted) Operating revenues $ 4,425,397 $ 3,915,141 $ 4,099,690 $ 510,256 $ (184,549) Purchased gas cost 1,854,323 1,620,515 2,061,920 233,808 (441,405) Operating expenses 1,607,684 1,440,192 1,345,144 167,492 95,048 Operating income 963,390 854,434 692,626 108,956 161,808 Other non-operating income 33,578 30,106 24,988 3,472 5,118 Interest charges 99,226 117,086 77,185 (17,860) 39,901 Income before income taxes 897,742 767,454 640,429 130,288 127,025 Income tax expense 150,961 96,041 60,032 54,920 36,009 Net income $ 746,781 $ 671,413 $ 580,397 $ 75,368 $ 91,016 Consolidated distribution sales volumes — MMcf 289,065 283,977 289,948 5,088 (5,971) Consolidated distribution transportation volumes — MMcf 156,859 156,389 152,963 470 3,426 Total consolidated distribution throughput — MMcf 445,924 440,366 442,911 5,558 (2,545) Consolidated distribution average cost of gas per Mcf sold $ 6.41 $ 5.71 $ 7.11 $ 0.70 $ (1.40) Fiscal year ended September 30, 2025 compared with fiscal year ended September 30, 2024 Operating income for our distribution segment increased 12.8 percent.
These risks and uncertainties include the following: federal, state, and local regulatory and political trends and decisions, including the impact of rate proceedings before various state regulatory commissions; increased federal regulatory oversight and potential penalties; possible increased federal, state, and local regulation of the safety of our operations; possible significant costs and liabilities resulting from pipeline integrity and other similar programs and related repairs; the inherent hazards and risks involved in distributing, transporting, and storing natural gas; the availability and accessibility of contracted gas supplies, interstate pipeline, and/or storage services; increased competition from energy suppliers and alternative forms of energy; failure to attract and retain a qualified workforce; natural disasters, adverse weather, terrorist activities, or other events and other risks and uncertainties discussed herein, all of which are difficult to predict and many of which are beyond our control; failure of technology that affects the Company's business operations; the threat of cyber-attacks or acts of cyber-terrorism that could disrupt our business operations and information technology systems or result in the loss or exposure of confidential or sensitive customer, employee, or Company 24 Table of Contents information; the impact of new cybersecurity compliance requirements; adverse weather conditions; the impact of legislation to reduce or eliminate greenhouse gas emissions or fossil fuels; the impact of climate change; the capital-intensive nature of our business; our ability to continue to access the credit and capital markets to execute our business strategy; market risks beyond our control affecting our risk management activities, including commodity price volatility, counterparty performance or creditworthiness, and interest rate risk; the concentration of our operations in Texas; the impact of adverse economic conditions on our customers; changes in the availability and price of natural gas; and increased costs of providing health care benefits, along with pension and postretirement health care benefits and increased funding requirements.
These risks and uncertainties include the following: federal, state, and local regulatory and political trends and decisions, including the impact of rate proceedings before various state regulatory commissions; increased federal regulatory oversight and potential penalties; possible increased federal, state, and local regulation of the safety of our operations; possible significant costs and liabilities resulting from pipeline integrity and other similar programs and related repairs; the inherent hazards and risks involved in distributing, transporting, and storing natural gas; the availability and accessibility of contracted gas supplies, interstate pipeline, and/or storage services; increased competition from energy suppliers and alternative forms of energy; failure to attract and retain a qualified workforce; natural disasters, adverse weather, terrorist activities, or other events and other risks and uncertainties discussed herein, all of which are difficult to predict and many of which are beyond our control; failure of technology that affects the Company's business operations; the threat of cyber-attacks or acts of cyber-terrorism that could disrupt our business operations and information technology systems or result in the loss or exposure of confidential or sensitive customer, employee, or Company information; the impact of new cybersecurity compliance requirements; adverse weather conditions; the impact of legislation to 24 Table of Contents reduce or eliminate greenhouse gas emissions or fossil fuels; the impact of climate change; the capital-intensive nature of our business; our ability to continue to access the credit and capital markets to execute our business strategy; market risks beyond our control affecting our risk management activities, including commodity price volatility, counterparty performance or creditworthiness, and interest rate risk; the concentration of our operations in Texas; the impact of adverse economic conditions on our customers; changes in the availability and price of natural gas; and increased costs of providing health care benefits, along with pension and postretirement health care benefits and increased funding requirements.
The fiscal year ended September 30, 2023 compared with fiscal year ended September 30, 2022 for our pipeline and storage segment is described in Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations" of our Annual Report on Form 10-K for the fiscal year ended September 30, 2023. 30 Table of Contents LIQUIDITY AND CAPITAL RESOURCES The liquidity required to fund our working capital, capital expenditures, and other cash needs is provided from a combination of internally generated cash flows and external debt and equity financing.
The fiscal year ended September 30, 2024 compared with fiscal year ended September 30, 2023 for our pipeline and storage segment is described in Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations" of our Annual Report on Form 10-K for the fiscal year ended September 30, 2024. 30 Table of Contents LIQUIDITY AND CAPITAL RESOURCES The liquidity required to fund our working capital, capital expenditures, and other cash needs is provided from a combination of internally generated cash flows and external debt and equity financing.
Additionally, we have various uncommitted trade credit lines with our gas suppliers that we utilize to purchase natural gas on a monthly basis. We have a shelf registration statement on file with the Securities and Exchange Commission (SEC) that allows us to issue up to $5.0 billion in common stock and/or debt securities.
Additionally, we have various uncommitted trade credit lines with our gas suppliers that we utilize to purchase natural gas on a monthly basis. We have a shelf registration statement on file with the Securities and Exchange Commission (SEC) that allows us to issue up to $8.0 billion in common stock and/or debt securities.
There can be no assurance that a rating will remain in effect for any given period of time or that a rating will not be lowered, or withdrawn entirely, by a rating agency if, in its judgment, circumstances so warrant. Debt Covenants We were in compliance with all of our debt covenants as of September 30, 2024.
There can be no assurance that a rating will remain in effect for any given period of time or that a rating will not be lowered, or withdrawn entirely, by a rating agency if, in its judgment, circumstances so warrant. Debt Covenants We were in compliance with all of our debt covenants as of September 30, 2025.
The fiscal year ended September 30, 2023 compared with fiscal year ended September 30, 2022 for our distribution segment is described in Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations" of our Annual Report on Form 10-K for the fiscal year ended September 30, 2023.
The fiscal year ended September 30, 2024 compared with fiscal year ended September 30, 2023 for our distribution segment is described in Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations" of our Annual Report on Form 10-K for the fiscal year ended September 30, 2024.
We also completed a public offering of $325 million of 5.90% senior notes due October 2033, and received net proceeds from the offering, after the underwriting discount and offering expenses, of $339.0 million. Additionally, during the fiscal year ended September 30, 2024, we settled 6,401,469 shares that had been sold on a forward basis for net proceeds of $750.0 million.
We also completed a public offering of $325 million of 5.90% senior notes due November 2033, and received net proceeds from the offering, after the underwriting discount and offering expenses, of $339.0 million. Additionally, during the year ended September 30, 2024, we settled 6,401,469 shares that had been sold on a forward basis for net proceeds of $750.0 million.
We completed a public offering of $500 million of 6.20% senior notes due October 2053 and $400 million of 5.90% senior notes due October 2033, and received net proceeds from the offering, after the underwriting discount and offering expenses, of $889.4 million.
We completed a public offering of $500 million of 6.20% senior notes due November 2053 and $400 million of 5.90% senior notes due November 2033, and received net proceeds from the offering, after the underwriting discount and offering expenses, of $889.4 million.
The following table shows our operating income by distribution division, in order of total rate base, for the fiscal years ended September 30, 2024, 2023, and 2022.
The following table shows our operating income by distribution division, in order of total rate base, for the fiscal years ended September 30, 2025, 2024, and 2023.
As of September 30, 2024, our outlook and current debt ratings, which are all considered investment grade, are as follows: S&P Moody’s Senior unsecured long-term debt A- A1 Short-term debt A-2 P-1 Outlook Stable Negative A significant degradation in our operating performance or a significant reduction in our liquidity caused by more limited access to the private and public credit markets as a result of deteriorating global or national financial and credit conditions could trigger a negative change in our ratings outlook or even a reduction in our credit ratings by the two credit rating agencies.
Currently, our outlook and current debt ratings, which are all considered investment grade, are as follows: S&P Moody’s Senior unsecured long-term debt A- A2 Short-term debt A-2 P-1 Outlook Stable Stable A significant degradation in our operating performance or a significant reduction in our liquidity caused by more limited access to the private and public credit markets as a result of deteriorating global or national financial and credit conditions could trigger a negative change in our ratings outlook or even a reduction in our credit ratings by the two credit rating agencies.
We also have an at-the-market (ATM) equity sales program that allows us to issue and sell shares of our common stock up to an aggregate offering price of $1.0 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 March 31, 2026.
We also have an at-the-market (ATM) equity sales program that allows us to 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.
Cash flows from financing activities Our financing activities provided $1,478.6 million of cash for fiscal year 2024 compared with $696.8 million of cash used by financing activities for fiscal year 2023. During the fiscal year ended September 30, 2024, we received approximately $2.0 billion in net proceeds from the issuance of long-term debt and equity.
Cash flows from financing activities Our financing activities provided $1,406.8 million of cash for fiscal year 2025 compared with $1,478.6 million of cash provided by financing activities for fiscal year 2024. During the fiscal year ended September 30, 2025, we received approximately $1.8 billion in net proceeds from the issuance of long-term debt and equity.
Approximately 83 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 regulatory lag to six months or less. During fiscal 2024, we completed approximately $2.0 billion of long-term debt and equity financing.
Approximately 87 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 regulatory lag to six months or less. During fiscal 2025, we completed approximately $1.8 billion of long-term debt and equity financing.
Over the last three fiscal years, approximately 86 percent of our capital spending has been committed to improving the safety and reliability of our system. For the fiscal year ended September 30, 2024, we had $2.9 billion in capital expenditures compared with $2.8 billion for the fiscal year ended September 30, 2023.
Over the last three fiscal years, approximately 85 percent of our capital spending has been committed to improving the safety and reliability of our system. For the fiscal year ended September 30, 2025, we had $3.6 billion in capital expenditures compared with $2.9 billion for the fiscal year ended September 30, 2024.
Excluding the impact of the refund of excess deferred income taxes resulting from previously enacted tax reform legislation, our total fiscal 2024 rate outcomes were $307.1 million. Additionally, we had ratemaking efforts in progress at September 30, 2024, seeking a total increase in annual operating income of $218.0 million.
Excluding the impact of the refund of excess deferred income taxes resulting from previously enacted tax reform legislation, our total fiscal 2025 rate outcomes were $322.8 million. Additionally, we had ratemaking efforts in progress at September 30, 2025, seeking a total increase in annual operating income of $231.1 million.
During fiscal year 2024, we refunded $133.6 million in excess deferred tax liabilities to customers. These refunds also reduced our income tax expense, resulting in an immaterial impact to our fiscal 2024 and 2023 results. Capital expenditures for fiscal 2024 were $2.9 billion.
During fiscal year 2025, we refunded $78.8 million in excess deferred tax liabilities to customers. These refunds also reduced our income tax expense, resulting in an immaterial impact to our fiscal 2025 and 2024 results. Capital expenditures for fiscal 2025 were $3.6 billion.
As of the date of this report, $10.0 million of equity is available for issuance under this ATM equity sales program. Additionally, as of September 30, 2024, we had $1.4 billion in available proceeds from outstanding forward sale agreements issued under the ATM program.
As of the date of this report, $828.5 million of equity is available for issuance under this ATM equity sales program. Additionally, as of September 30, 2025, we had $1.6 billion in available proceeds from outstanding forward sale agreements issued under the ATM program.
During the fiscal year ended September 30, 2023, we repaid $2.2 billion in long-term debt, and we received approximately $1.6 billion in net proceeds from the issuance of long-term debt and equity.
During the fiscal year ended September 30, 2024, we received approximately $2.0 billion in net proceeds from the issuance of long-term debt and equity.
New rates were implemented effective December 13, 2023. The demand fee our Louisiana natural gas transmission pipeline charges to our Louisiana distribution division increases five percent annually and has been approved by the Louisiana Public Service Commission until September 30, 2027.
The demand fee our Louisiana natural gas transmission pipeline charges to our Louisiana distribution division increases five percent annually and has been approved by the Louisiana Public Service Commission until September 30, 2027.
During fiscal 2024, we completed regulatory proceedings in our distribution segment resulting in a $266.8 million increase in annual operating income. Excluding the impact of the refund of excess deferred income taxes resulting from previously enacted tax reform legislation, our total fiscal 2024 annualized rate outcomes in our distribution segment were $234.5 million.
During fiscal 2025, we completed regulatory proceedings in our distribution segment resulting in a $256.4 million increase in annual operating income. Excluding the impact of the refund of excess deferred income taxes resulting from previously enacted tax reform legislation, our total fiscal 2025 annualized rate outcomes in our distribution segment were $245.6 million.
See Note 8 to the consolidated financial statements for further details. (2) Interest charges were calculated using the coupon rate for each debt issuance through the contractual maturity date. (3) Finance lease payments shown above include interest totaling $17.6 million. See Note 7 to the consolidated financial statements. (4) Operating lease payments shown above include interest totaling $61.6 million.
See Note 8 to the consolidated financial statements for further details. 33 Table of Contents (2) Interest charges were calculated using the coupon rate for each debt issuance through the contractual maturity date. (3) Finance lease payments shown above include interest totaling $15.8 million. See Note 7 to the consolidated financial statements.
Our commitment to this vision requires significant levels of capital spending to modernize our natural gas distribution system and operating costs to deliver natural gas safely and reliably and in full compliance with the various safety regulations impacting our business.
OVERVIEW Atmos Energy's vision is to be the safest provider of natural gas services. Our commitment to this vision requires significant levels of capital spending to modernize our natural gas distribution system and operating costs to deliver natural gas safely and reliably and in compliance with the various safety regulations impacting our business.
The following table shows the components of the change in fair value of our financial instruments for the fiscal year ended September 30, 2024 (in thousands): Fair value of contracts at September 30, 2023 $ 370,256 Contracts realized/settled (264,650) Fair value of new contracts 4,790 Other changes in value (21,745) Fair value of contracts at September 30, 2024 88,651 Netting of cash collateral — Cash collateral and fair value of contracts at September 30, 2024 $ 88,651 34 Table of Contents The fair value of our financial instruments at September 30, 2024, is presented below by time period and fair value source: Fair Value of Contracts at September 30, 2024 Maturity in years Source of Fair Value Less than 1 1-3 4-5 Greater than 5 Total Fair Value (In thousands) Prices actively quoted $ (5,233) $ 93,884 $ — $ — $ 88,651 Prices based on models and other valuation methods — — — — — Total Fair Value $ (5,233) $ 93,884 $ — $ — $ 88,651 RECENT ACCOUNTING DEVELOPMENTS Recent accounting developments and their impact on our financial position, results of operations and cash flows are described in Note 2 to the consolidated financial statements.
The following table shows the components of the change in fair value of our financial instruments for the fiscal year ended September 30, 2025 (in thousands): Fair value of contracts at September 30, 2024 $ 88,651 Contracts realized/settled (130,755) Fair value of new contracts 5,181 Other changes in value 40,335 Fair value of contracts at September 30, 2025 3,412 Netting of cash collateral — Cash collateral and fair value of contracts at September 30, 2025 $ 3,412 The fair value of our financial instruments at September 30, 2025, is presented below by time period and fair value source: Fair Value of Contracts at September 30, 2025 Maturity in years Source of Fair Value Less than 1 1-3 4-5 Greater than 5 Total Fair Value (In thousands) Prices actively quoted $ (1,036) $ 4,448 $ — $ — $ 3,412 Prices based on models and other valuation methods — — — — — Total Fair Value $ (1,036) $ 4,448 $ — $ — $ 3,412 RECENT ACCOUNTING DEVELOPMENTS Recent accounting developments and their impact on our financial position, results of operations and cash flows are described in Note 2 to the consolidated financial statements.
On February 27, 2024, APT made a GRIP filing that covered changes in net property, plant and equipment investment from January 1, 2023 through December 31, 2023 with a requested increase in operating income of $82.4 million. On May 14, 2024, the Texas Railroad Commission (RRC) approved the Company's GRIP filing.
On February 26, 2025, APT made a GRIP filing that covered changes in net property, plant and equipment investment from January 1, 2024 through December 31, 2024 with a requested increase in operating income of $77.2 million. On June 17, 2025, the Texas Railroad Commission (RRC) approved the Company's GRIP filing.
Critical Accounting Policy Summary of Policy Factors Influencing Application of the Policy Regulation Our distribution and pipeline operations meet the criteria of a cost-based, rate-regulated entity under accounting principles generally accepted in the United States.
Accordingly, these critical accounting policies are reviewed periodically by the Audit Committee of the Board of Directors. Critical Accounting Policy Summary of Policy Factors Influencing Application of the Policy Regulation Our distribution and pipeline operations meet the criteria of a cost-based, rate-regulated entity under accounting principles generally accepted in the United States.
As of September 30, 2024, our equity capitalization was 61.0 percent. As of September 30, 2024, we had approximately $4.8 billion in total liquidity, consisting of $307.3 million in cash and cash equivalents, $1,380.6 million in funds available through equity forward sales agreements, and $3,094.4 million in undrawn capacity under our credit facilities.
As of September 30, 2025, our equity capitalization was 60.3 percent. As of September 30, 2025, we had approximately $4.9 billion in total liquidity, consisting of $202.7 million in cash and cash equivalents, $1,558.5 million in funds available through equity forward sales agreements, and $3,094.4 million in undrawn capacity under our credit facilities.
Commitments for incremental daily purchases are made as necessary during the month in accordance with the terms of individual contracts. Our Mid-Tex Division also maintains a limited number of long-term supply contracts to ensure a reliable source of gas for our customers in its service area which obligate it to purchase specified volumes at market and fixed prices.
Our Mid-Tex Division also maintains a limited number of long-term supply contracts to ensure a reliable source of gas for our customers in its service area which obligate it to purchase specified volumes at market and fixed prices.
Capital spending in our distribution segment increased $322.2 million, primarily as a result of increased system modernization and customer growth spending. Capital spending in our pipeline and storage segment decreased $191.0 million, primarily due to the timing of spending for pipeline system safety and reliability in Texas.
Capital spending in our distribution segment increased $413.4 million, primarily as a result of increased system modernization and customer growth spending. Capital spending in our pipeline and storage segment increased $210.9 million, primarily due to increased spending for pipeline system safety and reliability in Texas.
The presentation of our distribution operating income is included for financial reporting purposes and may not be appropriate for ratemaking purposes. 28 Table of Contents For the Fiscal Year Ended September 30 2024 2023 2022 2024 vs. 2023 2023 vs. 2022 (In thousands) Mid-Tex $ 464,616 $ 345,545 $ 315,644 $ 119,071 $ 29,901 Kentucky/Mid-States 90,601 87,258 84,098 3,343 3,160 Louisiana 94,362 80,942 73,486 13,420 7,456 West Texas 72,929 62,351 53,604 10,578 8,747 Mississippi 97,512 78,517 65,947 18,995 12,570 Colorado-Kansas 42,816 40,674 26,000 2,142 14,674 Other (8,402) (2,661) (14,234) (5,741) 11,573 Total $ 854,434 $ 692,626 $ 604,545 $ 161,808 $ 88,081 Pipeline and Storage Segment Our pipeline and storage segment consists of the pipeline and storage operations of our Atmos Pipeline–Texas Division (APT) and our natural gas transmission operations in Louisiana.
The presentation of our distribution operating income is included for financial reporting purposes and may not be appropriate for ratemaking purposes. 28 Table of Contents For the Fiscal Year Ended September 30 2025 2024 2023 2025 vs. 2024 2024 vs. 2023 (In thousands) Mid-Tex $ 532,570 $ 464,616 $ 345,545 $ 67,954 $ 119,071 Kentucky/Mid-States 112,894 90,601 87,258 22,293 3,343 Louisiana 109,268 94,362 80,942 14,906 13,420 West Texas 73,138 72,929 62,351 209 10,578 Mississippi 94,654 97,512 78,517 (2,858) 18,995 Colorado-Kansas 37,341 42,816 40,674 (5,475) 2,142 Other 3,525 (8,402) (2,661) 11,927 (5,741) Total $ 963,390 $ 854,434 $ 692,626 $ 108,956 $ 161,808 Pipeline and Storage Segment Our pipeline and storage segment consists of the pipeline and storage operations of our Atmos Pipeline–Texas Division (APT) and our natural gas transmission operations in Louisiana.
Cash flows from operating, investing, and financing activities for the years ended September 30, 2024, 2023, and 2022 are presented below. 31 Table of Contents For the Fiscal Year Ended September 30 2024 2023 2022 2024 vs. 2023 2023 vs. 2022 (In thousands) Total cash provided by (used in) Operating activities $ 1,733,746 $ 3,459,743 $ 977,584 $ (1,725,997) $ 2,482,159 Investing activities (2,922,769) (2,795,280) (2,429,958) (127,489) (365,322) Financing activities 1,478,631 (696,769) 1,387,205 2,175,400 (2,083,974) Change in cash and cash equivalents and restricted cash and cash equivalents 289,608 (32,306) (65,169) 321,914 32,863 Cash and cash equivalents and restricted cash and cash equivalents at beginning of period 19,248 51,554 116,723 (32,306) (65,169) Cash and cash equivalents and restricted cash and cash equivalents at end of period $ 308,856 $ 19,248 $ 51,554 $ 289,608 $ (32,306) Cash flows for the fiscal year ended September 30, 2023 compared with fiscal year ended September 30, 2022 is described in Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations" of our Annual Report on Form 10-K for the fiscal year ended September 30, 2023.
For the Fiscal Year Ended September 30 2025 2024 2023 2025 vs. 2024 2024 vs. 2023 (In thousands) Total cash provided by (used in) Operating activities $ 2,049,456 $ 1,733,746 $ 3,459,743 $ 315,710 $ (1,725,997) Investing activities (3,561,282) (2,922,769) (2,795,280) (638,513) (127,489) Financing activities 1,406,773 1,478,631 (696,769) (71,858) 2,175,400 Change in cash and cash equivalents and restricted cash and cash equivalents (105,053) 289,608 (32,306) (394,661) 321,914 Cash and cash equivalents and restricted cash and cash equivalents at beginning of period 308,856 19,248 51,554 289,608 (32,306) Cash and cash equivalents and restricted cash and cash equivalents at end of period $ 203,803 $ 308,856 $ 19,248 $ (105,053) $ 289,608 31 Table of Contents Cash flows for the fiscal year ended September 30, 2024 compared with fiscal year ended September 30, 2023 is described in Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations" of our Annual Report on Form 10-K for the fiscal year ended September 30, 2024.
As of the date of this report, $1.1 billion of securities remained available for issuance under the shelf registration statement, which expires March 31, 2026.
As of the date of this report, $5.2 billion of securities remained available for issuance under the shelf registration statement, which expires December 3, 2027.
Key drivers for the change in operating income include: • a $68.4 million increase due to rate adjustments from the GRIP filings approved in May 2023 and 2024, and the rate case approved in December 2023. • a $39.0 million net increase in APT's through-system activities primarily associated with increased spreads. • a $27.8 million decrease in refunds of excess deferred taxes to customers, which is substantially offset in income tax expense. • a $14.5 million increase due to higher capacity contracted by tariff-based customers due to their increased peak day demand. • a $3.1 million decrease in property taxes, which is inclusive of a $5.4 million decrease related to the Texas property tax legislation discussed above.
Key drivers for the change in operating income include: • an $89.4 million increase primarily due to rate adjustments from the GRIP filings approved in May 2024 and June 2025, the System Safety and Integrity Rider filing approved in November 2024, and the rate case approved in December 2023. • a $7.7 million increase in APT's through-system activities. • a $9.1 million decrease in refunds of excess deferred taxes to customers, which is substantially offset in income tax expense. • a $16.5 million increase due to higher capacity contracted by tariff-based customers due to their increased peak day demand.
These increases were partially offset by increased employee-related costs, depreciation expense, and interest expense. During the year ended September 30, 2024, we implemented ratemaking regulatory actions which resulted in an increase in annual operating income of $376.3 million.
These increases were partially offset by higher bad debt expense, increased employee-related costs, depreciation and property tax expenses, and higher spending on safety and compliance related activities. During the year ended September 30, 2025, we implemented ratemaking regulatory actions which resulted in an increase in annual operating income of $333.6 million.
At September 30, 2024, we were committed to purchase 25.9 Bcf within one year and 38.7 Bcf within two to three years under indexed contracts. At September 30, 2024, we were committed to purchase 6.8 Bcf within one year under fixed price contracts with a weighted average price of $3.10 per Mcf.
At September 30, 2025, we were committed to purchase 73.4 Bcf within one year and 114.9 Bcf within two to three years under indexed contracts. At September 30, 2025, we were committed to purchase 21.0 Bcf within one year under fixed price contracts with a weighted average price of $2.70 per Mcf.
The following table shows the number of shares issued for the fiscal years ended September 30, 2024, 2023, and 2022: For the Fiscal Year Ended September 30 2024 2023 2022 Shares issued: Direct Stock Purchase Plan 60,756 64,871 68,693 Retirement Savings Plan and Trust 67,134 69,716 72,339 1998 Long-Term Incentive Plan (LTIP) 236,703 189,337 427,929 Equity Issuance (1) 6,401,469 7,272,261 7,907,883 Total shares issued 6,766,062 7,596,185 8,476,844 (1) Share amounts do not include shares issued under forward sale agreements until the shares have been settled.
The following table shows the number of shares issued for the fiscal years ended September 30, 2025, 2024, and 2023: For the Fiscal Year Ended September 30 2025 2024 2023 Shares issued: Direct Stock Purchase Plan 47,422 60,756 64,871 Retirement Savings Plan and Trust 54,565 67,134 69,716 1998 Long-Term Incentive Plan (LTIP) 276,263 236,703 189,337 Equity Issuance (1) 5,931,289 6,401,469 7,272,261 Total shares issued 6,309,539 6,766,062 7,596,185 (1) Share amounts do not include shares issued under forward sale agreements until the shares have been settled. 32 Table of Contents Credit Ratings Our credit ratings directly affect our ability to obtain short-term and long-term financing, in addition to the cost of such financing.
We completed a public offering of $500 million of 5.75% senior notes due October 2052 and $300 million of 5.45% senior notes due October 2032, and received net proceeds from the offering, after the underwriting discount and offering expenses, of $789.4 million.
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.
Review of Financial and Operating Results Financial and operational highlights for our pipeline and storage segment for the fiscal years ended September 30, 2024, 2023, and 2022 are presented below. 29 Table of Contents For the Fiscal Year Ended September 30 2024 2023 2022 2024 vs. 2023 2023 vs. 2022 (In thousands, unless otherwise noted) Mid-Tex / Affiliate transportation revenue $ 715,117 $ 621,987 $ 546,038 $ 93,130 $ 75,949 Third-party transportation revenue 210,568 154,018 136,907 56,550 17,111 Other revenue 12,344 9,169 10,715 3,175 (1,546) Total operating revenues 938,029 785,174 693,660 152,855 91,514 Total purchased gas cost 146 (1,220) (1,583) 1,366 363 Operating expenses 436,955 411,873 378,806 25,082 33,067 Operating income 500,928 374,521 316,437 126,407 58,084 Other non-operating income 40,940 44,787 26,791 (3,847) 17,996 Interest charges 73,546 60,096 52,890 13,450 7,206 Income before income taxes 468,322 359,212 290,338 109,110 68,874 Income tax expense 96,840 53,747 37,917 43,093 15,830 Net income $ 371,482 $ 305,465 $ 252,421 $ 66,017 $ 53,044 Gross pipeline transportation volumes — MMcf 831,534 834,847 776,608 (3,313) 58,239 Consolidated pipeline transportation volumes — MMcf 635,728 635,508 580,488 220 55,020 Fiscal year ended September 30, 2024 compared with fiscal year ended September 30, 2023 Operating income for our pipeline and storage segment increased 33.8 percent.
Review of Financial and Operating Results Financial and operational highlights for our pipeline and storage segment for the fiscal years ended September 30, 2025, 2024, and 2023 are presented below. 29 Table of Contents For the Fiscal Year Ended September 30 2025 2024 2023 2025 vs. 2024 2024 vs. 2023 (In thousands, unless otherwise noted) Mid-Tex / Affiliate transportation revenue $ 815,628 $ 715,117 $ 621,987 $ 100,511 $ 93,130 Third-party transportation revenue 238,667 210,568 154,018 28,099 56,550 Other revenue 11,005 12,344 9,169 (1,339) 3,175 Total operating revenues 1,065,300 938,029 785,174 127,271 152,855 Total purchased gas cost (1,346) 146 (1,220) (1,492) 1,366 Operating expenses 470,065 436,955 411,873 33,110 25,082 Operating income 596,581 500,928 374,521 95,653 126,407 Other non-operating income 56,163 40,940 44,787 15,223 (3,847) Interest charges 72,452 73,546 60,096 (1,094) 13,450 Income before income taxes 580,292 468,322 359,212 111,970 109,110 Income tax expense 128,319 96,840 53,747 31,479 43,093 Net income $ 451,973 $ 371,482 $ 305,465 $ 80,491 $ 66,017 Gross pipeline transportation volumes — MMcf 907,536 831,534 834,847 76,002 (3,313) Consolidated pipeline transportation volumes — MMcf 709,645 635,728 635,508 73,917 220 Fiscal year ended September 30, 2025 compared with fiscal year ended September 30, 2024 Operating income for our pipeline and storage segment increased 19.1 percent.
The following table presents our capitalization as of September 30, 2024 and 2023: September 30 2024 2023 (In thousands, except percentages) Short-term debt $ — — % $ 241,933 1.4 % Long-term debt (1) 7,785,297 39.0 % 6,555,701 37.1 % Shareholders’ equity 12,157,669 61.0 % 10,870,064 61.5 % Total capitalization, including short-term debt $ 19,942,966 100.0 % $ 17,667,698 100.0 % (1) Inclusive of our finance leases, but exclusive of AEK's securitized long-term debt.
The following table presents our capitalization as of September 30, 2025 and 2024: September 30 2025 2024 (In thousands, except percentages) Short-term debt $ — — % $ — — % Long-term debt (1) 8,918,944 39.7 % 7,785,297 39.0 % Shareholders’ equity 13,558,890 60.3 % 12,157,669 61.0 % Total capitalization, including short-term debt $ 22,477,834 100.0 % $ 19,942,966 100.0 % (1) Inclusive of our finance leases, but exclusive of AEK's securitized long-term debt.
We also received $171.1 million from the settlement of forward starting interest rate swaps related to a debt issuance completed in October 2023. Cash dividends increased due to an 8.8 percent increase in our dividend rate and an increase in shares 32 Table of Contents outstanding.
The net proceeds were used primarily to support capital spending and for other general corporate purposes. We also received $122.9 million from the settlement of forward starting interest rate swaps related to a debt issuance completed in October 2025. Cash dividends increased due to an 8.1 percent increase in our dividend rate and an increase in shares outstanding.
The accounting policies discussed below are both important to the presentation of our financial condition and results of operations and require management to make difficult, subjective, or complex accounting estimates. Accordingly, these critical accounting policies are reviewed periodically by the Audit Committee of the Board of Directors.
Our significant accounting policies are discussed in Note 2 to our consolidated financial statements. The accounting policies discussed below are both important to the presentation of our financial condition and results of operations and require management to make difficult, subjective, or complex accounting estimates.
On April 1, 2024, Moody's reaffirmed its long-term and short-term credit ratings and placed our ratings under negative outlook.
On April 2, 2025, Moody's reaffirmed its short-term credit ratings, downgraded our long-term credit rating to A2, and placed our ratings under stable outlook.
Finally, higher gas costs, as well as competitive factors in the industry and general economic conditions may cause customers to conserve or, in the case of industrial consumers, to use alternative energy sources. 27 Table of Contents Review of Financial and Operating Results Financial and operational highlights for our distribution segment for the fiscal years ended September 30, 2024, 2023, and 2022 are presented below.
Finally, higher gas costs, as well as competitive factors in the industry and general economic conditions may cause customers to conserve or, in the case of industrial consumers, to use alternative energy sources.
The following table details our consolidated net income by segment during the last three fiscal years: 26 Table of Contents For the Fiscal Year Ended September 30 2024 2023 2022 (In thousands) Distribution segment $ 671,413 $ 580,397 $ 521,977 Pipeline and storage segment 371,482 305,465 252,421 Net income $ 1,042,895 $ 885,862 $ 774,398 During fiscal 2024, we recorded net income of $1,042.9 million, or $6.83 per diluted share, compared to net income of $885.9 million, or $6.10 per diluted share in the prior year.
General economic and market conditions Assumed investment returns by asset class Assumed future salary increases Assumed discount rate Projected timing of future cash disbursements Health care cost experience trends Participant demographic information Actuarial mortality assumptions Impact of legislation Impact of regulation RESULTS OF OPERATIONS The following table details our consolidated net income by segment during the last three fiscal years: For the Fiscal Year Ended September 30 2025 2024 2023 (In thousands) Distribution segment $ 746,781 $ 671,413 $ 580,397 Pipeline and storage segment 451,973 371,482 305,465 Net income $ 1,198,754 $ 1,042,895 $ 885,862 During fiscal 2025, we recorded net income of $1,198.8 million, or $7.46 per diluted share, compared to net income of $1,042.9 million, or $6.83 per diluted share in the prior year.
We base our estimates on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ from estimates. Our significant accounting policies are discussed in Note 2 to our consolidated financial statements.
Preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, and expenses and the related disclosures of contingent assets and liabilities. We base our estimates on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ from estimates.
Excluding this cash inflow, operating cash flow in fiscal 2023 was $1,437.8 million, and the year-over-year increase in operating cash flow primarily reflects the positive effects of successful rate case outcomes achieved in fiscal 2024 and 2023.
Cash flows from operating activities For the fiscal year ended September 30, 2025, cash flow provided by operating activities was $2,049.5 million compared with $1,733.7 million in the prior year. The year-over-year increase in operating cash flow primarily reflects the positive effects of successful rate case outcomes achieved in fiscal 2025 and 2024.
(6) Represents expected contributions to our defined benefit and postretirement benefit plans, which are discussed in Note 11 to the consolidated financial statements. (7) Represents liabilities associated with uncertain tax positions claimed or expected to be claimed on tax returns. The amount does not include interest and penalties that may be applied to these positions.
(7) Represents liabilities associated with uncertain tax positions claimed or expected to be claimed on tax returns. The amount does not include interest and penalties that may be applied to these positions. See Note 15 to the consolidated financial statements for further details. We maintain supply contracts with several vendors that generally cover a period of up to one year.
Key drivers for the change in operating income include: • a $219.2 million increase in rate adjustments, primarily in our Mid-Tex Division. • a $24.8 million increase related to residential customer growth, primarily in our Mid-Tex Division, and increased industrial load. • a $10.6 million decrease in bad debt expense, as discussed in Note 6 to the consolidated financial statements.
Key drivers for the change in operating income include: • a $184.1 million increase in rate adjustments, primarily in our Mid-Tex Division. • a $26.7 million increase related to residential customer growth, primarily in our Mid-Tex Division, and increased industrial load. • a $46.3 million decrease in refunds of excess deferred taxes to customers, which is substantially offset in income tax expense.
Our debt covenants are described in Note 8 to the consolidated financial statements.
Our debt covenants are described in Note 8 to the consolidated financial statements. Contractual Obligations and Commercial Commitments The following table provides information about contractual obligations and commercial commitments at September 30, 2025.
S ee Note 7 to the consolidated financial statements. (5) Represents liabilities for natural gas commodity financial instruments that were valued as of September 30, 2024. The ultimate settlement amounts of these remaining liabilities are unknown because they are subject to continuing market risk until the financial instruments are settled.
The ultimate settlement amounts of these remaining liabilities are unknown because they are subject to continuing market risk until the financial instruments are settled. (6) Represents expected contributions to our defined benefit and postretirement benefit plans, which are discussed in Note 11 to the consolidated financial statements.
Additionally, we expect to continue to be able to obtain financing upon reasonable terms as necessary.
The liquidity provided by these sources is expected to be sufficient to fund the Company's working capital needs and capital expenditures program. Additionally, we expect to continue to be able to obtain financing upon reasonable terms as necessary.
Additionally, our fiscal 2024 results were favorably impacted by $21.1 million as a result of legislation that became effective during the first quarter of fiscal 2024 to reduce property tax expenses in Texas and $13.9 million as a result of a change to our bad debt recovery mechanism in Mississippi.
Additionally, our distribution segment's fiscal 2025 results were favorably impacted by $18.5 million as a result of Texas legislation that became effective during the third quarter of fiscal 2025 related to infrastructure spending.
Partially offset by: • a $50.0 million increase in depreciation expense associated with increased capital investments. • a $19.9 million increase in employee-related costs primarily due to an increase in headcount to support company growth. • a $2.7 million increase in property taxes, which is inclusive of a $15.7 million decrease related to the Texas property tax legislation discussed above. • a $26.9 million increase in other operation and maintenance expense, including higher costs associated with software maintenance, compliance activities, training, and other administrative costs.
Partially offset by: • a $78.0 million increase in depreciation expense and property taxes associated with increased capital investments. • a $32.6 million increase in employee-related costs primarily due to an increase in headcount to support company growth. • an $18.6 million increase in system monitoring, line locating, and other compliance-related activities. • a $17.8 million increase in bad debt expense due to a regulatory change in Mississippi in the first quarter of fiscal 2024 which significantly reduced bad debt expense in fiscal 2024, as discussed in Note 6 to the consolidated financial statements.
The year-over-year increase in net income of $157.0 million largely reflects positive rate outcomes driven by safety and reliability spending.
The year-over-year increase in net income of $155.9 million largely reflects positive rate outcomes driven by safety and reliability spending. Additionally, our fiscal 2025 results were 26 Table of Contents favorably impacted by $26.2 million as a result of Texas legislation that became effective during the third quarter of fiscal 2025 related to infrastructure spending.
See Note 15 to the consolidated financial statements for further details. We maintain supply contracts with several vendors that generally cover a period of up to one year. Commitments for estimated base gas volumes are established under these contracts on a monthly basis at contractually negotiated prices.
Commitments for estimated base gas volumes are established under these contracts on a monthly basis at contractually negotiated prices. Commitments for incremental daily purchases are made as necessary during the month in accordance with the terms of individual contracts.
Additionally, during the year ended September 30, 2023, we settled 7,272,261 shares that had been sold on a forward basis for net proceeds of $806.9 million. The net proceeds were used primarily to support capital spending and for other general corporate purposes.
We also completed a public offering of $500 million of 5.20% senior notes due August 2035, and received net proceeds from the offering, after the underwriting discount and offering expenses, of $493.7 million. Additionally, during the fiscal year ended September 30, 2025, we settled 5,931,289 shares that had been sold on a forward basis for net proceeds of $698.5 million.
CRITICAL ACCOUNTING POLICIES Our consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States. Preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, and expenses and the related disclosures of contingent assets and liabilities.
Although we believe these costs are ultimately recoverable through our rates based on the regulatory frameworks currently available to us, full recovery is not assured. CRITICAL ACCOUNTING POLICIES Our consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States.
Removed
General economic and market conditions Assumed investment returns by asset class Assumed future salary increases Assumed discount rate Projected timing of future cash disbursements Health care cost experience trends Participant demographic information Actuarial mortality assumptions Impact of legislation Impact of regulation RESULTS OF OPERATIONS Overview Atmos Energy's vision is to be the safest provider of natural gas services.
Added
We anticipate making significant capital expenditures for the foreseeable future to modernize our distribution and transmission system, to comply with the safety rules and regulations issued by the regulatory authorities responsible for the service areas in which we operate, and to prepare to serve the growing needs of the communities we serve.
Removed
Interest charges increased $39.9 million primarily due to the issuance of long-term debt during fiscal 2024. The increase in interest charges is also due to the amortization of the Texas regulatory asset that is discussed in Note 3 to the consolidated financial statements.
Added
Between fiscal years 2026 and 2030, we anticipate spending approximately $26 billion, with more than 80 percent dedicated to safety and reliability spending. The magnitude and allocation of these expenditures may be affected by factors such as new policy and regulations, population growth, and increased labor and materials costs.
Removed
However, this increase is offset by a corresponding increase in revenue resulting in no impact to net income.
Added
Partially offset by: • a $23.5 million increase in depreciation expense and property taxes associated with increased capital investments. • an $18.9 million increase in expenses recognized as a result of the System Safety and Integrity Rider filing approved in November 2024, which is offset in operating revenues.
Removed
Additionally, GRIP requires a utility to file a statement of intent at least once every five years to review its costs and expenses, including capital costs filed for recovery under GRIP. On May 19, 2023, APT filed its statement of intent seeking $107.4 million in additional annual operating income.
Added
Other non-operating income increased $15.2 million primarily due to higher AFUDC largely as a result of increased capital spending. Additionally, our pipeline and storage segment's fiscal 2025 results were favorably impacted by $7.7 million as a result of Texas legislation that became effective during the third quarter of fiscal 2025 related to infrastructure spending.
Removed
On December 13, 2023, the RRC approved the settlement agreement between APT and the intervening parties for an increase in annual operating income of $27.0 million, exclusive of the impact of the cessation of $36.9 million in excess deferred income tax refunds, which are substantially offset by a corresponding increase in income taxes.
Added
Cash flows from operating, investing, and financing activities for the years ended September 30, 2025, 2024, and 2023 are presented below.
Removed
Partially offset by: • an $8.4 million increase in depreciation expense associated with increased capital investments. • an $18.1 million increase in operation and maintenance expense due to increased storage and compression maintenance and other compliance-related activities. Interest charges increased $13.5 million primarily due to the issuance of long-term debt during fiscal 2024.
Added
Payments Due by Period Total Less than 1 year 1-3 years 3-5 years More than 5 years (In thousands) Contractual Obligations Long-term debt (1) $ 8,935,000 $ 10,000 $ 650,000 $ 500,000 $ 7,775,000 Securitized long-term debt 77,003 8,767 18,647 20,645 28,944 Interest charges (2) 7,867,907 418,219 827,500 779,125 5,843,063 Interest charges on securitized long-term debt 16,841 3,860 6,343 4,345 2,293 Finance leases (3) 63,067 3,502 7,203 7,485 44,877 Operating leases (4) 375,802 56,546 99,453 75,059 144,744 Financial instrument obligations (5) 6,485 6,339 146 — — Pension and postretirement benefit plan contributions (6) 286,856 30,175 75,661 45,773 135,247 Uncertain tax positions (7) 60,332 — 60,332 — — Total contractual obligations $ 17,689,293 $ 537,408 $ 1,745,285 $ 1,432,432 $ 13,974,168 (1) Long-term debt excludes our finance lease obligations, which are separately reported within this table.
Removed
In the first half of fiscal 2025, we anticipate filing a new $8.0 billion shelf registration statement and a prospectus supplement under this new shelf registration statement for a new $1.7 billion ATM equity sales program to replace the former arrangements.
Added
(4) Operating lease payments shown above include interest totaling $68.2 million. S ee Note 7 to the consolidated financial statements. (5) Represents liabilities for natural gas commodity financial instruments that were valued as of September 30, 2025.
Removed
As of September 30, 2024, we had the following forward starting interest rate swaps in place to hedge future planned debt issuances: Planned Debt Issuance Date Amount Hedged Effective Interest Rate (In thousands) Fiscal 2026 $ 300,000 2.16 % $ 300,000 The liquidity provided by these sources is expected to be sufficient to fund the Company's working capital needs and capital expenditures program.
Removed
Cash flows from operating activities For the fiscal year ended September 30, 2024, cash flow provided by operating activities was $1,733.7 million compared with $3,459.7 million in the prior year. Fiscal 2023 operating cash flow included $2,021.9 million of cash received as a result of the conclusion of Texas securitization proceedings.
Removed
Finally, Atmos Energy Kansas Securitization I, LLC, a special-purpose, wholly-owned subsidiary of Atmos Energy, issued $95 million in securitized long-term debt.
Removed
Credit Ratings Our credit ratings directly affect our ability to obtain short-term and long-term financing, in addition to the cost of such financing.
Removed
Contractual Obligations and Commercial Commitments The following table provides information about contractual obligations and commercial commitments at September 30, 2024. 33 Table of Contents Payments Due by Period Total Less than 1 year 1-3 years 3-5 years More than 5 years (In thousands) Contractual Obligations Long-term debt (1) $ 7,785,000 $ — $ 510,000 $ 650,000 $ 6,625,000 Securitized long-term debt 85,078 8,207 17,721 19,621 39,529 Interest charges (2) 5,854,623 318,117 635,037 592,054 4,309,415 Interest charges on securitized long-term debt 21,071 4,281 7,255 5,356 4,179 Finance leases (3) 66,506 3,438 7,070 7,338 48,660 Operating leases (4) 320,408 43,244 73,917 56,419 146,828 Financial instrument obligations (5) 7,637 7,324 313 — — Pension and postretirement benefit plan contributions (6) 273,428 27,596 51,411 65,310 129,111 Uncertain tax positions (7) 57,797 — 57,797 — — Total contractual obligations $ 14,471,548 $ 412,207 $ 1,360,521 $ 1,396,098 $ 11,302,722 (1) Long-term debt excludes our finance lease obligations, which are separately reported within this table.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

2 edited+0 added−0 removed5 unchanged
Biggest changeITEM 7A. Quantitative and Qualitative Disclosures About Market Risk. We are exposed to risks associated with commodity prices and interest rates. Commodity price risk is the potential loss that we may incur as a result of changes in the fair value of a particular instrument or commodity.
Biggest changeITEM 7A. Quantitative and Qualitative Disclosures About Market Risk. 34 Table of Contents We are exposed to risks associated with commodity prices and interest rates. Commodity price risk is the potential loss that we may incur as a result of changes in the fair value of a particular instrument or commodity.
Had interest rates associated with our short-term borrowings increased by an average of one percent, our interest expense would not have materially increased during 2024. 35 Table of Contents
Had interest rates associated with our short-term borrowings increased by an average of one percent, our interest expense would not have materially increased during 2025. 35 Table of Contents

Other ATO 10-K year-over-year comparisons