Company: SOJE
Filing Date: 2025-02-20
Form Type: 10-K
Source: 0000092122-25-000018
Chunk: 806

Company: SOUTHERN CO
Filing Date: 2025-02-20
Form: 10-K
Item: Item 7A
Chunk 806
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'S DISCUSSION AND ANALYSIS

operating results can vary significantly from quarter to quarter as a result of seasonality. The impact of Heating Season on Southern Company Gas' annual results is illustrated in the table below.

Percent Generated DuringHeating SeasonOperating RevenuesNetIncome202462 %80 %202367 %73 %

Net Income

Net income attributable to Southern Company Gas in 2024 was $740 million, an increase of $125 million, or 20.3%, compared to 2023. The increase was primarily due to a $109 million increase in net income at gas distribution operations and an $11 million increase in net income at gas marketing services.

A condensed income statement for Southern Company Gas follows:

2024Increase (Decrease) from 2023(in millions)Operating revenues$4,456 $(246)Cost of natural gas1,196 (448)Other operations and maintenance1,235 48 Depreciation and amortization650 68 Taxes other than income taxes248 (14)Estimated loss on regulatory disallowance— (88)Total operating expenses3,329 (434)Operating income1,127 188 Earnings from equity method investments146 6 Interest expense, net of amounts capitalized341 31 Other income (expense), net66 9 Earnings before income taxes998 172 Income taxes258 47 Net Income$740 $125 

Operating Revenues

Operating revenues in 2024 were $4.5 billion, reflecting a $246 million, or 5.2%, decrease compared to 2023. Details of operating revenues were as follows:

2024(in millions)Operating revenues — prior year$4,702 Estimated change resulting from —Rate changes243 Gas costs and other cost recovery(407)Gas marketing services(30)Other(52)Operating revenues — current year$4,456 

Revenues increased from rate changes in 2024 primarily due to base rate increases at the natural gas distribution utilities. See Note 2 to the financial statements under "Southern Company Gas – Rate Proceedings" for additional information.

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    Table of Contents                                Index to Financial Statements        COMBINED MANAGEMENT'S DISCUSSION AND ANALYSIS

Revenues associated with gas costs and other cost recovery decreased in 2024 primarily due to lower natural gas cost recovery associated with lower natural gas prices and lower demand associated with warmer weather. The