Atmos Energy 2001 Annual Report Download - page 10

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4
In April, we acquired the remaining 55 percent of Woodward Marketing, L.L.C.,
that we did not already own, giving us full ownership of Woodward Marketing. J. D.
Woodward, Woodward Marketing’s founder, now heads Atmos Energy Holdings, the
holding company for all of Atmos’ nonutility operations.
Atmos Energy Holdings includes Atmos Energy Marketing, which provides bundled
and unbundled gas services to Atmos, municipalities and industrial customers through
Woodward Marketing and Trans Louisiana Industrial Gas Company; Atmos Pipeline
and Storage, which owns, has interests in and manages gas storage fields and
intra-
state gas pipelines; Atmos Power Systems, Inc., a new venture that builds and
leases
small electric power plants; and an indirect equity interest in Heritage Propane
Partners,
the country’s fourth-largest propane marketer.
Woodward Marketing’s business is marketing and trading natural gas and providing
overall management of gas-supply requirements for customers in 17 states. In a 2000
gas-marketing survey, it was rated the No. 1 mid-tier and industrial gas marketer in the
U.S. Its customers are extremely loyal because of its reputation for providing exceptional
customer service.
In 2001, Woodward Marketing acquired two Kentucky-based natural gas marketing
companies, adding about 50 million cubic feet (MMcf) per day of nonutility gas sales.
We estimate that Atmos Energy Holdings has the ability to increase its earnings by
10 percent to 15 percent annually. In turn, its growth should help Atmos’ consolidated
returns achieve an annual average growth rate in earnings per share of 5 percent to
7 percent, including acquisitions.
Adding nonutility ventures
In July, Atmos Pipeline and Storage agreed to acquire a Kentucky-based gas storage
field and associated pipeline facilities; it completed the transaction in November 2001.
Including these new storage assets, Atmos Pipeline and Storage owns or manages more
than 6 Bcf of working gas storage. It provides gas storage services to Atmos, municipal-
ities and industrial customers.
Atmos’ newest nonutility venture, Atmos Power Systems, completed its first project
in June, a 20-megawatt power plant in Bolivar, Tennessee. The plant is being leased by
the City of Bolivar’s municipal electric department to supply electricity to the Tennessee
Valley Authority during periods of peak demand.