NYSE:SR Spire Q2 2025 Earnings Report $76.41 +0.12 (+0.16%) Closing price 05/2/2025 03:59 PM EasternExtended Trading$76.45 +0.04 (+0.05%) As of 05/2/2025 04:20 PM Eastern Extended trading is trading that happens on electronic markets outside of regular trading hours. This is a fair market value extended hours price provided by Polygon.io. Learn more. Earnings HistoryForecast Spire EPS ResultsActual EPS$3.60Consensus EPS $3.70Beat/MissMissed by -$0.10One Year Ago EPS$3.45Spire Revenue ResultsActual Revenue$1.05 billionExpected Revenue$1.15 billionBeat/MissMissed by -$99.35 millionYoY Revenue Growth-6.80%Spire Announcement DetailsQuarterQ2 2025Date4/30/2025TimeBefore Market OpensConference Call DateWednesday, April 30, 2025Conference Call Time10:00AM ETConference Call ResourcesConference Call AudioConference Call TranscriptSlide DeckPress Release (8-K)Quarterly Report (10-Q)Earnings HistoryCompany ProfileSlide DeckFull Screen Slide DeckPowered by Spire Q2 2025 Earnings Call TranscriptProvided by QuartrApril 30, 2025 ShareLink copied to clipboard.PresentationSkip to Participants Operator00:00:00Good day, and welcome to the Spire Inc. Q2 FY twenty twenty five Earnings Conference Call. All participants will be in listen only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. Operator00:00:27I would now like to turn the conference over to Megan McPhail, Managing Director of Investor Relations. Please go ahead. Megan McPhailManaging Director of Investor Relations at Spire Inc00:00:36Good morning and welcome to Spire's fiscal twenty twenty five second quarter earnings call. On the call with me today is Scott Doyle, President and CEO and Adam Woodard, Executive Vice President and CFO. We issued an earnings news release this morning and you may access it on our website at spireenergy.com under Newsroom. Is a slide presentation that accompanies our webcast, which can be downloaded from our website under Investors and then Events and Presentations. Before we begin, let me cover our Safe Harbor statement and use of non GAAP earnings measures. Megan McPhailManaging Director of Investor Relations at Spire Inc00:01:11Today's call, including responses to questions, may contain forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Although our forward looking statements are based on reasonable assumptions, there are various uncertainties and risk factors that may cause future performance or results to be different than those anticipated. These risks and uncertainties are outlined in our quarterly and annual filings with the SEC. In our comments, we will be discussing non GAAP measures used by management when evaluating performance and results of operations. Explanations and reconciliations of these measures to their GAAP counterparts are contained in both our news release and slide presentation. Megan McPhailManaging Director of Investor Relations at Spire Inc00:01:53Now here's Scott, who will start on Page four of the presentation. Scott DoylePresident, CEO & Director at Spire Inc00:01:59Thank you, Megan. Good morning, everyone, and thank you for joining us today for our fiscal second quarter earnings conference call. I'm honored to address you today as the newly appointed President and CEO of Spire. I'd like to express my gratitude to Steve Lindsey for his dedicated service and commitment to Spire over the years. Under his leadership, the company made significant strides and built a strong foundation for the future. Scott DoylePresident, CEO & Director at Spire Inc00:02:24Steve is assisting me over the next several months ensuring we have a seamless transition. I want to assure you our strategy remains unchanged. We'll continue to focus on organic growth, infrastructure investment and continuous improvement. This includes modernizing our systems to benefit our customers, advancing our regulatory engagement and maximizing value for our customers and other stakeholders while keeping the safety of our employees, customers and communities at the center of it all. Before I dive into results, I would like to express my gratitude to our employees for their dedication to providing safe and reliable gas service for our customers. Scott DoylePresident, CEO & Director at Spire Inc00:03:04Despite challenges of extreme cold at times throughout the winter, our natural gas system performed exceptionally well, thanks to their hard work and commitment. Turning to our performance for the quarter. This morning we announced adjusted earnings of $3.6 per share compared to $3.45 per share a year ago. The year over year increase reflects strong growth in our utility and midstream segments partially offset by slightly lower results in gas marketing. Our performance is driven by strategic infrastructure investments to modernize our natural systems coupled with our ongoing commitment to disciplined cost management. Scott DoylePresident, CEO & Director at Spire Inc00:03:45Adam will provide a more detailed breakdown of our results and share insights into our outlook. Now for an update on regulatory matters. Since our last earnings call, we have worked closely with key stakeholders in our ongoing Missouri rate case. We will continue to collaborate in the coming months to ensure a constructive outcome. In addition, earlier this month, the Missouri Public Service Commission staff recommended a $19,000,000 revenue increase in our infrastructure system replacement surcharge or ISRS request. Scott DoylePresident, CEO & Director at Spire Inc00:04:18This is our fifth such request since our last general rate case and if approved would bring our revenues in the rider to an annualized rate of $72,600,000 On the legislative front, we are pleased that Missouri Governor Kehoe signed Senate Bill four into law marking a significant advancement for the state's utilities. This constructive legislation introduces a future test year rate setting model that is forward looking allowing natural gas and water utilities to set rates based on projected costs rather than historical expenses. By attracting investment in energy infrastructure the bill aims to enhance system reliability and drive economic growth across Missouri. The bill allows utilities to file a rate case based on a future test year starting in July of twenty twenty six. We continue to be focused on achieving consistent and constructive regulatory outcomes jurisdictions leading to a more sustainable financial performance trajectory. Scott DoylePresident, CEO & Director at Spire Inc00:05:20Looking ahead, we are reaffirming our long term EPS growth target of 5% to 7%. This is supported by our ten year seven point four billion dollars capital investment plan and we expect to deliver within our fiscal twenty twenty five earnings guidance of $4.4 to $4.6 per share. We are committed to delivering strong results in the second half of the year and beyond with a focus on executing our capital investment plan, driving operational excellence and strengthening the performance of our utilities and gas related businesses. Spire is poised for sustainable growth. In St. Scott DoylePresident, CEO & Director at Spire Inc00:05:59Louis, we're excited about the growth opportunities ahead. The labor market has now fully recovered reaching pre pandemic employment levels. In addition, Boeing recently was selected to build the next generation fighter aircraft for the United States Air driving growth of high quality jobs in the St. Louis area strengthening Missouri's economy and securing a prosperous future for our community. I would also like to highlight that last week we renewed our labor agreement with our local five forty eight union representing employees in our Alabama service territory. Scott DoylePresident, CEO & Director at Spire Inc00:06:32This three year agreement is a win win as it provides stability to our workforce and allows us to focus operational excellence. We are well positioned to achieve our financial and operational goals as we execute our strategy to grow organically, invest in infrastructure and drive continuous improvement. Turning to page five. We continue to make capital investments to improve reliability, resiliency and safety for the benefit of our customers. Year to date our CapEx totaled $479,000,000 with the majority of the spend taking place at our gas utilities. Scott DoylePresident, CEO & Director at Spire Inc00:07:07Year over year utility CapEx increased nearly 27% as we focus on upgrading distribution infrastructure and connecting more homes and businesses to safe reliable and affordable natural gas. Investment in our midstream segment totaled $84,000,000 year to date largely for the expansion of Spire Storage West. The expansion is now substantially complete and we are pleased with the returns on the project. We expect to have the final components placed in service by the end of this summer. Looking ahead, we are increasing our fiscal twenty twenty five capital investment target by $50,000,000 to $840,000,000 The higher CapEx includes a $15,000,000 increase at Spire Missouri and the $35,000,000 increase at Midstream primarily for the storage expansion project. Scott DoylePresident, CEO & Director at Spire Inc00:07:57As a reminder, our long term investment plan is focused on organic growth utilities. Approximately 98% of our ten year capital expenditure plan is targeted utility spend driving our growth in rate base. Moving to page six for a Missouri rate case update. Last week the PSC staff proposed a $246,000,000 annual revenue increase in our Spire Missouri rate case. This increase amount is made up of two parts approximately $2.00 $5,000,000 included in the staff's direct testimony and staff's estimated 42,000,000 true up through 05/31/2025. Scott DoylePresident, CEO & Director at Spire Inc00:08:38The proposed revenue increase differs from our requested increase of $290,000,000 primarily due to staff's proposed 9.63% return on equity and 53.19% equity layer compared to our requested return on equity of 10.555% equity layer in discrete adjustments which we expect to be addressed in subsequent testimony. You may recall our requested increase reflects an estimated rate base of $4,400,000,000 inclusive of discrete adjustments. We expect future testimony to address the weather mechanism and other elements of the case. Evidentiary hearings are scheduled to begin on August 4 and an order from the commission and new rates expected to be effective by October. We appreciate the constructive engagement thus far and remain committed to working closely with stakeholders throughout the remainder of the process. Scott DoylePresident, CEO & Director at Spire Inc00:09:35I'll now turn the call over to Adam for a financial review and update on guidance and outlook. Adam? Adam WoodardEVP & CFO at Spire Inc00:09:44Thanks Scott and good morning everyone. I'll start with a review of our quarterly results which are detailed on pages seven and eight of our presentation. During the second quarter, we reported adjusted earnings of over $214,000,000 an increase of almost $18,000,000 compared to last year. Adam WoodardEVP & CFO at Spire Inc00:10:03The Gas Utilities segment had earnings of approximately $195,000,000 in the second quarter, over $7,000,000 higher than last year. The increased results reflect higher contribution margin at Spire Missouri driven by an increase in ISRS revenues and usage net of weather mitigation as well as new rates at Spire Alabama. These favorable items were partially offset by lower Spire Alabama usage net of weather mitigation. Excluding bad debt, utility earnings also reflected lower run rate O and M expense and higher depreciation expense. During the quarter, we continue to see strong earnings growth in our Midstream segment driven by new contracts on additional capacity, higher rates on contract renewals and asset optimization at Spire Storage. Adam WoodardEVP & CFO at Spire Inc00:10:50Earnings in our Marketing segment were strong, but slightly lower than the prior year due to reduced market volatility. Lastly, other corporate costs were higher primarily due to higher borrowing balances. In both Missouri and Alabama, we experienced colder temperatures than last year and slightly colder than normal temperatures. Our volumetric margins in Missouri for the quarter were higher by nearly $7,000,000 but short of our expectations. This adjustment is highly dependent on the relationship between heating degree days and customer usage set in the previous rate proceeding. Adam WoodardEVP & CFO at Spire Inc00:11:24The weather mitigation adjustment in Missouri was not effective as revenues were not aligned with usage over the course of the quarter. Looking out at Alabama, while we experienced a higher than anticipated adjustment under the weather mitigation mechanism during the quarter, the year to date results are largely in line with expectations. We are focused on cost management and continue to expect run rate O and M expense at the gas utility to be flat relative to fiscal twenty twenty four levels. During the quarter, utility run rate O and M expense was lower by $800,000 when compared to last year. Turning now to our growth outlook on Page nine. Adam WoodardEVP & CFO at Spire Inc00:12:04We are confident that our long term adjusted earnings per share growth target of 5% to 7%. This is reinforced by 7% to 8% rate base growth at Spire Missouri and steady sustained equity growth at Spire Alabama coupled with efficient recovery mechanisms. We remain committed to executing on our strategy and are affirming our FY twenty twenty five adjusted earnings guidance range of $4.4 to 4.6 per share. Weighted average shares for FY '20 '20 '5 are expected to be approximately $58,500,000 slightly lower than our previously anticipated 59,000,000 shares, providing the benefit in expected adjusted earnings per share for the year. We are updating our adjusted earnings targets by business segment to reflect first half results and expectations for the remainder of the year. Adam WoodardEVP & CFO at Spire Inc00:12:53We're lowering the gas utility range by $11,000,000 primarily due to weather related margin headwinds experienced year to date. As a result of the ineffectiveness of the weather adjustment and usage, we anticipate approximately $9,000,000 of lower margins from residential customers. We are raising the range for gas marketing by $4,000,000 on stronger than expected earnings in the first half of the year and we are increasing our midstream earnings outlook by $8,000,000 to reflect the realization of higher rates and capacity and optimization of our storage assets during the first half of the year. The range for corporate and others loss was increased by $4,000,000 primarily due to higher interest expense from higher short term balances. Moving to slide 10 for a financing update. Adam WoodardEVP & CFO at Spire Inc00:13:37Our three year financing plan is unchanged. To support our equity needs, we settled approximately 43,000,000 of forward sales during the quarter. Looking ahead, we anticipate using our ATM program for planned equity issuances through 2027. In April, we priced $150,000,000 of Spire Missouri first mortgage bonds that we expect to fund on May 1. Our financing plan includes additional issuances in 2026 and 2027 to refinance maturities and incremental debt of approximately $500,000,000 to fund our capital plan. Adam WoodardEVP & CFO at Spire Inc00:14:13Our FFO to debt target remains at 15% to 16%. In summary, we are executing our financing plan effectively and are confident in our financial position going forward. With that, let me turn it back over to you, Scott. Scott DoylePresident, CEO & Director at Spire Inc00:14:28Thanks Adam. As you've heard today, we have made significant progress towards achieving our priorities for the year, strengthening our position as a more resilient, efficient and sustainable company that creates value for both customers and shareholders. Scott DoylePresident, CEO & Director at Spire Inc00:14:43Our unwavering commitment to delivering natural gas safely and reliably remains at the core of our efforts. We are executing on our capital investment plan while actively collaborating with key stakeholders to secure constructive regulatory outcomes that benefit both our customers and shareholders. Additionally, we are focused on meeting our fiscal twenty twenty five adjusted earnings per share guidance range and preserving the strength of our balance sheet. Executing on these objectives is not just a focus for FY 2025, but a long term commitment to driving success and delivering meaningful results in the years to come. Thank you for your ongoing support of Spire and we look forward to seeing many of you at the AGA Financial Forum in a few weeks. Scott DoylePresident, CEO & Director at Spire Inc00:15:28We're now ready to take questions. Operator00:15:31Yes. Thank you. We will now begin the question and answer session. And the first question comes from Richard Sunderland with JPMorgan. Richard SunderlandEquity Research - North American Utilities & Power at JP Morgan00:15:59Hey, good morning. And Scott, congrats on your new leadership of the company. Scott DoylePresident, CEO & Director at Spire Inc00:16:04Good morning, Rich. Thank you. Richard SunderlandEquity Research - North American Utilities & Power at JP Morgan00:16:08Digging into the results a little bit in finer detail, some moving pieces on the segment guidance. I realize share count is tweaked as well. Can you speak a little bit about 1H trends and then where you're trending on a full year basis, giving all these moving pieces? Adam WoodardEVP & CFO at Spire Inc00:16:28Hey, Rich, it's Adam. We wanted to take stop and take a minute and really took we saw the margin weakness in Missouri and had elected to take that guidance down. Now, fortunately, the midstream had exceeded our expectations and we're able to move that up. So I mean, from a trend line perspective, obviously, we're moving into the summer months and you won't we won't see a lot of performance out of the gas utilities, but we do the midstream turning well into the end of the year. And as I mentioned on the last call, marketing, we feel very good about where they're at and where they're going for the year. Richard SunderlandEquity Research - North American Utilities & Power at JP Morgan00:17:23Understood. So it sounds like the sort of weather at the utility is obviously unfortunate. Is that really the sole deviation on the utility side? I think you referenced 9,000,000 of customer margin. So it looks like there should be a few other small pieces in there too. Richard SunderlandEquity Research - North American Utilities & Power at JP Morgan00:17:42Just trying to understand the weather versus where else you're having difficulty forecasting the utility. Adam WoodardEVP & CFO at Spire Inc00:17:49That's the main driver. There's a as you mentioned, there's a few other pieces, but the main driver really is the weather related margin. Richard SunderlandEquity Research - North American Utilities & Power at JP Morgan00:17:58Okay. Okay, understood. And then with the midstream guidance, that $8,000,000 increase, is it solely a one off for 2025? Or are you seeing a higher run rate for the business going forward? Adam WoodardEVP & CFO at Spire Inc00:18:11That's a great question. There's a little bit of we mentioned optimization there. There's One, we are seeing relative to where we started the year, feeling better about kind of where we're at on capacity and pricing. But a piece of that's optimization. So this would indicate some run rate lift over time, but I want to stress that it's not complete a complete lift on run rate. Adam WoodardEVP & CFO at Spire Inc00:18:40There is some optimization in there around circumstances or volatility that we saw in the first couple of quarters. Richard SunderlandEquity Research - North American Utilities & Power at JP Morgan00:18:50Okay. Understood. And sorry, just one last one on midstream, while we're on that. The higher CapEx for midstream, is that impacting your return expectations for the storage expansion project? Adam WoodardEVP & CFO at Spire Inc00:19:02Yes, it's Adam again. No, it's not. We did see some higher capital costs going into that and really it continues to exceed our return expectations. Richard SunderlandEquity Research - North American Utilities & Power at JP Morgan00:19:16Great. I'll leave it there. Thank Richard SunderlandEquity Research - North American Utilities & Power at JP Morgan00:19:17you. Scott DoylePresident, CEO & Director at Spire Inc00:19:18You bet. Operator00:19:21Thank you. And the next question comes from David Arcado with Morgan Stanley. David ArcaroExecutive Director, Equity Research at Morgan Stanley00:19:27Hey, good morning. Thanks so much. Hey, best wishes to Steve and congratulations, Scott. Scott DoylePresident, CEO & Director at Spire Inc00:19:34Thank you, David. Appreciate that. David ArcaroExecutive Director, Equity Research at Morgan Stanley00:19:37Yes, absolutely. I was curious just maybe on the weather mechanism. Could you elaborate a bit more on kind of what you see as the path forward here within the rate case, just prospects and where that could go? Adam WoodardEVP & CFO at Spire Inc00:19:53Yes. Thanks, David. It's Adam. We obviously, it's front and center in the rate case and it's something beyond the normal kind of cost of service, cost of capital reviews that we're going through is really the one of the main issues for us. And we do feel like we're in a good position to have that conversation with staff and the commission and other stakeholders. Adam WoodardEVP & CFO at Spire Inc00:20:20But there clearly, we need to there's something that we need to get fixed here. We realize that, and it's a big focus for us. Scott DoylePresident, CEO & Director at Spire Inc00:20:28Yes. And David, I'll just add. We proposed in this current case a couple of different options that we want to work with commission staff on and all the stakeholders as we get into the next elements of this case. Scott DoylePresident, CEO & Director at Spire Inc00:20:43And it ranges from decoupling to updating the weather time horizon that uses the comparison as well. So a lot of detail that we've got provided in the case, but clearly some work to be done there and we look forward to those discussions going forward. David ArcaroExecutive Director, Equity Research at Morgan Stanley00:21:02Yes. Got it. Makes sense. Thanks. And then I was just curious your latest thinking on the prospects for a settlement within the rate case? Scott DoylePresident, CEO & Director at Spire Inc00:21:11Yes. Hey, great question. And we still have a lot of work to do. So we're that's a little early in the process. Maybe just kind of lay out the process where we are in these stages. Scott DoylePresident, CEO & Director at Spire Inc00:21:22We do have the community meetings that take place that are coming up here very shortly. Then we have the public hearing or the commission hearing later this summer. There'll be opportunity that's built into the schedule for settlement discussions and those settlement talks can take place both prior to and after the commission hearing as well. The commission, at least if we're just watching over the last twelve to eighteen months has appears to be working towards settlement. So we're certainly willing to entertain those types of discussions as well. Scott DoylePresident, CEO & Director at Spire Inc00:21:54So look forward to collective and collaborative discussions going forward. David ArcaroExecutive Director, Equity Research at Morgan Stanley00:22:00Okay. Excellent. I appreciate the color. Thanks. Scott DoylePresident, CEO & Director at Spire Inc00:22:03Thank you. Thanks, David. Operator00:22:06Thank you. And the next question comes from Gabe Moreen with Mizuho. Gabriel MoreenManaging Director at Mizuho Financial Group, Inc.00:22:10Hey, good morning and congrats Scott as well. I would just ask, I know it's a little premature to ask about subsequent race cases in Missouri given that you're still involved in the midst of one right now. But as far as SB6 in its passage, can you talk about timing on future rate cases? Do you have to wait until that's implemented before you even start another rate case? So I'm just curious in terms of timing and how that may or may not influence your thoughts about future regulatory activity in Missouri? Scott DoylePresident, CEO & Director at Spire Inc00:22:40Yes. Hey, Dave. Good morning and thank you for the question. Yes, maybe best and you set it up very well. Clearly, our focus is this case right now and that's where our mind's attention is. Scott DoylePresident, CEO & Director at Spire Inc00:22:51If you look at Senate Bill four and see what's laid out there, July of twenty six is the first time that either a gas or water utility can file based on a future test year basis for their rate case. And so it won't be until that time before we clearly would be able to file. But we have an interest in working under that new paradigm for Missouri. And so more to come in that space as we move forward. But clearly our efforts right now are focused on this case, and getting it to conclusion. Gabriel MoreenManaging Director at Mizuho Financial Group, Inc.00:23:29Thanks, Scott. Maybe if I could just add a follow on Missouri regulation. I know you're trying to reform the weather mechanism in this rate case here. And I think staff is going to opine sometime soon on that. Is that a negotiation? Gabriel MoreenManaging Director at Mizuho Financial Group, Inc.00:23:45Is it sort of a thumbs up, thumbs down? I'm just curious how you envision that sort of shaking out within the rate case? Scott DoylePresident, CEO & Director at Spire Inc00:23:52Yes. Good question. I think as in all cases these are things that both parties clearly take sides and then work together and it's something that could be worked on together to get to the right solution that addresses both the needs of the customer but as well as the company as well. And I think that's the posture we're going to take as we work through this as well. So just like in all cases, there's opportunity for both sides to bring the issues to the table and work together to get to a constructive solution. Scott DoylePresident, CEO & Director at Spire Inc00:24:23That's what we're working towards. Gabriel MoreenManaging Director at Mizuho Financial Group, Inc.00:24:25Understood. Thanks, Scott. Appreciate it. Operator00:24:31Thank you. And the next question comes from Steven D'Ambrizi with Ladenburg Thalmann. Stephen D'AmbrisiManaging Director at Ladenburg Thalmann00:24:37Hey guys, thanks very much for taking my question. Scott, congratulations on the new role and best of luck leaving the company. Scott DoylePresident, CEO & Director at Spire Inc00:24:45You, sir. Good morning. Stephen D'AmbrisiManaging Director at Ladenburg Thalmann00:24:47Morning. Just, I guess my question would be just on the guidance modification. Guess listening to some of the answers in the earlier questions, it kind of sounds like the takeaway is that to the extent you can fix the weather norm mechanism in this the context of this rate case, the earnings power of the business of the utility business hasn't really changed. And then maybe you're seeing some slight structural uplift in the marketing and midstream businesses. So can you just am I reading that right? Stephen D'AmbrisiManaging Director at Ladenburg Thalmann00:25:19Or just how are you framing this guidance revision? Adam WoodardEVP & CFO at Spire Inc00:25:24Yes. Steve, it's Adam. And I'll my point of view and let Scott chime in as well. I think that's a fair assumption. It is. Adam WoodardEVP & CFO at Spire Inc00:25:34We are we do expect to get to a constructive outcome on the weather mechanism, weather mitigation mechanism and we do see some, obviously with how I characterize the midstream guidance revision, we do see some structural uplift there relative to our earlier expectations. So I think that's a fair assumption. Scott DoylePresident, CEO & Director at Spire Inc00:26:00Yes. And Stephen, I think what I'd add, maybe just take it up a level, is just think about what's happening at the macro level within our company and it's the things we laid out in the script and also just kind of what's been happening in particular as we've been working through this case. But it really is about building momentum as we are finishing out this fiscal year going into 2026. Scott DoylePresident, CEO & Director at Spire Inc00:26:23Clearly, we have you can see the pull through of our customer affordability project that we implemented last year. Those expenses are we're seeing the benefit of those expenses staying where they need to be in the right places. I think if you look a little deeper into the numbers, you can see we're down in administrative in general, but slightly up in our field activities and that means we're putting the money to the places that benefit our customers. So then coming out of that, if you think about the pull through of capital across both midstream and our utilities, that's what we're working on right now. You're seeing the project the storage projects coming to life and we're seeing the pull through of the returns there. Scott DoylePresident, CEO & Director at Spire Inc00:27:06And then as we're updating our capital recovery in this instant case that we have before the commission right now, those are things that are providing momentum to us to get us back to the returns that we expect in this business. So we feel good about the future and that's what we're focused on right now. Stephen D'AmbrisiManaging Director at Ladenburg Thalmann00:27:25Okay. That sounds great. Thank you. And then just one follow-up just on implementation, I guess, that's before. I know you guys have a rate case that you're prosecuting and there's some time here. Stephen D'AmbrisiManaging Director at Ladenburg Thalmann00:27:34But do you expect the commission do they need to do a rulemaking? Or will there be some type of process that gets done? And does that go concurrently? Or is there anything that needs to get done from a regulatory perspective before you guys are actually able to file with a future test year? Thanks. Scott DoylePresident, CEO & Director at Spire Inc00:27:51Yes. So maybe just I'll just point to the bill, how it's laid out in the bill. The bill does allow for a case to be filed after or in July of twenty six or later. It speaks to some rulemaking that has to be completed by a certain date, which is July of the following year. But what we anticipate and I don't want to get ahead of our commission or kind of how they're thinking on it is, once they start up the rulemaking we'll be active in that and we'll certainly work within the confines of the legislation as we think about the timing of our next case. Stephen D'AmbrisiManaging Director at Ladenburg Thalmann00:28:27Okay. That's great. Thank you very much for the time. Appreciate it. Scott DoylePresident, CEO & Director at Spire Inc00:28:32Thanks, Steve. Operator00:28:33Thank you. Well, this does conclude our question and answer session. So I would like to turn the floor back over to Megan McPhail for any closing comments. Megan McPhailManaging Director of Investor Relations at Spire Inc00:28:49I'd to thank you for joining the call today. Have a great day. Operator00:28:54Thank you so much. Thank you for attending today's presentation. The conference has now concluded. You may now disconnect your lines.Read moreParticipantsExecutivesMegan McPhailManaging Director of Investor RelationsScott DoylePresident, CEO & DirectorAdam WoodardEVP & CFOAnalystsRichard SunderlandEquity Research - North American Utilities & Power at JP MorganDavid ArcaroExecutive Director, Equity Research at Morgan StanleyGabriel MoreenManaging Director at Mizuho Financial Group, Inc.Stephen D'AmbrisiManaging Director at Ladenburg ThalmannPowered by Conference Call Audio Live Call not available Earnings Conference CallSpire Q2 202500:00 / 00:00Speed:1x1.25x1.5x2xTranscript SectionsPresentationParticipants Earnings DocumentsSlide DeckPress Release(8-K)Quarterly report(10-Q) Spire Earnings HeadlinesSpire Inc. Recorded A 15% Miss On Revenue: Analysts Are Revisiting Their ModelsMay 3 at 3:43 PM | finance.yahoo.comSpire reports second-quarter earnings of $209 millionMay 3 at 2:16 AM | msn.comBuffett’s favorite chart just hit 209% – here’s what that means for goldA Historic Gold Announcement Is About to Rock Wall Street For months, sharp-eyed analysts have watched the quiet buildup behind the scenes. Now, in just days, the floodgates are set to open. The greatest investor of all time is about to validate what Garrett Goggin has been saying for months: Gold is entering a once-in-a-generation mania. Front-running Buffett has never been more urgent — and four tiny miners could be your ticket to 100X gains.May 3, 2025 | Golden Portfolio (Ad)Spire Inc. (NYSE:SR) Q2 2025 Earnings Call TranscriptMay 3 at 2:16 AM | insidermonkey.comSpire (NYSE:SR) Hits New 12-Month Low After Earnings MissMay 1 at 3:47 AM | americanbankingnews.comSpire inc increases 2025 capex target to $840M amid strong midstream performance and regulatory updatesMay 1 at 1:48 AM | msn.comSee More Spire Headlines Get Earnings Announcements in your inboxWant to stay updated on the latest earnings announcements and upcoming reports for companies like Spire? Sign up for Earnings360's daily newsletter to receive timely earnings updates on Spire and other key companies, straight to your email. Email Address About SpireSpire (NYSE:SR), together with its subsidiaries, engages in the purchase, retail distribution, and sale of natural gas to residential, commercial, industrial, and other end-users of natural gas in the United States. The company operates through three segments: Gas Utility, Gas Marketing, and Midstream. It is also involved in the marketing of natural gas and related services; and transportation and storage of natural gas. In addition, the company engages in the operation of propane through its propane pipeline, risk management, and other activities. The company was formerly known as The Laclede Group, Inc. and changed its name to Spire Inc. in April 2016. 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PresentationSkip to Participants Operator00:00:00Good day, and welcome to the Spire Inc. Q2 FY twenty twenty five Earnings Conference Call. All participants will be in listen only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. Operator00:00:27I would now like to turn the conference over to Megan McPhail, Managing Director of Investor Relations. Please go ahead. Megan McPhailManaging Director of Investor Relations at Spire Inc00:00:36Good morning and welcome to Spire's fiscal twenty twenty five second quarter earnings call. On the call with me today is Scott Doyle, President and CEO and Adam Woodard, Executive Vice President and CFO. We issued an earnings news release this morning and you may access it on our website at spireenergy.com under Newsroom. Is a slide presentation that accompanies our webcast, which can be downloaded from our website under Investors and then Events and Presentations. Before we begin, let me cover our Safe Harbor statement and use of non GAAP earnings measures. Megan McPhailManaging Director of Investor Relations at Spire Inc00:01:11Today's call, including responses to questions, may contain forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Although our forward looking statements are based on reasonable assumptions, there are various uncertainties and risk factors that may cause future performance or results to be different than those anticipated. These risks and uncertainties are outlined in our quarterly and annual filings with the SEC. In our comments, we will be discussing non GAAP measures used by management when evaluating performance and results of operations. Explanations and reconciliations of these measures to their GAAP counterparts are contained in both our news release and slide presentation. Megan McPhailManaging Director of Investor Relations at Spire Inc00:01:53Now here's Scott, who will start on Page four of the presentation. Scott DoylePresident, CEO & Director at Spire Inc00:01:59Thank you, Megan. Good morning, everyone, and thank you for joining us today for our fiscal second quarter earnings conference call. I'm honored to address you today as the newly appointed President and CEO of Spire. I'd like to express my gratitude to Steve Lindsey for his dedicated service and commitment to Spire over the years. Under his leadership, the company made significant strides and built a strong foundation for the future. Scott DoylePresident, CEO & Director at Spire Inc00:02:24Steve is assisting me over the next several months ensuring we have a seamless transition. I want to assure you our strategy remains unchanged. We'll continue to focus on organic growth, infrastructure investment and continuous improvement. This includes modernizing our systems to benefit our customers, advancing our regulatory engagement and maximizing value for our customers and other stakeholders while keeping the safety of our employees, customers and communities at the center of it all. Before I dive into results, I would like to express my gratitude to our employees for their dedication to providing safe and reliable gas service for our customers. Scott DoylePresident, CEO & Director at Spire Inc00:03:04Despite challenges of extreme cold at times throughout the winter, our natural gas system performed exceptionally well, thanks to their hard work and commitment. Turning to our performance for the quarter. This morning we announced adjusted earnings of $3.6 per share compared to $3.45 per share a year ago. The year over year increase reflects strong growth in our utility and midstream segments partially offset by slightly lower results in gas marketing. Our performance is driven by strategic infrastructure investments to modernize our natural systems coupled with our ongoing commitment to disciplined cost management. Scott DoylePresident, CEO & Director at Spire Inc00:03:45Adam will provide a more detailed breakdown of our results and share insights into our outlook. Now for an update on regulatory matters. Since our last earnings call, we have worked closely with key stakeholders in our ongoing Missouri rate case. We will continue to collaborate in the coming months to ensure a constructive outcome. In addition, earlier this month, the Missouri Public Service Commission staff recommended a $19,000,000 revenue increase in our infrastructure system replacement surcharge or ISRS request. Scott DoylePresident, CEO & Director at Spire Inc00:04:18This is our fifth such request since our last general rate case and if approved would bring our revenues in the rider to an annualized rate of $72,600,000 On the legislative front, we are pleased that Missouri Governor Kehoe signed Senate Bill four into law marking a significant advancement for the state's utilities. This constructive legislation introduces a future test year rate setting model that is forward looking allowing natural gas and water utilities to set rates based on projected costs rather than historical expenses. By attracting investment in energy infrastructure the bill aims to enhance system reliability and drive economic growth across Missouri. The bill allows utilities to file a rate case based on a future test year starting in July of twenty twenty six. We continue to be focused on achieving consistent and constructive regulatory outcomes jurisdictions leading to a more sustainable financial performance trajectory. Scott DoylePresident, CEO & Director at Spire Inc00:05:20Looking ahead, we are reaffirming our long term EPS growth target of 5% to 7%. This is supported by our ten year seven point four billion dollars capital investment plan and we expect to deliver within our fiscal twenty twenty five earnings guidance of $4.4 to $4.6 per share. We are committed to delivering strong results in the second half of the year and beyond with a focus on executing our capital investment plan, driving operational excellence and strengthening the performance of our utilities and gas related businesses. Spire is poised for sustainable growth. In St. Scott DoylePresident, CEO & Director at Spire Inc00:05:59Louis, we're excited about the growth opportunities ahead. The labor market has now fully recovered reaching pre pandemic employment levels. In addition, Boeing recently was selected to build the next generation fighter aircraft for the United States Air driving growth of high quality jobs in the St. Louis area strengthening Missouri's economy and securing a prosperous future for our community. I would also like to highlight that last week we renewed our labor agreement with our local five forty eight union representing employees in our Alabama service territory. Scott DoylePresident, CEO & Director at Spire Inc00:06:32This three year agreement is a win win as it provides stability to our workforce and allows us to focus operational excellence. We are well positioned to achieve our financial and operational goals as we execute our strategy to grow organically, invest in infrastructure and drive continuous improvement. Turning to page five. We continue to make capital investments to improve reliability, resiliency and safety for the benefit of our customers. Year to date our CapEx totaled $479,000,000 with the majority of the spend taking place at our gas utilities. Scott DoylePresident, CEO & Director at Spire Inc00:07:07Year over year utility CapEx increased nearly 27% as we focus on upgrading distribution infrastructure and connecting more homes and businesses to safe reliable and affordable natural gas. Investment in our midstream segment totaled $84,000,000 year to date largely for the expansion of Spire Storage West. The expansion is now substantially complete and we are pleased with the returns on the project. We expect to have the final components placed in service by the end of this summer. Looking ahead, we are increasing our fiscal twenty twenty five capital investment target by $50,000,000 to $840,000,000 The higher CapEx includes a $15,000,000 increase at Spire Missouri and the $35,000,000 increase at Midstream primarily for the storage expansion project. Scott DoylePresident, CEO & Director at Spire Inc00:07:57As a reminder, our long term investment plan is focused on organic growth utilities. Approximately 98% of our ten year capital expenditure plan is targeted utility spend driving our growth in rate base. Moving to page six for a Missouri rate case update. Last week the PSC staff proposed a $246,000,000 annual revenue increase in our Spire Missouri rate case. This increase amount is made up of two parts approximately $2.00 $5,000,000 included in the staff's direct testimony and staff's estimated 42,000,000 true up through 05/31/2025. Scott DoylePresident, CEO & Director at Spire Inc00:08:38The proposed revenue increase differs from our requested increase of $290,000,000 primarily due to staff's proposed 9.63% return on equity and 53.19% equity layer compared to our requested return on equity of 10.555% equity layer in discrete adjustments which we expect to be addressed in subsequent testimony. You may recall our requested increase reflects an estimated rate base of $4,400,000,000 inclusive of discrete adjustments. We expect future testimony to address the weather mechanism and other elements of the case. Evidentiary hearings are scheduled to begin on August 4 and an order from the commission and new rates expected to be effective by October. We appreciate the constructive engagement thus far and remain committed to working closely with stakeholders throughout the remainder of the process. Scott DoylePresident, CEO & Director at Spire Inc00:09:35I'll now turn the call over to Adam for a financial review and update on guidance and outlook. Adam? Adam WoodardEVP & CFO at Spire Inc00:09:44Thanks Scott and good morning everyone. I'll start with a review of our quarterly results which are detailed on pages seven and eight of our presentation. During the second quarter, we reported adjusted earnings of over $214,000,000 an increase of almost $18,000,000 compared to last year. Adam WoodardEVP & CFO at Spire Inc00:10:03The Gas Utilities segment had earnings of approximately $195,000,000 in the second quarter, over $7,000,000 higher than last year. The increased results reflect higher contribution margin at Spire Missouri driven by an increase in ISRS revenues and usage net of weather mitigation as well as new rates at Spire Alabama. These favorable items were partially offset by lower Spire Alabama usage net of weather mitigation. Excluding bad debt, utility earnings also reflected lower run rate O and M expense and higher depreciation expense. During the quarter, we continue to see strong earnings growth in our Midstream segment driven by new contracts on additional capacity, higher rates on contract renewals and asset optimization at Spire Storage. Adam WoodardEVP & CFO at Spire Inc00:10:50Earnings in our Marketing segment were strong, but slightly lower than the prior year due to reduced market volatility. Lastly, other corporate costs were higher primarily due to higher borrowing balances. In both Missouri and Alabama, we experienced colder temperatures than last year and slightly colder than normal temperatures. Our volumetric margins in Missouri for the quarter were higher by nearly $7,000,000 but short of our expectations. This adjustment is highly dependent on the relationship between heating degree days and customer usage set in the previous rate proceeding. Adam WoodardEVP & CFO at Spire Inc00:11:24The weather mitigation adjustment in Missouri was not effective as revenues were not aligned with usage over the course of the quarter. Looking out at Alabama, while we experienced a higher than anticipated adjustment under the weather mitigation mechanism during the quarter, the year to date results are largely in line with expectations. We are focused on cost management and continue to expect run rate O and M expense at the gas utility to be flat relative to fiscal twenty twenty four levels. During the quarter, utility run rate O and M expense was lower by $800,000 when compared to last year. Turning now to our growth outlook on Page nine. Adam WoodardEVP & CFO at Spire Inc00:12:04We are confident that our long term adjusted earnings per share growth target of 5% to 7%. This is reinforced by 7% to 8% rate base growth at Spire Missouri and steady sustained equity growth at Spire Alabama coupled with efficient recovery mechanisms. We remain committed to executing on our strategy and are affirming our FY twenty twenty five adjusted earnings guidance range of $4.4 to 4.6 per share. Weighted average shares for FY '20 '20 '5 are expected to be approximately $58,500,000 slightly lower than our previously anticipated 59,000,000 shares, providing the benefit in expected adjusted earnings per share for the year. We are updating our adjusted earnings targets by business segment to reflect first half results and expectations for the remainder of the year. Adam WoodardEVP & CFO at Spire Inc00:12:53We're lowering the gas utility range by $11,000,000 primarily due to weather related margin headwinds experienced year to date. As a result of the ineffectiveness of the weather adjustment and usage, we anticipate approximately $9,000,000 of lower margins from residential customers. We are raising the range for gas marketing by $4,000,000 on stronger than expected earnings in the first half of the year and we are increasing our midstream earnings outlook by $8,000,000 to reflect the realization of higher rates and capacity and optimization of our storage assets during the first half of the year. The range for corporate and others loss was increased by $4,000,000 primarily due to higher interest expense from higher short term balances. Moving to slide 10 for a financing update. Adam WoodardEVP & CFO at Spire Inc00:13:37Our three year financing plan is unchanged. To support our equity needs, we settled approximately 43,000,000 of forward sales during the quarter. Looking ahead, we anticipate using our ATM program for planned equity issuances through 2027. In April, we priced $150,000,000 of Spire Missouri first mortgage bonds that we expect to fund on May 1. Our financing plan includes additional issuances in 2026 and 2027 to refinance maturities and incremental debt of approximately $500,000,000 to fund our capital plan. Adam WoodardEVP & CFO at Spire Inc00:14:13Our FFO to debt target remains at 15% to 16%. In summary, we are executing our financing plan effectively and are confident in our financial position going forward. With that, let me turn it back over to you, Scott. Scott DoylePresident, CEO & Director at Spire Inc00:14:28Thanks Adam. As you've heard today, we have made significant progress towards achieving our priorities for the year, strengthening our position as a more resilient, efficient and sustainable company that creates value for both customers and shareholders. Scott DoylePresident, CEO & Director at Spire Inc00:14:43Our unwavering commitment to delivering natural gas safely and reliably remains at the core of our efforts. We are executing on our capital investment plan while actively collaborating with key stakeholders to secure constructive regulatory outcomes that benefit both our customers and shareholders. Additionally, we are focused on meeting our fiscal twenty twenty five adjusted earnings per share guidance range and preserving the strength of our balance sheet. Executing on these objectives is not just a focus for FY 2025, but a long term commitment to driving success and delivering meaningful results in the years to come. Thank you for your ongoing support of Spire and we look forward to seeing many of you at the AGA Financial Forum in a few weeks. Scott DoylePresident, CEO & Director at Spire Inc00:15:28We're now ready to take questions. Operator00:15:31Yes. Thank you. We will now begin the question and answer session. And the first question comes from Richard Sunderland with JPMorgan. Richard SunderlandEquity Research - North American Utilities & Power at JP Morgan00:15:59Hey, good morning. And Scott, congrats on your new leadership of the company. Scott DoylePresident, CEO & Director at Spire Inc00:16:04Good morning, Rich. Thank you. Richard SunderlandEquity Research - North American Utilities & Power at JP Morgan00:16:08Digging into the results a little bit in finer detail, some moving pieces on the segment guidance. I realize share count is tweaked as well. Can you speak a little bit about 1H trends and then where you're trending on a full year basis, giving all these moving pieces? Adam WoodardEVP & CFO at Spire Inc00:16:28Hey, Rich, it's Adam. We wanted to take stop and take a minute and really took we saw the margin weakness in Missouri and had elected to take that guidance down. Now, fortunately, the midstream had exceeded our expectations and we're able to move that up. So I mean, from a trend line perspective, obviously, we're moving into the summer months and you won't we won't see a lot of performance out of the gas utilities, but we do the midstream turning well into the end of the year. And as I mentioned on the last call, marketing, we feel very good about where they're at and where they're going for the year. Richard SunderlandEquity Research - North American Utilities & Power at JP Morgan00:17:23Understood. So it sounds like the sort of weather at the utility is obviously unfortunate. Is that really the sole deviation on the utility side? I think you referenced 9,000,000 of customer margin. So it looks like there should be a few other small pieces in there too. Richard SunderlandEquity Research - North American Utilities & Power at JP Morgan00:17:42Just trying to understand the weather versus where else you're having difficulty forecasting the utility. Adam WoodardEVP & CFO at Spire Inc00:17:49That's the main driver. There's a as you mentioned, there's a few other pieces, but the main driver really is the weather related margin. Richard SunderlandEquity Research - North American Utilities & Power at JP Morgan00:17:58Okay. Okay, understood. And then with the midstream guidance, that $8,000,000 increase, is it solely a one off for 2025? Or are you seeing a higher run rate for the business going forward? Adam WoodardEVP & CFO at Spire Inc00:18:11That's a great question. There's a little bit of we mentioned optimization there. There's One, we are seeing relative to where we started the year, feeling better about kind of where we're at on capacity and pricing. But a piece of that's optimization. So this would indicate some run rate lift over time, but I want to stress that it's not complete a complete lift on run rate. Adam WoodardEVP & CFO at Spire Inc00:18:40There is some optimization in there around circumstances or volatility that we saw in the first couple of quarters. Richard SunderlandEquity Research - North American Utilities & Power at JP Morgan00:18:50Okay. Understood. And sorry, just one last one on midstream, while we're on that. The higher CapEx for midstream, is that impacting your return expectations for the storage expansion project? Adam WoodardEVP & CFO at Spire Inc00:19:02Yes, it's Adam again. No, it's not. We did see some higher capital costs going into that and really it continues to exceed our return expectations. Richard SunderlandEquity Research - North American Utilities & Power at JP Morgan00:19:16Great. I'll leave it there. Thank Richard SunderlandEquity Research - North American Utilities & Power at JP Morgan00:19:17you. Scott DoylePresident, CEO & Director at Spire Inc00:19:18You bet. Operator00:19:21Thank you. And the next question comes from David Arcado with Morgan Stanley. David ArcaroExecutive Director, Equity Research at Morgan Stanley00:19:27Hey, good morning. Thanks so much. Hey, best wishes to Steve and congratulations, Scott. Scott DoylePresident, CEO & Director at Spire Inc00:19:34Thank you, David. Appreciate that. David ArcaroExecutive Director, Equity Research at Morgan Stanley00:19:37Yes, absolutely. I was curious just maybe on the weather mechanism. Could you elaborate a bit more on kind of what you see as the path forward here within the rate case, just prospects and where that could go? Adam WoodardEVP & CFO at Spire Inc00:19:53Yes. Thanks, David. It's Adam. We obviously, it's front and center in the rate case and it's something beyond the normal kind of cost of service, cost of capital reviews that we're going through is really the one of the main issues for us. And we do feel like we're in a good position to have that conversation with staff and the commission and other stakeholders. Adam WoodardEVP & CFO at Spire Inc00:20:20But there clearly, we need to there's something that we need to get fixed here. We realize that, and it's a big focus for us. Scott DoylePresident, CEO & Director at Spire Inc00:20:28Yes. And David, I'll just add. We proposed in this current case a couple of different options that we want to work with commission staff on and all the stakeholders as we get into the next elements of this case. Scott DoylePresident, CEO & Director at Spire Inc00:20:43And it ranges from decoupling to updating the weather time horizon that uses the comparison as well. So a lot of detail that we've got provided in the case, but clearly some work to be done there and we look forward to those discussions going forward. David ArcaroExecutive Director, Equity Research at Morgan Stanley00:21:02Yes. Got it. Makes sense. Thanks. And then I was just curious your latest thinking on the prospects for a settlement within the rate case? Scott DoylePresident, CEO & Director at Spire Inc00:21:11Yes. Hey, great question. And we still have a lot of work to do. So we're that's a little early in the process. Maybe just kind of lay out the process where we are in these stages. Scott DoylePresident, CEO & Director at Spire Inc00:21:22We do have the community meetings that take place that are coming up here very shortly. Then we have the public hearing or the commission hearing later this summer. There'll be opportunity that's built into the schedule for settlement discussions and those settlement talks can take place both prior to and after the commission hearing as well. The commission, at least if we're just watching over the last twelve to eighteen months has appears to be working towards settlement. So we're certainly willing to entertain those types of discussions as well. Scott DoylePresident, CEO & Director at Spire Inc00:21:54So look forward to collective and collaborative discussions going forward. David ArcaroExecutive Director, Equity Research at Morgan Stanley00:22:00Okay. Excellent. I appreciate the color. Thanks. Scott DoylePresident, CEO & Director at Spire Inc00:22:03Thank you. Thanks, David. Operator00:22:06Thank you. And the next question comes from Gabe Moreen with Mizuho. Gabriel MoreenManaging Director at Mizuho Financial Group, Inc.00:22:10Hey, good morning and congrats Scott as well. I would just ask, I know it's a little premature to ask about subsequent race cases in Missouri given that you're still involved in the midst of one right now. But as far as SB6 in its passage, can you talk about timing on future rate cases? Do you have to wait until that's implemented before you even start another rate case? So I'm just curious in terms of timing and how that may or may not influence your thoughts about future regulatory activity in Missouri? Scott DoylePresident, CEO & Director at Spire Inc00:22:40Yes. Hey, Dave. Good morning and thank you for the question. Yes, maybe best and you set it up very well. Clearly, our focus is this case right now and that's where our mind's attention is. Scott DoylePresident, CEO & Director at Spire Inc00:22:51If you look at Senate Bill four and see what's laid out there, July of twenty six is the first time that either a gas or water utility can file based on a future test year basis for their rate case. And so it won't be until that time before we clearly would be able to file. But we have an interest in working under that new paradigm for Missouri. And so more to come in that space as we move forward. But clearly our efforts right now are focused on this case, and getting it to conclusion. Gabriel MoreenManaging Director at Mizuho Financial Group, Inc.00:23:29Thanks, Scott. Maybe if I could just add a follow on Missouri regulation. I know you're trying to reform the weather mechanism in this rate case here. And I think staff is going to opine sometime soon on that. Is that a negotiation? Gabriel MoreenManaging Director at Mizuho Financial Group, Inc.00:23:45Is it sort of a thumbs up, thumbs down? I'm just curious how you envision that sort of shaking out within the rate case? Scott DoylePresident, CEO & Director at Spire Inc00:23:52Yes. Good question. I think as in all cases these are things that both parties clearly take sides and then work together and it's something that could be worked on together to get to the right solution that addresses both the needs of the customer but as well as the company as well. And I think that's the posture we're going to take as we work through this as well. So just like in all cases, there's opportunity for both sides to bring the issues to the table and work together to get to a constructive solution. Scott DoylePresident, CEO & Director at Spire Inc00:24:23That's what we're working towards. Gabriel MoreenManaging Director at Mizuho Financial Group, Inc.00:24:25Understood. Thanks, Scott. Appreciate it. Operator00:24:31Thank you. And the next question comes from Steven D'Ambrizi with Ladenburg Thalmann. Stephen D'AmbrisiManaging Director at Ladenburg Thalmann00:24:37Hey guys, thanks very much for taking my question. Scott, congratulations on the new role and best of luck leaving the company. Scott DoylePresident, CEO & Director at Spire Inc00:24:45You, sir. Good morning. Stephen D'AmbrisiManaging Director at Ladenburg Thalmann00:24:47Morning. Just, I guess my question would be just on the guidance modification. Guess listening to some of the answers in the earlier questions, it kind of sounds like the takeaway is that to the extent you can fix the weather norm mechanism in this the context of this rate case, the earnings power of the business of the utility business hasn't really changed. And then maybe you're seeing some slight structural uplift in the marketing and midstream businesses. So can you just am I reading that right? Stephen D'AmbrisiManaging Director at Ladenburg Thalmann00:25:19Or just how are you framing this guidance revision? Adam WoodardEVP & CFO at Spire Inc00:25:24Yes. Steve, it's Adam. And I'll my point of view and let Scott chime in as well. I think that's a fair assumption. It is. Adam WoodardEVP & CFO at Spire Inc00:25:34We are we do expect to get to a constructive outcome on the weather mechanism, weather mitigation mechanism and we do see some, obviously with how I characterize the midstream guidance revision, we do see some structural uplift there relative to our earlier expectations. So I think that's a fair assumption. Scott DoylePresident, CEO & Director at Spire Inc00:26:00Yes. And Stephen, I think what I'd add, maybe just take it up a level, is just think about what's happening at the macro level within our company and it's the things we laid out in the script and also just kind of what's been happening in particular as we've been working through this case. But it really is about building momentum as we are finishing out this fiscal year going into 2026. Scott DoylePresident, CEO & Director at Spire Inc00:26:23Clearly, we have you can see the pull through of our customer affordability project that we implemented last year. Those expenses are we're seeing the benefit of those expenses staying where they need to be in the right places. I think if you look a little deeper into the numbers, you can see we're down in administrative in general, but slightly up in our field activities and that means we're putting the money to the places that benefit our customers. So then coming out of that, if you think about the pull through of capital across both midstream and our utilities, that's what we're working on right now. You're seeing the project the storage projects coming to life and we're seeing the pull through of the returns there. Scott DoylePresident, CEO & Director at Spire Inc00:27:06And then as we're updating our capital recovery in this instant case that we have before the commission right now, those are things that are providing momentum to us to get us back to the returns that we expect in this business. So we feel good about the future and that's what we're focused on right now. Stephen D'AmbrisiManaging Director at Ladenburg Thalmann00:27:25Okay. That sounds great. Thank you. And then just one follow-up just on implementation, I guess, that's before. I know you guys have a rate case that you're prosecuting and there's some time here. Stephen D'AmbrisiManaging Director at Ladenburg Thalmann00:27:34But do you expect the commission do they need to do a rulemaking? Or will there be some type of process that gets done? And does that go concurrently? Or is there anything that needs to get done from a regulatory perspective before you guys are actually able to file with a future test year? Thanks. Scott DoylePresident, CEO & Director at Spire Inc00:27:51Yes. So maybe just I'll just point to the bill, how it's laid out in the bill. The bill does allow for a case to be filed after or in July of twenty six or later. It speaks to some rulemaking that has to be completed by a certain date, which is July of the following year. But what we anticipate and I don't want to get ahead of our commission or kind of how they're thinking on it is, once they start up the rulemaking we'll be active in that and we'll certainly work within the confines of the legislation as we think about the timing of our next case. Stephen D'AmbrisiManaging Director at Ladenburg Thalmann00:28:27Okay. That's great. Thank you very much for the time. Appreciate it. Scott DoylePresident, CEO & Director at Spire Inc00:28:32Thanks, Steve. Operator00:28:33Thank you. Well, this does conclude our question and answer session. So I would like to turn the floor back over to Megan McPhail for any closing comments. Megan McPhailManaging Director of Investor Relations at Spire Inc00:28:49I'd to thank you for joining the call today. Have a great day. Operator00:28:54Thank you so much. Thank you for attending today's presentation. The conference has now concluded. You may now disconnect your lines.Read moreParticipantsExecutivesMegan McPhailManaging Director of Investor RelationsScott DoylePresident, CEO & DirectorAdam WoodardEVP & CFOAnalystsRichard SunderlandEquity Research - North American Utilities & Power at JP MorganDavid ArcaroExecutive Director, Equity Research at Morgan StanleyGabriel MoreenManaging Director at Mizuho Financial Group, Inc.Stephen D'AmbrisiManaging Director at Ladenburg ThalmannPowered by