Segment Information

3 Months Ended

Dec. 31, 2015

Segment Reporting [Abstract]

Segment Information

Segment Information

We operate the Company through the following three segments:

• The regulated distribution segment, which includes our regulated natural gas distribution and related sales operations,

• The regulated pipeline segment, which includes the regulated pipeline and storage operations of our Atmos Pipeline — Texas Division and

• The nonregulated segment, which is comprised of our nonregulated natural gas management, nonregulated natural gas transmission, storage and other services.

Our determination of reportable segments considers the strategic operating units under which we manage sales of various products and services to customers in differing regulatory environments. Although our regulated distribution segment operations are geographically dispersed, they are reported as a single segment as each regulated distribution division has similar economic characteristics. The accounting policies of the segments are the same as those described in the summary of significant accounting policies found in our Annual Report on Form 10-K for the fiscal year ended September 30, 2015. We evaluate performance based on net income or loss of the respective operating units.

Income statements for the three month periods ended December 31, 2015 and 2014 by segment are presented in the following tables:

	Three Months Ended December 31, 2015
	Regulated Distribution			Regulated Pipeline			Nonregulated			Eliminations			Consolidated
	(In thousands)
Operating revenues from external parties	$	637,167		$	23,407		$	245,647		$	—		$	906,221
Intersegment revenues	1,435			71,270			26,877			(99,582		)	—
	638,602			94,677			272,524			(99,582		)	906,221
Purchased gas cost	305,141			—			256,766			(99,449		)	462,458
Gross profit	333,461			94,677			15,758			(133		)	443,763
Operating expenses
Operation and maintenance	91,349			27,088			6,544			(133		)	124,848
Depreciation and amortization	57,334			12,770			1,135			—			71,239
Taxes, other than income	45,261			5,571			639			—			51,471
Total operating expenses	193,944			45,429			8,318			(133		)	247,558
Operating income	139,517			49,248			7,440			—			196,205
Miscellaneous income (expense)	(752		)	(429		)	379			(407		)	(1,209		)
Interest charges	20,705			9,147			1,038			(407		)	30,483
Income before income taxes	118,060			39,672			6,781			—			164,513
Income tax expense	44,805			14,086			2,761			—			61,652
Net income	$	73,255		$	25,586		$	4,020		$	—		$	102,861
Capital expenditures	$	166,544		$	125,283		$	(153	)	$	—		$	291,674

	Three Months Ended December 31, 2014
	Regulated Distribution			Regulated Pipeline			Nonregulated		Eliminations			Consolidated
	(In thousands)
Operating revenues from external parties	$	845,404		$	20,551		$	392,810	$	—		$	1,258,765
Intersegment revenues	1,368			63,016			69,478		(133,862		)	—
	846,772			83,567			462,288		(133,862		)	1,258,765
Purchased gas cost	522,960			—			446,249		(133,729		)	835,480
Gross profit	323,812			83,567			16,039		(133		)	423,285
Operating expenses
Operation and maintenance	86,985			24,615			7,115		(133		)	118,582
Depreciation and amortization	55,086			11,382			1,125		—			67,593
Taxes, other than income	43,644			4,865			876		—			49,385
Total operating expenses	185,715			40,862			9,116		(133		)	235,560
Operating income	138,097			42,705			6,923		—			187,725
Miscellaneous income (expense)	(1,329		)	(252		)	300		(426		)	(1,707		)
Interest charges	21,640			8,324			226		(426		)	29,764
Income before income taxes	115,128			34,129			6,997		—			156,254
Income tax expense	43,741			12,094			2,824		—			58,659
Net income	$	71,387		$	22,035		$	4,173	$	—		$	97,595
Capital expenditures	$	166,247		$	94,754		$	312	$	—		$	261,313

Balance sheet information at December 31, 2015 and September 30, 2015 by segment is presented in the following tables:

	December 31, 2015
	Regulated Distribution		Regulated Pipeline		Nonregulated			Eliminations			Consolidated
	(In thousands)
ASSETS
Property, plant and equipment, net	$	5,779,479	$	1,821,114	$	52,694		$	—		$	7,653,287
Investment in subsidiaries	1,020,629		—		—			(1,020,629		)	—
Current assets
Cash and cash equivalents	57,691		—		21,212			—			78,903
Assets from risk management activities	716		—		18,229			—			18,945
Other current assets	589,257		20,008		420,897			(264,740		)	765,422
Intercompany receivables	943,005		—		—			(943,005		)	—
Total current assets	1,590,669		20,008		460,338			(1,207,745		)	863,270
Goodwill	575,449		132,542		34,711			—			742,702
Noncurrent assets from risk management activities	96		—		—			—			96
Deferred charges and other assets	277,662		17,095		541			—			295,298
	$	9,243,984	$	1,990,759	$	548,284		$	(2,228,374	)	$	9,554,653
CAPITALIZATION AND LIABILITIES
Shareholders’ equity	$	3,272,109	$	602,861	$	417,768		$	(1,020,629	)	$	3,272,109
Long-term debt	2,455,474		—		—			—			2,455,474
Total capitalization	5,727,583		602,861		417,768			(1,020,629		)	5,727,583
Current liabilities
Short-term debt	1,017,236		—		—			(254,000		)	763,236
Liabilities from risk management activities	6,738		—		—			—			6,738
Other current liabilities	625,055		28,197		102,570			(10,740		)	745,082
Intercompany payables	—		923,366		19,639			(943,005		)	—
Total current liabilities	1,649,029		951,563		122,209			(1,207,745		)	1,515,056
Deferred income taxes	1,008,353		434,497		(1,525		)	—			1,441,325
Noncurrent liabilities from risk management activities	103,337		—		—			—			103,337
Regulatory cost of removal obligation	425,555		—		—			—			425,555
Pension and postretirement liabilities	289,939		—		—			—			289,939
Deferred credits and other liabilities	40,188		1,838		9,832			—			51,858
	$	9,243,984	$	1,990,759	$	548,284		$	(2,228,374	)	$	9,554,653

	September 30, 2015
	Regulated Distribution		Regulated Pipeline		Nonregulated			Eliminations			Consolidated
	(In thousands)
ASSETS
Property, plant and equipment, net	$	5,670,306	$	1,706,449	$	53,825		$	—		$	7,430,580
Investment in subsidiaries	1,038,670		—		(2,096		)	(1,036,574		)	—
Current assets
Cash and cash equivalents	23,863		—		4,790			—			28,653
Assets from risk management activities	378		—		8,854			—			9,232
Other current assets	426,270		24,628		480,503			(338,301		)	593,100
Intercompany receivables	887,713		—		—			(887,713		)	—
Total current assets	1,338,224		24,628		494,147			(1,226,014		)	630,985
Goodwill	575,449		132,542		34,711			—			742,702
Noncurrent assets from risk management activities	368		—		—			—			368
Deferred charges and other assets	265,693		17,288		5,329			—			288,310
	$	8,888,710	$	1,880,907	$	585,916		$	(2,262,588	)	$	9,092,945
CAPITALIZATION AND LIABILITIES
Shareholders’ equity	$	3,194,797	$	577,275	$	461,395		$	(1,038,670	)	$	3,194,797
Long-term debt	2,455,388		—		—			—			2,455,388
Total capitalization	5,650,185		577,275		461,395			(1,038,670		)	5,650,185
Current liabilities
Short-term debt	782,927		—		—			(325,000		)	457,927
Liabilities from risk management activities	9,568		—		—			—			9,568
Other current liabilities	569,273		29,780		99,480			(11,205		)	687,328
Intercompany payables	—		867,409		20,304			(887,713		)	—
Total current liabilities	1,361,768		897,189		119,784			(1,223,918		)	1,154,823
Deferred income taxes	1,008,091		406,254		(3,030		)	—			1,411,315
Noncurrent liabilities from risk management activities	110,539		—		—			—			110,539
Regulatory cost of removal obligation	427,553		—		—			—			427,553
Pension and postretirement liabilities	287,373		—		—			—			287,373
Deferred credits and other liabilities	43,201		189		7,767			—			51,157
	$	8,888,710	$	1,880,907	$	585,916		$	(2,262,588	)	$	9,092,945