ONE Gas Inc. issued its financial guidance for 2016 on Tuesday hinting at the type of year the company is expecting. The gas utility believes it will have a 2016 net income in the range of $127 million to $137 million, or approximately $2.40 to $2.60 per diluted share.
Looking back on the previous year, ONE Gas expects 2015 net income to come in around $118 million to $120 million once it is tallied. That’s mostly due to lower operating expenses. At the end of October, ONE Gas thought its net income would be in the range of $113 million to $118 million.
The growth in the company’s expectations for 2016 net income reflects new rates and residential customer growth in Texas and Oklahoma. However, costs are being pressured by higher employee-related costs and higher depreciation expense due to capital investments.
ONE Gas expects to have capital expenditures of $305 million this year. Most of the expenditures will be targeted for system integrity and replacement projects.
Over the next five years, ONE Gas expects net income and earnings per share grow to average between five to eight percent annually.
The Board of Directors for ONE Gas also approved an increase in the quarterly dividend by a nickel to 35 cents per share. The increase kicks in the first quarter of this year. The dividend is payable March 11, 2016 to shareholders of record on February 26, 2016.
