ONE Gas Announces First Quarter 2026 Financial Results; Affirms 2026 Financial Guidance

Declares Second Quarter Dividend

Analyst call and webcast scheduled tomorrow, May 5 at 11 a.m. EDT

TULSA, Okla., May 4, 2026 /PRNewswire/ -- ONE Gas, Inc. (NYSE: OGS) today announced its first quarter 2026 financial results, affirmed its 2026 financial guidance and declared its quarterly dividend.

"Our positive performance through a historically warm winter underscores the resilience of our business model and our ability to drive long‑term value while sustaining customer affordability," said Robert S. McAnnally, chief executive officer. "We are confident in our strategic plan and remain on track to achieve our 2026 financial guidance."

FINANCIAL RESULTS & HIGHLIGHTS

FIRST QUARTER 2026 FINANCIAL PERFORMANCE

ONE Gas reported operating income of $189.6 million in the first quarter, compared with $180.5 million in the first quarter 2025, which primarily reflects an increase of $27.3 million from new rates.

This increase was partially offset by:

Excluding interest related to KGSS-I securitized bonds, net interest expense decreased $3.0 million for the three months ending March 31, 2026. The decrease in interest expense is primarily due to commercial paper borrowings at lower rates and the implementation of Texas House Bill 4384.

Income tax expense includes a credit for amortization of the regulatory liability associated with excess deferred income taxes (EDIT) of $9.5 million and $8.1 million for the three months ended March 31, 2026, and 2025, respectively.

Capital expenditures and asset removal costs were $169.6 million for the first quarter 2026 compared with $177.7 million in the same period last year, primarily representing expenditures for system integrity and extension of service to new areas.

REGULATORY ACTIVITIES UPDATE

In April 2026, Kansas House Bill 2435 was signed into law, amending the Gas System Reliability Surcharge (GSRS) statute effective July 1, 2026. The amendment expands the qualifying infrastructure investments eligible for recovery to include all utility plant investments (excluding allocated corporate costs other than cyber-security related investments), increases the maximum monthly residential surcharge to $1.35 from $0.80 and provides added filing flexibility by allowing one GSRS filing per calendar year, rather than once every 365 days.

In March 2026, Texas Gas Service made a Gas Reliability Infrastructure Program filing for all customers requesting a $36.9 million revenue increase to be effective in July 2026.

In February 2026, Oklahoma Natural Gas filed its annual Performance-Based Rate Change application for the test year ended December 2025. The filing includes a requested $28.7 million base rate revenue increase, $2.6 million energy efficiency incentive and $14.4 million of estimated EDIT to be credited to customers in 2027. A hearing is scheduled for June 11, 2026. Rates may be implemented subject to refund on June 26, 2026.

2026 FINANCIAL GUIDANCE

ONE Gas affirmed the financial guidance it issued on Dec. 1, 2025, as supplemented on Feb. 18, 2026. For 2026, net income is expected to be in the range of $294 million to $302 million, or $4.65 to $4.77 per diluted share, while adjusted net income is expected to be in the range of $306 million to $314 million, or $4.83 to $4.95 per diluted share. The Company continues to expect long-term GAAP and adjusted net income growth of 7 to 9 percent and GAAP and adjusted net income per diluted share growth of 5 to 7 percent, consistent with its established five-year financial outlook.

Capital investments, including asset removal costs, are expected to be approximately $800 million in 2026. Capital investments for extensions to new customers are expected to be approximately $230 million.

EARNINGS CONFERENCE CALL AND WEBCAST

The ONE Gas executive management team will host a conference call on Tuesday, May 5, 2026, at 11 a.m. Eastern Daylight Time (10 a.m. Central Daylight Time). The call also will be carried live on the ONE Gas website.

To participate in the telephone conference call, dial 800-715-9871, passcode 3280987, or log on to www.onegas.com/investors and select Events and Presentations.

If you are unable to participate in the conference call or the webcast, a replay will be available on the ONE Gas website, www.onegas.com, for 30 days. A recording will be available by phone for seven days. The playback call may be accessed at 1-800-770-2030, passcode 3280987.

NON-GAAP DISCLOSURE STATEMENT

This news release includes financial results and guidance for ONE Gas with respect to adjusted net income and adjusted net income per share, which are non-GAAP financial measures as defined by the Securities and Exchange Commission. Adjusted net income and adjusted net income per share are calculated as GAAP net income plus the deferral of an equity portion of a carrying cost attributable to shareholders' investment capitalized for regulatory purposes but not for financial reporting purposes. These carrying costs relate to property, plant and equipment that has been placed in service, but not yet reflected in base rates. Adjusted net income and adjusted net income per share should not be considered in isolation or as a substitute for GAAP net income or GAAP earnings per share.

Management believes these non‑GAAP measures provide useful information because they offer a more complete view of our overall regulatory economics, reflect the period-specific effects of certain regulatory mechanisms designed to mitigate regulatory lag associated with property, plant and equipment placed in service prior to regulatory action, and reflect the impact of regulatory timing differences that arise under the Company's rate-setting framework. These adjustments, net of applicable tax effects, are expected to recur as a result of the Company's regulatory framework and are a consistent part of our earnings profile. A reconciliation of the Company's GAAP net income and GAAP earnings per share to adjusted net income and adjusted net income per share is provided in the Appendix.

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ONE Gas, Inc. (NYSE: OGS) is a 100% regulated natural gas utility, and trades on the New York Stock Exchange and the NYSE Texas under the symbol "OGS." ONE Gas is included in the S&P MidCap 400 Index and is one of the largest natural gas utilities in the United States.

Headquartered in Tulsa, Oklahoma, ONE Gas provides a reliable and affordable energy choice to more than 2.3 million customers in Kansas, Oklahoma and Texas. Its divisions include Kansas Gas Service, the largest natural gas distributor in Kansas; Oklahoma Natural Gas, the largest in Oklahoma; and Texas Gas Service, the third largest in Texas, in terms of customers.

For more information and the latest news about ONE Gas, visit onegas.com and follow its social channels: @ONEGas, Facebook, LinkedIn and YouTube.

Some of the statements contained and incorporated in this news release are forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. The forward-looking statements relate to our anticipated financial performance, liquidity, management's plans and objectives for our future operations, our business prospects, the outcome of regulatory and legal proceedings, market conditions and other matters. We make these forward-looking statements in reliance on the safe harbor protections provided under the Private Securities Litigation Reform Act of 1995. The following discussion is intended to identify important factors that could cause future outcomes to differ materially from those set forth in the forward-looking statements.

Forward-looking statements include the items identified in the preceding paragraph, the information concerning possible or assumed future results of our operations and other statements contained or incorporated in this news release identified by words such as "anticipate," "estimate," "expect," "project," "intend," "plan," "believe," "should," "goal," "forecast," "guidance," "could," "may," "continue," "might," "potential," "scheduled," "likely," and other words and terms of similar meaning.

One should not place undue reliance on forward-looking statements, which are applicable only as of the date of this news release. Known and unknown risks, uncertainties and other factors may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by forward-looking statements. Those factors may affect our operations, costs, liquidity, markets, products, services and prices. In addition to any assumptions and other factors referred to specifically in connection with the forward-looking statements, factors that could cause our actual results to differ materially from those contemplated in any forward-looking statement include, among others, the following:

These factors are not necessarily all of the important factors that could cause actual results to differ materially from those expressed in any of our forward-looking statements. Other factors could also have material adverse effects on our future results. These and other risks are described in greater detail in Part 1, Item 1A, Risk Factors, in our Annual Report. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by these factors. Other than as required under securities laws, we undertake no obligation to update publicly any forward-looking statement whether as a result of new information, subsequent events or change in circumstances, expectations or otherwise.

APPENDIX

ONE Gas, Inc.

CONSOLIDATED STATEMENTS OF INCOME

Three Months Ended

March 31,

(Unaudited)

2026

2025

(Thousands of dollars, except

per share amounts)

Total revenues

$ 831,711

$ 935,190

Cost of natural gas

393,576

512,462

Operating expenses

Operations and maintenance

146,947

135,295

Depreciation and amortization

76,785

81,704

General taxes

24,811

25,230

Total operating expenses

248,543

242,229

Operating income

189,592

180,499

Other income (expense), net

(2,097)

518

Interest expense, net

(32,358)

(35,697)

Income before income taxes

155,137

145,320

Income taxes

(26,464)

(25,901)

Net income

$ 128,673

$ 119,419

Earnings per share

Basic

$ 2.05

$ 1.99

Diluted

$ 2.04

$ 1.98

Average shares (thousands)

Basic

62,913

60,077

Diluted

63,204

60,266

Dividends declared per share of stock

$ 0.68

$ 0.67

APPENDIX

ONE Gas, Inc.

CONSOLIDATED BALANCE SHEETS

March 31,

December 31,

(Unaudited)

2026

2025

Assets

(Thousands of dollars)

Property, plant and equipment

$ 9,852,116

$ 9,734,150

Accumulated depreciation and amortization

2,640,623

2,611,952

Net property, plant and equipment

7,211,493

7,122,198

Current assets

Cash and cash equivalents

11,354

10,620

Restricted cash and cash equivalents

11,639

23,107

Total cash, cash equivalents and restricted cash and cash equivalents

22,993

33,727

Accounts receivable, net

405,157

461,631

Materials and supplies

92,987

97,595

Income tax receivable

55,552

Natural gas in storage

123,920

176,451

Regulatory assets

61,487

49,504

Other current assets

34,544

41,424

Total current assets

796,640

915,884

Goodwill and other assets

Regulatory assets

252,048

256,225

Securitized intangible asset, net

226,359

233,786

Goodwill

157,953

Pension and other postemployment benefits

47,175

47,012

Other assets

133,933

120,026

Total goodwill and other assets

817,468

815,002

Total assets

$ 8,825,601

$ 8,853,084

APPENDIX

ONE Gas, Inc.

CONSOLIDATED BALANCE SHEETS

(Continued)

March 31,

December 31,

(Unaudited)

2026

2025

Equity and Liabilities

(Thousands of dollars)

Equity and long-term debt

Common stock, $0.01 par value:

authorized 250,000,000 shares; issued and outstanding 62,761,990 shares at March 31, 2026;

issued and outstanding 62,692,392 shares at December 31, 2025

$ 628

$ 627

Paid-in capital

2,530,435

2,530,137

Retained earnings

994,838

909,355

Accumulated other comprehensive income (loss)

(179)

Total equity

3,525,722

3,440,123

Other long-term debt, excluding current maturities, net of issuance costs

2,133,350

2,133,018

Securitized utility tariff bonds, excluding current maturities, net of issuance costs

206,970

223,020

Total long-term debt, excluding current maturities, net of issuance costs

2,340,320

2,356,038

Total equity and long-term debt

5,866,042

5,796,161

Current liabilities

Current maturities of other long-term debt, net of issuance costs

249,798

249,674

Current maturities of securitized utility tariff bonds, net of issuance costs

31,404

30,566

Notes payable

759,700

737,400

Accounts payable

137,587

222,102

Accrued taxes other than income

71,272

75,568

Regulatory liabilities

21,638

57,277

Customer deposits

54,901

52,871

Other current liabilities

75,980

106,400

Total current liabilities

1,402,280

1,531,858

Deferred credits and other liabilities

Deferred income taxes

999,420

963,874

Regulatory liabilities

441,041

451,620

Other deferred credits

116,818

109,571

Total deferred credits and other liabilities

1,557,279

1,525,065

Commitments and contingencies

Total liabilities and equity

$ 8,825,601

$ 8,853,084

APPENDIX

ONE Gas, Inc.

CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended

(Unaudited)

2026

2025

(Thousands of dollars)

Operating activities

Net income

$ 128,673

$ 119,419

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

76,785

81,704

Deferred income taxes

23,293

19,146

Share-based compensation expense

3,837

3,656

Provision for doubtful accounts

2,896

2,331

Changes in assets and liabilities:

Accounts receivable

53,578

(40,690)

Materials and supplies

4,608

3,681

Natural gas in storage

52,531

92,498

Asset removal costs

(13,081)

(11,089)

Accounts payable

(78,600)

(72,871)

Accrued taxes other than income

(4,296)

2,245

Customer deposits

2,030

(1,320)

Regulatory assets and liabilities - current

(51,927)

73,872

Regulatory assets and liabilities - noncurrent

5,894

9,425

Other assets and liabilities - current

(26,105)

(11,650)

Other assets and liabilities - noncurrent

(3,803)

7,102

Cash provided by operating activities

176,313

277,459

Investing activities

Capital expenditures

(156,533)

(166,597)

Other investing expenditures

(2,697)

(2,427)

Other investing receipts

5,130

1,179

Cash used in investing activities

(154,100)

(167,845)

Financing activities

Borrowings (repayments) of notes payable, net

22,300

(102,700)

Repayment of other long-term debt

(4)

Repayment of securitized utility tariff bonds

(15,356)

(14,547)

Dividends paid

(42,678)

(40,153)

Tax withholdings related to net share settlements of stock compensation

(4,050)

(2,559)

Construction advances

6,841

—

Cash provided by financing activities

(32,947)

(159,963)

Change in cash, cash equivalents, restricted cash and restricted cash equivalents

(10,734)

(50,349)

Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period

33,727

78,537

Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period

$ 22,993

$ 28,188

Supplemental cash flow information:

Cash paid for interest, net of amounts capitalized

$ 32,628

$ 36,268

Cash paid (received) for state income taxes

$ —

Cash paid (received) for federal income taxes

$ —

APPENDIX

The following table reconciles the Company's GAAP net income and GAAP earnings per share to adjusted net income and adjusted net income per share:

ONE Gas, Inc.

Three Months Ended

March 31,

2026

2025

(Thousands of dollars, except per share amounts)

Net income - GAAP

$ 128,673

$ 119,419

Other income - deferred carrying cost (a)

4,725

648

Income taxes (a)

—

Adjusted net income - non-GAAP

$ 133,398

$ 120,067

Earnings per share - GAAP

Basic

$ 2.05

$ 1.99

Diluted

$ 2.04

$ 1.98

Adjusted net income per share - non-GAAP

Basic

$ 2.12

$ 2.00

Diluted

$ 2.11

$ 1.99

Average shares (thousands)

Basic

62,913

60,077

Diluted

63,204

60,266

(a) The allowance for earnings on shareholders' investment capitalized for regulatory purposes but not for financial reporting purposes

applied to property, plant and equipment placed in service, but not yet reflected in rates as authorized by our regulators or state law. This

increases book income but is non-taxable, creating a permanent tax difference.

ONE Gas, Inc.

2026 Financial Guidance: Reconciliation of non-GAAP to GAAP:

Low

Mid

High

(Thousands of dollars, except per share amounts)

Net income - GAAP

$ 294,000

$ 298,000

$ 302,000

Other income - deferred carrying cost (a)

11,890

11,919

12,000

Income taxes (a)

—

Adjusted net income - non-GAAP

$ 305,890

$ 309,919

$ 314,000

Earnings per share - GAAP

Basic

$ 4.67

$ 4.73

$ 4.79

Diluted

$ 4.65

$ 4.71

$ 4.77

Adjusted net income per share - non-GAAP

Basic

$ 4.86

$ 4.92

$ 4.98

Diluted

$ 4.83

$ 4.89

$ 4.95

Average shares (thousands)

Basic

62,995

Diluted

63,350

(a) The allowance for earnings on shareholders' investment capitalized for regulatory purposes but not for financial reporting purposes

applied to property, plant and equipment placed in service, but not yet reflected in rates as authorized by our regulators or state law. This

increases book income but is non-taxable, creating a permanent tax difference.

APPENDIX

ONE Gas, Inc.

INFORMATION AT A GLANCE

Three Months Ended

March 31,

(Unaudited)

2026

2025

(Millions of dollars)

Natural gas sales

769.9

870.4

Transportation revenues

40.1

43.8

Securitization customer charges

11.0

11.6

Other revenues

10.7

9.4

Total revenues

831.7

935.2

Cost of natural gas

393.5

512.5

Operating costs

171.8

160.5

Depreciation and amortization

76.8

81.7

Operating income

189.6

180.5

Net income

128.7

119.4

Capital expenditures and asset removal costs

169.6

177.7

Volumes (Bcf)

Natural gas sales

Residential

44.0

58.9

Commercial and industrial

15.0

19.2

Other

0.9

1.2

Total sales volumes delivered

59.9

79.3

Transportation

59.1

65.3

Total volumes delivered

119.0

144.6

Average number of customers (in thousands)

Residential

2,138

2,125

Commercial and industrial

163

165

Other

Transportation

Total customers

2,315

2,305

Heating Degree Days

Actual degree days

4,159

5,513

Normal degree days

5,232

5,231

Percent colder (warmer) than normal weather

(21) %

5 %

Statistics by State

Oklahoma

Average number of customers (in thousands)

939

934

Actual degree days

1,411

1,916

Normal degree days

1,798

1,797

Percent colder (warmer) than normal weather

(22) %

7 %

Kansas

Average number of customers (in thousands)

660

659

Actual degree days

2,070

2,610

Normal degree days

2,486

Percent colder (warmer) than normal weather

(17) %

5 %

Texas

Average number of customers (in thousands)

716

712

Actual degree days

678

987

Normal degree days

948

Percent colder (warmer) than normal weather

(28) %

4 %

Analyst Contact:

Erin Dailey

918-947-7441

Media Contact:

Leah Harper

918-947-7123

SOURCE ONE Gas, Inc.