Basis of Presentation. The condensed consolidated financial statements of the Company and Southwest Gas included herein have been prepared pursuant to the rules and regulations of the SEC. The year-end 2025 consolidated balance sheet data was derived from audited financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations.

The preparation of the condensed consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities, as of the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. In the opinion of management, all adjustments, consisting of normal recurring items and estimates necessary for a fair statement of results for the interim periods, have been made.

Discontinued Operations. On August 11, 2025, the Company completed a secondary public offering and a concurrent private placement transaction with Icahn investment entities. These transactions resulted in the sale of a combined total of 18,823,500 shares of Centuri common stock previously held by the Company. Following the completion of these transactions, the Company no longer maintained a controlling financial interest in Centuri. Accordingly, Centuri’s assets, liabilities, and results of operations are no longer included in the Company’s condensed consolidated financial statements.

In addition, the sale of Centuri, which comprised the Company’s Utility Infrastructure Services segment, represented a strategic shift that had a significant impact on the Company’s operations and financial results. Therefore, Centuri met the criteria to be reported as discontinued operations in accordance with U.S. GAAP. The results of discontinued operations are aggregated and presented separately in the Condensed Consolidated Statements of Income and Condensed Consolidated Statements of Cash Flows for all periods presented. Unless otherwise noted, the financial disclosures and related information provided herein relate to our continuing operations, which exclude our former Utility Infrastructure Services segment, and prior period amounts have been recast to reflect discontinued operations.

Segment Information. The Company’s and Southwest Gas’ CEO and President has been identified as the CODM for each company respectively. The CODM reviews the Company’s income (loss) from continuing operations and Southwest Gas’ net income as reported on their respective condensed consolidated statements of income in assessing performance and allocating resources. The CODM considers budget-to-actual variances against these metrics when making decisions about allocating capital and personnel. The CODM also uses income (loss) from continuing operations and net income to assess the return on assets, margin earned, and in assessing the compensation of certain employees.

Because both the Company and Southwest Gas operate as a single reportable segment, the related disclosure information is presented in the applicable sections. The other significant amounts required for disclosure are included within income (loss) from continuing operations and net income. Revenues from external customers are reported as “Revenues from contracts with customers” in Note 3 – Revenues for the three months and six months ended June 30, 2026, and June 30, 2025. Capital expenditures for the three-months ended June 30, 2026 and June 30, 2025 were $320.4 million and $199.3 million, respectively, and for the six-months ended June 30, 2026 and June 30, 2025 were $529.1 million and $362.5 million, respectively. The measures of assets for the Company and Southwest Gas are reported as “Total assets” on their respective condensed consolidated balance sheets.

These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto of Southwest Gas and the Company included in our 2025 Annual Report on Form 10-K for the fiscal year ended December 31, 2025.


(Thousands of dollars)	June 30, 2026		December 31, 2025
Net cash surrender value of COLI policies	$	168,916	$	165,551
Other property	2,274		4,396
Total Southwest Gas Corporation	171,190		169,947
Other property and investments	10,216		8,879
Total Southwest Gas Holdings, Inc.	$	181,406	$	178,826

Materials, supplies, and gas inventories. Materials, supplies, and gas inventories for Southwest Gas and the Company includes gas pipe materials and operating supplies of $80.6 million and $78.1 million as of June 30, 2026 and December 31, 2025, respectively (carried at weighted average cost).

Prepaid and other current assets. Prepaid and other current assets for the Company and Southwest Gas include, among other things, $125.2 million and $91.1 million related to a regulatory asset associated with the Arizona decoupling mechanism as of June 30, 2026 and December 31, 2025, respectively, and a regulatory asset associated with the margin tracker for Southern Nevada of $46.1 million and $28.5 million as of June 30, 2026 and December 31, 2025, respectively.

Regulatory Operations - Following CPUC approval of the All-Party Settlement and interim rates effective July 1, 2026, Southwest Gas recognized $20.2 million of operating revenue in the second quarter of 2026 related to the period from January 1, 2026 through June 30, 2026. Southwest Gas continues to await a final CPUC decision on cost of capital, which is expected in the third quarter of 2026.

Deferred charges and other assets. Deferred charges and other assets for Southwest Gas and the Company include, among other things, cloud-based software of $42.7 million and $33.9 million as of June 30, 2026 and December 31, 2025, respectively, and a regulatory asset associated with pension for Arizona, Nevada and California of $266.2 million as of June 30, 2026 and for Arizona and Nevada of $246.4 million as of December 31, 2025, respectively.

Accrued general taxes. Accrued general taxes for the Company and Southwest Gas include, among other things, $30.7 million and $27.1 million related to property taxes accrued as of June 30, 2026 and December 31, 2025.

Other Income (Deductions). The following table provides the composition of significant items included in Other income (deductions) in Southwest Gas’ and the Company’s Condensed Consolidated Statements of Income:


	Three Months Ended June 30,				Six Months Ended June 30,
(Thousands of dollars)	2026		2025		2026		2025
Southwest Gas Corporation:
Change in COLI policies	$	3,600	$	5,500	$	3,300	$	3,800
Interest income	3,077		5,817		5,731		11,627
Equity AFUDC	2,449		1,558		4,482		2,911
Other components of net periodic benefit gain	2,195		4,368		4,390		8,737
Miscellaneous income and (expense)	(2,901)		563		(3,768)		33
Southwest Gas Corporation - total other income (deductions)	8,420		17,806		14,135		27,108
Southwest Gas Holdings, Inc.:
Interest income	3,010		329		7,140		364
Equity in earnings (loss) of unconsolidated investments	(97)		—		1,097		—
Miscellaneous income and (expense)	(38)		(67)		(86)		(209)
Southwest Gas Holdings, Inc. – total other income (deductions)	$	11,295	$	18,068	$	22,286	$	27,263

Interest income for Southwest Gas relates to interest income earned on money market investments and interest income earned on Southwest Gas’ regulatory asset balances, including the Arizona decoupling mechanism. Interest income is earned on regulatory asset balances and interest expense is incurred on regulatory liability balances. Interest income for Southwest Gas Holdings, Inc. relates to interest income earned on money market investments. Refer also to Note 5 – Components of Net Periodic Benefit Cost for details regarding Other components of net periodic benefit cost.

EPS. Basic EPS in each period of this report were calculated by dividing net income attributable to the Company by the weighted-average number of shares during those periods. Diluted EPS includes additional weighted-average common stock equivalents (performance stock units and restricted stock units). Unless otherwise noted, the term EPS refers to Basic EPS. A reconciliation of the denominator used in Basic and Diluted EPS calculations is shown in the following table:


	Three Months Ended June 30,		Six Months Ended June 30,
(In thousands)	2026	2025	2026	2025
Weighted average basic shares	72,516	72,088	72,479	72,050
Effect of dilutive securities:
Restricted stock units (1)(2)	149	—	138	145
Weighted average diluted shares	72,665	72,088	72,617	72,195

(1) The number of securities included 136,000 performance stock units during the three months ended June 30, 2026. During the six months ended June 30, 2026 and June 30, 2025, respectively, the number of securities included 121,000 and 124,000 performance stock units, the total of which was derived by assuming that target performance will be achieved during the relevant performance period.

(2) The number of anti-dilutive restricted stock units excluded from the calculation of diluted shares during the three months ended June 30, 2025 is 161,000. The number of anti-dilutive restricted stock units excluded from the calculation of diluted shares on discontinued operations during the six months ended June 30, 2025 is 145,000.

Income Taxes. The Company’s effective tax rate was 18.3% for the three months ended June 30, 2026, compared to 102.5% for the corresponding period in 2025. The lower effective tax rate was primarily due to a state income tax expense recognized in the prior year’s quarter related to a change in state apportionment rates that did not reoccur in the current quarter. This was partially offset by lower amortization of excess deferred income taxes. The Company’s effective tax rate was 23.6% for the six months ended June 30, 2026, compared to 32.4% for the corresponding period in 2025, primarily due to a state income tax expense recognized in the prior year’s period related to a change in state apportionment rates that did not reoccur in the current period. This was partially offset by lower amortization of excess deferred income taxes and lower nondeductible executive compensation in the current period when compared to the prior year’s period.

Southwest Gas’ effective tax rate was 18.1% for the three months ended June 30, 2026, compared to (18.8)% for the corresponding period in 2025. The higher effective tax rate was primarily due to a state income tax benefit recognized in the prior year’s quarter related to a change in state apportionment rates that did not reoccur in current quarter and lower amortization of excess deferred income taxes. Southwest Gas’ effective tax rate was 22.6% for the six months ended June 30, 2026, compared to 14.5% in the corresponding period in 2025 primarily due to a state income tax benefit recognized in the prior year’s period related to a change in state apportionment rates that did not reoccur in the current period. In addition, there were lower amortization of excess accumulated deferred income taxes and nondeductible executive compensation in the current period when compared to the prior year’s period.

In November 2024, the FASB issued ASU 2024-03 “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses.” The update requires disclosure of disaggregated information about certain income statement expense line items in the notes to the financial statements. The update is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027; early adoption is permitted. The update should be applied prospectively; however, retrospective application is also permitted. Management is evaluating the impacts this update might have on the Company’s and Southwest Gas’ disclosures.

In September 2025, the FASB issued ASU 2025-06 “Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software.” The update improves the operability of the guidance by removing all references to software development project stages so that the guidance is neutral to different software development methods. The update is effective for annual periods beginning after December 15, 2027, including interim periods within those fiscal years; early adoption is permitted. Management is evaluating the impacts this update might have on the Company’s and Southwest Gas’ condensed consolidated financial statements.

In May 2026, the FASB issued ASU 2026-02, “Environmental Credits and Environmental Credit Obligations (Topic 818).” The update provides guidance for the recognition, measurement, presentation, and disclosure of environmental credits and environmental credit obligations. The update is effective for annual reporting periods beginning after December 15, 2027, including interim periods within those fiscal years; early adoption is permitted. The update should be applied on a retrospective basis through a cumulative-effect adjustment to the opening balance of retained earnings (or other appropriate components of equity or net assets) as of the beginning of the annual reporting period of adoption. Management is evaluating the impacts this update might have on the Company’s and Southwest Gas’ condensed consolidated financial statements.