Q2 2025 Southwest Gas Holdings Inc Earnings Call
All links second quarter 2025 earnings conference call.
Today's call is being recorded on our webcast is live.
A replay will be available later today and for the next 12 months on the Southwest Gas Holdings webcaster website.
All participants are currently in a listen-only mode. A question and answer session will follow.
after the prepared remarks.
If you would like to ask a question at that time, please press star then the number 1 on your phone.
I will now turn the call over to Justin Forsberg, Vice President of Investor Relations and Treasurer of Southwest Gas Holdings.
Please go ahead.
Thanks, Sergio, and hello everyone. We appreciate you joining the call today.
This morning, we issued and posted the Southwest Gas Holdings website. Our second quarter 2025 earnings release and filed the associated Form 10-Q.
The slides accompanying today's call are also available on Southwest Gas, Holdings website. We'll refer to those slides by number throughout the call today.
Please note that on today's call, we will address certain factors that may impact 2025 earnings and discuss longer term guidance.
Information that will be discussed. Today contains forward-looking statements. These statements are based on Management's assumptions on what the future holds but our subject to several risks and uncertainties including uncertainties surrounding the impacts of future economic conditions and Regulatory approvals.
This cautionary note as well as a note regarding non-gaap measures is included on. Slides, 2 and 3 of this presentation.
In today's press release and in our filings with the Securities and Exchange Commission, which we encourage you to review.
These risks and uncertainties may cause actual results to differ materially from statements made today.
We caution against placing undue Reliance on any forward looking statements and we assume no obligation to update any such statement.
As shown on slide 4 on. Today's call, we have Karen Haller, president, and CEO of Southwest Gas Holdings. Rob Stefani Chief Financial Officer of Southwest Gas Holdings and Justin Brown president of Southwest Gas Corporation.
Other members of the management team are also available to answer your questions during the Q&A portion of the call today.
I'll now turn the call over to Karen.
Thanks Justin. Thank you for joining us today to discuss the Southwest Gas Holdings, result and Outlet.
Starting with slide 5 during the second quarter, we made significant progress toward positioning, Southwest Gas holding. As a premier Pure Play. Fully regulated natural gas business. We continue to make strides and improving operational and financial performance at the utility.
Following 2 consecutive years of return on Equity, where are we at? Southwest Gas of 8%, we ended the quarter with the trailing 12-month re of 8.3% on the regulatory front. We achieved a constructive outcome in Nevada with the signing of SB 47. By Governor Lombardo,
This legislation enhances Nevada's regulatory framework by allowing Natural Gas. Utilities to pursue alternative rate making which we believe will reduce regulatory lag and support price stability, cost, reductions and customer protections. We appreciate the collaboration of all stakeholders in achieving this outcome, which we expect will benefit all parties.
We continue to work closely with Regulators across our service territories to support the growth. In the communities, we serve,
Our utility optimization strategy and delivering tangible results. Southwest Gas posted record net income for the first half of 2025, with only modest increases in o&m expenses compared to the same period last year.
We continue to demonstrate our commitment to continuous Improvement and optimization.
We reaffirm each of Southwest Gas's previously communicated guidance ranges, including full-year net income of $265 million to $275 million.
We continue to expect robust Capital, spending driven by safety, reliability, and economic activity in our service territories.
I'll provide more detail on guidance later.
Turning to our Century exit.
We successfully executed 2 secondary public, offerings of our Century shares during the second quarter.
Combined with concurrent private placements. We generated over 470 million in net proceeds.
And strengthen our balance sheet.
Our ownership and cry. Now stands at just over 52% we continue to monitor market conditions, as we evaluate options for completing the separation. In a way that optimizes value and limits execution risk for our stockholders,
As you can see on, slide 6, we are on track to achieve our 2025, strategic priorities. We are confident in our regulatory strategy as we near completion of our outstanding. California rate keeps proceeding
We also received approval of our Arizona system Integrity mechanism.
We are however evaluating our options in light of the 15 million dollar cap placed on the qualifying Capital under the approved mechanism.
Justin Brown will discuss our regulatory progress and strategy in more detail in a moment.
In early June, we announced the results of our 2028. Great Basin Expansion Project finding Open Seasons. We have added to this slide a few high-level milestones. We expect to accomplish by the end of this year. We have already begun negotiating, Preston agreements with the new shippers and plan to have those completed. During this year's third quarter, Justin will further discuss this opportunity, but we are excited about the investment opportunity. This interstate pipeline project presents.
During the quarter, we successfully extended the term loan facility at Southwest Gas holding at a lower amount of 225 million. After substantially paying down the facility from the 550 million that was previously outstanding.
We also successfully replaced, our old, 300 million revolving credit facility with a new facility, keeping the capacity. The same while extending this maturity to August 2029.
Following our Century sell balance. We no longer expect to issue any new Equity under our 18m program in 2025.
As I mentioned a moment ago, we remain committed to fully separating Century in a manner that optimizes value and limits execution risk for our stockholders.
Of the remaining separation options, we may fully separate the business through a series of taxable sell-downs, share exchanges, or some combination thereof.
On slide 7. I'd like to highlight the strength of our balance sheet which gives us the flexibility to make thoughtful Capital Investments and supports our ability to deliver stockholder value.
I'd also like to highlight the utilities continued robust growth driven by strong economic activity in our service area which has led to about 40,000 new meter sets during the last 12 months.
As of the second quarter of 20125, we had more than 350 million of cash on hand and more than 1 billion liquidity.
Which enables us to honor our commitments and execute the remainder of our 2025 strategy.
One of those commitments relates to the return of purchased gas costs. We have over-collected from our Nevada customers.
As such we successfully received approval, to provide an energy credit for those customers to accelerate the return of those balances beginning July 1 of this year.
We are excited about the future of the company and we have good reasons for that excitement.
now, to just
Thanks Karen.
On slide 9, we highlight our proposed Great Base and Expansion Project. I mentioned on the last earnings call that in response to inquiries about available capacity and the demand for natural gas, Great Basin Transmission Company posted a notice of binding open season for potential 2028 system expansion.
The open season closed on June 16 after having been extended and subsequently reopened.
The total interest from potential shippers is estimated at approximately 1.76 billion cubic feet of capacity, or 1.76 million dekatherms per day.
By way of comparison, great basins. Existing capacity is about 250,000 that concerns a day.
Demand for energy is growing support, super Comm, supercomputing and related data center, requires the country. And this project highlights, the demand we are seeing in our service territory
We are thrilled by the outcome of the binding open seats. And in the opportunity, this presents these inbound requests for capacity, highlight the importance of our infrastructure and delivering reliable resilient OnDemand energy in a growing region.
As well as our current incremental, capital expenditure estimates for the project.
we have begun the process of negotiating Crescent and agreements with these potential new shippers and depending on the outcome of these negotiations,
We believe the incremental Capital expenditures opportunity, could now be in the range of 1.2 billion to 1.6 billion depending on how many shippers actually signed precedent agreements.
We are still targeting a November 2028, inservice date for the project.
Following the receipt of signed precedents, we would then progress through the next steps of the project which include updating internal design and cost estimates a pre-filing application with the first.
Performing engineering and design work and completing the environmental assessment and other items necessary to file the first certificate of public convenience and necessity and the fourth quarter of 2026. We plan to provide periodic updates as we achieve key milestones,
Turning to slide 10, you'll see an overview of the progress we've made on our regulatory strategy over the past year across each of our jurisdictions, as we've been refreshing rates to reflect current costs and to start recovering the investments we've made to ensure our customers continue to receive safe and reliable service.
Our Arizona ranked case completed with a final order issued in March. The order included a $600 million increase in authorized rate base which includes a full 12 months of qualifying post test year Investments. Placed in service as of the end of last October.
this resulted in an 80.2 million Revenue increase,
And an authorized Roe is 9.84% the commission's. Final decision approved rates to be effective in March, similar to Nevada after consideration of updating, our cost of service to reflect actuals and proposals on cost of capital, this outcome reflects nearly 90% of our apps.
On July 9th, the Arizona commission also, approved, our proposed Capital tracker referred to as our system Integrity mechanism which will allow us to implement a search charge each year to recover non-revenue producing Investments. We made in the prior year
As part of the approval, the commission did amend the settlement to impose a cap of 50 million, with respect to the qualifying Capital under the mechanism.
Application for rehearing. It must be filed by August 11th.
We believe that the Arizona raid case outcome was ultimately constructed and we are specially pleased with the collaboration of the commission staff throughout the process.
I'll discuss our pending California rig case in more detail in a moment. But I'm pleased with the progress we've made on refreshing rates and reducing regulatory lag in each of our jurisdictions.
Moving to slide 11. I wanted to mention a couple noteworthy initiatives in Nevada, which represents about 35% of our customers revenues and rate base.
We successfully work with policy makers on legislation that allows for Alternative forms of rate making, including formula rates, multi-year rate plans, and performance-based rates, this bill referred to as SB 417 was recently passed by the Nevada legislature and as Karen mentioned was signed into law by governor limardo.
We are focused on the formula rates part of the law, is that rate structure more closely aligns with our business model and we've turned our attention to the rulemaking process at the Nevada Commission.
as we evaluate the timing of our next general rate case, in the state, we see formula raises a proven alternative to traditional rate making
This approach can streamline regulatory processes, reduce costs for customers and improve the timeliness of cost. Recovery and churn, this enhances our ability to attract investment into Nevada supporting the state's economic growth.
Additionally, we work with the Nevada commission staff and the consumer Advocate on a filing that requested to accelerate the refund of the over-collected PGA, balance in the state, which was approximately 280 million at the end of the second quarter.
The commission of the rate reduction and those customer credits became effective on July 1st.
While we expect an impact on near-term liquidity. We should also see a reduction in near-term interest expense because we our interest expense at our weighted average cost of capital on the PGA. Balance. In Nevada, we provide more details in the appendix to today's presentation on slide 28.
Moving to slide 12 in California, we successfully reached an agreement in principle to resolve all issues in our pending rate case, with the exception of certain cost to capital and capital structure issues.
The agreement results and recovery of over 90% of our adjusted ask.
$43 million before adjustments for these outstanding issues.
It also provides for continuation of our annual attrition adjustment of 2.75%, as well as continuation of several existing and new regulatory mechanisms.
That we propose to ensure the safety and reliability of our distribution system and to mitigate regulatory lag.
We concluded a hearing last week and will now focus on documenting our settlement agreement and drafting legal briefs on the unresolved issues.
We expect new rates to become effective in January 2026.
Attorney to slide 13 is Karen, noted economic activity and demand for natural gas service remains strong throughout our service territories. And we continue to invest in the communities in which we operate while steadily growing our rate base.
This is demonstrated by the addition of 40,000 new meter sets over the past 12 months, as well as the interest we have received on the proposed. Great Basin Expansion Project.
Customer growth in a related interview. Energy demands.
In Arizona, there have also been recent developments resulting in the Arizona Commission opening a docket to address the resource adequacy of natural gas infrastructure and storage in the state. They are scheduled to hold a workshop to discuss opportunities later this month, and we look forward to participating in that workshop.
We reiterate our commitment to invest about 4.3 billion over the next 5 years, to support safety, reliability, and economic development, across our service territories. This estimate does not yet include any capital expenditure impacts that could develop with respect to the potential, Great Basin expansion opportunity.
We currently expect this Baseline utility capital investment to translate to a compound annual growth rate and rate base of 6 to 8% over that same time period.
About 50% of this plan spending is needed for safety and reliability, and approximately, 30% of the plant spending relates to Economic Development new business growth.
Centuries, quarterly earnings were largely driven by a reduction in interest expense, which supported improved profitability.
Southwest Gas Holdings, corporate and administrative results, reflected lower overall operating expenses and reduced interest expense on outstanding debt balances, which contributed positively to net income.
Deferred tax liabilities and deferred tax. Assets recorded in the second quarter of 2025 as a result of the income tax consolidation of centuries.
The net impact of approximately $45 million was excluded from adjusted net income.
This impact is expected to be partially offset by future lower tax expense following the disposition of the remaining Century St. and the decon for GAAP reporting purposes.
Also, future book gains from dispositions of Century. Stock are expected to be classified as an adjustment to net income consistent with this treatment.
Moving on to slide 16. We provide a bridge of quarter over quarter performance drivers for Southwest Gas in Q2 2025 facility, operating margin increased by 26.6 million. This Improvement was primarily driven by 24 million of combined rate relief across all jurisdictions and additional 2 million came from customer growth.
A&M expense increased by 7 million compared to the prior year Corner. This increase with mainly attributable to 5 million in higher, labor, and benefit costs along with 3 million of additional contractor and Professional Services spend AC
Several areas of the business, these were partially offset by lower expenses and leak survey and line rotating activities.
Of note, year-to-date, O&M expense is up just over 2% overall, which is below inflation. This reflects our continued focus on cost discipline and utility.
Depreciation and amortization. Plus other taxes, increase 9.3 million, reflecting a 7% increase in average, gas, gas plan and Service as compared to the second quarter of 2024. This growth highlights continued, capital investment in infrastructure for system, safety and reliability, and customer expansion.
Other income increased by 3.6 million in driven, primarily by a 4.5 million gain from COI policy, value increases and a 1.6 million 1-time, non-operating game between asset sales. These gains were partially offset by a 3.3 million decline in interest income, largely tied to lower carrying charges on regulatory account balances,
Notably, deferred purchase gas costs moved from an $82 million asset as of June 30, 2020, to a $249 million liability as of June 30, 2020. As Justin mentioned earlier, following the Nevada approval to return over-collected purchase gas costs to customers more quickly, we should begin to see those elevated balances start to decline later this year. Interest expense rose by $4.9 million, primarily due to interest incurred on the over-collected PGA balance.
Compared to interest income recorded in the same quarter last year, additionally, regulatory treatment of Industrial, Development, revenue bonds, which were our advertised through interest expense contributed to the increase of setting margin for elsewhere.
Income tax is increased by 2.9 Million reflecting the impact of the higher frequencies net income during the quarter.
On slide 17 and is Karen mentioned. We outlined the successful execution of 2, secondary offerings of the company Century stock in May and June 2025 each with a concurrent private placement. The second of which closed in July,
These transactions collectively generated just over $470 million in debt proceeds. On May 22nd, we sold 13.2 million Century shares, representing 14.9% of Century's outstanding shares, at an offering price of $17.50 per share, resulting in $225 million in proceeds.
Proceeds to Southwest Gas Holdings, less than 4 weeks later, we sold an additional 12.3 million shares, including the concurrent private placement that closed. Several weeks later in July representing 14% of century shares outstanding, at an offering price of $20 per 7 $20.75 per share. Generally in additional 246 million in that proceeds to Southwest Gas Holdings.
Proceeds from these offerings to be used to reduce Southwest Gas Holdings, debt supporting our, the leveraging efforts.
Following these transactions Southwest Gas Holdings. Retains a 52.1% stake in Century. It represented 46.2, million Century shares, pending further disposition, transactions.
Southwest Gas Holdings will continue to consolidate Century and its financial statements until the conditions for deconsolidation are met.
To issue equity in 2025.
On slide 18, we show our 2025 financing plan for both Southwest Gas Holdings and Southwest Gas Corporation, which, for simplicity of the presentation, assumes consolidation of Century for the entirety of the year. To the extent Century ceases to be consolidated in 2025, we plan to adjust our financing plan as needed, depending on the timing and successful execution of further separation transactions.
We highlight that Southwest Gas Holdings, balance sheet and liquidity position could improve even further. If additional investment of century shares were to result in increased cash in Southwest Gas Holdings. We expect the beginning of the year, cash on hand balance combined, with the cash flow from operations to fund the entire capital expenditure program at the utility forecasted in 2020 by
Southwest Gas Holdings, do not foresee any Equity issuance requirements for the remainder of 25, we still do not currently foreseen in Need for any significant debt, Capital markets, in the issue of activity at the utility until 2026. As Karen mentioned previously, we completed the amendment and extension of the remaining balance of 225 million in Southwest Gas Holdings term month facility, extending the maturity to June 2026. In addition, the company replaced an extended, its existing 300 million revolving, credit facility, which now matures in 2029 we have reflected on the slides and expect the liquidity impacts of Southwest Gas of the accelerated return of over-collected purchased gas costs. And
Nevada.
Which we expect to absorb with no changes to our current year. Finally, given the liquidity equipment to the Enterprise.
Southwest Gas Holdings remains committed to paying a competitive dividend to our stockholders for plan dividend payouts in 2025 are expected to result in a competitive payout ratio. We plan to continue to balance factors such as price, projected Capital requirements impacts to credit ratings, The competitiveness of our dividend yield economic conditions and other factors. And we'll review the dividend policy for any changes post further separation and decolonization of centuries.
On slide 19, we've outlined the strength of our balance sheet and our commitment to maintaining an investment grade profile at Southwest Gas and that the holding company.
On the left hand side of the slide, we walk through net debt by operating company which has substantially improved. Since last quarter, we finished the quarter with 323 million of cash at Southwest Gas, as I mentioned earlier, at the utility that PJ balance is now flipped to a liability liability balance of about 345 million as of June 30th 2025.
We have a largely offsetting amount of cash on the books at the end of the quarter, which is clearly related to the collection of the PGA in the appendix on July 28th. Additional details are provided on the PGA. Balance returning to slide 20 in the Improvement. Net depth results in continued improvement in our estimated ffo to death funded, metrics included on slide 20, which we show in approximately 270 basis point Improvement.
and our estimate sense, the end of 2024 back to you, Gary,
Thanks Rob. We are pleased with our results, over the first half of this year and aim to carry this momentum through the rest of 2025 and Beyond.
On 52020 on slide 22! We reaffirm our 2025 utility net income, guidance range of 265 to 275 million.
With the completion of the Arizona, rate case and strong Regional economic Outlook in our service area. We are confident in our previously stated range, additionally, for 2025 and Beyond, we affirm all our other guidance metrics.
While we continue to expect the impacts of the regulatory cycle to result in non-linear. Net income growth over the forecast period, our regulatory strategy, and plan to achieve a flat on in, for customer Trends. Over the same period are expected to be important components of our growth story going forward.
You can find additional long-term drivers in the appendix of this presentation on. Slide 29.
As a reminder, each of our forward-looking compound annual growth rates are calculated off of a 2025 base year and do not currently include any impacts related to the potential expansion opportunity at Great Basin for the potential for formula rates in Arizona and Nevada in our next rate case proceedings.
Priorities and deliver, strong financial results.
At Southwest Gas Holdings. We are confident in our path forward. As a premiere of pure play, natural gas business. We plan to continue delivering steady organic rate-based growth. Through strong, Regional demand Dynamics as well as earnings growth through financial discipline. Operational excellence and constructive regulatory relationships.
And we will continue executing on the full separation Century to create a more tracking value proposition for stock.
That I'd like to open the call for questions.
Thank you. If you wish to ask a question, please press star 1 on your telephone keypad, you will remove yourself from the cube by pressing a star 2.
We'll take our first question from. Give me some word from Jeffrey. Please go ahead.
Hi guys. How are you doing?
Good morning.
Good morning. Hi. Um,
Wanted to ask for on Great Basin. Um that was terrific to see uh obviously the upward expansion from the 800 million to 1.2 moving the range up to 1.2 to 1.6.
Just want to confirm.
If you could provide a bit more granularity is that just a purely volume-driven uh from the 1. 7 6.
Hey James, it's Justin Brown. Uh, yeah, it's just volume, it's just additional shippers asking for incremental capacity which would result in, uh, just additional upside. I think
Perfect. Awesome, nice and clear-cut. Um,
Given the the 14 to 17 uh you know, Decades of monthly rate range. How should we think about the return profile, just high level of this investment relative to your typical distribution capex and maybe you could just
Speak a little bit to AFDC. Obviously, we're modeling that, but just be helpful as things to keep advancing here, to just get a better color from you.
James, what was the first part of the question? I missed it. Sorry. Return profile relative to the, uh, your distribution capex.
Just a reminder for for people.
Yep. We have a different uh further authorized rate of return obviously. So I'd look at the great base and authorized returned from our last rate case.
And then, yeah, we would anticipate, uh, if you'd see on the project, no different than any other project.
Terrific.
Um, last 1 I've got is just on Nevada and um,
When you think about the potential timeline overlap for your next Nevada, rate case, and then uh, the time frame to get alternative rate making in place. Would you consider delaying a traditional rate case filing? Um, if that would help accelerate formula rates, do you think of them as separate from each other? Uh, how should we kind of think about just the, the evolving construct in Nevada?
Yeah, so in Nevada, we’re currently going to be starting. I think the commission just published their notice of rulemaking asking for comments.
Um, you know, it's hard to gauge how long that'll take. Um, we anticipate it, you know, be completed within the year. I think the nice thing is
With the Nevada rate case. And the way the legislation was constructed is that um, whenever we file our next rate case. If, if we include the formula, right, proposal on the front end of that, or the legislation allows us to use that next rate, case as the Baseline, starting point for formula rates. And so we can always make it separate application filing After we receive an order in that case. So I don't think, you know, from our perspective, we don't see any advantage to delaying our next rate,
I think they're going to work uh very much complimentary to each other in terms of the legislation. And our next rate case
Perfect. Thank you for confirming that. And, uh, yeah, I believe the legislation allows you to file the formula rates up to six months after the conclusion of the last case, is that correct?
Correct.
Awesome, great. Well, congratulations, guys. Uh, it's been a long time coming, but you had a huge quarter between the Century sell-down, the Great Basin announcement, and the legislation.
Doing great.
That's all for me. I'll hop back in the queue. Thanks a lot.
Thank you, appreciate it.
Thank you. Your next question comes from Chris. Geylang House from Seabird. William Shank, please go ahead.
Sure did have tons. Oh, I'm sorry. You sure did have tons of, uh, stuff going on.
The.
The SP 47 processed. Have you got any sense of how long you think it'll take?
the Nevada commission to sort of,
get that to a place where I, I guess the, the question is so if you plan to stay on sort of the typical Cadence for enough filing, but you have that 6 months, um, you know, lead time upon the conclusion of the case, you, you feel pretty comfortable, that that
Rule making process will be completed in in a appropriate amount of time to to be comfortable with the timing of the the Nevada filing.
Hey Chris, it's Justin. Yeah I think so when we look at I think a couple factors play into that 1 is as you may recall from prior conversations. We the the legislation is really modeled after kind of an Omnibus electric um, bill that was ran a few years ago and the commission went through a rule making. So I think
You know, if, as long as we're able to kind of use that experience and kind of use, you know, some of the same platform from that rulemaking to kind of have it be our starting point, I think it'll help accelerate the process, is what we're hoping. I think, secondly, just when we think about other prior rulemaking that we've gone through on different new legislative initiatives, you know, we kind of look at kind of an average length of time, assuming, you know, there's not...
Uh, new things that come up on the commission's radar that that slows the process down to where we feel like it's something that could be completed within the next 12 months.
Um, but I think until we kind of get the process started, which is, I believe the commission that's for comments. Uh, later this month, I think we'll know more in the next couple months. Kind of how that fits into kind of the way we're looking at it from just kind of our historical experience of practice as well as kind of, the idea of being able to use
um, the prior electric bill is kind of a starting point for some of the discussions around the role making
okay, um so in in the Arizona Sim, you know in in the reduction sort of discussion amongst the commissioners
Um, it it seemed like it was basically.
An invitation to file your next rate case and to implement formula rates quicker. You know, what are your thoughts on the cadence there? And, you know, given the time it takes to execute an Arizona case.
And add to that. The extra complications of formula rates. Can you just sort of talk about what your thought process is on? You know, the Cadence and duration of that case.
Yeah, Chris uh, all of the above.
Uh, there's a lot of thoughts going through our mind right now. Um, obviously you know, through the open meeting process. I agree with you. I mean, I think, you know, 1 of the encouraging things from that was, you know, clearly from the commission kind of a, an indication of a preference for formula rates and we appreciate that, um, which is why we're we're evaluating kind of do we just accelerate the timing of our next Arizona rate case, where do we look at? Um, also trying to maybe provide some information to help address what we perceived as maybe some confusion around kind of what the the, uh, the Sim was attempting to accomplish. And so we're evaluating both um the timing obviously plays into that because regardless of what filing you you want,
Take, you know, you can kind of contemplate certain time periods with that.
I think 1 of the 1 of the other things we're evaluating is we've talked about previously is you know, you have a couple other rate cases that are currently pending that are probably uh, you know, halfway through the process that have asked for formula rates. And so I think there's some benefit of just kind of seeing how those play out and how those could then inform what your proposal looks like. So, I think there's a variety of different things that we're evaluating, it'll ultimately Drive kind of the timing on, you know, uh, the different paths that we're exploring.
Okay, that makes sense. I don't know if you want to comment on this, but I found the
Doing your replacing pipe too fast and others arguing, you're replacing pipe too slow. Is there anything that you can sort of clarify, your take on, um, what they're, what they're trying to accomplish their
Yeah, Chris I think that's where when we're looking at, you know, the potential for an application for rehearing. I think that's probably what's
Maybe motivating us to explore. That is, I think to your point, you know, I think our takeaway was perhaps there was some confusion about
some of the information that was in the record or that maybe, you know, information that certain Commissioners kind of latched on to. And so, the thought would be, is if we're able to summarize that and lay that out in a, in a more kind of, you know, summarized and kind of clarifying, way to address some of those things. It would, I think it would it would help some of the Commissioners, um, kind of understand, kind of what the historical spend has been what the proposed prospective span is anticipated to be, and then how the Sim fits into that and how the parties evaluated each of those, when we came up with our all party settlements so those are the things that we're evaluating. But yeah I agree that it just it seemed like maybe there was some confusion and so that was 1 of the things we were kind of motivating us to want to to just kind of clarify that for for some of the commissioners.
okay, that that helps
Um, Rob, in the corporate segment for the quarter, you know, there's a pretty big coal gain in there, but there was.
You know, the remainder that was non, you know, sort of Market driven, can we sort of infer that that was the interest savings year-over-year?
So um, you know, as you as you think about the corporate costs, clearly the interest expense, you know, as we've paid down debt from the 2 Century follow-ups. Um, you know, we'll continue to realize the interest is big savings, uh, on a year-over-year basis as we head into the back half of the year. So, um, yeah, I mean I think as you think about the the the total, yes, you know, coal which runs through the utility uh with favorable for the second quarter by about 4 and a half million relative to the same time uh last quarter of 2024. Um but that being said we didn't have as much uh interest income on the cash balance of the utility. So thinking about that, you know, we we obviously uh you didn't have uh, as much cash in the first half of the year at the utility um as we had last year when we collected uh, a sub substitute portion.
Ga.
Um and then the rest is really that like I said, the interest expense that it makes from the pay down of that term 1.
Okay.
Um,
let me I I don't know who this is for but maybe Justin relative to a great base and
So, there's quite a bit of, uh, theoretical rate base addition there in.
The Expansion Project. Um, do you need to get a result from the CPCN to be comfortable, you know, to make an adjustment, you know, at your typical year-end for what your rate base and CAPEX looks like going forward? Or, you know, do you feel comfortable enough with that process that once you've decided to proceed and made that filing, that that project is?
Adequately confident to uh, to change your numbers.
Yeah, I think a couple things Chris. I think really the, uh,
The critical point for us is really getting signed, pressed agreements from shippers.
Um, because that really locks everyone in, and that'll allow us then to revisit our internal estimate and kind of capex estimates.
Resident agreement, negotiation, and what part is actually signed of those agreements. Provide the information that we're requesting, as it is part of those agreements.
Okay, so if you do, make the cpcn filing, can we infer from that? You feel comfortable with the level of agreement that you signed to date at that point, you know, that you're you're proceeding given what you've you've obtained on the agreements.
Yeah, absolutely because that's that's what's required in that filing. So I think to your point that, you know, implicit in that filing is going to be, you know, a pretty strong confidence of what we think. Is the project is openly going to look like,
Right? Okay, that helps. Okay, thanks for the details, I appreciate it.
Thank you.
Thank you as a reminder. If you want to ask a question, please press star 1.
There are no further questions at this time, this concludes the Q&A portion of today's conference. I will now like to return the call over to Justin forestburgh foreclosing remarks. Please go ahead.
Thanks again, and thanks everyone for joining us today and for your questions. This concludes our conference call. We appreciate your interest in Southwest Gas Holdings.
This concludes today's Southwest Gas Holdings, Inc. second quarter 2025 earnings call and webcast. You may now disconnect your line. At this time, have a wonderful day.