QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Commission File Number | Exact name of registrant as specified in its charter and principal office address and telephone number | State of Incorporation | I.R.S. Employer Identification No. | |||||||||||||||||||||||
Securities registered pursuant to Section 12(b) of the Act: | ||||||||||||||
Title of each class | Trading Symbol | Name of each exchange on which registered | ||||||||||||
N/A |
☒ | Accelerated filer | ☐ | ||||||||||||||||||
Non-accelerated filer | ☐ | Smaller reporting company | ||||||||||||||||||
Emerging growth company |
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||||||||||||||||
☒ | Smaller reporting company | |||||||||||||||||||
Emerging growth company |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
2 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
March 31, 2022 | December 31, 2021 | |||||||||||||
ASSETS | ||||||||||||||
Regulated operations plant: | ||||||||||||||
Gas plant | $ | $ | ||||||||||||
Less: accumulated depreciation | ( | ( | ||||||||||||
Construction work in progress | ||||||||||||||
Net regulated operations plant | ||||||||||||||
Other property and investments, net | ||||||||||||||
Current assets: | ||||||||||||||
Cash and cash equivalents | ||||||||||||||
Accounts receivable, net of allowances | ||||||||||||||
Accrued utility revenue | ||||||||||||||
Income taxes receivable, net | ||||||||||||||
Deferred purchased gas costs | ||||||||||||||
Prepaid and other current assets | ||||||||||||||
Total current assets | ||||||||||||||
Noncurrent assets: | ||||||||||||||
Goodwill | ||||||||||||||
Deferred income taxes | ||||||||||||||
Deferred charges and other assets | ||||||||||||||
Total noncurrent assets | ||||||||||||||
Total assets | $ | $ | ||||||||||||
CAPITALIZATION AND LIABILITIES | ||||||||||||||
Capitalization: | ||||||||||||||
Common stock, $ | $ | $ | ||||||||||||
Additional paid-in capital | ||||||||||||||
Accumulated other comprehensive loss, net | ( | ( | ||||||||||||
Retained earnings | ||||||||||||||
Total equity | ||||||||||||||
Redeemable noncontrolling interests | ||||||||||||||
Long-term debt, less current maturities | ||||||||||||||
Total capitalization | ||||||||||||||
Current liabilities: | ||||||||||||||
Current maturities of long-term debt | ||||||||||||||
Short-term debt | ||||||||||||||
Accounts payable | ||||||||||||||
Customer deposits | ||||||||||||||
Income taxes payable, net | ||||||||||||||
Accrued general taxes | ||||||||||||||
Accrued interest | ||||||||||||||
Deferred purchased gas costs | ||||||||||||||
Other current liabilities | ||||||||||||||
Total current liabilities | ||||||||||||||
Deferred income taxes and other credits: | ||||||||||||||
Deferred income taxes and investment tax credits, net | ||||||||||||||
Accumulated removal costs | ||||||||||||||
Other deferred credits and other long-term liabilities | ||||||||||||||
Total deferred income taxes and other credits | ||||||||||||||
Total capitalization and liabilities | $ | $ |
3 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Three Months Ended March 31, | Twelve Months Ended March 31, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Operating revenues: | ||||||||||||||||||||||||||
Regulated operations revenues | $ | $ | $ | $ | ||||||||||||||||||||||
Utility infrastructure services revenues | ||||||||||||||||||||||||||
Total operating revenues | ||||||||||||||||||||||||||
Operating expenses: | ||||||||||||||||||||||||||
Net cost of gas sold | ||||||||||||||||||||||||||
Operations and maintenance | ||||||||||||||||||||||||||
Depreciation and amortization | ||||||||||||||||||||||||||
Taxes other than income taxes | ||||||||||||||||||||||||||
Utility infrastructure services expenses | ||||||||||||||||||||||||||
Total operating expenses | ||||||||||||||||||||||||||
Operating income | ||||||||||||||||||||||||||
Other income and (expenses): | ||||||||||||||||||||||||||
Net interest deductions | ( | ( | ( | ( | ||||||||||||||||||||||
Other income (deductions) | ( | |||||||||||||||||||||||||
Total other income and (expenses) | ( | ( | ( | ( | ||||||||||||||||||||||
Income before income taxes | ||||||||||||||||||||||||||
Income tax expense | ||||||||||||||||||||||||||
Net income | ||||||||||||||||||||||||||
Net income attributable to noncontrolling interests | ||||||||||||||||||||||||||
Net income attributable to Southwest Gas Holdings, Inc. | $ | $ | $ | $ | ||||||||||||||||||||||
Earnings per share: | ||||||||||||||||||||||||||
Basic | $ | $ | $ | $ | ||||||||||||||||||||||
Diluted | $ | $ | $ | $ | ||||||||||||||||||||||
Weighted average shares: | ||||||||||||||||||||||||||
Basic | ||||||||||||||||||||||||||
Diluted |
4 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Three Months Ended March 31, | Twelve Months Ended March 31, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Net income | $ | $ | $ | $ | ||||||||||||||||||||||
Other comprehensive income (loss), net of tax | ||||||||||||||||||||||||||
Defined benefit pension plans: | ||||||||||||||||||||||||||
Net actuarial gain (loss) | ( | |||||||||||||||||||||||||
Amortization of prior service cost | ||||||||||||||||||||||||||
Amortization of net actuarial loss | ||||||||||||||||||||||||||
Regulatory adjustment | ( | ( | ( | |||||||||||||||||||||||
Net defined benefit pension plans | ( | |||||||||||||||||||||||||
Forward-starting interest rate swaps (“FSIRS”): | ||||||||||||||||||||||||||
Amounts reclassified into net income | ||||||||||||||||||||||||||
Net forward-starting interest rate swaps | ||||||||||||||||||||||||||
Foreign currency translation adjustments | ||||||||||||||||||||||||||
Total other comprehensive income, net of tax | ||||||||||||||||||||||||||
Comprehensive income | ||||||||||||||||||||||||||
Comprehensive income attributable to noncontrolling interests | ||||||||||||||||||||||||||
Comprehensive income attributable to Southwest Gas Holdings, Inc. | $ | $ | $ | $ |
5 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Three Months Ended March 31, | Twelve Months Ended March 31, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
CASH FLOW FROM OPERATING ACTIVITIES: | ||||||||||||||||||||||||||
Net income | $ | $ | $ | $ | ||||||||||||||||||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||||||||||||||||||||||
Depreciation and amortization | ||||||||||||||||||||||||||
Deferred income taxes | ||||||||||||||||||||||||||
Changes in current assets and liabilities: | ||||||||||||||||||||||||||
Accounts receivable, net of allowances | ( | ( | ( | |||||||||||||||||||||||
Accrued utility revenue | ( | ( | ||||||||||||||||||||||||
Deferred purchased gas costs | ( | ( | ( | ( | ||||||||||||||||||||||
Accounts payable | ( | ( | ||||||||||||||||||||||||
Accrued taxes | ( | |||||||||||||||||||||||||
Other current assets and liabilities | ( | ( | ||||||||||||||||||||||||
Gains on sale of property and equipment | ( | ( | ( | ( | ||||||||||||||||||||||
Changes in undistributed stock compensation | ||||||||||||||||||||||||||
Equity AFUDC | ( | ( | ( | |||||||||||||||||||||||
Changes in deferred charges and other assets | ( | ( | ( | ( | ||||||||||||||||||||||
Changes in other liabilities and deferred credits | ( | ( | ( | ( | ||||||||||||||||||||||
Net cash provided by (used in) operating activities | ( | |||||||||||||||||||||||||
CASH FLOW FROM INVESTING ACTIVITIES: | ||||||||||||||||||||||||||
Construction expenditures and property additions | ( | ( | ( | ( | ||||||||||||||||||||||
Acquisition of businesses, net of cash acquired | ( | |||||||||||||||||||||||||
Changes in customer advances | ||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||
Net cash used in investing activities | ( | ( | ( | ( | ||||||||||||||||||||||
CASH FLOW FROM FINANCING ACTIVITIES: | ||||||||||||||||||||||||||
Issuance of common stock, net | ||||||||||||||||||||||||||
Centuri distribution to redeemable noncontrolling interest | ( | ( | ||||||||||||||||||||||||
Dividends paid | ( | ( | ( | ( | ||||||||||||||||||||||
Issuance of long-term debt, net | ||||||||||||||||||||||||||
Retirement of long-term debt | ( | ( | ( | ( | ||||||||||||||||||||||
Change in credit facility and commercial paper | ( | ( | ||||||||||||||||||||||||
Change in short-term debt | ( | ( | ||||||||||||||||||||||||
Issuance of short-term debt | ||||||||||||||||||||||||||
Withholding remittance - share-based compensation | ( | ( | ( | ( | ||||||||||||||||||||||
Other | ( | ( | ( | ( | ||||||||||||||||||||||
Net cash provided by financing activities | ||||||||||||||||||||||||||
Effects of currency translation on cash and cash equivalents | ||||||||||||||||||||||||||
Change in cash and cash equivalents | ||||||||||||||||||||||||||
Cash and cash equivalents at beginning of period | ||||||||||||||||||||||||||
Cash and cash equivalents at end of period | $ | $ | $ | $ | ||||||||||||||||||||||
SUPPLEMENTAL INFORMATION: | ||||||||||||||||||||||||||
Interest paid, net of amounts capitalized | $ | $ | $ | $ | ||||||||||||||||||||||
Income taxes paid (received), net | $ | $ | $ | $ |
6 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Three Months Ended March 31, | |||||||||||||||||
2022 | 2021 | ||||||||||||||||
Common stock shares | |||||||||||||||||
Beginning balances | |||||||||||||||||
Common stock issuances | |||||||||||||||||
Ending balances | |||||||||||||||||
Common stock amount | |||||||||||||||||
Beginning balances | $ | $ | |||||||||||||||
Common stock issuances | |||||||||||||||||
Ending balances | |||||||||||||||||
Additional paid-in capital | |||||||||||||||||
Beginning balances | |||||||||||||||||
Common stock issuances | |||||||||||||||||
Ending balances | |||||||||||||||||
Accumulated other comprehensive loss | |||||||||||||||||
Beginning balances | ( | ( | |||||||||||||||
Foreign currency exchange translation adjustment | |||||||||||||||||
Net actuarial gain arising during period, less amortization of unamortized benefit plan cost, net of tax | |||||||||||||||||
FSIRS amounts reclassified to net income, net of tax | |||||||||||||||||
Ending balances | ( | ( | |||||||||||||||
Retained earnings | |||||||||||||||||
Beginning balances | |||||||||||||||||
Net income | |||||||||||||||||
Dividends declared | ( | ( | |||||||||||||||
Redemption value adjustments | ( | ||||||||||||||||
Ending balances | |||||||||||||||||
Total equity ending balances | $ | $ | |||||||||||||||
Dividends declared per common share | $ | $ |
7 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
March 31, 2022 | December 31, 2021 | |||||||||||||
ASSETS | ||||||||||||||
Regulated operations plant: | ||||||||||||||
Gas plant | $ | $ | ||||||||||||
Less: accumulated depreciation | ( | ( | ||||||||||||
Construction work in progress | ||||||||||||||
Net regulated operations plant | ||||||||||||||
Other property and investments, net | ||||||||||||||
Current assets: | ||||||||||||||
Cash and cash equivalents | ||||||||||||||
Accounts receivable, net of allowance | ||||||||||||||
Accrued utility revenue | ||||||||||||||
Income taxes receivable, net | ||||||||||||||
Deferred purchased gas costs | ||||||||||||||
Receivable from parent | ||||||||||||||
Prepaid and other current assets | ||||||||||||||
Total current assets | ||||||||||||||
Noncurrent assets: | ||||||||||||||
Goodwill | ||||||||||||||
Deferred charges and other assets | ||||||||||||||
Total noncurrent assets | ||||||||||||||
Total assets | $ | $ | ||||||||||||
CAPITALIZATION AND LIABILITIES | ||||||||||||||
Capitalization: | ||||||||||||||
Common stock | $ | $ | ||||||||||||
Additional paid-in capital | ||||||||||||||
Accumulated other comprehensive loss, net | ( | ( | ||||||||||||
Retained earnings | ||||||||||||||
Total equity | ||||||||||||||
Long-term debt, less current maturities | ||||||||||||||
Total capitalization | ||||||||||||||
Current liabilities: | ||||||||||||||
Current maturities of long-term debt | ||||||||||||||
Short-term debt | ||||||||||||||
Accounts payable | ||||||||||||||
Customer deposits | ||||||||||||||
Accrued general taxes | ||||||||||||||
Accrued interest | ||||||||||||||
Other current liabilities | ||||||||||||||
Total current liabilities | ||||||||||||||
Deferred income taxes and other credits: | ||||||||||||||
Deferred income taxes and investment tax credits, net | ||||||||||||||
Accumulated removal costs | ||||||||||||||
Other deferred credits and other long-term liabilities | ||||||||||||||
Total deferred income taxes and other credits | ||||||||||||||
Total capitalization and liabilities | $ | $ |
8 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Three Months Ended March 31, | Twelve Months Ended March 31, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Regulated operations revenues | $ | $ | $ | $ | ||||||||||||||||||||||
Operating expenses: | ||||||||||||||||||||||||||
Net cost of gas sold | ||||||||||||||||||||||||||
Operations and maintenance | ||||||||||||||||||||||||||
Depreciation and amortization | ||||||||||||||||||||||||||
Taxes other than income taxes | ||||||||||||||||||||||||||
Total operating expenses | ||||||||||||||||||||||||||
Operating income | ||||||||||||||||||||||||||
Other income and (expenses): | ||||||||||||||||||||||||||
Net interest deductions | ( | ( | ( | ( | ||||||||||||||||||||||
Other income (deductions) | ( | |||||||||||||||||||||||||
Total other income and (expenses) | ( | ( | ( | ( | ||||||||||||||||||||||
Income before income taxes | ||||||||||||||||||||||||||
Income tax expense | ||||||||||||||||||||||||||
Net income | $ | $ | $ | $ |
9 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Three Months Ended March 31, | Twelve Months Ended March 31, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Net income | $ | $ | $ | $ | ||||||||||||||||||||||
Other comprehensive income (loss), net of tax | ||||||||||||||||||||||||||
Defined benefit pension plans: | ||||||||||||||||||||||||||
Net actuarial gain (loss) | ( | |||||||||||||||||||||||||
Amortization of prior service cost | ||||||||||||||||||||||||||
Amortization of net actuarial loss | ||||||||||||||||||||||||||
Regulatory adjustment | ( | ( | ( | |||||||||||||||||||||||
Net defined benefit pension plans | ( | |||||||||||||||||||||||||
Forward-starting interest rate swaps (“FSIRS”): | ||||||||||||||||||||||||||
Amounts reclassified into net income | ||||||||||||||||||||||||||
Net forward-starting interest rate swaps | ||||||||||||||||||||||||||
Total other comprehensive income (loss), net of tax | ( | |||||||||||||||||||||||||
Comprehensive income | $ | $ | $ | $ |
10 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Three Months Ended March 31, | Twelve Months Ended March 31, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
CASH FLOW FROM OPERATING ACTIVITIES: | ||||||||||||||||||||||||||
Net income | $ | $ | $ | $ | ||||||||||||||||||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||||||||||||||||||||||
Depreciation and amortization | ||||||||||||||||||||||||||
Deferred income taxes | ||||||||||||||||||||||||||
Changes in current assets and liabilities: | ||||||||||||||||||||||||||
Accounts receivable, net of allowance | ( | ( | ( | ( | ||||||||||||||||||||||
Accrued utility revenue | ( | ( | ||||||||||||||||||||||||
Deferred purchased gas costs | ( | ( | ( | ( | ||||||||||||||||||||||
Accounts payable | ( | ( | ||||||||||||||||||||||||
Accrued taxes | ( | ( | ||||||||||||||||||||||||
Other current assets and liabilities | ( | ( | ||||||||||||||||||||||||
Gain on sale of property | ( | ( | ||||||||||||||||||||||||
Changes in undistributed stock compensation | ||||||||||||||||||||||||||
Equity AFUDC | ( | ( | ( | |||||||||||||||||||||||
Changes in deferred charges and other assets | ( | ( | ( | ( | ||||||||||||||||||||||
Changes in other liabilities and deferred credits | ( | ( | ( | ( | ||||||||||||||||||||||
Net cash provided by (used in) operating activities | ( | |||||||||||||||||||||||||
CASH FLOW FROM INVESTING ACTIVITIES: | ||||||||||||||||||||||||||
Construction expenditures and property additions | ( | ( | ( | ( | ||||||||||||||||||||||
Changes in customer advances | ||||||||||||||||||||||||||
Other | ( | ( | ( | |||||||||||||||||||||||
Net cash used in investing activities | ( | ( | ( | ( | ||||||||||||||||||||||
CASH FLOW FROM FINANCING ACTIVITIES: | ||||||||||||||||||||||||||
Contributions from parent | ||||||||||||||||||||||||||
Dividends paid | ( | ( | ( | ( | ||||||||||||||||||||||
Issuance of long-term debt, net | ||||||||||||||||||||||||||
Retirement of long-term debt | ( | ( | ( | |||||||||||||||||||||||
Change in credit facility and commercial paper | ( | ( | ||||||||||||||||||||||||
Change in short-term debt | ( | |||||||||||||||||||||||||
Withholding remittance - share-based compensation | ( | ( | ( | ( | ||||||||||||||||||||||
Other | ( | ( | ( | ( | ||||||||||||||||||||||
Net cash provided by financing activities | ||||||||||||||||||||||||||
Change in cash and cash equivalents | ( | |||||||||||||||||||||||||
Cash and cash equivalents at beginning of period | ||||||||||||||||||||||||||
Cash and cash equivalents at end of period | $ | $ | $ | $ | ||||||||||||||||||||||
SUPPLEMENTAL INFORMATION: | ||||||||||||||||||||||||||
Interest paid, net of amounts capitalized | $ | $ | $ | $ | ||||||||||||||||||||||
Income taxes paid (received), net | $ | $ | $ | ( | $ |
11 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Three Months Ended March 31, | ||||||||||||||||||||
2022 | 2021 | |||||||||||||||||||
Common stock shares | ||||||||||||||||||||
Beginning and ending balances | ||||||||||||||||||||
Common stock amount | ||||||||||||||||||||
Beginning and ending balances | $ | $ | ||||||||||||||||||
Additional paid-in capital | ||||||||||||||||||||
Beginning balances | ||||||||||||||||||||
Share-based compensation | ||||||||||||||||||||
Contributions from Southwest Gas Holdings, Inc. | ||||||||||||||||||||
Ending balances | ||||||||||||||||||||
Accumulated other comprehensive loss | ||||||||||||||||||||
Beginning balances | ( | ( | ||||||||||||||||||
Net actuarial gain arising during period, less amortization of unamortized benefit plan cost, net of tax | ||||||||||||||||||||
FSIRS amounts reclassified to net income, net of tax | ||||||||||||||||||||
Ending balances | ( | ( | ||||||||||||||||||
Retained earnings | ||||||||||||||||||||
Beginning balances | ||||||||||||||||||||
Net income | ||||||||||||||||||||
Share-based compensation | ( | ( | ||||||||||||||||||
Dividends declared to Southwest Gas Holdings, Inc. | ( | ( | ||||||||||||||||||
Ending balances | ||||||||||||||||||||
Total Southwest Gas Corporation equity ending balances | $ | $ |
12 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
13 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
(Thousands of dollars) | March 31, 2022 | December 31, 2021 | |||||||||
Net cash surrender value of COLI policies | $ | $ | |||||||||
Other property | |||||||||||
Total Southwest Gas Corporation | |||||||||||
Non-regulated property, equipment, and intangibles | |||||||||||
Non-regulated accumulated provision for depreciation and amortization | ( | ( | |||||||||
Other property and investments | |||||||||||
Total Southwest Gas Holdings, Inc. | $ | $ |
14 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
(Thousands of dollars) | Natural Gas Distribution | Utility Infrastructure Services | Pipeline and Storage | Total Company | ||||||||||||||||||||||
December 31, 2021 | $ | $ | $ | $ | ||||||||||||||||||||||
Measurement-period adjustments from Riggs Distler acquisition (a) | ( | ( | ||||||||||||||||||||||||
Measurement-period adjustments from MountainWest acquisition (a) | ( | ( | ||||||||||||||||||||||||
Foreign currency translation adjustment | ||||||||||||||||||||||||||
March 31, 2022 | $ | $ | $ | $ |
Three Months Ended March 31, | Twelve Months Ended March 31, | ||||||||||||||||||||||
(Thousands of dollars) | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||
Southwest Gas Corporation: | |||||||||||||||||||||||
Change in COLI policies | $ | ( | $ | $ | $ | ||||||||||||||||||
Interest income | |||||||||||||||||||||||
Equity AFUDC | ( | ||||||||||||||||||||||
Other components of net periodic benefit cost | ( | ( | ( | ( | |||||||||||||||||||
Miscellaneous income and (expense) | ( | ( | ( | ||||||||||||||||||||
Southwest Gas Corporation - total other income (deductions) | ( | ||||||||||||||||||||||
Centuri, MountainWest, and Southwest Gas Holdings, Inc.: | |||||||||||||||||||||||
Foreign transaction gain (loss) | ( | ( | ( | ||||||||||||||||||||
Equity AFUDC | |||||||||||||||||||||||
Equity in earnings of unconsolidated investments | ( | ||||||||||||||||||||||
Miscellaneous income and (expense) | ( | ( | ( | ||||||||||||||||||||
Southwest Gas Holdings, Inc. - total other income (deductions) | $ | $ | $ | ( | $ |
15 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
(Thousands of dollars): | Linetec | Drum | Total | |||||||||||||||||
Balance, December 31, 2021 | $ | $ | $ | |||||||||||||||||
Net income attributable to redeemable noncontrolling interests | ( | |||||||||||||||||||
Redemption value adjustments | ( | ( | ||||||||||||||||||
Redemption of equity interest from noncontrolling party | ( | ( | ||||||||||||||||||
Balance, March 31, 2022 | $ | $ | $ |
Three Months Ended March 31, | Twelve Months Ended March 31, | |||||||||||||||||||||||||
(In thousands) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Weighted average basic shares | ||||||||||||||||||||||||||
Effect of dilutive securities: | ||||||||||||||||||||||||||
Restricted stock units (1) | ||||||||||||||||||||||||||
Weighted average diluted shares |
16 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
17 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Qualified Retirement Plan | |||||||||||||||||||||||
March 31, | |||||||||||||||||||||||
Three Months | Twelve Months | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
(Thousands of dollars) | |||||||||||||||||||||||
Service cost | $ | $ | $ | $ | |||||||||||||||||||
Interest cost | |||||||||||||||||||||||
Expected return on plan assets | ( | ( | ( | ( | |||||||||||||||||||
Amortization of net actuarial loss | |||||||||||||||||||||||
Net periodic benefit cost | $ | $ | $ | $ | |||||||||||||||||||
SERP | |||||||||||||||||||||||
March 31, | |||||||||||||||||||||||
Three Months | Twelve Months | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
(Thousands of dollars) | |||||||||||||||||||||||
Service cost | $ | $ | $ | $ | |||||||||||||||||||
Interest cost | |||||||||||||||||||||||
Amortization of net actuarial loss | |||||||||||||||||||||||
Net periodic benefit cost | $ | $ | $ | $ | |||||||||||||||||||
PBOP | |||||||||||||||||||||||
March 31, | |||||||||||||||||||||||
Three Months | Twelve Months | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
(Thousands of dollars) | |||||||||||||||||||||||
Service cost | $ | $ | $ | $ | |||||||||||||||||||
Interest cost | |||||||||||||||||||||||
Expected return on plan assets | ( | ( | ( | ( | |||||||||||||||||||
Amortization of prior service costs | |||||||||||||||||||||||
Net periodic benefit cost | $ | $ | $ | $ |
18 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Three Months Ended March 31, | Twelve Months Ended March 31, | ||||||||||||||||||||||
(Thousands of dollars) | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||
Residential | $ | $ | $ | $ | |||||||||||||||||||
Small commercial | |||||||||||||||||||||||
Large commercial | |||||||||||||||||||||||
Industrial/other | |||||||||||||||||||||||
Transportation | |||||||||||||||||||||||
Revenue from contracts with customers | |||||||||||||||||||||||
Alternative revenue program revenues (deferrals) | ( | ( | ( | ||||||||||||||||||||
Other revenues (1) | |||||||||||||||||||||||
Total Regulated operations revenues | $ | $ | $ | $ |
Three Months Ended March 31, | Twelve Months Ended March 31, | ||||||||||||||||||||||
(Thousands of dollars) | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||
Service Types: | |||||||||||||||||||||||
Gas infrastructure services | $ | $ | $ | $ | |||||||||||||||||||
Electric power infrastructure services | |||||||||||||||||||||||
Other | |||||||||||||||||||||||
Total Utility infrastructure services revenues | $ | $ | $ | $ |
19 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Three Months Ended March 31, | Twelve Months Ended March 31, | ||||||||||||||||||||||
(Thousands of dollars) | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||
Contract Types: | |||||||||||||||||||||||
Master services agreement | $ | $ | $ | $ | |||||||||||||||||||
Bid contract | |||||||||||||||||||||||
Total Utility infrastructure services revenues | $ | $ | $ | $ | |||||||||||||||||||
Unit price contracts | $ | $ | $ | $ | |||||||||||||||||||
Fixed price contracts | |||||||||||||||||||||||
Time and materials contracts | |||||||||||||||||||||||
Total Utility infrastructure services revenues | $ | $ | $ | $ |
(Thousands of dollars) | March 31, 2022 | December 31, 2021 | |||||||||
Contracts receivable, net | $ | $ | |||||||||
Revenue earned on contracts in progress in excess of billings | |||||||||||
Amounts billed in excess of revenue earned on contracts |
(Thousands of dollars) | March 31, 2022 | December 31, 2021 | |||||||||
Billed on completed contracts and contracts in progress | $ | $ | |||||||||
Other receivables | |||||||||||
Contracts receivable, gross | |||||||||||
Allowance for doubtful accounts | ( | ( | |||||||||
Contracts receivable, net | $ | $ |
20 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Three Months Ended March 31, | |||||
(Thousands of dollars) | 2022 | ||||
Regulated gas transportation and storage revenues | $ | ||||
NGL revenues | |||||
Other revenues | |||||
Revenue from contracts with customers | |||||
Other revenues | |||||
Total Regulated operations revenues | $ |
21 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Gross proceeds | $ | |||||||
Less: agent commissions | ( | |||||||
Net proceeds | $ | |||||||
Number of shares sold | ||||||||
Weighted average price per share | $ |
22 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
March 31, 2022 | December 31, 2021 | |||||||||||||||||||||||||
Carrying Amount | Fair Value | Carrying Amount | Fair Value | |||||||||||||||||||||||
(Thousands of dollars) | ||||||||||||||||||||||||||
Southwest Gas Corporation: | ||||||||||||||||||||||||||
Debentures: | ||||||||||||||||||||||||||
Notes, | $ | $ | $ | $ | ||||||||||||||||||||||
Notes, | ||||||||||||||||||||||||||
Notes, | ||||||||||||||||||||||||||
Notes, | ||||||||||||||||||||||||||
Notes, | ||||||||||||||||||||||||||
Notes, | ||||||||||||||||||||||||||
Notes, | ||||||||||||||||||||||||||
Notes, | ||||||||||||||||||||||||||
Notes, | ||||||||||||||||||||||||||
Medium-term notes, | ||||||||||||||||||||||||||
Medium-term notes, | ||||||||||||||||||||||||||
Medium-term notes, | ||||||||||||||||||||||||||
Unamortized discount and debt issuance costs | ( | ( | ||||||||||||||||||||||||
Revolving credit facility and commercial paper | ||||||||||||||||||||||||||
Industrial development revenue bonds: | ||||||||||||||||||||||||||
Tax-exempt Series A, due 2028 | ||||||||||||||||||||||||||
2003 Series A, due 2038 | ||||||||||||||||||||||||||
2008 Series A, due 2038 | ||||||||||||||||||||||||||
2009 Series A, due 2039 | ||||||||||||||||||||||||||
Unamortized discount and debt issuance costs | ( | ( | ||||||||||||||||||||||||
Less: current maturities | ( | ( | ||||||||||||||||||||||||
Southwest Gas Corporation total long-term debt, less current maturities | $ | $ | ||||||||||||||||||||||||
Southwest Gas Holdings, Inc.: | ||||||||||||||||||||||||||
Centuri secured term loan facility | $ | $ | $ | $ | ||||||||||||||||||||||
Centuri secured revolving credit facility | ||||||||||||||||||||||||||
MountainWest unsecured senior notes, | ||||||||||||||||||||||||||
MountainWest unsecured senior notes, | ||||||||||||||||||||||||||
MountainWest unsecured senior notes, | ||||||||||||||||||||||||||
Other debt obligations | ||||||||||||||||||||||||||
Unamortized discount and debt issuance costs | ( | ( | ||||||||||||||||||||||||
Less: current maturities | ( | ( | ||||||||||||||||||||||||
Southwest Gas Holdings, Inc. total long-term debt, less current maturities | $ | $ |
23 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
24 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
25 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | |||||||||||||||||||||||||||||||||||||
(Thousands of dollars) | Before- Tax Amount | Tax (Expense) or Benefit (1) | Net-of- Tax Amount | Before- Tax Amount | Tax (Expense) or Benefit (1) | Net-of- Tax Amount | ||||||||||||||||||||||||||||||||
Defined benefit pension plans: | ||||||||||||||||||||||||||||||||||||||
Amortization of prior service cost | $ | $ | ( | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||
Amortization of net actuarial (gain)/loss | ( | ( | ||||||||||||||||||||||||||||||||||||
Regulatory adjustment | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Pension plans other comprehensive income (loss) | ( | ( | ||||||||||||||||||||||||||||||||||||
FSIRS (designated hedging activities): | ||||||||||||||||||||||||||||||||||||||
Amounts reclassified into net income | ( | ( | ||||||||||||||||||||||||||||||||||||
FSIRS other comprehensive income (loss) | ( | ( | ||||||||||||||||||||||||||||||||||||
Total other comprehensive income (loss) - Southwest Gas Corporation | ( | ( | ||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustments: | ||||||||||||||||||||||||||||||||||||||
Translation adjustments | ||||||||||||||||||||||||||||||||||||||
Foreign currency other comprehensive income (loss) | ||||||||||||||||||||||||||||||||||||||
Total other comprehensive income (loss) - Southwest Gas Holdings, Inc. | $ | $ | ( | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||
Twelve Months Ended March 31, 2022 | Twelve Months Ended March 31, 2021 | |||||||||||||||||||||||||||||||||||||
(Thousands of dollars) | Before- Tax Amount | Tax (Expense) or Benefit (1) | Net-of- Tax Amount | Before- Tax Amount | Tax (Expense) or Benefit (1) | Net-of- Tax Amount | ||||||||||||||||||||||||||||||||
Defined benefit pension plans: | ||||||||||||||||||||||||||||||||||||||
Net actuarial gain/(loss) | $ | $ | ( | $ | $ | ( | $ | $ | ( | |||||||||||||||||||||||||||||
Amortization of prior service cost | ( | ( | ||||||||||||||||||||||||||||||||||||
Amortization of net actuarial (gain)/loss | ( | ( | ||||||||||||||||||||||||||||||||||||
Regulatory adjustment | ( | ( | ( | |||||||||||||||||||||||||||||||||||
Pension plans other comprehensive income (loss) | ( | ( | ( | |||||||||||||||||||||||||||||||||||
FSIRS (designated hedging activities): | ||||||||||||||||||||||||||||||||||||||
Amounts reclassified into net income | ( | ( | ||||||||||||||||||||||||||||||||||||
FSIRS other comprehensive income (loss) | ( | ( | ||||||||||||||||||||||||||||||||||||
Total other comprehensive income (loss) - Southwest Gas Corporation | ( | ( | ( | |||||||||||||||||||||||||||||||||||
Foreign currency translation adjustments: | ||||||||||||||||||||||||||||||||||||||
Translation adjustments | ||||||||||||||||||||||||||||||||||||||
Foreign currency other comprehensive income (loss) | ||||||||||||||||||||||||||||||||||||||
Total other comprehensive income (loss) - Southwest Gas Holdings, Inc. | $ | $ | ( | $ | $ | ( | $ | $ |
26 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Defined Benefit Plans | FSIRS | Foreign Currency Items | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(Thousands of dollars) | Before-Tax | Tax (Expense) Benefit (4) | After-Tax | Before-Tax | Tax (Expense) Benefit (4) | After-Tax | Before-Tax | Tax (Expense) Benefit | After-Tax | AOCI | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Beginning Balance AOCI December 31, 2021 | $ | ( | $ | $ | ( | $ | ( | $ | $ | ( | $ | $ | — | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Translation adjustments | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss) before reclassifications | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
FSIRS amount reclassified from AOCI (1) | — | — | — | ( | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Amortization of prior service cost (2) | ( | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Amortization of net actuarial loss (2) | ( | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Regulatory adjustment (3) | ( | ( | — | — | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Net current period other comprehensive income (loss) attributable to Southwest Gas Holdings, Inc. | ( | ( | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Ending Balance AOCI March 31, 2022 | $ | ( | $ | $ | ( | $ | $ | $ | $ | $ | — | $ | $ | ( |
Defined Benefit Plans | FSIRS | |||||||||||||||||||||||||||||||||||||||||||
(Thousands of dollars) | Before-Tax | Tax (Expense) Benefit (8) | After-Tax | Before-Tax | Tax (Expense) Benefit (8) | After-Tax | AOCI | |||||||||||||||||||||||||||||||||||||
Beginning Balance AOCI December 31, 2021 | $ | ( | $ | $ | ( | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||||||||||||||||||
FSIRS amount reclassified from AOCI (5) | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||
Amortization of prior service cost (6) | ( | — | — | — | ||||||||||||||||||||||||||||||||||||||||
Amortization of net actuarial loss (6) | ( | — | — | — | ||||||||||||||||||||||||||||||||||||||||
Regulatory adjustment (7) | ( | ( | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||
Net current period other comprehensive income attributable to Southwest Gas Corporation | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
Ending Balance AOCI March 31, 2022 | $ | ( | $ | $ | ( | $ | $ | $ | $ | ( |
27 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
(Thousands of dollars) | March 31, 2022 | December 31, 2021 | ||||||||||||
Net actuarial loss | $ | ( | $ | ( | ||||||||||
Prior service cost | ( | ( | ||||||||||||
Less: amount recognized in regulatory assets | ||||||||||||||
Recognized in AOCI | $ | ( | $ | ( |
(Thousands of dollars) | March 31, 2022 | December 31, 2021 | |||||||||
Centuri accounts receivable for services provided to Southwest | $ | $ |
(Thousands of dollars) | Natural Gas Distribution | Utility Infrastructure Services | Pipeline and Storage | Other | Total | ||||||||||||||||||||||||
Three Months Ended March 31, 2022 | |||||||||||||||||||||||||||||
Revenues from external customers | $ | $ | $ | $ | — | $ | |||||||||||||||||||||||
Intersegment revenues | — | ||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | — | $ | |||||||||||||||||||||||
Segment net income (loss) | $ | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||
Three Months Ended March 31, 2021 | |||||||||||||||||||||||||||||
Revenues from external customers | $ | $ | $ | $ | — | $ | |||||||||||||||||||||||
Intersegment revenues | — | ||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | — | $ | |||||||||||||||||||||||
Segment net income (loss) | $ | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||
28 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
(Thousands of dollars) | Natural Gas Distribution | Utility Infrastructure Services | Pipeline and Storage | Other | Total | ||||||||||||||||||||||||
Twelve Months Ended March 31, 2022 | |||||||||||||||||||||||||||||
Revenues from external customers | $ | $ | $ | $ | — | $ | |||||||||||||||||||||||
Intersegment revenues | — | ||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | — | $ | |||||||||||||||||||||||
Segment net income (loss) | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||
Twelve Months Ended March 31, 2021 | |||||||||||||||||||||||||||||
Revenues from external customers | $ | $ | $ | $ | — | $ | |||||||||||||||||||||||
Intersegment revenues | — | ||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | — | $ | |||||||||||||||||||||||
Segment net income (loss) | $ | $ | $ | $ | ( | $ |
29 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
(Millions of dollars) | Acquisition Date | Measurement Period Adjustments | Revised Acquisition Date | |||||||||||||||||
Cash and cash equivalents | $ | $ | — | $ | ||||||||||||||||
Accounts receivable | ( | |||||||||||||||||||
Contract assets | ||||||||||||||||||||
Income taxes receivable, net | — | |||||||||||||||||||
Right of use assets under operating leases | — | |||||||||||||||||||
Prepaid expenses | — | |||||||||||||||||||
Property and equipment | ||||||||||||||||||||
Intangible assets | ( | |||||||||||||||||||
Goodwill | ||||||||||||||||||||
Total assets acquired | $ | ( | $ | |||||||||||||||||
Trade and other payables | — | |||||||||||||||||||
Finance lease obligations | ||||||||||||||||||||
Contract liabilities | — | |||||||||||||||||||
Operating lease obligations | — | |||||||||||||||||||
Other liabilities | ( | |||||||||||||||||||
Deferred tax liabilities | ( | |||||||||||||||||||
Total liabilities assumed and noncontrolling interest | ( | |||||||||||||||||||
Net assets acquired | $ | $ | ( | $ |
30 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
(Millions of dollars) | Acquisition Date | Measurement Period Adjustments | Revised Acquisition Date | |||||||||||||||||
Gas plant, net | $ | $ | — | $ | ||||||||||||||||
Other property and investments | — | |||||||||||||||||||
Cash and cash equivalents | — | |||||||||||||||||||
Accounts receivable, net of allowances | ||||||||||||||||||||
Prepaid and other current assets | — | |||||||||||||||||||
Deferred charges and other assets | — | |||||||||||||||||||
Goodwill | ( | |||||||||||||||||||
Deferred income taxes | ( | |||||||||||||||||||
Total assets acquired | ( | |||||||||||||||||||
Long-term debt | — | |||||||||||||||||||
Accounts payable | — | |||||||||||||||||||
Deferred purchased gas costs | — | |||||||||||||||||||
Customer deposits | — | |||||||||||||||||||
Accrued general taxes | — | |||||||||||||||||||
Accrued interest | — | |||||||||||||||||||
Other current liabilities | — | |||||||||||||||||||
Accumulated removal costs | — | |||||||||||||||||||
Other deferred credits | — | |||||||||||||||||||
Total liabilities assumed | — | |||||||||||||||||||
Net assets acquired | $ | $ | ( | $ |
31 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
32 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
33 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
34 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Period Ended March 31, | ||||||||||||||||||||||||||
Three Months | Twelve Months | |||||||||||||||||||||||||
(In thousands, except per share amounts) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Contribution to net income | ||||||||||||||||||||||||||
Natural gas distribution | $ | 111,795 | $ | 118,715 | $ | 180,215 | $ | 194,234 | ||||||||||||||||||
Utility infrastructure services | (23,486) | (859) | 17,793 | 84,207 | ||||||||||||||||||||||
Pipeline and storage | 16,930 | — | 16,930 | — | ||||||||||||||||||||||
Corporate and administrative | (9,061) | (563) | (35,274) | (1,366) | ||||||||||||||||||||||
Net income | $ | 96,178 | $ | 117,293 | $ | 179,664 | $ | 277,075 | ||||||||||||||||||
Weighted average common shares | 60,737 | 57,600 | 59,919 | 56,564 | ||||||||||||||||||||||
Basic earnings per share | ||||||||||||||||||||||||||
Consolidated | $ | 1.58 | $ | 2.04 | $ | 3.00 | $ | 4.90 | ||||||||||||||||||
Natural Gas Distribution | ||||||||||||||||||||||||||
Reconciliation of Gross Margin to Operating Margin (Non-GAAP measure) | ||||||||||||||||||||||||||
Utility Gross Margin | $ | 233,882 | $ | 233,156 | $ | 571,051 | $ | 546,171 | ||||||||||||||||||
Plus: | ||||||||||||||||||||||||||
Operations and maintenance (excluding Admin. & General) expense | 73,422 | 64,057 | 276,525 | 246,214 | ||||||||||||||||||||||
Depreciation and amortization expense | 72,114 | 68,698 | 256,814 | 239,268 | ||||||||||||||||||||||
Operating margin | $ | 379,418 | $ | 365,911 | $ | 1,104,390 | $ | 1,031,653 |
35 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Three Months Ended March 31, | ||||||||||||||
(Thousands of dollars) | 2022 | 2021 | ||||||||||||
Regulated operations revenues | $ | 676,539 | $ | 521,932 | ||||||||||
Net cost of gas sold | 297,121 | 156,021 | ||||||||||||
Operating margin | 379,418 | 365,911 | ||||||||||||
Operations and maintenance expense | 119,636 | 106,135 | ||||||||||||
Depreciation and amortization | 72,114 | 68,698 | ||||||||||||
Taxes other than income taxes | 21,652 | 20,687 | ||||||||||||
Operating income | 166,016 | 170,391 | ||||||||||||
Other income (deductions) | 1,315 | 550 | ||||||||||||
Net interest deductions | 26,610 | 22,166 | ||||||||||||
Income before income taxes | 140,721 | 148,775 | ||||||||||||
Income tax expense | 28,926 | 30,060 | ||||||||||||
Contribution to consolidated net income | $ | 111,795 | $ | 118,715 |
36 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Twelve Months Ended March 31, | ||||||||||||||
(Thousands of dollars) | 2022 | 2021 | ||||||||||||
Regulated operations revenues | $ | 1,676,397 | $ | 1,369,690 | ||||||||||
Net cost of gas sold | 572,007 | 338,037 | ||||||||||||
Operating margin | 1,104,390 | 1,031,653 | ||||||||||||
Operations and maintenance expense | 452,051 | 409,429 | ||||||||||||
Depreciation and amortization | 256,814 | 239,268 | ||||||||||||
Taxes other than income taxes | 81,308 | 67,769 | ||||||||||||
Operating income | 314,217 | 315,187 | ||||||||||||
Other income (deductions) | (3,794) | 14,496 | ||||||||||||
Net interest deductions | 102,004 | 98,256 | ||||||||||||
Income before income taxes | 208,419 | 231,427 | ||||||||||||
Income tax expense | 28,204 | 37,193 | ||||||||||||
Contribution to consolidated net income | $ | 180,215 | $ | 194,234 |
37 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Three Months Ended March 31, | ||||||||||||||
(Thousands of dollars) | 2022 | 2021 | ||||||||||||
Utility infrastructure services revenues | $ | 523,877 | $ | 363,975 | ||||||||||
Operating expenses: | ||||||||||||||
Utility infrastructure services expenses | 503,232 | 335,614 | ||||||||||||
Depreciation and amortization | 37,612 | 24,744 | ||||||||||||
Operating income (loss) | (16,967) | 3,617 | ||||||||||||
Other income (deductions) | (486) | (102) | ||||||||||||
Net interest deductions | 11,131 | 1,622 | ||||||||||||
Income (loss) before income taxes | (28,584) | 1,893 | ||||||||||||
Income tax expense (benefit) | (6,170) | 1,200 | ||||||||||||
Net income (loss) | (22,414) | 693 | ||||||||||||
Net income attributable to noncontrolling interests | 1,072 | 1,552 | ||||||||||||
Contribution to consolidated results attributable to Centuri | $ | (23,486) | $ | (859) |
38 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Twelve Months Ended March 31, | ||||||||||||||
(Thousands of dollars) | 2022 | 2021 | ||||||||||||
Utility infrastructure services revenues | $ | 2,318,563 | $ | 1,978,770 | ||||||||||
Operating expenses: | ||||||||||||||
Utility infrastructure services expenses | 2,123,085 | 1,745,729 | ||||||||||||
Depreciation and amortization | 130,511 | 98,548 | ||||||||||||
Operating income | 64,967 | 134,493 | ||||||||||||
Other income (deductions) | 683 | (67) | ||||||||||||
Net interest deductions | 30,508 | 7,992 | ||||||||||||
Income before income taxes | 35,142 | 126,434 | ||||||||||||
Income tax expense | 11,406 | 34,477 | ||||||||||||
Net income | 23,736 | 91,957 | ||||||||||||
Net income attributable to noncontrolling interests | 5,943 | 7,750 | ||||||||||||
Contribution to consolidated net income attributable to Centuri | $ | 17,793 | $ | 84,207 |
39 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Three Months Ended March 31, | ||||||||
(Thousands of dollars) | 2022 | |||||||
Regulated operations revenues | $ | 66,993 | ||||||
Operating expenses: | ||||||||
Net cost of gas sold | 1,797 | |||||||
Operations and maintenance expense | 24,312 | |||||||
Depreciation and amortization | 12,920 | |||||||
Taxes other than income taxes | 3,164 | |||||||
Operating income | 24,800 | |||||||
Other income (deductions) | 543 | |||||||
Net interest deductions | 4,382 | |||||||
Income before income taxes | 20,961 | |||||||
Income tax expense | 4,031 | |||||||
Contribution to consolidated results attributable to MountainWest | $ | 16,930 |
40 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
41 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
42 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
43 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
(Thousands of dollars) | March 31, 2022 | December 31, 2021 | March 31, 2021 | |||||||||||||||||
Arizona | $ | 255,472 | $ | 214,387 | $ | 194,446 | ||||||||||||||
Northern Nevada | 13,700 | 12,632 | 3,036 | |||||||||||||||||
Southern Nevada | 93,153 | 55,967 | 31,849 | |||||||||||||||||
California | 5,629 | 8,159 | 9,555 | |||||||||||||||||
$ | 367,954 | $ | 291,145 | $ | 238,886 |
44 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
45 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
46 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
47 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
48 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
49 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
50 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Exhibit 4.01 | - | ||||||||||
Exhibit 4.02 | - | ||||||||||
Exhibit 4.03 | - | ||||||||||
Exhibit 10.1 | - | Amendment No. 1, dated as of March 22, 2022, to the Term Loan Agreement, dated as of March 23, 2021, by and among Southwest Gas Corporation, the lenders, book runners and syndication agents party thereto and The Bank of New York Mellon, as Administrative Agent. Incorporated herein by reference to Exhibit 10.1 to Form 8-K dated March 17, 2022. File Nos. 001-37976 and 001-07850. | |||||||||
Exhibit 31.01* | - | ||||||||||
Exhibit 31.02* | - | ||||||||||
Exhibit 32.01* | - | ||||||||||
Exhibit 32.02* | - | ||||||||||
Exhibit 101* | - | The following materials from the Quarterly Report on Form 10-Q of Southwest Gas Holdings, Inc. and Southwest Gas Corporation for the quarter ended March 31, 2022, were formatted in Inline XBRL (Extensible Business Reporting Language): (1) Southwest Gas Holdings, Inc. and Subsidiaries Condensed Consolidated Balance Sheets, (ii) Southwest Gas Holdings, Inc. and Subsidiaries Condensed Consolidated Statements of Income, (iii) Southwest Gas Holdings, Inc. and Subsidiaries Condensed Consolidated Statements of Comprehensive Income, (iv) Southwest Gas Holdings, Inc. and Subsidiaries Condensed Consolidated Statements of Cash Flows, (v) Southwest Gas Holdings, Inc. and Subsidiaries Condensed Consolidated Statements of Equity, (vi) Southwest Gas Corporation and Subsidiaries Condensed Consolidated Balance Sheets, (vii) Southwest Gas Corporation and Subsidiaries Condensed Consolidated Statements of Income, (viii) Southwest Gas Corporation and Subsidiaries Condensed Consolidated Statements of Comprehensive Income, (ix) Southwest Gas Corporation and Subsidiaries Condensed Consolidated Statements of Cash Flows, (x) Southwest Gas Corporation and Subsidiaries Condensed Consolidated Statements of Equity. The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | |||||||||
104* | Cover Page Interactive Data File (embedded within the Inline XBRL document). | ||||||||||
*Filed herewith. |
51 |
SOUTHWEST GAS HOLDINGS, INC. | Form 10-Q | |||||||
SOUTHWEST GAS CORPORATION | March 31, 2022 |
Southwest Gas Holdings, Inc. | ||
(Registrant) |
/s/ LORI L. COLVIN | ||
Lori L. Colvin | ||
Vice President/Controller and Chief Accounting Officer |
Southwest Gas Corporation | ||
(Registrant) |
/s/ LORI L. COLVIN | ||
Lori L. Colvin | ||
Vice President/Controller and Chief Accounting Officer |
52 |
/s/ KAREN S. HALLER | |||||
Karen S. Haller | |||||
President and Chief Executive Officer | |||||
Southwest Gas Holdings, Inc. |
/s/ GREGORY J. PETERSON | |||||
Gregory J. Peterson | |||||
Senior Vice President/Chief Financial Officer | |||||
Southwest Gas Holdings, Inc. |
/s/ KAREN S. HALLER | |||||
Karen S. Haller | |||||
President and Chief Executive Officer | |||||
Southwest Gas Corporation |
/s/ GREGORY J. PETERSON | |||||
Gregory J. Peterson | |||||
Senior Vice President/Chief Financial Officer | |||||
Southwest Gas Corporation |
/s/ Karen S. Haller | |||||
Karen S. Haller President and Chief Executive Officer |
/s/ Gregory J. Peterson | |||||
Gregory J. Peterson Senior Vice President/Chief Financial Officer |
/s/ Karen S. Haller | |||||
Karen S. Haller President and Chief Executive Officer |
/s/ Gregory J. Peterson | |||||
Gregory J. Peterson Senior Vice President/Chief Financial Officer |
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares |
Mar. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Common stock, par (in USD per share) | $ 1 | $ 1 |
Common stock, authorized (in shares) | 120,000,000 | 120,000,000 |
Common stock, issued (in shares) | 66,849,225 | 60,422,081 |
Common stock, outstanding (in shares) | 66,849,225 | 60,422,081 |
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Operating revenues: | ||||
Regulated operations revenues | $ 743,532 | $ 521,932 | $ 1,743,390 | $ 1,369,690 |
Utility infrastructure services revenues | 523,877 | 363,975 | 2,318,563 | 1,978,770 |
Total operating revenues | 1,267,409 | 885,907 | 4,061,953 | 3,348,460 |
Operating expenses: | ||||
Net cost of gas sold | 298,918 | 156,021 | 573,804 | 338,037 |
Operations and maintenance | 149,303 | 106,690 | 515,759 | 411,025 |
Depreciation and amortization | 122,646 | 93,442 | 400,245 | 337,816 |
Taxes other than income taxes | 24,816 | 20,687 | 84,472 | 67,769 |
Utility infrastructure services expenses | 503,232 | 335,614 | 2,123,085 | 1,745,729 |
Total operating expenses | 1,098,915 | 712,454 | 3,697,365 | 2,900,376 |
Operating income | 168,494 | 173,453 | 364,588 | 448,084 |
Other income and (expenses): | ||||
Net interest deductions | (48,363) | (23,964) | (143,597) | (107,061) |
Other income (deductions) | 1,244 | 448 | (2,703) | 14,429 |
Total other income and (expenses) | (47,119) | (23,516) | (146,300) | (92,632) |
Income before income taxes | 121,375 | 149,937 | 218,288 | 355,452 |
Income tax expense | 24,125 | 31,092 | 32,681 | 70,627 |
Net income | 97,250 | 118,845 | 185,607 | 284,825 |
Net income attributable to noncontrolling interests | 1,072 | 1,552 | 5,943 | 7,750 |
Net income attributable to Southwest Gas Holdings, Inc. | $ 96,178 | $ 117,293 | $ 179,664 | $ 277,075 |
Earnings per share: | ||||
Basic (in USD per share) | $ 1.58 | $ 2.04 | $ 3.00 | $ 4.90 |
Diluted (in USD per share) | $ 1.58 | $ 2.03 | $ 2.99 | $ 4.89 |
Weighted average shares: | ||||
Basic (in shares) | 60,737 | 57,600 | 59,919 | 56,564 |
Diluted (in shares) | 60,854 | 57,679 | 60,044 | 56,649 |
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - Southwest - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Regulated operations revenues | $ 743,532 | $ 521,932 | $ 1,743,390 | $ 1,369,690 |
Operating expenses: | ||||
Net cost of gas sold | 298,918 | 156,021 | 573,804 | 338,037 |
Operations and maintenance | 149,303 | 106,690 | 515,759 | 411,025 |
Depreciation and amortization | 122,646 | 93,442 | 400,245 | 337,816 |
Taxes other than income taxes | 24,816 | 20,687 | 84,472 | 67,769 |
Total operating expenses | 1,098,915 | 712,454 | 3,697,365 | 2,900,376 |
Operating income | 168,494 | 173,453 | 364,588 | 448,084 |
Other income and (expenses): | ||||
Net interest deductions | (48,363) | (23,964) | (143,597) | (107,061) |
Other income (deductions) | 1,244 | 448 | (2,703) | 14,429 |
Total other income and (expenses) | (47,119) | (23,516) | (146,300) | (92,632) |
Income before income taxes | 121,375 | 149,937 | 218,288 | 355,452 |
Income tax expense | 24,125 | 31,092 | 32,681 | 70,627 |
Net income attributable to Southwest Gas Holdings, Inc. | 96,178 | 117,293 | 179,664 | 277,075 |
Southwest Gas Corporation | ||||
Regulated operations revenues | 676,539 | 521,932 | 1,676,397 | 1,369,690 |
Operating expenses: | ||||
Net cost of gas sold | 297,121 | 156,021 | 572,007 | 338,037 |
Operations and maintenance | 119,636 | 106,135 | 452,051 | 409,429 |
Depreciation and amortization | 72,114 | 68,698 | 256,814 | 239,268 |
Taxes other than income taxes | 21,652 | 20,687 | 81,308 | 67,769 |
Total operating expenses | 510,523 | 351,541 | 1,362,180 | 1,054,503 |
Operating income | 166,016 | 170,391 | 314,217 | 315,187 |
Other income and (expenses): | ||||
Net interest deductions | (26,610) | (22,166) | (102,004) | (98,256) |
Other income (deductions) | 1,315 | 550 | (3,794) | 14,496 |
Total other income and (expenses) | (25,295) | (21,616) | (105,798) | (83,760) |
Income before income taxes | 140,721 | 148,775 | 208,419 | 231,427 |
Income tax expense | 28,926 | 30,060 | 28,204 | 37,193 |
Net income attributable to Southwest Gas Holdings, Inc. | $ 111,795 | $ 118,715 | $ 180,215 | $ 194,234 |
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY - Southwest - USD ($) $ in Thousands |
Total |
Southwest Gas Corporation |
Southwest Gas Holdings, Inc. Common Stock, $1 Par Value |
Southwest Gas Holdings, Inc. Common Stock, $1 Par Value
Southwest Gas Corporation
|
Additional paid-in capital |
Additional paid-in capital
Southwest Gas Corporation
|
Accumulated other comprehensive loss |
Accumulated other comprehensive loss
Southwest Gas Corporation
|
Retained earnings |
Retained earnings
Southwest Gas Corporation
|
---|---|---|---|---|---|---|---|---|---|---|
Beginning balance (in shares) at Dec. 31, 2020 | 57,193,000 | |||||||||
Beginning balance at Dec. 31, 2020 | $ 58,823 | $ 1,609,155 | $ 1,410,345 | $ (61,003) | $ (61,135) | $ 1,067,978 | $ 835,146 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Share-based compensation | 2,015 | (350) | ||||||||
Contributions from Southwest Gas Holdings, Inc. | 45,984 | |||||||||
Net actuarial gain arising during period, less amortization of unamortized benefit plan cost, net of tax | 1,379 | 1,379 | ||||||||
FSIRS amounts reclassified to net income, net of tax | $ 413 | $ 413 | 413 | 413 | ||||||
Net income | 117,293 | 118,715 | ||||||||
Dividends declared to Southwest Gas Holdings, Inc. | (34,876) | (27,500) | ||||||||
Ending balance (in shares) at Mar. 31, 2021 | 57,995,000 | 47,482,000 | ||||||||
Ending balance at Mar. 31, 2021 | 2,374,124 | $ 59,625 | $ 49,112 | 1,660,108 | 1,458,344 | (58,388) | (59,343) | 1,112,377 | 926,011 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
FSIRS amounts reclassified to net income, net of tax | $ 1,655 | 1,655 | ||||||||
Ending balance (in shares) at Mar. 31, 2022 | 66,849,225 | 66,849,000 | 47,482,000 | |||||||
Ending balance at Mar. 31, 2022 | 2,611,534 | $ 68,479 | $ 49,112 | 2,273,837 | 1,620,616 | (43,972) | (45,371) | 1,190,738 | 987,177 | |
Beginning balance (in shares) at Dec. 31, 2021 | 60,422,081 | 60,422,000 | ||||||||
Beginning balance at Dec. 31, 2021 | $ 62,052 | 1,824,216 | 1,618,911 | (46,761) | (46,913) | 1,114,313 | 906,827 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Share-based compensation | 1,705 | (445) | ||||||||
Contributions from Southwest Gas Holdings, Inc. | 0 | |||||||||
Net actuarial gain arising during period, less amortization of unamortized benefit plan cost, net of tax | 1,126 | 1,126 | ||||||||
FSIRS amounts reclassified to net income, net of tax | $ 416 | 416 | 416 | 416 | ||||||
Net income | 96,178 | 111,795 | ||||||||
Dividends declared to Southwest Gas Holdings, Inc. | (41,909) | (31,000) | ||||||||
Ending balance (in shares) at Mar. 31, 2022 | 66,849,225 | 66,849,000 | 47,482,000 | |||||||
Ending balance at Mar. 31, 2022 | $ 2,611,534 | $ 68,479 | $ 49,112 | $ 2,273,837 | $ 1,620,616 | $ (43,972) | $ (45,371) | $ 1,190,738 | $ 987,177 |
Background, Organization, and Summary of Significant Accounting Policies |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Background, Organization, and Summary of Significant Accounting Policies | Note 1 – Background, Organization, and Summary of Significant Accounting Policies Nature of Operations. Southwest Gas Holdings, Inc. (together with its subsidiaries, the “Company”) is a holding company, owning all of the shares of common stock of Southwest Gas Corporation (“Southwest” or the “natural gas distribution” segment), all of the shares of common stock of Centuri Group, Inc. (“Centuri,” or the “utility infrastructure services” segment), and all of the shares of common stock of MountainWest Pipelines Holding Company (“MountainWest,” or the “pipeline and storage” segment). The Company completed the acquisition of Dominion Energy Questar Pipeline, LLC and related entities (“Questar Pipelines”) in December 2021. Following the completion of the acquisition, the Company formed MountainWest which owns all of the membership interests in Questar Pipelines. In April 2022, the Company completed a general rebranding of the Questar Pipelines entities under the MountainWest name. The acquired operations further diversify the Company’s business in the midstream sector, with an expansion of interstate natural gas pipelines and underground storage services, primarily composed of regulated operations under the jurisdiction of the Federal Energy Regulatory Commission (the “FERC”), thereby expanding natural gas transportation services into Utah, Wyoming, and Colorado. See Note 8 - Business Acquisitions for more information. Southwest is engaged in the business of purchasing, distributing, and transporting natural gas for customers in portions of Arizona, Nevada, and California. Public utility rates, practices, facilities, and service territories of Southwest are subject to regulatory oversight. The timing and amount of rate relief can materially impact results of operations. Natural gas purchases and the timing of related recoveries can materially impact liquidity. Results for the natural gas distribution segment are higher during winter periods due to the seasonality incorporated in its regulatory rate structures. Centuri is a strategic utility infrastructure services company dedicated to partnering with North America’s gas and electric providers to build and maintain the energy network that powers millions of homes across the United States (“U.S.”) and Canada. Centuri derives revenue primarily from installation, replacement, repair, and maintenance of energy networks. Centuri operates in the U.S., primarily as NPL, Neuco, Linetec, and Riggs Distler, and in Canada, primarily as NPL Canada. Utility infrastructure services activity is seasonal in many of Centuri’s operating areas. Peak periods are the summer and fall months in colder climate areas, such as the northeastern and midwestern U.S. and in Canada. In warmer climate areas, such as the southwestern and southeastern U.S., utility infrastructure services activity continues year round. Centuri completed the acquisition of Drum Parent LLC (“Drum”), including Drum’s most significant operating subsidiary, Riggs Distler, in August 2021, thereby expanding Centuri’s electric infrastructure services footprint in the northeast and mid-Atlantic regions of the U.S. See Note 8 - Business Acquisitions for more information. In March 2022, the Company announced that its Board of Directors (the “Board”) had determined to separate Centuri from the Company and authorized management to complete the separation within to twelve months. Management evaluated various alternatives to determine the optimal structure to maximize stockholder value and announced the separation structure was expected to be a tax-free spin-off in which stockholders of the Company would receive a prorated dividend of Centuri shares in association with the completion. Then, in April 2022, as a result of interest in the Company well in excess of a tender offer by an activist stockholder (Carl Icahn) to other stockholders, the Board authorized the review of a full range of strategic alternatives to maximize stockholder value. As part of this process, a strategic transactions committee of the Board (the “Strategic Transactions Committee”), consisting entirely of independent directors, will evaluate a sale of the Company, as well as a range of alternatives, including, but not limited to, a separate sale of its business units and/or pursuing the spin-off of Centuri. Basis of Presentation. The condensed consolidated financial statements of Southwest Gas Holdings, Inc. and subsidiaries and Southwest included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). The year-end condensed balance sheet data was derived from audited financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations. No substantive change has occurred with regard to the Company’s business segments on the whole. The preparation of the condensed consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. In the opinion of management, all adjustments, consisting of normal recurring items and estimates necessary for a fair depiction of results for the interim periods, have been made. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the 2021 Annual Report to Stockholders, which is incorporated by reference into the 2021 Form 10-K. Other Property and Investments. Other property and investments on Southwest’s and the Company’s Condensed Consolidated Balance Sheets includes:
Included in the table above are the net cash surrender values of company-owned life insurance (“COLI”) policies. These life insurance policies on members of management and other key employees are used by Southwest to indemnify itself against the loss of talent, expertise, and knowledge, as well as to provide indirect funding for certain nonqualified benefit plans. The term non-regulated in regard to assets and related balances in the table above is in reference to the non-rate regulated operations of Centuri, and to a more limited extent, certain assets of MountainWest. Cash and Cash Equivalents. Cash and cash equivalents include money market fund investments totaling approximately $169 million and $231 million, for Southwest and the Company, respectively, at March 31, 2022, and $20 million for the Company as of December 31, 2021. The balance for Southwest as of December 31, 2021 was insignificant. These investments fall within Level 2 of the fair value hierarchy, due to the asset valuation methods used by money market funds. The Company had $7 million in restricted cash included in Cash and cash equivalents at March 31, 2022, related to residual proceeds received from its March 2022 common stock offering to be applied against its 364-day Term Loan Facility, which occurred in April 2022. The restricted cash balance is included in Cash and cash equivalents within the Company’s Condensed Consolidated Statement of Cash Flows as of March 31, 2022. Non-cash investing activities for the Company and Southwest include capital expenditures that were not yet paid totaling approximately $26.1 million at March 31, 2022, and $19.4 million at December 31, 2021. Accounts Receivable, net of allowances. Southwest lifted the moratorium on disconnection of natural gas service for non-payment in Arizona and Nevada in September 2021, which was initiated (at the same time as a moratorium on late fees) in March 2020 in response to the COVID-19 pandemic. The moratorium on disconnection in California ended in November 2021. Southwest recommenced assessing late fees on past-due balances in Arizona and Nevada in April 2021, and in California in August 2021. Southwest continues to actively work with customers experiencing financial hardship by means of flexible payment options, partnering with assistance agencies and participating in state-funded arrearage payment assistance programs. Deferred Purchased Gas Costs. The various regulatory commissions have established procedures to enable the rate-regulated companies to adjust billing rates for changes in the cost of natural gas purchased. The difference between the current cost of gas purchased and the cost of gas recovered in billed rates is deferred. Generally, these deferred amounts are recovered or refunded within one year. In mid-February 2021, the central U.S. experienced extreme cold temperatures, which increased natural gas demand and caused supply issues due to wellhead freeze-offs, power outages, or other adverse operating conditions upstream of Southwest’s distribution systems. These conditions caused daily natural gas prices to reach unprecedented levels. During this time, Southwest secured natural gas supplies, albeit at substantially higher prices, maintaining service to its customers. The incremental cost for these supplies was approximately $250 million, funded using a 364-day $250 million term loan executed in March 2021. The incremental gas costs were included, for collection from customers, as part of the purchased gas adjustment (“PGA”) mechanisms. The term loan was amended in March 2022 to extend the maturity date to March 2023 due to gas prices that, while not at levels incurred during the 2021 freeze, continue to be elevated (see Note 5 – Debt). Prepaid and other current assets. Prepaid and other current assets for Southwest include, among other things, materials and operating supplies of $60 million at March 31, 2022 and $62.9 million at December 31, 2021 (carried at weighted average cost). For the Company, there were materials and operating supplies of $64.6 million and $67.4 million at March 31, 2022 and December 31, 2021, which included amounts for MountainWest. Also included in the balance for both Southwest and the Company was $52 million as of December 31, 2021 in accrued purchased gas cost, with no corresponding asset balance as of March 31, 2022 for either entity. Goodwill. Goodwill is assessed as of October 1st each year for impairment, or more frequently, if circumstances indicate an impairment to the carrying value of goodwill may have occurred. Management of the Company and Southwest considered its reporting units and segments, determining that they remained consistent between periods presented below, and that no change was necessary with regard to the level at which goodwill is assessed for impairment. The acquisition of MountainWest resulted in a new reportable segment which is assessed for impairment beginning in 2022. Since December 31, 2021, management qualitatively assessed whether events during the first three months of 2022 may have resulted in conditions whereby the carrying value of goodwill was higher than its fair value, which if the case, could be an indication of a permanent impairment. Through this assessment, no such condition was believed to have existed and therefore, no impairment was deemed to have occurred. Goodwill in Southwest’s and the Company’s Condensed Consolidated Balance Sheets is as follows:
(a) See Note 8 - Business Acquisitions for details regarding measurement-period adjustments. Other Current Liabilities. Management recognizes in its balance sheets various liabilities that are expected to be settled through future cash payment within the next twelve months, including amounts payable under regulatory mechanisms, customary accrued expenses for employee compensation and benefits, declared but unpaid dividends, and miscellaneous other accrued liabilities. Other current liabilities for the Company include $41.4 million and $36 million of dividends declared as of March 31, 2022 and December 31, 2021, respectively. Other Income (Deductions). The following table provides the composition of significant items included in Other income (deductions) in Southwest’s and the Company’s Condensed Consolidated Statements of Income:
Included in the table above is the change in cash surrender values of COLI policies (including net death benefits recognized). Current tax regulations provide for tax-free treatment of life insurance (death benefit) proceeds. Therefore, changes in the cash surrender values of COLI policies, as they progress towards the ultimate death benefits, are also recorded without tax consequences. Refer also to the discussion of Other Property and Investments above and to Note 2 – Components of Net Periodic Benefit Cost. Redeemable Noncontrolling Interests. In connection with the acquisition of Linetec in November 2018, the previous owner retained a 20% equity interest in that entity, the reduction of which being subject to certain rights based on the passage of time or upon the occurrence of certain triggering events. Effective January 2022, the Company, through Centuri, had the right, but not the obligation, to purchase at fair value (subject to a floor) a portion of the interest held by the previous owner, and in incremental amounts each year thereafter. In March 2022, the parties agreed to a partial redemption based on these provisions, and as a result, Centuri paid $39.6 million to the previous owner of Linetec for a 5.0% equity interest in Linetec, thereby reducing the balance continuing to be redeemable to 15% under the terms of the original agreement. In order to fund the redemption, Southwest Gas Holdings, Inc. contributed capital to Centuri. Certain members of Riggs Distler management have a 1.42% interest in Drum, which is redeemable, subject to certain rights based on the passage of time or upon the occurrence of certain triggering events. Significant changes in the value of the redeemable noncontrolling interests, above a floor determined at the establishment date, are recognized as they occur, and the carrying value is adjusted as necessary at each reporting date. The fair value is estimated using a market approach that utilizes certain financial metrics from guideline public companies of similar industry and operating characteristics. Based on the fair value model employed, the estimated redemption value of the Linetec redeemable noncontrolling interest decreased by approximately $22 million during the three months ended March 31, 2022. Adjustment to the redemption value also impacts retained earnings, as reflected in the Company’s Condensed Consolidated Statement of Equity, but does not impact net income. The following depicts changes to the balances of the redeemable noncontrolling interests:
Earnings Per Share. Basic earnings per share (“EPS”) in each period of this report were calculated by dividing net income attributable to Southwest Gas Holdings, Inc. by the weighted-average number of shares during those periods. Diluted EPS includes additional weighted-average common stock equivalents (performance shares and restricted stock units). Unless otherwise noted, the term “Earnings Per Share” refers to Basic EPS. A reconciliation of the denominator used in Basic and Diluted EPS calculations is shown in the following table:
(1) The number of securities included 112,000 and 75,000 performance shares during the three months ending March 31, 2022 and 2021, and 114,000 and 76,000 performance shares during the twelve months ending March 31, 2022 and 2021, respectively, the total of which was derived by assuming that target performance will be achieved during the relevant performance period. Contingencies. Southwest maintains liability insurance for various risks associated with the operation of its natural gas pipelines and facilities. In connection with these liability insurance policies, Southwest is responsible for an initial deductible or self-insured retention amount per incident, after which the insurance carriers would be responsible for amounts up to the policy limits. For the policy year August 2021 to July 2022, these liability insurance policies require Southwest to be responsible for the first $1 million (self-insured retention) of each incident plus the first $4 million in aggregate claims above its self-insured retention in the policy year. In August 2021, a natural gas pipe operated by Southwest was involved in an explosion that injured four individuals and damaged property. The explosion was caused by a leak in the pipe, and is under investigation. Individuals that were injured have each brought legal claims against Southwest and other parties. If Southwest is deemed fully or partially responsible, Southwest estimates its net exposure could be equal to the self-insured retention of $5 million (the maximum noted above). In 2021, pursuant to Accounting Standards Codification 450, Contingencies, Southwest recorded a $5 million liability related to this incident reflecting the maximum noted above; an estimate of actual loss greater than this exposure (to be covered by insurance) cannot be estimated as of the date these financial statements are issued. On November 29, 2021, Icahn Partners LP and Icahn Master Fund LP (collectively, “Icahn”) commenced an action in the Court of Chancery for the State of Delaware. The action is captioned Icahn Partners LP, et al. v. John P. Hester, et al., C.A. No. 2021-1031-KSJM (Del. Ch.). The complaint names the Company and the individual members of the Board as defendants. The complaint seeks to allege breach of fiduciary duty claims and, among other things, seeks declaratory and injunctive relief to (1) limit the scope and manner of certain equity issuances by the Company; (2) allow Icahn to proceed with a Special Meeting proposal at the Company’s 2022 Annual Meeting; and (3) require the Board to approve Icahn’s slate of nominees as “continuing directors” under certain of the Company’s debt instruments. After filing the complaint, Icahn sought a temporary restraining order to prohibit defendants from making certain equity issuances. On December 21, 2021, the Court denied Icahn’s request. On January 19, 2022, the defendants filed a motion to dismiss the claims that were subject to Icahn’s motion for a temporary restraining order. The same day, the defendants filed an answer, denying the remaining claims in Icahn’s complaint. On February 11, 2022, defendants filed a motion for summary judgement on Icahn’s claims regarding a proposal for a special meeting. On April 5, 2022, following a hearing, the court granted defendants’ motion for summary judgment, finding that the Company properly rejected Icahn’s special meeting proposal. On April 27, 2022, the court entered an order dismissing Icahn’s special meeting proposal claims with prejudice and Icahn’s “continuing directors” claims without prejudice. In accordance with the Cooperation Agreement described in Note 9 - Subsequent Events, Icahn filed a stipulation of dismissal of the case with prejudice, which was entered by the court on May 9, 2022. On November 18, 2021, the City Pension Fund for Firefighters and Police Officers in the City of Miami Beach (“City Pension Fund”) commenced a putative class action lawsuit in the Court of Chancery for the State of Delaware on behalf of a putative class of persons who purchased the Company’s stock. The action is captioned City Pension Fund for Firefighters and Police Officers in the City of Miami Beach v. Robert L. Boughner, et al., C.A. No. 2021-0990-KSJM (Del. Ch.). The complaint was later amended on November 30, 2021. The amended complaint names the Company and the individual members of the Board as defendants. The complaint seeks to assert breach of fiduciary duty claims, alleging that the Board’s recommendation that stockholders reject Icahn’s tender offer to purchase shares of the Company’s common stock omitted material information about the Company’s financial analysis; and seeks to have the Board approve Icahn’s slate of nominees as “continuing directors” under certain of the Company’s debt instruments. On March 9, 2022, City Pension Fund filed a motion for summary judgment on its claim that the Board omitted material information in its recommendation concerning Icahn’s tender offer. On April 19, 2022, City Pension Fund filed a notice of withdrawal of its motion for summary judgment. The Company believes that the claims lack merit and intends to vigorously defend against them. Recent Accounting Standards Updates. Accounting pronouncements effective or adopted in 2022: In March 2020, the FASB issued ASU 2020-04 “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” The update provides optional guidance for a limited time to ease the potential burden in accounting for, or recognizing the effects of, reference rate reform on financial reporting, including when modifying a contract (during the eligibility period covered by the update to Topic 848) to replace a reference rate affected by such reform. The update applies only to contracts and hedging relationships that reference the London Interbank Offered Rate (“LIBOR”) or another rate expected to be discontinued due to reference rate reform. The guidance was eligible to be applied upon issuance on March 12, 2020, and can generally be applied through December 31, 2022, but to date, no further updates have occurred that would extend the optional guidance to the full tenor of LIBOR expiration dates occurring after 2022. Management will monitor the impacts this update might have on the Company’s and Southwest’s consolidated financial statements and disclosures, and will reflect such appropriately, in the event that the optional guidance is elected. Management will also monitor further FASB action, if any, in regard to the full tenor of LIBOR expiration dates. See also LIBOR discussion in Note 5 – Debt. In August 2020, the FASB issued ASU 2020-06 “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging— Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity.” The update, amongst other amendments, improves the guidance related to the disclosures and earnings-per-share for convertible instruments and contracts in an entity’s own equity. The update is effective starting in the first quarter of 2022 in regard to relevant contracts.
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Components of Net Periodic Benefit Cost |
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Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Net Periodic Benefit Cost | Note 2 – Components of Net Periodic Benefit Cost Southwest has a noncontributory qualified retirement plan with defined benefits covering substantially all employees and a separate unfunded supplemental retirement plan (“SERP”) which is limited to officers. Southwest also provides postretirement benefits other than pensions (“PBOP”) to its qualified retirees for health care, dental, and life insurance. The defined benefit qualified retirement plan, SERP and PBOP are not available to Southwest employees hired on or after January 1, 2022. Employees hired in 2022 or later periods are eligible for enhanced defined contributions as part of the Southwest 401(k) plan rather than participating in the defined benefit retirement plan. The service cost component of net periodic benefit costs included in the table below is a component of an overhead loading process associated with the cost of labor. The overhead process ultimately results in allocation of service cost to the same accounts to which productive labor is charged. As a result, service costs become components of various accounts, primarily operations and maintenance expense, net regulated operations plant, and deferred charges and other assets for both the Company and Southwest. The other components of net periodic benefit cost are reflected in Other income (deductions) on the Condensed Consolidated Statements of Income of each entity.
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Revenue |
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue | Note 3 – Revenue The following information about the Company’s revenues is presented by segment. Southwest encompasses the natural gas distribution segment, Centuri encompasses the utility infrastructure services segment, and MountainWest encompasses the pipeline and storage segment. Certain disclosures, where materially consistent with those provided most recently in Southwest’s and the Company’s 2021 Annual Report on Form 10-K, are not repeated below. Natural Gas Distribution Segment: Southwest’s operating revenues included on the Condensed Consolidated Statements of Income of both the Company and Southwest include revenue from contracts with customers, which is shown below, disaggregated by customer type, in addition to other categories of revenue:
(1) Amounts include late fees and other miscellaneous revenues, and may also include the impact of certain regulatory mechanisms, such as cost-of-service components in customer rates expected to be returned to customers in future periods. Also includes the impacts of a temporary moratorium on late fees and disconnection for nonpayment during the COVID-19 pandemic. Utility Infrastructure Services Segment: The following tables display Centuri’s revenue, reflected as Utility infrastructure services revenues on the Condensed Consolidated Statements of Income of the Company, representing revenue from contracts with customers disaggregated by service and contract types:
The following table provides information about contracts receivable and revenue earned on contracts in progress in excess of billings (contract assets), which are both included within Accounts receivable, net of allowances, as well as amounts billed in excess of revenue earned on contracts (contract liabilities), which are included in Other current liabilities as of March 31, 2022 and December 31, 2021 on the Company’s Condensed Consolidated Balance Sheets:
The revenue earned on contracts in progress in excess of billings (contract asset) primarily relates to Centuri’s rights to consideration for work completed but not billed and/or approved for billing at the reporting date. These contract assets are transferred to contracts receivable when the rights become unconditional. The amounts billed in excess of revenue earned (contract liability) primarily relate to the advance consideration received from customers for which work has not yet been completed. The change in this contract liability balance from December 31, 2021 to March 31, 2022 is due to increases in cash received, net of revenue recognized, from contracts that commenced during the period, offset by revenue recognized of approximately $11.9 million that was included in this balance as of January 1, 2022, after which time it became earned and the balance was reduced. For contracts that have an original duration of one year or less, Centuri uses the practical expedient applicable to such contracts and does not consider/compute an interest component based on the time value of money. Furthermore, because of the short duration of these contracts, Centuri has not disclosed the transaction price for the remaining performance obligations as of the end of each reporting period or when the Company expects to recognize the revenue. As of March 31, 2022, Centuri had 29 contracts with an original duration of more than one year. The aggregate amount of the transaction price allocated to the unsatisfied performance obligations of these contracts as of March 31, 2022 was $205.6 million. Centuri expects to recognize the remaining performance obligations over approximately the next three years; however, the timing of that recognition is largely within the control of the customer, including when the necessary equipment and materials required to complete the work are provided by the customer. Utility infrastructure services contracts receivable consists of the following:
Pipeline and Storage Segment: MountainWest derives revenue on the basis of services rendered, commodities delivered, or contracts settled and includes amounts yet to be billed to customers. MountainWest generates revenue and earnings from annual reservation payments under firm peaking storage and firm transportation contracts. Straight-fixed-variable rate designs are used to allow for recovery of substantially all fixed costs in demand or reservation charges, thereby reducing the earnings impact of volume changes on gas transportation and storage operations. MountainWest receives upfront payment for certain storage services it provides to customers, which are considered to be contract liabilities. These payments are amortized to revenue over the term of the contract. The primary types of sales and service activities reported as revenue from contracts with customers are FERC-regulated gas transportation and storage service, and to a lesser extent, natural gas liquid (“NGL”) revenues consisting primarily of NGL processing services, and other revenue (consisting of natural gas sales, as well as services related to gathering and processing activities and miscellaneous service revenue). Transportation and storage contracts are primarily stand-ready service contracts that include fixed reservation and variable usage fees. Fixed fees are recognized ratably over the life of the contract as the stand-ready performance obligations are satisfied, while variable usage fees are recognized when MountainWest has a right to consideration from a customer in an amount that corresponds directly with the value to the customer of the performance obligation completed to date. Substantially all of MountainWest’s revenues are derived from performance obligations satisfied over time, rather than recognized at a single point in time. Payment for most sales and services varies by contract type, but is typically due within a month of billing. MountainWest typically receives or retains NGLs and natural gas from customers when providing natural gas processing, transportation, or storage services. MountainWest records the fair value of NGLs received as service revenue recognized over time and recognizes revenue from the subsequent sale of the NGLs to customers upon delivery. MountainWest typically retains some natural gas under certain transportation service arrangements, intended to facilitate performance of the service and allow for natural losses that occur. As the intent of the retention amount is to enable fulfillment of the contract rather than to provide compensation for services, the fuel allowance is not included in revenue. MountainWest Regulated operations revenues on the Condensed Consolidated Statements of Income of the Company include revenue from contracts with customers, which is shown below, disaggregated by categories of sales and service activities.
MountainWest has certain multi-year contracts with fixed-price performance obligations that were unsatisfied (or partially unsatisfied) at the end of the reporting period, whereby revenue will be earned over time as MountainWest stands ready to provide service. These amounts are not material to the financial statements overall. MountainWest also has certain contract liabilities related to consideration received from customers with an obligation to transfer goods or services subsequent to the balance sheet date, amounts for which are generally consistent between December 31, 2021 and March 31, 2022 and are not material.
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Common Stock | Note 4 – Common Stock Shares of the Company’s common stock are publicly traded on the New York Stock Exchange, under the ticker symbol “SWX.” Share-based compensation related to Southwest and Centuri is based on stock awards to be issued in shares of Southwest Gas Holdings, Inc. On April 8, 2021, the Company entered into a Sales Agency Agreement between the Company and BNY Mellon Capital Markets, LLC and J.P. Morgan Securities LLC (the “Equity Shelf Program”) for the offer and sale of up to $500 million of common stock from time to time in an at-the-market offering program. The shares are issued pursuant to the Company’s automatic shelf registration statement on Form S-3 (File No. 333-251074), or “the Universal Shelf.” There was no activity in the Equity Shelf Program during the quarter ended March 31, 2022. The following table provides the life-to-date activity under that program for the period ended March 31, 2022:
As of March 31, 2022, the Company had approximately $341.8 million in common stock available for sale under the program. Net proceeds from the sale of shares of common stock under the Equity Shelf Program are intended for general corporate purposes, including the acquisition of property for the construction, completion, extension, or improvement of pipeline systems and facilities located in and around the communities served by Southwest, as well as for the repayment or repurchase of indebtedness (including amounts outstanding from time to time under the credit facilities, senior notes, term loan, or future credit facilities), and to provide for working capital. In March 2022, the Company issued, through a separate prospectus supplement under the Universal Shelf, an aggregate of 6,325,000 shares of common stock, in an underwritten public offering price of $74.00 per share, resulting in proceeds to the Company of $452,253,312, net of an underwriters’ discount of $15,796,688. The Company used the net proceeds to repay a portion of the outstanding borrowings under the 364-day term loan credit agreement that was used to initially fund the MountainWest acquisition. During the three months ended March 31, 2022, the Company issued approximately 65,000 shares of common stock through the Restricted Stock/Unit Plan and Omnibus Incentive Plan. Additionally, during the three months ended March 31, 2022, the Company issued 37,000 shares of common stock through the Dividend Reinvestment and Stock Purchase Plan, raising approximately $2.5 million.
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt | Note 5 – Debt Long-Term Debt Long-term debt is recognized in the Company’s and Southwest’s Condensed Consolidated Balance Sheets generally at the carrying value of the obligations outstanding. Details surrounding the fair value and individual carrying values of instruments are provided in the table that follows.
Southwest has a $400 million credit facility that is scheduled to expire in April 2025. Southwest designates $150 million of associated capacity as long-term debt and the remaining $250 million for working capital purposes. Interest rates for the credit facility are calculated at either the Secured Overnight Financing Rate (“SOFR”) or an “alternate base rate,” plus in each case an applicable margin that is determined based on Southwest’s senior unsecured debt rating. At March 31, 2022, the applicable margin is 1.125% for loans bearing interest with reference to SOFR and 0.125% for loans bearing interest with reference to the alternative base rate. At March 31, 2022, no borrowings were outstanding on the long-term portion (including under the commercial paper program, discussed below) of the facility or on the short-term portion of this credit facility discussed below. Southwest has a $50 million commercial paper program. Issuances under the commercial paper program are supported by Southwest’s revolving credit facility and, therefore, do not represent additional borrowing capacity under the credit facility. Borrowings under the commercial paper program are designated as long-term debt. Interest rates for the program are calculated at the then current commercial paper rate. At March 31, 2022, as noted above, no borrowings were outstanding under the commercial paper program. In March 2022, Southwest issued $600 million aggregate principal amount of 4.05% Senior Notes at a discount of 0.65%. The notes will mature in March 2032. Southwest used the net proceeds to redeem the $250 million 3.875% notes due in April 2022 and to repay outstanding amounts under its credit facility, with the remaining net proceeds used for general corporate purposes. Centuri has a $1.545 billion secured revolving credit and term loan multi-currency facility. Amounts can be borrowed in either Canadian or U.S. dollars. The revolving credit facility matures on August 27, 2026 and the term loan facility matures on August 27, 2028. Interest rates for the revolving credit facility and term loan facility are based on either a “base rate” or LIBOR, plus an applicable margin in either case. The capacity of the line of credit portion of the facility is $400 million; related amounts borrowed and repaid are available to be re-borrowed. The term loan portion of the facility has a limit of $1.145 billion. The obligations under the credit agreement are secured by present and future ownership interests in substantially all direct and indirect subsidiaries of Centuri, substantially all of the tangible and intangible personal property of each borrower, certain of their direct and indirect subsidiaries, and all products, profits, and proceeds of the foregoing. Centuri’s assets securing the facility at March 31, 2022 totaled $2.4 billion. At March 31, 2022, $1.122 billion in borrowings were outstanding under Centuri’s combined secured revolving credit and term loan facility. During March 2022, Centuri utilized proceeds of approximately $100 million in fixed-rate term loans secured by owned vehicles and equipment to repay a corresponding amount outstanding under the term loan facility. MountainWest has two private placement unsecured senior notes and a public unsecured senior note, with a combined carrying value of $449.5 million and aggregate principal amount of $430 million. The carrying value is higher than the principal balance as amounts outstanding were recorded at their fair values as of the December 31, 2021 acquisition date of the MountainWest entities. Short-Term Debt Southwest Gas Holdings, Inc. has a $200 million credit facility that is scheduled to expire in December 2026 and is primarily used for short-term financing needs. Interest rates for the credit facility are calculated at either SOFR or the “alternate base rate” plus in each case an applicable margin. There was $69 million outstanding under this credit facility as of March 31, 2022. As indicated above, under Southwest’s $400 million credit facility, no short-term borrowings were outstanding at March 31, 2022. In March 2022, Southwest amended its $250 million Term Loan, extending the maturity date to March 21, 2023 and replacing LIBOR interest rate benchmarks with SOFR interest rate benchmarks. The proceeds were originally used to fund the increased cost of natural gas supply during the month of February 2021, caused by extreme weather conditions in the central U.S. Management extended the maturity date to fund recent increases in gas purchase costs, as reflected in the PGA. Interest rates for the amended term loan are calculated at either SOFR or an “alternate base rate,” plus in each case an applicable margin that is determined based on Southwest’s senior unsecured long-term debt rating. The applicable margin ranges from 0.550% to 1.000% for loans bearing interest with reference to SOFR and 0.000% for loans bearing interest with reference to an alternate base rate. The amended agreement contains a financial covenant requiring Southwest to maintain a ratio of funded debt to total capitalization not to exceed 0.70 to 1.00 as of the end of any quarter of any fiscal year. In November 2021, Southwest Gas Holdings, Inc. entered into a 364-day term loan credit agreement (the “Credit Agreement”). The Credit Agreement provided for a $1.6 billion delayed-draw term loan (the “Term Loan Facility”) to fund and to pay fees, commissions, and expenses related to the Term Loan Facility and the acquisition of the equity interests in MountainWest (refer to Note 8 - Business Acquisitions). The Term Loan Facility was funded on December 31, 2021, and matures on December 30, 2022. Interest rates for the Term Loan Facility are based on either the “base rate” or LIBOR, plus an applicable margin. There was $1.16 billion outstanding under the Term Loan Facility as of March 31, 2022. The borrowings under the term loan facility to temporarily finance the acquisition of MountainWest created a negative working capital condition for the Company, which as of March 31, 2022 is approximately $584 million. As of May 10, 2022, the Company does not have sufficient liquidity or capital resources to repay the term loan facility without issuing new debt or equity. Management intends to issue long-term debt to permanently refinance the remaining portion of the term loan facility. Management believes that its refinancing plan is probable based on the Company’s ability to generate consistent cash flows, its current credit ratings, its relationships with its lenders and its prior history of successfully raising debt and equity necessary to fund its acquisitions and operations. As such, management has concluded that the Company can satisfy its obligations for at least the next twelve months from the issuance date of these financial statements. The Company’s ability to access capital markets or to otherwise obtain sufficient financing may be affected by future conditions. If the Company is unable to execute its plan to refinance debt obligations, the Company’s credit facility could be terminated, and amounts due under its revolver and other borrowing arrangements could be declared immediately due and payable. LIBOR Certain rates established at LIBOR are scheduled to be discontinued as a benchmark or reference rate after 2021, while other LIBOR-based rates are scheduled to be discontinued after June 2023. As of March 31, 2022, the Company had $2.17 billion in aggregate outstanding borrowings under Centuri’s combined facility and Southwest Gas Holdings, Inc.’s Term Loan Facility. Southwest had no outstanding borrowings or variable rate debt agreements with reference to LIBOR as of March 31, 2022. In order to mitigate the impact on the financial condition and results of operations of the Company, management will monitor developments and work with lenders to determine the appropriate replacement/alternative reference rate for variable rate debt. At this time the Company can provide no assurances as to the impact a LIBOR discontinuance will have on their financial condition or results of operations. Any alternative rate may be less predictable or less attractive than LIBOR.
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Other Comprehensive Income and Accumulated Other Comprehensive Income |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Comprehensive Income and Accumulated Other Comprehensive Income | Note 6 – Other Comprehensive Income and Accumulated Other Comprehensive Income The following information presents the Company’s Other comprehensive income (loss), both before and after-tax impacts, within the Condensed Consolidated Statements of Comprehensive Income, which also impact Accumulated other comprehensive income (“AOCI”) in the Condensed Consolidated Balance Sheets and the Condensed Consolidated Statements of Equity. Related Tax Effects Allocated to Each Component of Other Comprehensive Income (Loss)
(1)Tax amounts are calculated using a 24% rate. The Company has elected to indefinitely reinvest, in Canada, the earnings of Centuri’s Canadian subsidiaries, thus precluding deferred taxes on such earnings. As a result of this assertion, and no repatriation of earnings anticipated, the Company is not recognizing a tax effect or presenting a tax expense or benefit for currency translation adjustments reported in Other comprehensive income (loss). The remaining balance of realized losses (net of tax) related to Southwest’s previously settled forward-starting interest rate swap (“FSIRS”), included in AOCI at March 31, 2022, was reclassified into interest expense during the three months ended March 31, 2022. The following table represents a rollforward of AOCI, presented on the Company’s Condensed Consolidated Balance Sheets and its Condensed Consolidated Statements of Equity:
(1)The FSIRS reclassification amount is included in Net interest deductions on the Company’s Condensed Consolidated Statements of Income. (2)These AOCI components are included in the computation of net periodic benefit cost (see Note 2 – Components of Net Periodic Benefit Cost for additional details). (3)The regulatory adjustment represents the portion of the activity above that is expected to be recovered through rates in the future (the related regulatory asset is included in Deferred charges and other assets on the Company’s Condensed Consolidated Balance Sheets). (4)Tax amounts are calculated using a 24% rate. The following table represents a rollforward of AOCI, presented on Southwest’s Condensed Consolidated Balance Sheets:
(5) The FSIRS reclassification amount is included in Net interest deductions on Southwest’s Condensed Consolidated Statements of Income. (6)These AOCI components are included in the computation of net periodic benefit cost (see Note 2 – Components of Net Periodic Benefit Cost for additional details). (7)The regulatory adjustment represents the portion of the activity above that is expected to be recovered through rates in the future (the related regulatory asset is included in Deferred charges and other assets on Southwest’s Condensed Consolidated Balance Sheets). (8)Tax amounts are calculated using a 24% rate. The following table represents amounts (before income tax impacts) included in AOCI (in the tables above), that have not yet been recognized in net periodic benefit cost:
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Segment Information |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information | Note 7 – Segment Information As a result of the MountainWest acquisition on December 31, 2021, management updated its segment reporting from the historical presentation of two reportable segments to three reportable segments, with MountainWest presented as the pipeline and storage segment. Southwest comprises the natural gas distribution segment and Centuri comprises the utility infrastructure services segment. Centuri accounts for the services provided to Southwest at contractual prices at contract inception. Accounts receivable for these services, which are not eliminated during consolidation, are presented in the table below:
In order to reconcile (below) to net income as disclosed in the Condensed Consolidated Statements of Income, an Other column is included associated with impacts of corporate and administrative activities related to Southwest Gas Holdings, Inc. The financial information pertaining to the natural gas distribution, utility infrastructure services, and pipeline and storage segments are as follows:
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Business Acquisitions |
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Business Combination and Asset Acquisition [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisitions | Note 8 - Business Acquisitions In August 2021, the Company, through its subsidiaries, led principally by Centuri, completed the acquisition of Drum, including its primary subsidiary, Riggs Distler. In November 2021, certain members of Riggs Distler management acquired a 1.42% interest in Drum. See the Company’s 2021 Form 10-K for additional information about this acquisition. Assets acquired and liabilities assumed in the transaction were recorded at their acquisition date fair values. Transaction costs associated with the acquisition were expensed as incurred. The Company’s allocation of the purchase price was based on an evaluation of the appropriate fair values and represented management’s best estimate based on available data (including market data, data regarding customers of the acquired businesses, terms of acquisition-related agreements, analysis of historical and projected results, and other types of data). The analysis included consideration of types of intangibles that were acquired, including customer relationships, trade name, and backlog. Certain payments were estimated as of the acquisition date and were adjusted when amounts were finalized. Further adjustments may still occur. Due to the estimations made, the final purchase accounting has not yet been completed and further refinements may occur, including potential changes to income taxes. The preliminary estimated fair values of assets acquired and liabilities assumed as of August 27, 2021, and as updated through March 31, 2022, are as follows:
The Company incurred and expensed acquisition costs of $14 million, included in Utility infrastructure services expenses in the Company’s Condensed Consolidated Statement of Income for the twelve months ended March 31, 2022. No acquisition-related costs were incurred during the three months ended March 31, 2022, and no significant impacts to earnings resulted from the measurement-period adjustments reflected above. In December 2021 Southwest Gas Holdings, Inc. completed the acquisition of Dominion Energy Questar Pipeline, LLC and related entities (subsequently rebranded as “MountainWest”), which resulted in MountainWest becoming a wholly owned subsidiary of the Company. See the Company’s 2021 Form 10-K for additional information about this acquisition. Assets acquired and liabilities assumed in the transaction were recorded at their acquisition date fair values. Transaction costs associated with the acquisition were expensed as incurred. The majority of the operations acquired are subject to FERC rate-regulation and therefore are accounted for pursuant to ASC 980, Regulated Operations. The fair values of MountainWest’s assets and liabilities, subject to rate making and cost recovery provisions, provide revenues derived from costs of service, including a return on investment of assets and liabilities included in rate base. Accordingly, the carrying values of such assets and liabilities were deemed to approximate their fair values. The fair value of the MountainWest assets and liabilities assumed that are not subject to the rate-regulation provisions discussed above include a 50% equity method investment, non-regulated property, plant and equipment, and long-term debt assumed; related fair values were determined using a market approach, income approach, or cost approach, as appropriate. Amounts related to post-closing payments were estimated as of the acquisition date and adjusted when determined during the period ended March 31, 2022. No other measurement period adjustments occurred during the period. However, the final purchase accounting has not yet been completed and further refinements may occur, including finalization of income tax-related amounts. The preliminary estimated fair values of assets acquired and liabilities assumed as of December 31, 2021, and as updated through March 31, 2022, are as follows:
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Subsequent Events |
3 Months Ended |
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Mar. 31, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On May 6, 2022, the Company entered into a Cooperation Agreement (the “Cooperation Agreement”) with Carl Icahn and the persons and entities listed therein (collectively, the “Icahn Group”). In accordance with the Cooperation Agreement, John P. Hester, the President and Chief Executive Officer of the Company and Southwest and a member of the Board and the Southwest Board (the “SWG Board” and, together with the Board, the “Southwest Boards”), retired as President and Chief Executive Officer of the Company and resigned from the Southwest Boards, effective as of May 6, 2022. Karen S. Haller, the Company’s former Executive Vice President / Chief Legal & Administrative Officer, was appointed as President and Chief Executive Officer of Southwest, effective as of May 6, 2022, and as a member of the Board, effective immediately following the completion of the Company’s 2022 annual meeting of stockholders (the “2022 Annual Meeting”). In addition, pursuant to the Cooperation Agreement, the Company has agreed to appoint three new directors, Andrew W. Evans, H. Russell Frisby, Jr. and Henry P. Linginfelter (collectively, the “Icahn Designees”), to the Board, effective immediately following the 2022 Annual Meeting, and, unless within 90 days of the date of the Cooperation Agreement, the Board has determined to pursue a spin-off of Centuri to the exclusion of other strategic alternatives, the Icahn Group has the ability to designate a fourth director, Andrew J. Teno, unless Mr. Teno has previously replaced one of the other Icahn Designees, in which case the fourth director will be such Icahn Designee. The Icahn Group’s ability to designate directors to the Board is subject to certain ownership thresholds following the closing of the previously announced tender offer by the Icahn Group to purchase any and all shares of common stock of the Company (the “Offer”). The Cooperation Agreement requires the Board to expand the Strategic Transactions Committee from three directors to six directors, comprised of the current members of the Strategic Transactions Committee and the three Icahn Designees. For so long as the Icahn Group has the ability to designate at least three members of the Board, three of such designees shall be included on the Strategic Transactions Committee. If the Icahn Group may only designate two members of the Board, then both of such designees shall serve on the Strategic Transactions Committee. In addition, the Cooperation Agreement provides that the Icahn Group will amend the Offer, to (i) provide that the number of shares of common stock to be purchased in the Offer shall not exceed that number of shares of common stock which, together with the shares of Common Stock beneficially owned by the Icahn Group, would exceed 24.9% of the then outstanding shares of Common Stock, (ii) extend the expiration date of the Offer (the “Expiration Date”) to May 19, 2022 and that the Expiration Date shall not be further extended, and (iii) to waive any conditions to the Offer that have not been satisfied and consummate the Offer and pay for the tendered shares of Common Stock as promptly as practicable after the Expiration Date. Pursuant to the Cooperation Agreement, the Icahn Group caused the parties to the action filed by Icahn Partners LP and Icahn Partners Master Fund LP in the Court of Chancery of the State of Delaware on November 29, 2021 (Civil Action No. 2021-1031-KSJM), naming as defendants the Company and certain directors and officers of the Company, to file a stipulation of dismissal with prejudice, which was entered by the court on May 9, 2022 In connection with the entry into the Cooperation Agreement, the Company entered into Amendment No. 1 to Rights Agreement (the “Rights Agreement Amendment”) by and between the Company and Equiniti Trust Company. The Rights Agreement Amendment amends the Rights Agreement, dated October 10, 2021, to increase the beneficial ownership percentage included in the definition of “Acquiring Person” from 10% to 24.9% and to delete the concept of a “Passive Institutional Investor.”
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Background, Organization, and Summary of Significant Accounting Policies (Policies) |
3 Months Ended |
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Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations | Nature of Operations. Southwest Gas Holdings, Inc. (together with its subsidiaries, the “Company”) is a holding company, owning all of the shares of common stock of Southwest Gas Corporation (“Southwest” or the “natural gas distribution” segment), all of the shares of common stock of Centuri Group, Inc. (“Centuri,” or the “utility infrastructure services” segment), and all of the shares of common stock of MountainWest Pipelines Holding Company (“MountainWest,” or the “pipeline and storage” segment). The Company completed the acquisition of Dominion Energy Questar Pipeline, LLC and related entities (“Questar Pipelines”) in December 2021. Following the completion of the acquisition, the Company formed MountainWest which owns all of the membership interests in Questar Pipelines. In April 2022, the Company completed a general rebranding of the Questar Pipelines entities under the MountainWest name. The acquired operations further diversify the Company’s business in the midstream sector, with an expansion of interstate natural gas pipelines and underground storage services, primarily composed of regulated operations under the jurisdiction of the Federal Energy Regulatory Commission (the “FERC”), thereby expanding natural gas transportation services into Utah, Wyoming, and Colorado. See Note 8 - Business Acquisitions for more information. Southwest is engaged in the business of purchasing, distributing, and transporting natural gas for customers in portions of Arizona, Nevada, and California. Public utility rates, practices, facilities, and service territories of Southwest are subject to regulatory oversight. The timing and amount of rate relief can materially impact results of operations. Natural gas purchases and the timing of related recoveries can materially impact liquidity. Results for the natural gas distribution segment are higher during winter periods due to the seasonality incorporated in its regulatory rate structures. Centuri is a strategic utility infrastructure services company dedicated to partnering with North America’s gas and electric providers to build and maintain the energy network that powers millions of homes across the United States (“U.S.”) and Canada. Centuri derives revenue primarily from installation, replacement, repair, and maintenance of energy networks. Centuri operates in the U.S., primarily as NPL, Neuco, Linetec, and Riggs Distler, and in Canada, primarily as NPL Canada. Utility infrastructure services activity is seasonal in many of Centuri’s operating areas. Peak periods are the summer and fall months in colder climate areas, such as the northeastern and midwestern U.S. and in Canada. In warmer climate areas, such as the southwestern and southeastern U.S., utility infrastructure services activity continues year round.
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Basis of Presentation | Basis of Presentation. The condensed consolidated financial statements of Southwest Gas Holdings, Inc. and subsidiaries and Southwest included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). The year-end condensed balance sheet data was derived from audited financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations. No substantive change has occurred with regard to the Company’s business segments on the whole. The preparation of the condensed consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. In the opinion of management, all adjustments, consisting of normal recurring items and estimates necessary for a fair depiction of results for the interim periods, have been made. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the 2021 Annual Report to Stockholders, which is incorporated by reference into the 2021 Form 10-K.
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Fair Value Measurements | |
Cash and Cash Equivalents | Cash and Cash Equivalents. Cash and cash equivalents include money market fund investments totaling approximately $169 million and $231 million, for Southwest and the Company, respectively, at March 31, 2022, and $20 million for the Company as of December 31, 2021. The balance for Southwest as of December 31, 2021 was insignificant. These investments fall within Level 2 of the fair value hierarchy, due to the asset valuation methods used by money market funds. The Company had $7 million in restricted cash included in Cash and cash equivalents at March 31, 2022, related to residual proceeds received from its March 2022 common stock offering to be applied against its 364-day Term Loan Facility, which occurred in April 2022. The restricted cash balance is included in Cash and cash equivalents within the Company’s Condensed Consolidated Statement of Cash Flows as of March 31, 2022.Non-cash investing activities for the Company and Southwest include capital expenditures that were not yet paid totaling approximately $26.1 million at March 31, 2022, and $19.4 million at December 31, 2021. |
Accounts Receivable, net of allowances | Accounts Receivable, net of allowances. Southwest lifted the moratorium on disconnection of natural gas service for non-payment in Arizona and Nevada in September 2021, which was initiated (at the same time as a moratorium on late fees) in March 2020 in response to the COVID-19 pandemic. The moratorium on disconnection in California ended in November 2021. Southwest recommenced assessing late fees on past-due balances in Arizona and Nevada in April 2021, and in California in August 2021. Southwest continues to actively work with customers experiencing financial hardship by means of flexible payment options, partnering with assistance agencies and participating in state-funded arrearage payment assistance programs. Deferred Purchased Gas Costs. The various regulatory commissions have established procedures to enable the rate-regulated companies to adjust billing rates for changes in the cost of natural gas purchased. The difference between the current cost of gas purchased and the cost of gas recovered in billed rates is deferred. Generally, these deferred amounts are recovered or refunded within one year. In mid-February 2021, the central U.S. experienced extreme cold temperatures, which increased natural gas demand and caused supply issues due to wellhead freeze-offs, power outages, or other adverse operating conditions upstream of Southwest’s distribution systems. These conditions caused daily natural gas prices to reach unprecedented levels. During this time, Southwest secured natural gas supplies, albeit at substantially higher prices, maintaining service to its customers. The incremental cost for these supplies was approximately $250 million, funded using a 364-day $250 million term loan executed in March 2021. The incremental gas costs were included, for collection from customers, as part of the purchased gas adjustment (“PGA”) mechanisms. The term loan was amended in March 2022 to extend the maturity date to March 2023 due to gas prices that, while not at levels incurred during the 2021 freeze, continue to be elevated (see Note 5 – Debt).
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Deferred Purchased Gas Costs | Deferred Purchased Gas Costs. The various regulatory commissions have established procedures to enable the rate-regulated companies to adjust billing rates for changes in the cost of natural gas purchased. The difference between the current cost of gas purchased and the cost of gas recovered in billed rates is deferred. Generally, these deferred amounts are recovered or refunded within one year. In mid-February 2021, the central U.S. experienced extreme cold temperatures, which increased natural gas demand and caused supply issues due to wellhead freeze-offs, power outages, or other adverse operating conditions upstream of Southwest’s distribution systems. These conditions caused daily natural gas prices to reach unprecedented levels. During this time, Southwest secured natural gas supplies, albeit at substantially higher prices, maintaining service to its customers. The incremental cost for these supplies was approximately $250 million, funded using a 364-day $250 million term loan executed in March 2021. The incremental gas costs were included, for collection from customers, as part of the purchased gas adjustment (“PGA”) mechanisms. |
Prepaid and other current assets | Prepaid and other current assets. Prepaid and other current assets for Southwest include, among other things, materials and operating supplies of $60 million at March 31, 2022 and $62.9 million at December 31, 2021 (carried at weighted average cost). For the Company, there were materials and operating supplies of $64.6 million and $67.4 million at March 31, 2022 and December 31, 2021, which included amounts for MountainWest. Also included in the balance for both Southwest and the Company was $52 million as of December 31, 2021 in accrued purchased gas cost, with no corresponding asset balance as of March 31, 2022 for either entity. |
Goodwill | Goodwill. Goodwill is assessed as of October 1st each year for impairment, or more frequently, if circumstances indicate an impairment to the carrying value of goodwill may have occurred. Management of the Company and Southwest considered its reporting units and segments, determining that they remained consistent between periods presented below, and that no change was necessary with regard to the level at which goodwill is assessed for impairment. The acquisition of MountainWest resulted in a new reportable segment which is assessed for impairment beginning in 2022. |
Other current liabilities | Other Current Liabilities. Management recognizes in its balance sheets various liabilities that are expected to be settled through future cash payment within the next twelve months, including amounts payable under regulatory mechanisms, customary accrued expenses for employee compensation and benefits, declared but unpaid dividends, and miscellaneous other accrued liabilities. Other current liabilities for the Company include $41.4 million and $36 million of dividends declared as of March 31, 2022 and December 31, 2021, respectively. |
Earnings Per Share | Earnings Per Share. Basic earnings per share (“EPS”) in each period of this report were calculated by dividing net income attributable to Southwest Gas Holdings, Inc. by the weighted-average number of shares during those periods. Diluted EPS includes additional weighted-average common stock equivalents (performance shares and restricted stock units). Unless otherwise noted, the term “Earnings Per Share” refers to Basic EPS. |
Recent Accounting Standards Updates | Recent Accounting Standards Updates. Accounting pronouncements effective or adopted in 2022: In March 2020, the FASB issued ASU 2020-04 “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” The update provides optional guidance for a limited time to ease the potential burden in accounting for, or recognizing the effects of, reference rate reform on financial reporting, including when modifying a contract (during the eligibility period covered by the update to Topic 848) to replace a reference rate affected by such reform. The update applies only to contracts and hedging relationships that reference the London Interbank Offered Rate (“LIBOR”) or another rate expected to be discontinued due to reference rate reform. The guidance was eligible to be applied upon issuance on March 12, 2020, and can generally be applied through December 31, 2022, but to date, no further updates have occurred that would extend the optional guidance to the full tenor of LIBOR expiration dates occurring after 2022. Management will monitor the impacts this update might have on the Company’s and Southwest’s consolidated financial statements and disclosures, and will reflect such appropriately, in the event that the optional guidance is elected. Management will also monitor further FASB action, if any, in regard to the full tenor of LIBOR expiration dates. See also LIBOR discussion in Note 5 – Debt. In August 2020, the FASB issued ASU 2020-06 “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging— Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity.” The update, amongst other amendments, improves the guidance related to the disclosures and earnings-per-share for convertible instruments and contracts in an entity’s own equity. The update is effective starting in the first quarter of 2022 in regard to relevant contracts.
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Background, Organization, and Summary of Significant Accounting Policies (Tables) |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Property and Investments | Other property and investments on Southwest’s and the Company’s Condensed Consolidated Balance Sheets includes:
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Schedule of Goodwill | Goodwill in Southwest’s and the Company’s Condensed Consolidated Balance Sheets is as follows:
(a) See Note 8 - Business Acquisitions for details regarding measurement-period adjustments.
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Schedule of Significant Items Included in Other Income (Deductions) | The following table provides the composition of significant items included in Other income (deductions) in Southwest’s and the Company’s Condensed Consolidated Statements of Income:
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Summary of Redeemable Noncontrolling Interest | The following depicts changes to the balances of the redeemable noncontrolling interests:
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Schedule of Earnings Per Share, Basic and Diluted | A reconciliation of the denominator used in Basic and Diluted EPS calculations is shown in the following table:
(1) The number of securities included 112,000 and 75,000 performance shares during the three months ending March 31, 2022 and 2021, and 114,000 and 76,000 performance shares during the twelve months ending March 31, 2022 and 2021, respectively, the total of which was derived by assuming that target performance will be achieved during the relevant performance period.
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Components of Net Periodic Benefit Cost (Tables) |
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Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Net Periodic Benefit Costs | The service cost component of net periodic benefit costs included in the table below is a component of an overhead loading process associated with the cost of labor. The overhead process ultimately results in allocation of service cost to the same accounts to which productive labor is charged. As a result, service costs become components of various accounts, primarily operations and maintenance expense, net regulated operations plant, and deferred charges and other assets for both the Company and Southwest. The other components of net periodic benefit cost are reflected in Other income (deductions) on the Condensed Consolidated Statements of Income of each entity.
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Revenue (Tables) |
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Revenue Disaggregated by Service Type and Contract Type | Southwest’s operating revenues included on the Condensed Consolidated Statements of Income of both the Company and Southwest include revenue from contracts with customers, which is shown below, disaggregated by customer type, in addition to other categories of revenue:
(1) Amounts include late fees and other miscellaneous revenues, and may also include the impact of certain regulatory mechanisms, such as cost-of-service components in customer rates expected to be returned to customers in future periods. Also includes the impacts of a temporary moratorium on late fees and disconnection for nonpayment during the COVID-19 pandemic. The following tables display Centuri’s revenue, reflected as Utility infrastructure services revenues on the Condensed Consolidated Statements of Income of the Company, representing revenue from contracts with customers disaggregated by service and contract types:
MountainWest Regulated operations revenues on the Condensed Consolidated Statements of Income of the Company include revenue from contracts with customers, which is shown below, disaggregated by categories of sales and service activities.
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Summary of Information about Receivables, Revenue Earned on Contracts in Progress in Excess of Billings, Which are Included Within Accounts Receivable, Net of Allowances, and Amounts Billed in Excess of Revenue Earned on Contracts | The following table provides information about contracts receivable and revenue earned on contracts in progress in excess of billings (contract assets), which are both included within Accounts receivable, net of allowances, as well as amounts billed in excess of revenue earned on contracts (contract liabilities), which are included in Other current liabilities as of March 31, 2022 and December 31, 2021 on the Company’s Condensed Consolidated Balance Sheets:
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Schedule of Utility Infrastructure Services Contracts Receivable | Utility infrastructure services contracts receivable consists of the following:
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Common Stock (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Common Stock Activity | The following table provides the life-to-date activity under that program for the period ended March 31, 2022:
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Debt (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Carrying Amounts and Estimated Fair Values of Long-Term Debt |
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Other Comprehensive Income and Accumulated Other Comprehensive Income (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Related Tax Effects Allocated to Each Component of Other Comprehensive Income (Loss) | Related Tax Effects Allocated to Each Component of Other Comprehensive Income (Loss)
(1)Tax amounts are calculated using a 24% rate. The Company has elected to indefinitely reinvest, in Canada, the earnings of Centuri’s Canadian subsidiaries, thus precluding deferred taxes on such earnings. As a result of this assertion, and no repatriation of earnings anticipated, the Company is not recognizing a tax effect or presenting a tax expense or benefit for currency translation adjustments reported in Other comprehensive income (loss).
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Schedule of Rollforward of Accumulated Other Comprehensive Income | The following table represents a rollforward of AOCI, presented on the Company’s Condensed Consolidated Balance Sheets and its Condensed Consolidated Statements of Equity:
(1)The FSIRS reclassification amount is included in Net interest deductions on the Company’s Condensed Consolidated Statements of Income. (2)These AOCI components are included in the computation of net periodic benefit cost (see Note 2 – Components of Net Periodic Benefit Cost for additional details). (3)The regulatory adjustment represents the portion of the activity above that is expected to be recovered through rates in the future (the related regulatory asset is included in Deferred charges and other assets on the Company’s Condensed Consolidated Balance Sheets). (4)Tax amounts are calculated using a 24% rate. The following table represents a rollforward of AOCI, presented on Southwest’s Condensed Consolidated Balance Sheets:
(5) The FSIRS reclassification amount is included in Net interest deductions on Southwest’s Condensed Consolidated Statements of Income. (6)These AOCI components are included in the computation of net periodic benefit cost (see Note 2 – Components of Net Periodic Benefit Cost for additional details). (7)The regulatory adjustment represents the portion of the activity above that is expected to be recovered through rates in the future (the related regulatory asset is included in Deferred charges and other assets on Southwest’s Condensed Consolidated Balance Sheets). (8)Tax amounts are calculated using a 24% rate.
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Schedule of Amount Recognized Before Income Tax in Accumulated Other Comprehensive Income | The following table represents amounts (before income tax impacts) included in AOCI (in the tables above), that have not yet been recognized in net periodic benefit cost:
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Segment Information (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Accounts Receivable Not Eliminated During Consolidation | Accounts receivable for these services, which are not eliminated during consolidation, are presented in the table below:
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Schedule of Segment Reporting Information | The financial information pertaining to the natural gas distribution, utility infrastructure services, and pipeline and storage segments are as follows:
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Business Acquisitions (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combination and Asset Acquisition [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Fair Values of Assets Acquired and Liabilities Assumed | The preliminary estimated fair values of assets acquired and liabilities assumed as of August 27, 2021, and as updated through March 31, 2022, are as follows:
The preliminary estimated fair values of assets acquired and liabilities assumed as of December 31, 2021, and as updated through March 31, 2022, are as follows:
|
Background, Organization, and Summary of Significant Accounting Policies - Schedule of Other Property and Investments (Details) - USD ($) $ in Thousands |
Mar. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Property, Plant and Equipment [Line Items] | ||
Other property and investments | $ 57,170 | $ 59,337 |
Total | 1,313,291 | 1,316,479 |
Non-regulated property, equipment, and intangibles | 1,645,159 | 1,616,392 |
Non-regulated accumulated provision for depreciation and amortization | (540,206) | (512,343) |
Southwest Gas Corporation | ||
Property, Plant and Equipment [Line Items] | ||
Net cash surrender value of COLI policies | 147,987 | 149,947 |
Other property and investments | 3,181 | 3,146 |
Total | $ 151,168 | $ 153,093 |
Background, Organization, and Summary of Significant Accounting Policies - Other Income (Deductions) (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Other income (deductions) | ||||
Equity AFUDC | $ 182 | $ 0 | $ 182 | $ 0 |
Foreign transaction gain (loss) | 3 | (3) | (16) | (9) |
Equity in earnings of unconsolidated investments | 515 | (8) | 749 | 121 |
Miscellaneous income and (expense) | (771) | (91) | 176 | (179) |
Total other income (deductions) | 1,244 | 448 | (2,703) | 14,429 |
Southwest Gas Corporation | ||||
Other income (deductions) | ||||
Change in COLI policies | (2,000) | 2,700 | 4,100 | 27,400 |
Interest income | 2,801 | 716 | 7,198 | 3,343 |
Equity AFUDC | 76 | 981 | (905) | 4,644 |
Other components of net periodic benefit cost | (188) | (3,505) | (10,704) | (18,522) |
Miscellaneous income and (expense) | 626 | (342) | (3,483) | (2,369) |
Total other income (deductions) | $ 1,315 | $ 550 | $ (3,794) | $ 14,496 |
Background, Organization, and Summary of Significant Accounting Policies - Schedule of Earnings Per Share (Details) - shares shares in Thousands |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Weighted average basic shares (in shares) | 60,737 | 57,600 | 59,919 | 56,564 |
Effect of dilutive securities: | ||||
Restricted stock units (in shares) | 117 | 79 | 125 | 85 |
Weighted average diluted shares (in shares) | 60,854 | 57,679 | 60,044 | 56,649 |
Number of performance share units granted (in shares) | 112 | 75 | 114 | 76 |
Components of Net Periodic Benefit Cost (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Qualified Retirement Plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 11,028 | $ 10,290 | $ 41,897 | $ 36,015 |
Interest cost | 11,251 | 10,108 | 41,575 | 44,275 |
Expected return on plan assets | (19,978) | (18,088) | (74,242) | (67,060) |
Amortization of net actuarial loss | 8,117 | 10,489 | 39,583 | 37,507 |
Net periodic benefit cost | 10,418 | 12,799 | 48,813 | 50,737 |
SERP | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 106 | 131 | 501 | 422 |
Interest cost | 360 | 358 | 1,433 | 1,561 |
Amortization of net actuarial loss | 588 | 660 | 2,570 | 2,014 |
Net periodic benefit cost | 1,054 | 1,149 | 4,504 | 3,997 |
PBOP | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 485 | 423 | 1,753 | 1,608 |
Interest cost | 613 | 548 | 2,258 | 2,485 |
Expected return on plan assets | (807) | (810) | (3,236) | (3,366) |
Amortization of prior service costs | 44 | 240 | 763 | 1,106 |
Net periodic benefit cost | $ 335 | $ 401 | $ 1,538 | $ 1,833 |
Revenue - Summary of Information about Receivables (Details) - USD ($) $ in Thousands |
Mar. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Revenue from Contract with Customer [Abstract] | ||
Contracts receivable, net | $ 309,876 | $ 296,005 |
Revenue earned on contracts in progress in excess of billings | 197,620 | 214,774 |
Amounts billed in excess of revenue earned on contracts | $ 26,875 | $ 11,860 |
Revenue - Schedule of Utility Infrastructure Services Contracts Receivable (Details) - USD ($) $ in Thousands |
Mar. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Disaggregation of Revenue [Line Items] | ||
Contracts receivable, net | $ 309,876 | $ 296,005 |
Utility Infrastructure Services | ||
Disaggregation of Revenue [Line Items] | ||
Contracts receivable, gross | 310,228 | 296,262 |
Allowance for doubtful accounts | (352) | (257) |
Contracts receivable, net | 309,876 | 296,005 |
Billed on completed contracts and contracts in progress | Utility Infrastructure Services | ||
Disaggregation of Revenue [Line Items] | ||
Contracts receivable, gross | 308,798 | 292,770 |
Other receivables | Utility Infrastructure Services | ||
Disaggregation of Revenue [Line Items] | ||
Contracts receivable, gross | $ 1,430 | $ 3,492 |
Revenue - Schedule of Regulated Operations Revenues: Pipeline and Storage Segment (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Segment Reporting Information [Line Items] | ||||
Total Regulated operations revenues | $ 743,532 | $ 521,932 | $ 1,743,390 | $ 1,369,690 |
Pipeline and Storage | ||||
Segment Reporting Information [Line Items] | ||||
Revenue from contracts with customers | 66,949 | |||
Other revenues | 44 | |||
Total Regulated operations revenues | 66,993 | |||
Regulated gas transportation and storage revenues | Pipeline and Storage | ||||
Segment Reporting Information [Line Items] | ||||
Revenue from contracts with customers | 61,977 | |||
NGL revenues | Pipeline and Storage | ||||
Segment Reporting Information [Line Items] | ||||
Revenue from contracts with customers | 1,493 | |||
Other revenues | Pipeline and Storage | ||||
Segment Reporting Information [Line Items] | ||||
Revenue from contracts with customers | $ 3,479 |
Common Stock - Activity of Equity Shelf Program (Details) - USD ($) |
3 Months Ended | 12 Months Ended | |||
---|---|---|---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
Mar. 31, 2022 |
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Class of Stock [Line Items] | |||||
Net proceeds | $ 453,495,000 | $ 48,990,000 | $ 618,146,000 | $ 185,087,000 | |
Equity Shelf Program | |||||
Class of Stock [Line Items] | |||||
Gross proceeds | $ 158,180,343 | ||||
Less: agent commissions | (1,581,803) | ||||
Net proceeds | $ 156,598,540 | ||||
Number of shares sold (in shares) | 2,302,407 | ||||
Weighted average price per share (in USD per share) | $ 68.70 |
Common Stock - Narratives (Details) - USD ($) $ / shares in Units, shares in Thousands |
1 Months Ended | 3 Months Ended | |
---|---|---|---|
Mar. 31, 2022 |
Mar. 31, 2022 |
Apr. 08, 2021 |
|
Class of Stock [Line Items] | |||
Sale of stock, number of shares | 6,325 | ||
Sale of stock, price per share (in USD per share) | $ 74.00 | $ 74.00 | |
Net proceeds from sale of stock | $ 452,253,312 | ||
Sale of stock, underwriters' discount | 15,796,688 | ||
Restricted Stock/Unit Plan, and Management Incentive Plan | |||
Class of Stock [Line Items] | |||
Common stock issued (in shares) | 65 | ||
Dividend Reinvestment and Stock Purchase Plan | |||
Class of Stock [Line Items] | |||
Common stock issued (in shares) | 37 | ||
Common stock issued, amount | $ 2,500,000 | ||
Equity Shelf Program | |||
Class of Stock [Line Items] | |||
Sale of stock, amount of common stock offered for sale | $ 500,000,000 | ||
Sale of stock, amount of common stock available for sale | $ 341,800,000 | $ 341,800,000 |
Other Comprehensive Income and Accumulated Other Comprehensive Income - Amounts Recognized Before Tax, Defined Benefit Plans (Details) - USD ($) $ in Thousands |
Mar. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Equity [Abstract] | ||
Net actuarial loss | $ (390,305) | $ (399,010) |
Prior service cost | (1,484) | (1,528) |
Less: amount recognized in regulatory assets | 332,088 | 339,356 |
Recognized in AOCI | $ (59,701) | $ (61,182) |
Segment Information - Narratives (Details) - segment |
3 Months Ended | 12 Months Ended |
---|---|---|
Mar. 31, 2022 |
Dec. 31, 2021 |
|
Segment Reporting [Abstract] | ||
Number of reportable segments | 3 | 2 |
Segment Information - Accounts Receivable Not Eliminated During Consolidation (Details) - USD ($) $ in Thousands |
Mar. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Centuri | ||
Segment Reporting Information [Line Items] | ||
Centuri accounts receivable for services provided to Southwest | $ 15,522 | $ 15,166 |
Business Acquisitions - Narrative (Detail) - USD ($) $ in Millions |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2022 |
Nov. 30, 2021 |
Aug. 27, 2021 |
|
Questar Pipelines | |||
Business Acquisition [Line Items] | |||
Incurred and expensed acquisition costs | $ 18.5 | ||
Acquisition-related costs | 0.0 | ||
Drum | |||
Business Acquisition [Line Items] | |||
Incurred and expensed acquisition costs | $ 14.0 | ||
Acquisition-related costs | $ 0.0 | ||
Certain Members Of Riggs Distler Management | Drum | |||
Business Acquisition [Line Items] | |||
Ownership percentage by noncontrolling owners | 1.42% | 1.42% |
Subsequent Events (Details) - director |
May 06, 2022 |
May 05, 2022 |
Oct. 10, 2021 |
---|---|---|---|
Subsequent Event [Line Items] | |||
Rights Agreement Amendment, beneficial ownership percentage | 10.00% | ||
Subsequent Event | |||
Subsequent Event [Line Items] | |||
Number of new board of directors appointed | 3 | ||
Number of Strategic Transactions Committee directors | 6 | 3 | |
Cooperation Agreement term, beneficial ownership percentage benchmark | 24.90% | ||
Rights Agreement Amendment, beneficial ownership percentage | 24.90% |
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