Spire's Q2 Earnings Lower Than Expected, Revenues Decline Y/Y

Spire Inc. SR reported second-quarter fiscal 2025 earnings of $3.60 per share, which lagged the Zacks Consensus Estimate of $3.70 by 2.7%. However, the company’s bottom line improved 4.4% from $3.45 reported in the year-ago quarter. (See the Zacks Earnings Calendar to stay ahead of market-making news.)

SR’s Revenues

Total revenues for the reported quarter were $1.05 billion, which missed the Zacks Consensus Estimate of $1.1 billion by 4%. The top line also decreased 6.8% from $1.13 billion in the year-ago quarter.

Highlights of SR’s Earnings Release

Operating expenses totaled $744.9 million, down 10.2% from $829.9 million recorded in the prior-year period.

Operating income came in at $306.4 million compared with $298.6 million in the prior-year quarter.

Net interest expenses decreased 9.2% year over year to $47.4 million.

SR’s Segmental Performance

Gas Utility: The segment reported adjusted earnings of $195.2 million, indicating an improvement of 3.8% from the prior-year quarter’s figure. The improvement reflected an increase in the contribution margin due to higher Spire Missouri Infrastructure System Replacement revenues, as well as Spire Alabama margins due to the annual rate update and Spire Missouri usage net of weather mitigation.

Gas Marketing: The segment reported adjusted earnings of $14.8 million, indicating a decline of 4.5% from the prior-year quarter’s reported actuals. The decrease in earnings reflects less volatility in regional basis differences.

Midstream: Adjusted earnings from this segment totaled $15.8 million, up a massive 315.8% from the year-ago quarter’s reported number. This increase was driven by higher Spire Storage earnings, reflecting additional capacity and contract renewals at higher rates and asset optimization.

Other: This segment reported an adjusted loss of $11.4 million compared with a loss of $10.7 million in the prior-year quarter.

SR’s Financial Highlights

Cash and cash equivalents as of March 31, 2025 were $15.2 million compared with $4.5 million as of Sept. 30, 2024.

Long-term debt (less current portion) as of March 31, 2025 totaled $3.35 billion compared with $3.70 billion as of Sept. 30, 2024.

Net cash provided by operating activities in the first six months of fiscal 2025 totaled $453.8 million compared with $559.4 million in the year-ago period.

SR’s 2025 Guidance

Spire continues to expect its fiscal 2025 earnings in the range of $4.40-$4.60 per share. The Zacks Consensus Estimate is pegged at $4.50 per share, which is on par with the midpoint of the company’s guided range.

SR continues to expect its 10-year capital investment to be $7.4 billion. This planned investment is expected to drive annual rate-based growth of 7-8%.

Capital expenditures for fiscal 2025 are expected to be $840 million, up from the previous figure of $790 million.

SR’s Zacks Rank

Spire currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Upcoming Releases

ONE Gas, Inc. OGS is slated to report first-quarter 2025 results on May 5, after market close. The Zacks Consensus Estimate for earnings is pegged at $1.85 per share, which indicates year-over-year growth of 5.7%.

OGS’ long-term (three to five years) earnings growth rate is 5.6%. The Zacks Consensus Estimate for first-quarter sales is pegged at $803.6 million, which suggests year-over-year growth of 6%.

Atmos Energy ATO is slated to report second-quarter 2025 results on May 7, after market close. The Zacks Consensus Estimate for earnings is pegged at $2.89 per share, which implies year-over-year growth of 1.4%.

ATO’s long-term earnings growth rate is 7.2%. The Zacks Consensus Estimate for second-quarter sales is pegged at $1.88 billion, which indicates year-over-year growth of 14.4%.

UGI Corporation UGI is slated to report second-quarter fiscal 2025 results on May 7, after market close. The Zacks Consensus Estimate for earnings is pegged at $1.80 per share.

UGI’s long-term earnings growth rate is 5.2%. The Zacks Consensus Estimate for sales stands at $2.70 billion, which indicates year-over-year growth of 9.3%.

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This article originally published on Zacks Investment Research (zacks.com).

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