Atos Annual Report 2006 | Quarterlytics

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FY2006 Annual Report · Atos

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A T M O S E N E R G Y C O R P O R A T I O N

C E L E B R A T I N G

1OOY E A R S o f

S E R V I C E

2 0 0 6 S U M M A R Y A N N U A L R E P O R T

years ago,

a few visionary pioneers founded
Amarillo Gas Company to bring
energy to the frontier.

Today, some 4,600 Atmos Energy
employees keep that energy
alive for 3.2 million customers
across the nation.

100

we are the number one all-natural-gas

1Every single employee is the reason

utility in America today.

–

1906: Amarillo Gas Company was founded by brothers J.C. and Frank Storm to manufacture coal gas on the Texas frontier .

Centennial Review

Letter to Shareholders

Financial Review

Atmos Energy Officers

Board of Directors

Corporate Information

In 2006, we celebrated a century of bringing the energy of America to homes and businesses across our vast countryside. In this annual report, I’m proud to share with you the literally hundreds of great things about our 100-year-old company. Our spirit has remained strong through the decades. From the early days of finding and delivering natural gas, to innovation in our homes and places of business, to the unwavering commitment in the wake of disasters like Hurricane Katrina, the spirit of our employees remains stronger than ever as we look forward to our next 100 years. —Robert W. Best Chairman, President & CEO

100 | The oil and gas boom brought new prosperity to Amarillo—and hundreds of road rally racers.

In Kansas, two Atmos Energy employees answer to the
name “Mr. Mayor.” Howard Hatﬁeld serves as mayor of
Anthony, and Bruce Main is mayor of Independence.

1918: In the Texas Panhandle, Amarillo Oil Company discovered one of the largest natural gas fields in the world. 1920: Amarillo Gas Company delivered the. . . . . . . . . . . . . . . . . first locally produced natural gas. 1924: Amarillo Gas and Amarillo Oil became part of Southwestern Development Company. 1927: Southwestern . . . . . . . . . . .

–

Over 200 countries celebrate with more than
1 million fruitcakes from Collin Street Bakery’s
ovens fired with natural gas from Atmos Energy.

200 | When a call brought Atmos Energy employees Tim Thomas

and Tim Langston to the home where Pat Walker cares for daughter
Leslie, the men spent nearly three hours of their Saturday morning
isolating a gas leak, keeping the gas turned on and getting to know
this Special Olympian.

Of the thousands of suppliers to
Eastman Chemical Company, we
have been awarded its coveted
Supplier Excellence Award twice.

4 | The four
elements of air, fire,

earth and water

came together mid-

century as millions

of West Texas acres

prospered from

gas-fired irrigation.

60 | Natural gas

has long been vital
to business. Today,
60 percent of all
natural gas is used
by industry and to
generate electricity.

–

Atmos Energy leads
the industry in
equipping its meter
readers with the Bite
Terminator,® a new
device that reduces
dog bites by 95 percent
without harming Fido.

Atmos Energy employees
showed their community
spirit by grilling 800 burgers

and hot dogs to celebrate
the lifesaving work of
the ﬁre department in
Olathe, Kansas.

Ten major acquisitions
since 1983 have grown
Atmos Energy’s utility
customer base 11-fold.

students at
City Park
Elementary in
Dallas have been
adopted by
Atmos Energy.

. . . . . Development Company expanded its system in West Texas, and by the late ’20s, natural gas was being piped to 23 new cities, serving more than 10,000 . . . . . . . . . . . . . . . . . . customers. 1931: Southwestern Development with Standard Oil and others built the country’s first 24-inch-diameter long-distance gas pipeline to . . . . . . . . . . .

2633280095
850

850 cubic feet of gas per
minute can be extracted from
the ground thanks to
the Vapor Extraction Unit,

invented by Atmos Energy
employee Marc Chapman of
Dallas. This is a tremendous

boon to ﬁnding and repairing
gas leaks that have saturated
the ground and pose a safety
risk. Most natural gas

companies in the U.S. could
be using the device within
the next two to three years.

Atmos Energy has 53 billion
cubic feet of underground
natural gas working storage.

For the third time in four
years, Atmos Energy was
honored with CIO magazine’s
CIO 100 award, recognizing

the most influential and
forward-thinking uses of
information technology.

. . . . . Chicago. 1932: Sinclair Oil Corporation gained a controlling interest in Southwestern Development Company. 1933: Amarillo Gas began adding odorant . . . . . . . . . . . . . . . . . . to natural gas to make it safer. 1934: Western Kentucky Gas Company was formed. 1942: Amarillo Gas fueled new army camps, air bases and defense . . . . . . . . . . .

1 | One hole
in the ground
that changed
the world. In
1918, Amarillo
Gas struck one
of the largest
gas ﬁelds ever.

–

1,000

Untold thousands of
gas lamps illuminated
towns in the company’s
early days. Today’s
natural gas lights provide
picturesque and
decorative lighting.

The 23 Segways Atmos Energy has in operation
so far have improved meter readers’ efficiency
by 30 percent and have reduced injuries. That’s
what we call making great strides.

10023Atmos Energy and its employees gave $1.5 million
to the Red Cross to help hurricane victims.

Taking health and
safety to heart,
we have installed
186 defibrillators
in our offices.

After Hurricane Katrina, 280 Atmos Energy employees from outside Louisiana relocated to the storm-ravaged
area. Living in company-provided trailers, they restored 1.5 million feet of gas main in nine months.

500

Five hundred gas meters were
under water in Iberia, St. Mary
and Vermilion Parishes as
a result of Hurricane Katrina.

Online gas customers have
grown by 37 percent this year.
Almost half a million of our

utility customers now have
online accounts.

. . . . . plants during World War II. 1944: Greeley Gas Company was formed in Greeley, Colorado. 1948: Two-way radios and telemetering equipment improved . . . . . . . . . . . . . . . . . . . operations. 1954: Southwestern Development Company and its subsidiaries were collapsed into Pioneer Natural Gas Company. 1955: Pioneer installed . . . . . . . . . . .

–

Kent Maycut, a senior
service technician from
St. Bernard Parish, spent
several days in a small
boat rescuing 40 victims
of the post-Katrina flood.

Atmos Energy crews are in high gear,
installing 65,000 feet of six-inch pipe to
serve the thousands of new homes
and businesses on the North Shore of
Lake Pontchartrain in Louisiana.

50 | As the country boomed in the ’50s,
so did the widespread use of natural gas.

401,500,00028065,0003718612

–

As the first utility to restore service
in Jefferson Parish after Katrina,
Atmos Energy enabled Drago’s
Seafood Restaurant to serve up to
3,500 free meals a day to emergency
workers and neighbors in need.

. . . . . its first computer, an RCA Spectra, reducing the time from meter reading to billing. 1956: Pioneer built its own headquarters building in Amarillo.

1962: The growth of irrigation customers made Pioneer a summer-peaking company. 1975: Pioneer Natural Gas Company changed its name to Pioneer . . . . . . . . . .

Atmos Energy maintains more than 80,000 miles
of gas transmission and distribution pipelines.

1,950 | Our employees
have walked 1,950
kilometers for the
Susan G. Komen Breast
Cancer Foundation
Race for the Cure.®

By 1950, Texas had 15,010 miles of gas transmission lines. Their operation led to
development of gas reserves in the Permian Basin of West Texas.

3,50080,00015,01045

One of the largest pipeline
projects in Atmos Energy’s
history, the 45-mile North
Side Loop was completed in

2006 to better serve the
Dallas-Fort Worth area.

Natural gas costs less
than one-third of the cost
of electricity per Btu.

500

Atmos Energy was named to
the FORTUNE 500 for the
ﬁrst time in 2006. The

company moved up
150 places since 2005.

In 1626, French explorers
discovered American natives
igniting gases that were
seeping into Lake Erie.

. . . . . Corporation to emphasize its diversified assets. 1980: Trans Louisiana Gas Company was formed. 1983: Pioneer launched Energas as an independent, . . . . . . . . . . . . . . . . . . publicly held gas utility company. 1986: Energas made its first acquisition with the purchase of Trans Louisiana Gas. 1987: Growth continued with . . . . . . . . . . .

–

Dear Fellow Shareholder:

We have many reasons to celebrate 2006,
not the least of which was our company’s
100th birthday.

In our centennial year, Atmos Energy

delivered exceptional ﬁnancial results
that were driven by increased sales volumes
and higher margins in our nonutility
segment. At the same time, our utility
operations implemented improved
rate designs to strengthen our future
ﬁnancial performance.

Net income for the ﬁscal year increased

9 percent to $147.7 million from $135.8
million in ﬁscal 2005, and earnings per
diluted share grew by 10 cents to $1.82.
We paid dividends of $1.26 per
share, resulting in a yield of between
4 percent and 5 percent. In November
2006, the board of directors declared our
19th consecutive annual dividend
increase, raising the dividend by 2 cents
a share. The indicated rate for ﬁscal
2007 is $1.28.

During 2006, we achieved smooth
management transitions in both our utility
and nonutility operations. Kim R. Cocklin
assumed responsibilities as senior vice

president, utility operations, and
Mark H. Johnson was named senior vice
president, nonutility operations.

We also began recovering from
Hurricanes Katrina and Rita, which ini-
tially had affected service to more than
60 percent of our Louisiana customers.
Although Atmos Energy has changed

in many ways during the past century,
it has remained true to the founders’ core
vision to serve the public as a natural
gas company.

Today, that vision translates into our

complementary strategy of natural
gas utility services and nonutility gas
marketing, pipeline and storage
services—a strategy that produced
exceptional results in ﬁscal 2006.

N o N u t i l i t y e a r N i N g s i N c r e a s e 7 3 p e r c e N t

A very bright spot in 2006 was our
nonutility operations. Earnings from
these operations offset a 35 percent
decline in our utility earnings to contribute
a record-setting $94.7 million to net
income, or $1.17 per diluted share.

Our gas marketing subsidiary,
Atmos Energy Marketing (AEM), was
able to realize $68.7 million more in
margins primarily as a result of the extreme
volatility in natural gas commodity

prices last winter. AEM used its experience
and expertise as one of the country’s
leading gas marketers to help many public
utilities, municipalities and industrial
customers contend with the wide swings
in wholesale gas prices. As a result,
AEM increased its 2006 marketing sales
volumes by 46 billion cubic feet (Bcf)
to 284.0 Bcf.

Furthermore, our pipeline and storage

segment, also part of our nonutility
operations, achieved higher transportation
and related-service margins and
favorable arbitrage spreads on its storage
contracts. The segment contributed
$35.6 million to net income, a 16 percent
increase over its contribution in ﬁscal
2005. Consolidated pipeline and storage
throughput increased to 420.2 Bcf from
383.4 Bcf in ﬁscal 2005.

A signiﬁcant step we took during
2006—one that promises favorable returns
and future opportunities—was our
expansion into natural gas gathering. We
expect to be able to use many of the same
operating and marketing strengths found
in our pipeline business in the gathering
business. A gathering system collects raw
gas from producers’ wells and transports
it to a processing and sales terminal. From
there, larger regulated pipelines carry
the gas to market.

In October 2006, we received an order

from the Federal Energy Regulatory
Commission (FERC) exempting our
proposed Straight Creek Gathering
System from FERC regulation. This
gathering system will use a 20-inch
backbone pipeline running approximately
60 miles through the Big Sandy natural
gas producing region in eastern Kentucky.
It will be able to transport up to 100,000
million Btu (MMBtu) a day of gas when
it goes into operation in 2007, with the
capability to expand throughput up to
225,000 MMBtu a day.

The Big Sandy producing region
historically has not had sufficient gathering
capacity to handle the available supply. It’s
estimated that our project could generate
more than $150 million a year in

f i s c a l 2 0 0 6 N e t i N c o m e b y s e g m e N t

P I P E L I N E A N D S T O R A G E 24.1%

N A T U R A L G A S M A R K E T I N G 39.6%

U T I L I T Y 35.9%

O T H E R N O N U T I L I T Y 0.4%

contributions from utility and nonutility operations

331626In 1859, Edwin Drake drilled
the ﬁrst commercial well
and hit oil and natural gas at

69 feet below the surface of the
earth. A two-inch-diameter
pipeline was built, running
5.5 miles from the well to the

village of Titusville,
Pennsylvania. This discovery
well is considered to be

the beginning of the natural
gas industry in America.

Baby Jessica McClure was
rescued from an abandoned
well pipe with the help of
our employees 19 years ago.

Because natural gas is one of
the most efﬁcient energy
sources, its use has increased
35 percent during the past

decade and demand
is expected to grow by
40 percent by 2025.

. . . . . the acquisition of Western Kentucky Gas. 1988: Energas changed its name to Atmos Energy Corporation and was listed on the NYSE (ATO). 1993: Atmos . . . . . . . . . . . . . . . . . . Energy acquired Greeley Gas operations in Colorado and Kansas. 1997: Atmos Energy doubled in size to one million customers through its merger with . . . . . . . . . . .

wellhead sales revenues, severance taxes,
property taxes and royalty-owner
revenues. Atmos Energy and our minority
partner, Kinzer Drilling Company,
plan to invest between $75 million and
$80 million in the project.

N e w r a t e d e s i g N s h o u l d h e l p u t i l i t y s e g m e N t

Extremely volatile natural gas prices, one
of the warmest winters on record and
two of the worst hurricanes in American
history strained our utility business
by adding operating costs and lowering
utility revenues.

to write off our irrigation properties
in West Texas. The volumes of natural gas
we deliver for irrigation pumping in
Texas have continued to decline year after
year and were not expected to generate
enough cash flow from operations to
recover our net investment.

On the positive side, our biggest
ﬁnancial success came in breakthroughs
in rate design in our utility segment.
These changes should help return our
utility to strong performance in ﬁscal
2007 and beyond.

We secured protection from weather

in our two largest divisions. In Texas, the

We cannot control the weather and we cannot control the cost of natural gas;
however, we can control how we address adverse situations.

–

Railroad Commission granted our
Mid-Tex Division a weather normalization
adjustment as part of a pending rate case.
In Louisiana, the Public Service
Commission allowed new rate provisions
that protect our margins from warm
winter weather, declining customer use
and greater conservation.

In particular, unseasonably warm

winter weather, which was 13 percent
warmer than normal, reduced our utility
earnings. Net income from utility
operations fell to $53.0 million from $81.1
million in ﬁscal 2005. In addition,
we lost approximately 230,000 utility
customers in Louisiana until service
could be restored after Hurricanes Katrina
and Rita. About 26,500 of these customers
became permanent losses with no plans
for rebuilding homes or businesses.

Utility earnings also were reduced by

a nonrecurring after-tax charge of
$14.6 million, or 18 cents per diluted share,

As a result of these changes, more
than 90 percent of our customer margins
are now substantially insulated from
the effects of adverse weather. This has
been a primary goal to help safeguard
our earnings.

We cannot control the weather and

we cannot control the cost of natural
gas; however, we can control how we
address adverse situations. We believe
that implementing sound rate-design
principles beneﬁts both the company
and our customers over the long term.

K e e p i N g r a t e s c u r r e N t

In Texas, we also continued to refresh

our rates under the state’s Gas Reliability
Infrastructure Program, or GRIP. The
program authorizes utilities to earn a rate
of return on their incremental annual
capital investments. It also reduces the
regulatory lag time between when we
make an investment and when we begin
earning a return on it.

Since 2003, we have been able to
increase base rates in Texas under GRIP
by about $190 million while earning
about $36 million in allowed return on
that investment.

In Missouri, we reached a tentative

settlement in a rate case seeking an

We ﬁled a number of rate cases during
2006, seeking rate increases and weather
normalization adjustments as well as
provisions to compensate for declining
customer use and to recoup our costs
for the natural gas consumed by customers
with uncollectible accounts.

In Louisiana, the Public Service
Commission acted quickly to allow a rate
increase, subject to refund, of $10.8 million.
The increase covered customer losses in
Katrina-affected parishes and increases in
rate base and operating expenses.

Our most signiﬁcant rate ﬁling was
for a $60 million increase in Texas by our
Mid-Tex Division to recover increases
in the division’s operating costs and its
allowed rate of return. A decision is due
no later than April 2007.

e a r N i N g s r e V i e w

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Net income per diluted share

193569Atmos Energy Marketing
added the city of Hamilton,
Ohio (population 61,000),

to its more than 1,000
municipal and industrial
customers.

Atmos Energy’s Kentucky
Division was named one of
the 20 best places to work
in the state, coming in 12th.

Atmos Energy helped create
two statues in West Texas
to commemorate the fallen

space shuttle Columbia.
The statue of pilot William
McCool stands in Lubbock,
and the statue of shuttle

commander Rick Husband
stands in Amarillo. Together,

their upraised hands point to
the trajectory of the shuttle
and her crew’s ﬁnal mission.

. . . . . United Cities Gas Company. 2001: Woodward Marketing became a wholly owned subsidiary, greatly expanding the company’s nonutility business.

2002: Mississippi Valley Gas, the state’s largest gas supplier, was acquired. 2004: Atmos Energy acquired the operations of TXU Gas in Texas, becoming . . . . . . . . . . .

–

increase of $3.4 million. Signiﬁcantly, the
commission staff has agreed to support
a ﬁxed monthly delivery charge, which
would allow us to earn our residential
margins regardless of customers’ usage.
A ﬁnal decision in the case is expected
in March 2007.

In a contested case, the Tennessee
Regulatory Authority ordered a $6.1 million
reduction in our base rates, effective
December 1, 2006. Because the company
had absorbed a decade of inflation
and expenses for system improvements
without seeking a rate increase, we
believe the current rates are deﬁcient.
We are continuing to analyze our rate
strategy in Tennessee.

s u c c e s s a N d i N d e p e N d e N c e

Strategic innovation has always set our
company apart. For example, in 1986, the
company was still a regional utility in West
Texas with a complementary irrigation
business. That year, CEO Charles Vaughan
made a tender offer to acquire Trans
Louisiana Gas Company. It was a bold
step that set the course for the company’s
future growth.

“We had to do something because our

service area was not growing,” Vaughan
said. “We had to buy something—or be
bought ourselves.”

Vaughan chose to diversify the
company’s operations into other states
but to maintain its basic strategy as a
regulated local distribution company.

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20 07 dividend is the indicated rate

Other successful acquisitions followed

that conﬁrmed the corporate vision and
the long-standing belief in independence by
our board of directors. Charles Vaughan
set the dual hallmarks of ﬁnancial success
and corporate independence by which
we operate today.

Atmos Energy has continued to
expand, largely through mergers and
acquisitions, to become the largest all-
natural-gas distribution company in the
country. Our 10 major acquisitions
to date not only have bolstered our core
utility business, but also have provided
valuable diversiﬁcation.

In particular, our acquisition in 2001

of the balance of Woodward Marketing
has proved to be one of our best steps. We

acquired one of the country’s leading
and most respected mid-tier natural
gas marketing companies. Under
JD Woodward’s leadership, we greatly
expanded the scope and scale of our
nonutility business.

In 2004, we acquired the operations
of TXU Gas Company. Not only did we
obtain one of the most dynamic markets
for natural gas distribution—Dallas-Fort
Worth is now the nation’s fourth largest
metropolitan statistical area, but we also

core business. And we will remain
active in using acquisitions as an engine
of future growth. However, we expect
to be even more selective to ﬁnd the right
ﬁt of properties.

We will invest most of our future
growth capital in states with timely and
adequate rates of return as well as in
new nonutility projects. We expect our
capital expenditures in ﬁscal 2007 will be
between $425 million and $440 million, as
compared to $425.3 million in ﬁscal 2006.

I am confident that we are in a better position today than at any time in our past.

s t r a t e g i c f o c u s

acquired a highly valuable intrastate
gas pipeline system. Today, it is yielding
superior returns in our pipeline and
storage segment while offering growth due
to the extensive rate of gas drilling
in Texas and the producers’ needs to
transport the gas to markets.

As Atmos Energy enters its second
century, our strategic focus remains ﬁxed
on being ﬁnancially successful by
proﬁtably delivering natural gas to our
customers. We expect our earnings in
ﬁscal 2007 to grow at our stated goal of
4 percent to 6 percent a year, on average.
Our utility operations will remain our

We will continue to work for federal
laws to increase our country’s natural gas
supply in order to moderate gas prices.
Towards this end, our interests are aligned
perfectly with our customers’ interests.
We both want reasonable gas costs and
lower volatility in gas prices.

Today, Atmos Energy is in an excellent

position to expand its core business,
stabilize its earnings and take advantage
of its complementary strategy. We are
pursuing consistent and focused strategies

261,00020When it comes to helping
our communities, Atmos
Energy digs deep. Working
with Habitat for Humanity,

our employees have helped
build 186 homes so far in our
service area.

Among American single-
family homes, 69 percent
feature natural gas heating.

m a N a g e m e N t t r i b u t e s

. . . . . the largest all-natural-gas distributor in the U.S. 2006: The Environmental Protection Agency honored the company for reducing greenhouse gas emissions.

–

to beneﬁt our shareholders, customers
and employees. Furthermore, natural gas
remains the most valued energy source in
American homes and businesses, offering
comfort, convenience and efficiency. For
all these reasons, I am conﬁdent that we
are in a better position today than at
any time in our past.

i N o b s e r V a N c e o f o u r c e N t e N N i a l

We have many reasons to celebrate
Atmos Energy’s 100th anniversary. But
the one that’s most important to me
is our company’s culture of developing
exceptional employees.

They produced innovative solutions

and found market opportunities that
yielded our strong results in 2006 while
they maintained the high level of service
that we take pride in. Our employees took
care of their customers and their fellow
employees in a time of suffering and need.
Only hours after Hurricane Katrina

devastated southern Louisiana and parts
of Mississippi, our employees—more
than 50 of whom lost their own homes—
were in the ﬁeld to ensure safety, to
begin restoration where possible and to
help their neighbors. For weeks thereafter,
more than 450 of our employees from
across our system worked up to 18-hour
days under dangerous and difficult
conditions. It is a ﬁtting tribute to all our
employees that the natural gas that

powered the pumps to drain the toxic
waters from New Orleans and to begin
the healing came from Atmos Energy.

Local teams of employees from every

operation joined together to “adopt”
the families of our employees who lost
their homes, autos and belongings.
They held fundraisers, donated clothing,
furniture, toys and supplies and went
to the destroyed communities to help
them rebuild their lives. Above all,
they gave personal encouragement and
strength to sustain their fellow employees
through a difficult time.

Our ﬁrst commitment always is to
serve—safely, reliably and efficiently. This
commitment ensures the value and
integrity of your investment. It provides the
conﬁdence on which our enterprise has
been built during the past 100 years. Even
as our business and our employees change,
service remains our deﬁning mission.

Robert W. Best
Chairman, President and Chief Executive Officer
November 22, 2006

r. earl fischer—spent 44 years with
Atmos Energy and Western Kentucky
Gas (WKG) Company. He served
in accounting and operational
management positions at WKG, where
he tirelessly promoted the state’s

economic development, recruiting the General
Motors Corvette Assembly Plant, the Mid-
America Air Park and a dozen major companies.
He was promoted to president of WKG in 1989.
In 1998, he was named president of our West Texas
Division, then known as Energas, and later
became senior vice president, utility operations.
Earl led our utility operations through many
changes in the industry, dealing with volatile gas
prices, system conversions and major acquisitions.
He has truly been dedicated to the people we serve
through his extensive civic and charitable work.
Larger than life, and always a lot of fun, he leaves
us a living legacy in the many young managers
he has selected and developed over the years. We
wish Earl and his wife, Sally, all the best.

Kim r. cocklin—assumed the
responsibilities as senior vice
president, utility operations, and
a member of the Management
Committee on October 1. Before
joining Atmos Energy, Kim was

senior vice president, general counsel and chief
compliance officer for Piedmont Natural Gas
Company, Inc. At Piedmont, he was responsible
for all legal, governmental and community
affairs, corporate communications and Sarbanes-
Oxley compliance. Earlier, Kim worked for
The Williams Companies for 19 years. He served
as senior vice president in charge of planning,
rates and regulatory, and business development
for Williams Gas Pipeline and in other executive
positions. Kim brings extensive experience in both
the utility-distribution and gas-pipeline
businesses. His management philosophy reflects
our own corporate culture, making him a
valuable addition to our senior management team.

gene c. Koonce—Atmos Energy
Corporation has beneﬁted for
nearly a decade from the wisdom
and insights of Gene C. Koonce.
Gene joined our board of directors
in 1997 after our merger with

United Cities Gas Company, where he had served
as chairman, president and chief executive officer
for 20 years. A long-time industry leader, Gene was
also a distinguished community servant in the
Greater Nashville area and across Tennessee. In
February 2007, Gene will retire from the board,
and we wish him and his wife, Bettye, our very best.

Two members of Atmos Energy Corporation’s
senior Management Committee retired during 2006.
JD Woodward, who led our nonutility business,
retired on April 1, and R. Earl Fischer, who led our
utility operations, retired on September 30.

Jd woodward—began working
with Atmos Energy in 1997 after our
merger with United Cities Gas
Company. United Cities had owned
45 percent of his company,
Woodward Marketing LLC. The
relationship was so beneﬁcial that we

acquired the remaining interest in his company
in 2001, and JD joined us as senior vice president,
nonutility operations. He signiﬁcantly expanded
our gas marketing business into 22 states and
developed our pipeline and storage operations
into a separate business segment that is making
major contributions to our earnings. We are greatly
indebted to him for all that he did to help Atmos
Energy grow and succeed. We wish JD and his wife,
Linda, much happiness.

mark h. Johnson—who joined
Woodward Marketing in 1992 as vice
president of marketing and
operations, succeeded JD Woodward
as senior vice president, nonutility
operations, and as a member of our
Management Committee. Mark, a

petroleum engineer by training, is a highly
experienced leader in gas marketing, trading,
storage and ﬁnancial hedging. He previously had
served in a number of executive positions with
Woodward Marketing and Atmos Energy
Marketing. He brings a dynamic style and clear
focus to his job.

18669
f i N a N c i a l h i g h l i g h t s

a t m o s e N e r g y a t a g l a N c e

Year Ended September 30

Dollars in thousands, except per share data

Operating revenues
Gross proﬁt

Utility net income
Natural gas marketing net income
Pipeline and storage net income
Other nonutility net income

Total

Total assets
Total capitalization*
Net income per share – diluted
Cash dividends per share
Book value per share at end of year

2 2

–

2 3

Consolidated utility segment throughput (MMcf)
Consolidated natural gas marketing segment throughput (MMcf)
Consolidated pipeline and storage segment

transportation volumes (MMcf)

Heating degree days
Degree days as a percentage of normal
Meters in service at end of year
Return on average shareholders’ equity
Shareholders’ equity as a percentage of total capitalization

(including short-term debt) at end of year

Shareholders of record
Weighted average shares outstanding – diluted (000s)

* Total capitalization represents the sum of shareholders’ equity and long-term debt, excluding current maturities.

2 0 0 6

2 0 0 5

c h a n g e

$ 6,152,363
$ 1,216,570

$ 4,961,873

$ 1,117,637

53,002

58,566

35,624

545

81,117

23,404

30,599

665

147,737

135,785

$ 5,719,547

$ 5,653,527

1.82

$ 3,828,460
$
$
$

20.16

1.26

393,995

283,962

420,217

2,527

$ 3,785,526

1.72

1.24

19.90

411,134

238,097

383,377

2,587

87%

89%

3,181,199

3,157,840

8.9%

9.0%

39.1%

40.7%

24,690

81,390

26,242

79,012

24.0%

8.9%

-34.7%

150.2%

16.4%

-18.0%

8.8%

1.2%

1.1%

5.8%

1.6%

1.3%

-4.2%

19.3%

9.6%

-2.3%

-2.2%

0.7%

-1.1%

-3.9%

-5.9%

3.0%

s u m m a r y a N N u a l r e p o r t

The ﬁnancial information presented in this
report about Atmos Energy Corporation is
condensed. Our complete ﬁnancial statements,
including notes as well as management’s
discussion and analysis of ﬁnancial condition
and results of operations, are presented in our
Annual Report on Form 10-K. Atmos Energy’s
chief executive officer and its chief ﬁnancial
officer have executed all certiﬁcations with respect
to the ﬁnancial statements contained therein
and have completed management’s report on
internal control over ﬁnancial reporting, which

are required under the Sarbanes-Oxley Act
of 2002 and all related rules and regulations of
the Securities and Exchange Commission.
Investors may request, without charge, our
Annual Report on Form 10-K for the ﬁscal
year ended September 30, 2006, by calling
Shareholder Relations at 972-855-3729
between 8 a.m. and 5 p.m. Central time. Our
Form 10-K also is available on Atmos
Energy’s Web site at www.atmosenergy.com.
Additional investor information is presented
on page 32 of this report.

Year Ended September 30

Meters in service

Residential
Commercial
Industrial
Agricultural
Public authority and other

Total meters

Heating degree days

Actual (weighted average)
Percent of normal

Utility sales volumes (MMcf)

Residential
Commercial
Industrial
Agricultural
Public authority and other

Total

Utility transportation volumes (MMcf)

Total utility throughput (MMcf)

Intersegment activity (MMcf)

Consolidated utility throughput (MMcf)

Consolidated natural gas marketing throughput (MMcf)

Consolidated pipeline transportation volumes (MMcf)

Operating revenues (000s)

Gas utility sales revenues

Residential
Commercial
Industrial
Agricultural
Public authority and other
Total gas sales revenues

Transportation revenues
Other gas revenues

Total utility revenues

Natural gas marketing revenues
Pipeline and storage revenues
Other nonutility revenues

Total operating revenues (000s)

Other statistics

Gross plant (000s)
Net plant (000s)
Miles of pipe
Employees

2 0 0 6

2 0 0 5

2,886,042

275,577

2,862,822

274,536

2,661

8,714

8,205

2,715

9,639

8,128

3,181,199

3,157,840

2,527

87%

2,587

89%

144,780

162,016

87,006

26,161

5,629

8,457

92,401

29,434

3,348

9,084

272,033

296,283

126,960

398,993

(4,998)

393,995

283,962

420,217

122,098

418,381

(7,247)

411,134

238,097

383,377

$ 2,068,736

$ 1,791,172

1,061,783

276,186

40,664

103,936

869,722

229,649

27,889

86,853

3,551,305

3,005,285

61,475

37,071

3,649,851

2,418,856

81,857

1,799

58,897

37,859

3,102,041

1,783,926

73,880

2,026

$ 6,152,363

$ 4,961,873

$ 5,101,308

$ 4,765,610

$ 3,629,156

$ 3,374,367

81,996

4,632

81,604

4,543

c o N d e N s e d c o N s o l i d a t e d b a l a N c e s h e e t s

c o N d e N s e d c o N s o l i d a t e d s t a t e m e N t s o f i N c o m e

–

September 30

Dollars in thousands, except per share data

Assets

Property, plant and equipment

Construction in progress

Less accumulated depreciation and amortization

Net property, plant and equipment

Current assets

Cash and cash equivalents
Cash held on deposit in margin account
Accounts receivable, less allowance for doubtful accounts of $13,686 in 2006

and $15,613 in 2005
Gas stored underground
Other current assets

Total current assets

Goodwill and intangible assets

Deferred charges and other assets

Capitalization and Liabilities

Shareholders’ equity

Common stock, no par value (stated at $.005 per share);

200,000,000 shares authorized, issued and outstanding:
2006 – 81,739,516 shares, 2005 – 80,539,401 shares

Additional paid-in capital
Accumulated other comprehensive loss
Retained earnings

Shareholders’ equity

Long-term debt

Total capitalization

Current liabilities

Accounts payable and accrued liabilities
Other current liabilities
Short-term debt
Current maturities of long-term debt

Total current liabilities

Deferred income taxes

Regulatory cost of removal obligation

Deferred credits and other liabilities

2 0 0 6

2 0 0 5

Dollars in thousands, except per share data

2 0 0 6

2 0 0 5

2 0 0 4

Year Ended September 30

$ 5,026,478

$ 4,631,684

74,830

5,101,308

1,472,152

3,629,156

75,815

35,647

374,629

461,502

169,952

133,926

4,765,610

1,391,243

3,374,367

40,116

80,956

454,313

450,807

238,238

1,117,545

1,264,430

738,521

234,325

737,787

276,943

$ 5,719,547

$ 5,653,527

409

403

1,467,240

1,426,523

(43,850)

224,299

1,648,098

2,180,362

3,828,460

345,108

388,451

382,416

3,186

(3,341)

178,837

1,602,422

2,183,104

3,785,526

461,314

503,368

144,809

3,264

1,119,161

1,112,755

306,172

261,376

204,378

292,207

263,424

199,615

$ 5,719,547

$ 5,653,527

Operating revenues

Utility segment
Natural gas marketing segment
Pipeline and storage segment
Other nonutility segment
Intersegment eliminations

Purchased gas cost

Utility segment
Natural gas marketing segment
Pipeline and storage segment
Other nonutility segment
Intersegment eliminations

Gross profit

Operating expenses

Operation and maintenance
Depreciation and amortization
Taxes, other than income
Impairment of long-lived assets
Total operating expenses

Operating income

Miscellaneous income

Interest charges

Income before income taxes

Income tax expense

Net income

Per share data

Basic net income per share

Diluted net income per share

Weighted average shares outstanding:

Basic
Diluted

$ 3,650,591

$ 3,103,140

$ 1,637,728

3,156,524

2,106,278

1,618,602

160,567

5,898

153,289

5,302

19,758

3,393

(821,217)

(406,136)

(359,444)

6,152,363

4,961,873

2,920,037

2,725,534

3,025,897

838

—

2,195,774

2,044,305

6,811

—

1,134,594

1,571,971

9,383

—

(816,476)

(402,654)

(358,102)

4,935,793

1,216,570

3,844,236

2,357,846

1,117,637

562,191

433,418

185,596

191,993

22,947

833,954

382,616

881

146,607

236,890

89,153

416,281

178,005

174,696

—

768,982

348,655

2,021

132,658

218,018

82,233

214,470

96,647

57,379

—

368,496

193,695

9,507

65,437

137,765

51,538

147,737

135,785

86,227

1.83

1.82

1.73

1.72

1.60

1.58

80,731

81,390

78,508

79,012

54,021

54,416

c o N d e N s e d c o N s o l i d a t e d s t a t e m e N t s o f c a s h f l o w s

r e p o r t o f i N d e p e N d e N t r e g i s t e r e d p u b l i c a c c o u N t i N g f i r m

Year Ended September 30

Dollars in thousands

Cash Flows from Operating Activities

Net income

Adjustments to reconcile net income to net cash

provided by operating activities:

Gain on sales of assets
Impairment of long-lived assets
Depreciation and amortization:

Charged to depreciation and amortization
Charged to other accounts

Deferred income taxes
Other

Changes in assets and liabilities

Net cash provided by operating activities

Cash Flows Used in Investing Activities

Capital expenditures
Acquisitions, net of cash received
Other, net
Proceeds from sales of assets

Net cash used in investing activities

Cash Flows from Financing Activities

Net increase (decrease) in short-term debt
Net proceeds from issuance of long-term debt
Settlement of Treasury lock agreements
Repayment of long-term debt
Cash dividends paid
Issuance of common stock
Net proceeds from equity offering

Net cash provided by ﬁnancing activities
Net increase (decrease) in cash and cash equivalents

Cash and cash equivalents at beginning of year

Cash and cash equivalents at end of year

–

2 0 0 6

2 0 0 5

2 0 0 4

147,737

135,785

86,227

—

22,947

—

185,596

178,005

371

86,178

18,480

(149,860)

311,449

791

12,669

11,522

48,172

(6,700)

—

96,647

1,465

36,997

(1,772)

57,870

386,944

270,734

(425,324)

(333,183)

(190,285)

—

(1,916,696)

(5,767)

—

(2,131)

—

(1,957)

(570)

27,919

(431,091)

(2,252,010)

(164,893)

237,607

144,809

(118,595)

—

(3,264)

(102,275)

23,273

—

1,385,847

(43,770)

(103,425)

(98,978)

37,183

381,584

155,341

1,703,250

35,699

40,116

(161,816)

201,932

5,000

—

(9,713)

(66,736)

34,715

235,737

80,408

186,249

15,683

75,815

40,116

201,932

The Board of Directors
Atmos Energy Corporation

We have audited, in accordance with the

standards of the Public Company Accounting
Oversight Board (United States), the
consolidated balance sheets of Atmos Energy
Corporation at September 30, 2006 and
2005, and the related consolidated statements
of income, shareholders’ equity, and cash
flows for each of the three years in the period
ended September 30, 2006 (not presented
herein); and in our report dated November 20,
2006, we expressed an unqualiﬁed opinion
on those consolidated ﬁnancial statements.

In our opinion, the information set forth in

the accompanying condensed consolidated
ﬁnancial statements is fairly stated, in all material
respects, in relation to the consolidated ﬁnancial
statements from which it has been derived.

Dallas, Texas
November 20, 2006

c o N s o l i d a t e d f i N a N c i a l a N d s t a t i s t i c a l s u m m a r y ( 2 0 0 2 - 2 0 0 6 )

f o r w a r d - l o o K i N g s t a t e m e N t s

The matters discussed or incorporated by
reference in this Summary Annual Report may
contain “forward-looking statements” within
the meaning of Section 27A of the Securities Act
of 1933 and Section 21E of the Securities
Exchange Act of 1934. All statements other than
statements of historical fact included in this
report are forward-looking statements made in
good faith by the Company and are intended
to qualify for the safe harbor from liability
established by the Private Securities Litigation
Reform Act of 1995. When used in this report
or any other of the Company’s documents or
oral presentations, the words “anticipate,”
“believe,” “estimate,” “expect,” “forecast,” “goal,”
“intend,” “objective,” “plan,” “projection,”
“seek,” “strategy” or similar words are intended
to identify forward-looking statements. Such
forward-looking statements are subject to risks
and uncertainties that could cause actual
results to differ materially from those discussed
in this report. These risks and uncertainties are
discussed in the Company’s Form 10-K for the
ﬁscal year ended September 30, 2006. Although
the Company believes these forward-looking
statements to be reasonable, there can be
no assurance that they will approximate actual
experience or that the expectations derived
from them will be realized. Further, the Company
undertakes no obligation to update or revise
any of its forward-looking statements, whether
as a result of new information, future events
or otherwise.

–

Year Ended September 30

Balance Sheet Data at September 30 (000s)
Capital expenditures
Net property, plant and equipment
Working capital
Total assets
Shareholders’ equity
Long-term debt, excluding current maturities
Total capitalization

Income Statement Data
Operating revenues (000s)
Gross proﬁt (000s)
Net income (000s)
Net income per diluted share

Common Stock Data
Shares outstanding (000s)

End of year
Weighted average

Cash dividends per share
Shareholders of record
Market price – High
Low
End of year

Book value per share at end of year
Price/Earnings ratio at end of year
Market/Book ratio at end of year
Annualized dividend yield at end of year

Customers and Volumes (as metered)
Consolidated utility gas sales volumes (MMcf)
Consolidated utility gas transportation

volumes (MMcf)
Consolidated utility throughput (MMcf)

Consolidated natural gas marketing

throughput (MMcf)

Consolidated pipeline transportation

volumes (MMcf)

Meters in service at end of year
Heating degree days*
Degree days as a percentage of normal
Utility average cost of gas per Mcf sold
Utility average transportation fee per Mcf

Statistics
Return on average shareholders’ equity
Number of employees
Net utility plant per meter
Utility operation and maintenance

expense per meter

Meters per employee – utility
Times interest earned before income taxes

2 0 0 6

2 0 0 5

2 0 0 4

2 0 0 3

2 0 0 2

425,324
3,629,156
(1,616)
5,719,547
1,648,098
2,180,362
3,828,460

333,183
3,374,367
151,675
5,653,527
1,602,422
2,183,104
3,785,526

190,285
1,722,521
283,310
2,912,627
1,133,459
861,311
1,994,770

159,439
1,624,394
16,248
2,625,495
857,517
862,500
1,720,017

132,252
1,380,070
(139,150)
2,059,631
573,235
668,959
1,242,194

$ 6,152,363
1,216,570
147,737
1.82

$ 4,961,873
1,117,637
135,785
1.72

$ 2,920,037
562,191
86,227
1.58

$ 2,799,916
534,976
71,688
1.54

$ 1,650,964
431,140
59,656
1.45

$
$
$
$

$
$

81,740
81,390
1.26
24,690
29.11
25.79
28.55
20.16
15.69
1.42
4.4%

$
$
$
$

80,539
79,012
1.24
26,242
29.76
24.85
28.25
19.90
16.42
1.42
4.4%

$
$
$
$

62,800
54,416
1.22
27,555
26.86
23.68
25.19
18.05
15.94
1.40
4.8%

$
$
$
$

51,476
46,496
1.20
28,510
25.45
20.70
23.94
16.66
15.55
1.44
5.0%

$
$
$
$

41,676
41,250
1.18
28,829
24.46
18.37
21.50
13.75
14.83
1.56

5.5%

272,033

296,283

173,219

184,512

145,488

121,962
393,995

114,851
411,134

72,814
246,033

63,453
247,965

63,053
208,541

283,962

238,097

222,572

225,961

204,027

420,217
3,181,199
2,527

383,377
3,157,840
2,587

—
1,679,136
3,271

—
1,672,798
3,473

—
1,389,341
3,368

87%

10.02
.49

8.9%

4,632
969

112
723
2.55

$
$

89%

7.41
.49

$
$

96%

6.55
.36

$
$

101%
5.76
.43

$
$

9.0%

4,543
927

110
730
2.59

9.1%

2,864
994

116
612
3.05

9.9%

2,905
930

115
594
2.75

94%

3.87
.41

9.9%

2,338
939

101
616
2.55

*Heating degree days are adjusted for service areas with weather-normalized operations.

a t m o s e N e r g y o f f i c e r s

b o a r d o f d i r e c t o r s

s e N i o r m a N a g e m e N t t e a m

u t i l i t y d i V i s i o N s

robert w. best
Chairman, President and
Chief Executive Officer

J. patrick reddy
Senior Vice President and
Chief Financial Officer

Kim r. cocklin
Senior Vice President,
Utility Operations

mark h. Johnson
Senior Vice President,
Nonutility Operations

louis p. gregory
Senior Vice President and
General Counsel

wynn d. mcgregor
Senior Vice President,
Human Resources

3 0

–

J. Kevin akers
President,
Mississippi Division

richard a. erskine
President,
Mid-Tex Division
President,
Atmos Pipeline–Texas Division

gary w. gregory
President,
West Texas Division

tom s. hawkins, Jr.
President,
Louisiana Division

John a. paris
President,
Kentucky and
Mid-States Division

gary l. schlessman
President,
Colorado-Kansas Division

N o N u t i l i t y o p e r a t i o N s

mark h. Johnson
President,
Atmos Energy Marketing, LLC

ronald w. mcdowell
Vice President,
New Business Ventures

s h a r e d s e r V i c e s

Verlon r. aston, Jr.
Vice President,
Governmental and
Public Affairs

cindy a. foor
Vice President,
Corporate Communications

susan Kappes giles
Vice President,
Investor Relations

conrad e. gruber
Vice President,
Strategic Planning

dwala J. Kuhn
Corporate Secretary

fred e. meisenheimer
Vice President and Controller

laurie m. sherwood
Vice President,
Corporate Development,
and Treasurer

travis w. bain ii
Chairman, Texas Custom Pools, Inc.
Plano, Texas
Board member since 1988
Committees: Work Session/Annual Meeting
(Chairman), Audit, Human Resources

robert w. best
Chairman, President and Chief Executive Officer
Atmos Energy Corporation
Dallas, Texas
Board member since 1997
Committee: Executive

dan busbee
Adjunct Professor, Dedman School of Law,
Southern Methodist University
Dallas, Texas
Board member since 1988
Committees: Audit (Chairman),
Human Resources

richard w. cardin
Retired partner of Arthur Andersen LLP
Nashville, Tennessee
Board member since 1997
Committees: Audit, Nominating and
Corporate Governance

thomas J. garland
Chairman of the Tusculum Institute
for Public Leadership and Policy
Greeneville, Tennessee
Board member since 1997
Committees: Human Resources,
Work Session/Annual Meeting

richard K. gordon
General Partner, Juniper Energy LP,
Juniper Capital LP and Juniper Advisory LP
Houston, Texas
Board member since 2001
Committees: Human Resources, Nominating
and Corporate Governance

gene c. Koonce
Retired Chairman of the Board, President and
Chief Executive Officer, United Cities Gas Company
Nashville, Tennessee
Board member since 1997
Committees: Human Resources (Chairman),
Executive, Work Session/Annual Meeting

dr. thomas c. meredith
Commissioner of Mississippi Institutions
of Higher Learning
Jackson, Mississippi
Board member since 1995
Committees: Audit, Nominating and
Corporate Governance

phillip e. Nichol
Retired Senior Vice President of Central Division Staff
UBS PaineWebber Incorporated
Dallas, Texas
Board member since 1985
Committees: Nominating and Corporate Governance
(Chairman), Human Resources, Work Session/
Annual Meeting

Nancy K. Quinn
Principal, Hanover Capital, LLC
East Hampton, New York
Board member since 2004
Committees: Audit, Nominating and
Corporate Governance

stephen r. springer
Retired Senior Vice President and
General Manager, Mid-Stream Division
The Williams Companies, Inc.
Syracuse, Indiana
Board member since 2005
Committee: Work Session/Annual Meeting

charles K. Vaughan
Retired Chairman of the Board
Atmos Energy Corporation
Dallas, Texas
Board member since 1983
Committee: Executive (Chairman)

richard ware ii
President, Amarillo National Bank
Amarillo, Texas
Board member since 1994
Committees: Nominating and Corporate
Governance, Work Session/Annual Meeting

lee e. schlessman
Honorary Director
President, Dolo Investment Company
Denver, Colorado
Retired from Board in 1998

c o r p o r a t e i N f o r m a t i o N

c o m m o N s t o c K l i s t i N g

a N N u a l m e e t i N g o f s h a r e h o l d e r s

New York Stock Exchange. Trading symbol: ATO

s t o c K t r a N s f e r a g e N t a N d r e g i s t r a r

American Stock Transfer and Trust Company
59 Maiden Lane
Plaza Level
New York, New York 10038
800-543-3038

To inquire about your Atmos Energy stock,
please call AST at the telephone number above.
You may use the agent’s interactive voice
response system 24 hours a day to learn about
transferring stock or to check your recent
account activity—all without the assistance of
a customer service representative. Please
have available your Atmos Energy shareholder
account number and your Social Security or
federal taxpayer ID number.

To speak to an AST customer service
representative, please call the same number
between 8 a.m. and 7 p.m. Eastern time,
Monday through Thursday, or 8 a.m. to 5 p.m.
Eastern time on Friday.

You also may send an e-mail message on

our agent’s Web site at http://www.amstock.
com. Please refer to Atmos Energy in your e-mail
and include your Atmos Energy shareholder
account number and your Social Security or
federal taxpayer ID number.

i N d e p e N d e N t r e g i s t e r e d p u b l i c a c c o u N t i N g f i r m

Ernst & Young LLP
2100 Ross Avenue, Suite 1500
Dallas, Texas 75201
214-969-8000

f o r m 1 0 - K

Atmos Energy Corporation’s Annual Report
on Form 10-K is available at no charge
from Shareholder Relations, Atmos Energy
Corporation, P.O. Box 650205, Dallas, Texas
75265-0205 or by calling 972-855-3729 between
8 a.m. and 5 p.m. Central time. Atmos Energy’s
Form 10-K also may be viewed on Atmos Energy’s
Web site at http://www.atmosenergy.com.

The 2007 Annual Meeting of Shareholders will
be held in the Symphony Ballroom at the
Loews Vanderbilt Hotel, 2100 West End Avenue,
Nashville, Tennessee 37203 on Wednesday,
February 7, 2007, at 11 a.m. Central time.

d i r e c t s t o c K p u r c h a s e p l a N

Atmos Energy Corporation has a Direct Stock
Purchase Plan that is available to all investors.
For an Enrollment Application Form and a Plan
Prospectus, please call AST at 800-543-3038.
The Prospectus is also available on the Internet
at http://www.atmosenergy.com. You may also
obtain information by writing to Shareholder
Relations, Atmos Energy Corporation,
P.O. Box 650205, Dallas, Texas 75265-0205.

This is not an offer to sell, or a solicitation

to buy, any securities of Atmos Energy
Corporation. Shares of Atmos Energy common
stock purchased through the Direct Stock
Purchase Plan will be offered only by Prospectus.

a t m o s e N e r g y o N t h e i N t e r N e t

Information about Atmos Energy is available on
the Internet at http://www.atmosenergy.com.
Our Web site includes news releases, current and
historical ﬁnancial reports, other investor data,
corporate governance documents, management
biographies, customer information and facts
about Atmos Energy’s operations.

a t m o s e N e r g y c o r p o r a t i o N c o N t a c t s

To contact Atmos Energy’s Shareholder
Relations, call 972-855-3729 between 8 a.m.
and 5 p.m. Central time or send an e-mail
message to InvestorRelations@atmosenergy.com.

Securities analysts and investment managers,
please contact:

Susan Kappes Giles
Vice President, Investor Relations
972-855-3729 972-855-3040 (fax)
InvestorRelations@atmosenergy.com

–

3 3

You can view this Summary Annual Report, our
Annual Report on Form 10-K and other ﬁnancial
documents for ﬁscal 2006 and previous years
on our Web site at www.atmosenergy.com.

If you are a shareholder who would like to

receive our Summary Annual Report and other
company documents in the future electronically,
please sign up for electronic distribution.
It’s convenient and easy and will save costs in
producing and distributing these materials.

To receive these documents over the Internet

next year, please visit www.amstock.com and
access your account to give your consent. Please
remember that accessing the Summary Annual
Report and other company documents over the
Internet may result in charges to you from your
Internet service provider or telephone company.

Cover: Atmos Energy has changed in size and technology since its origins in the horse-and-wagon era a century ago.
However, its mission of service remains as central as ever, as represented by Operations Manager Lou Ann Goldie,
General Plant Operator Jerry Christensen, Human Resources Analyst Amy Kuan and Operations Supervisor Roy Moss.

Atmos Energy Corporation P.O. Box 650205 Dallas, Texas 75265-0205 www.atmosenergy.com 972-934-9227