Spire Inc. Reports Robust FY26 Second Quarter Results and Strategic Portfolio Realignment

Key Financial and Strategic Highlights

• Acquisition and Divestitures: Spire completed the acquisition of Piedmont Natural Gas Tennessee business on March 31, 2026 and, following quarter-end, completed the sale of Spire Marketing. Agreements to sell Spire Storage and Spire Mississippi have also been announced.
• Adjusted Earnings: Second quarter net income from continuing operations reached \$217.6 million (\$3.51 per diluted share), up from \$189.3 million (\$3.17 per share) a year ago. Adjusted earnings were \$223.7 million (\$3.76 per share), compared to \$189.3 million (\$3.17 per share) last year.
• Segment Performance: Gas Utility segment delivered \$234.8 million in adjusted earnings, up from \$195.2 million last year. The ‘Other’ segment recorded an adjusted loss of \$11.1 million versus \$5.9 million in the prior year.
• Discontinued Operations: Spire Marketing and Spire Storage are now classified as discontinued operations, with prior period results restated accordingly. Adjusted earnings from discontinued operations surged from \$20.0 million to \$64.6 million in Q2, driven primarily by growth at Spire Marketing.
• Year-to-Date Performance: For the first six months ended March 31, 2026, Spire reported net income of \$305.4 million (\$4.93 per diluted share), up from \$261.4 million (\$4.36 per share) last year. Adjusted earnings were \$317.5 million (\$5.28 per share) versus \$261.4 million (\$4.36 per share).
• Capital Investment: Spire reaffirmed its 10-year \$11.2 billion capital investment target through fiscal 2035, supporting infrastructure and new business development. Expected total capital expenditures for continuing operations in fiscal 2026 are \$797 million.
• Guidance Update: Fiscal 2026 adjusted earnings guidance from continuing operations updated to \$3.90–\$4.10 per share, reflecting year-to-date results and operating outlook. Guidance excludes Spire Tennessee results. Fiscal 2027 EPS guidance reaffirmed at \$5.40–\$5.60, with a long-term adjusted earnings growth target of 5-7% per annum.
• Dividend Increase: Dividends declared per common share for Q2 2026 increased to \$0.825 from \$0.785 in Q2 2025. Year-to-date dividends were \$1.65 versus \$1.57 last year.

Operational and Financial Details

• Rate Changes: Earnings growth was primarily driven by new rates at Spire Missouri (effective October 2025) and Spire Alabama (effective December 2025), along with favorable off-system sales.
• Cost Management: Operation and maintenance expense was \$1.9 million lower than a year ago, due to reduced employee-related costs, partially offset by higher non-payroll expenses.
• Depreciation and Taxes: Depreciation expense increased \$12.1 million year-over-year, reflecting capital investment and updated schedules. Taxes other than income taxes rose by \$6.0 million, mainly due to revised property tax amortization in new Missouri rates.
• Interest Expense: Interest expense increased by \$1.5 million, attributed to higher long-term debt balances, partially offset by lower borrowing rates.
• Corporate Costs: The ‘Other’ segment saw higher corporate costs and interest expense, resulting in increased adjusted losses.

Balance Sheet and Liquidity

• Total Assets: As of March 31, 2026, Spire’s total assets stood at \$14.67 billion, up from \$11.58 billion on September 30, 2025.
• Shareholders’ Equity: Shareholders’ equity was \$3.42 billion, with retained earnings of \$1.35 billion.
• Debt Position: Long-term debt increased to \$5.76 billion from \$3.37 billion, reflecting financing for acquisitions and capital investments. Notes payable rose to \$1.96 billion.
• Preferred Stock: Spire redeemed its preferred stock during the quarter, incurring a redemption cost of \$8 million.
• Cash Flow: Net cash provided by operating activities for the first six months was \$491.4 million. Capital expenditures totaled \$395 million, while business acquisitions accounted for \$2.5 billion in cash outflows. Financing activities contributed \$2.42 billion, mainly from long-term debt issuance and term loan draws.

Strategic Actions and Long-Term Outlook

• Portfolio Simplification: The sale of non-core businesses (Spire Marketing, Spire Storage, Spire Mississippi) and the completion of the Tennessee acquisition reinforce Spire’s focus on regulated gas utilities, improving risk profile and earnings visibility.
• Segment Reporting Change: Going forward, Spire will report results under a single Gas Utility segment, with remaining operations (including Spire MoGas Pipeline) classified as ‘Other’.
• Growth Strategy: Management maintains confidence in its ability to deliver shareholder value through organic growth, infrastructure investment, and disciplined cost control, despite headwinds from lower weather-related usage in Missouri.
• Earnings Guidance Sensitivity: Lower weather-related usage in Missouri, not fully mitigated, led to a reduction in FY26 adjusted earnings guidance. However, the long-term growth outlook remains unchanged.

Price-Sensitive and Shareholder-Relevant Information

• Acquisition and Divestiture Activity: Completion of the Piedmont acquisition and divestitures of Spire Marketing and planned sales of Spire Storage and Spire Mississippi are likely to materially impact the future earnings mix and risk profile.
• Guidance Revision: FY26 adjusted earnings guidance has been lowered, which may affect investor expectations and share price. However, FY27 guidance and long-term growth targets remain intact.
• Debt Increase: Significant rise in long-term debt and notes payable, largely to finance acquisitions and capital investments. Investors should monitor leverage and interest expense trends.
• Dividend Growth: Increased dividends signal confidence in cash flow and profit sustainability.
• Reporting Changes: Shift to a single Gas Utility segment may simplify financial analysis and highlight core business performance.
• Non-GAAP Measures: Adjusted earnings and contribution margin are used extensively; investors are advised to review GAAP reconciliations for a full picture.

Management Commentary

“Our second quarter results demonstrate continued progress as we focus on our core regulated gas utility businesses. I am pleased with the disciplined execution of our strategic initiatives, including the successful completion of the Tennessee acquisition and the processes supporting our recent divestitures. These actions reinforce our focus on regulated growth, improve earnings visibility and strengthen our financial foundation.” – Scott Doyle, President and CEO

Conference Call Information

• Date: Wednesday, May 6
• Time: 8 a.m. CT (9 a.m. ET)
• Dial-in: 844-824-3832 (U.S. & Canada), 412-317-5142 (International)
• Replay: Available until May 13, 2026 (Access Code: 3309348)
• Webcast: Investors.SpireEnergy.com under Events & Presentations

About Spire

Spire Inc. (NYSE: SR) is one of the largest publicly traded natural gas companies in the U.S., serving nearly 2 million homes and businesses across Alabama, Mississippi, Missouri, and Tennessee. The company is committed to organic growth, infrastructure investment, and operational excellence.

Disclaimer

This article contains forward-looking statements based on Spire management’s current estimates, assumptions, and expectations. Actual results may differ due to risks including economic conditions, regulatory actions, execution of divestitures and acquisitions, weather variability, and other factors. Investors should review Spire’s SEC filings for more comprehensive risk disclosures. This article is provided for informational purposes only and does not constitute investment advice.

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