Delaware | 1-4174 | 73-0569878 |
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
One Williams Center | ||
Tulsa | Oklahoma | 74172-0172 |
(Address of principal executive offices) | (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Common Stock, $1.00 par value | WMB | New York Stock Exchange |
Emerging growth company | ☐ |
(a) | None |
(b) | None |
(c) | None |
(d) | Exhibits. |
THE WILLIAMS COMPANIES, INC. | |||
Dated: | July 31, 2019 | By: | /s/ JOHN D. CHANDLER |
John D. Chandler | |||
Senior Vice President and Chief Financial Officer |
News Release | Williams (NYSE: WMB) One Williams Center Tulsa, OK 74172 800-Williams www.williams.com | ![]() |
MEDIA CONTACT: | INVESTOR CONTACTS: | ||
Keith Isbell (918) 573-7308 | John Porter (918) 573-0797 | Grace Scott (918) 573-1092 |
• | Net Income Attributable to Williams available to common stockholders of $310 million; up $175 million or 130%; Year-to-Date ("YTD") up $217 million or 76% |
• | Net Income Per Share of $0.26; up 63%; Adjusted Income Per Share of $0.26; up 53% |
• | Cash Flow From Operations of $1.069 billion; up $178 million or 20%; YTD up $259 million or 16% |
• | Adjusted EBITDA of $1.241 billion; up $131 million or 12%; YTD up $212 million or 9% |
• | Distributable Cash Flow ("DCF") of $867 million; up $230 million or 36%; YTD up $287 million or 21% |
• | Dividend Coverage Ratio is 1.88x |
• | Completed formation of joint venture with Canada Pension Plan Investment Board ("CPPIB"); received $1.33 billion from CPPIB in exchange for 35% interest in new Northeast JV |
• | Completed sale of our 50% interest in Jackalope Gas Gathering Services, LLC to an affiliate of Crestwood Equity Partners L.P. for $485 million |
• | Debt (Net of Cash) to Adjusted EBITDA at Quarter End: 4.43x |
• | Northeast G&P segment up 19% in Modified EBITDA and 25% in Adjusted EBITDA 2Q 2019 vs. 2Q 2018 |
• | Atlantic-Gulf segment up 10% in Modified EBITDA and 23% in Adjusted EBITDA 2Q 2019 vs. 2Q 2018 |
• | Norphlet Deepwater-Gulf project placed in service; first gas delivery on June 22; increasing volumes at Mobile Bay processing facility |
• | Gathering volumes on operated assets up 11% 2Q 2019 vs. 2Q 2018 |
Williams Summary Financial Information | 2Q | YTD | |||||||||||
Amounts in millions, except ratios and per-share amounts. Per share amounts are reported on a diluted basis. Net income (loss) amounts are attributable to The Williams Companies, Inc. available to common stockholders. | 2019 | 2018 | 2019 | 2018 | |||||||||
GAAP Measures | |||||||||||||
Net Income | $310 | $135 | $504 | $287 | |||||||||
Net Income Per Share | $0.26 | $0.16 | $0.41 | $0.35 | |||||||||
Cash Flow From Operations | $1,069 | $891 | $1,844 | $1,585 | |||||||||
Non-GAAP Measures (1) | |||||||||||||
Adjusted EBITDA | $1,241 | $1,110 | $2,457 | $2,245 | |||||||||
Adjusted Income | $313 | $143 | $586 | $302 | |||||||||
Adjusted Income Per Share | $0.26 | $0.17 | $0.48 | $0.36 | |||||||||
Distributable Cash Flow | $867 | $637 | $1,647 | $1,360 | |||||||||
Dividend Coverage Ratio | 1.88 | x | 1.44 | x | 1.79 | x | 1.54 | x | |||||
Other | |||||||||||||
Debt-to-Adjusted EBITDA at Quarter End (2) | 4.43 | x | 4.66 | x | |||||||||
Capital Investments (3)(4) | $702 | $1,000 | $1,219 | $1,955 | |||||||||
(1) Schedules reconciling adjusted income from continuing operations, adjusted EBITDA, Distributable Cash Flow and Coverage Ratio (non-GAAP measures) to the most comparable GAAP measure are available at www.williams.com and as an attachment to this news release. | |||||||||||||
(2) Debt-to-Adjusted EBITDA ratio does not represent leverage ratios measured for WMB credit agreement compliance or leverage ratios as calculated by the major credit ratings agencies. Debt is net of cash on hand, and Adjusted EBITDA reflects the sum of the last four quarters. | |||||||||||||
(3) Capital Investments includes increases to property, plant, and equipment, purchases of businesses, net of cash acquired, and purchases of and contributions to equity-method investments. | |||||||||||||
(4) YTD 2019 excludes $727 million (net of cash acquired) for the purchase of the remaining 38% of UEO as this amount was provided for at the close of the new Northeast JV by our JV partners, CPPIB, in June 2019. |
• | Second-quarter 2019 Net Income benefited from increased service revenues in the Atlantic-Gulf segment primarily from Transco expansion projects and in the Northeast G&P segment driven by growth in gathering volumes, partially offset by a decline in the West segment results due to lower commodity margins and the absence of the former Four Corners area business sold in fourth-quarter 2018. The current year benefited from a $122 million gain on the sale of our 50 percent interest in Jackalope, partially offset by the absence of a $62 million gain in the prior year associated with the deconsolidation of that Jackalope interest. Asset impairments in the current year were substantially offset by similar levels of impairments in the prior year. Second-quarter 2019 also includes $43 million of estimated employee severance and related costs. The estimated severance costs are primarily associated with a voluntary separation program announced in anticipation of our pending organizational realignment and considering our ongoing evaluation of cost structure. The current year also reflects higher interest expense associated with financing obligations for leased pipeline capacity and higher provision for income taxes driven by higher pre-tax income. Net Income also reflects less income attributable to noncontrolling interests driven by the WPZ merger in the third-quarter 2018. |
• | Year-to-date 2019 Net Income benefited from increased service revenues in the Atlantic-Gulf segment primarily from Transco expansion projects and in the Northeast G&P segment driven by growth in volumes, partially offset by a decline in West segment results due to lower commodity margins and the |
• | The increase in Cash Flow From Operations for second-quarter and year-to-date 2019 periods was largely driven by the increased service revenues in the Atlantic-Gulf and Northeast G&P segments, the collection of Transco's filed rates subject to refund, and the receipt of an income tax refund, partially offset by the decline in West segment results. |
• | The increase in Adjusted EBITDA for second-quarter 2019 and year-to-date 2019 largely reflects the previously mentioned increased service revenues in the Atlantic-Gulf and Northeast G&P segments, partially offset by the decline in West segment results. |
• | Adjusted Income for both the quarter and year-to-date periods also improved, driven by the higher Adjusted EBITDA and less income attributable to noncontrolling interests, partially offset by higher interest expense and provision for income taxes. |
• | Second-quarter and year-to-date 2019 DCF are higher, reflecting the increased Adjusted EBITDA, an income tax refund received in 2019, and lower maintenance capital, partially offset by higher net interest expense. |
Quarter-To-Date | Year-To-Date | ||||||||||||||||||||||||||||||||||||||
Amounts in millions | Modified EBITDA | Adjusted EBITDA | Modified EBITDA | Adjusted EBITDA | |||||||||||||||||||||||||||||||||||
2Q 2019 | 2Q 2018 | Change | 2Q 2019 | 2Q 2018 | Change | 2019 | 2018 | Change | 2019 | 2018 | Change | ||||||||||||||||||||||||||||
Atlantic-Gulf | $524 | $475 | $49 | $559 | $456 | $103 | $1,084 | $926 | $158 | $1,119 | $922 | $197 | |||||||||||||||||||||||||||
West | 278 | 389 | (111 | ) | 356 | 389 | (33 | ) | 610 | 802 | (192 | ) | 702 | 795 | (93 | ) | |||||||||||||||||||||||
Northeast G&P | 303 | 255 | 48 | 319 | 255 | 64 | 602 | 505 | 97 | 621 | 505 | 116 | |||||||||||||||||||||||||||
Other | 7 | (61 | ) | 68 | 7 | 10 | (3 | ) | 3 | (55 | ) | 58 | 15 | 23 | (8 | ) | |||||||||||||||||||||||
Totals | $1,112 | $1,058 | $54 | $1,241 | $1,110 | $131 | $2,299 | $2,178 | $121 | $2,457 | $2,245 | $212 | |||||||||||||||||||||||||||
Note: Williams uses Modified EBITDA for its segment reporting. Definitions of Modified EBITDA and Adjusted EBITDA and schedules reconciling to net income are included in this news release. |
• | Improvement in second-quarter and year-to-date 2019 Modified and Adjusted EBITDA is driven by Transco expansion projects, including Atlantic Sunrise (in service October 2018) and Gulf Connector (in service early January 2019). |
• | Unfavorable impact from a reduced allowance for equity funds used during construction due to lower levels of construction activity. |
• | Modified EBITDA was further impacted by the absence of a net favorable regulatory adjustment resulting from Tax Reform in the prior year, along with current-year charges for estimated employee severance and related costs and the reversal of expenditures capitalized in prior years, all of which are excluded from Adjusted EBITDA. |
• | Lower second-quarter and year-to-date 2019 Modified and Adjusted EBITDA reflect lower NGL margins (excluding Four Corners) driven by lower NGL prices. |
• | Additionally, both second-quarter and year-to-date results reflect the absence of EBITDA from our former Four Corners area business. |
• | Modified EBITDA for both the quarter and year-to-date 2019 periods includes asset impairment charges and estimated employee severance and related costs that are excluded from Adjusted EBITDA. |
• | Completed sale of our 50% interest in Jackalope (an equity-method investment) for $485 million in second-quarter 2019. |
• | Placed into service Ft. Lupton III processing plant expansion of 200 MMcf/d. |
• | Improvement in Modified and Adjusted EBITDA for second-quarter and year-to-date 2019 driven by increased gathering volumes in the Susquehanna Supply Hub and in the Utica Shale region and higher proportional EBITDA from investments in the Marcellus South and Bradford gas gathering systems. Modified EBITDA also includes estimated employee severance and related costs that are excluded from Adjusted EBITDA. |
• | Gross gathering volumes, including 100% of operated equity-method investments, reflect a 17% increase for second-quarter 2019 over second-quarter 2018. Year-to-date, gross gathering volumes increased 16% over the same reporting period in 2018. |
• | The consolidation of Utica East Ohio Midstream ("UEO") following our March 2019 purchase of the remaining 38% ownership stake in UEO favorably impacted both Modified and Adjusted EBITDA, driving an $11 million increase for second-quarter 2019 over second-quarter 2018. Year-to-date results reflect a $13 million favorable impact over the same reporting period in 2018 due to the consolidation of UEO. |
• | Successfully completed the formation of the new Northeast JV with CPPIB in June 2019, receiving approximately $1.33 billion from CPPIB for its 35% interest in the venture. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
(Millions, except per-share amounts) | |||||||||||||||
Revenues: | |||||||||||||||
Service revenues | $ | 1,489 | $ | 1,340 | $ | 2,929 | $ | 2,691 | |||||||
Service revenues – commodity consideration | 56 | 94 | 120 | 195 | |||||||||||
Product sales | 496 | 657 | 1,046 | 1,293 | |||||||||||
Total revenues | 2,041 | 2,091 | 4,095 | 4,179 | |||||||||||
Costs and expenses: | |||||||||||||||
Product costs | 483 | 636 | 1,008 | 1,249 | |||||||||||
Processing commodity expenses | 24 | 26 | 64 | 61 | |||||||||||
Operating and maintenance expenses | 387 | 388 | 727 | 745 | |||||||||||
Depreciation and amortization expenses | 424 | 434 | 840 | 865 | |||||||||||
Selling, general, and administrative expenses | 152 | 130 | 280 | 262 | |||||||||||
Impairment of certain assets | 64 | 66 | 76 | 66 | |||||||||||
Other (income) expense – net | 9 | 1 | 41 | 30 | |||||||||||
Total costs and expenses | 1,543 | 1,681 | 3,036 | 3,278 | |||||||||||
Operating income (loss) | 498 | 410 | 1,059 | 901 | |||||||||||
Equity earnings (losses) | 87 | 92 | 167 | 174 | |||||||||||
Other investing income (loss) – net | 126 | 68 | 53 | 72 | |||||||||||
Interest incurred | (306 | ) | (288 | ) | (612 | ) | (570 | ) | |||||||
Interest capitalized | 10 | 13 | 20 | 22 | |||||||||||
Other income (expense) – net | 7 | 26 | 18 | 47 | |||||||||||
Income (loss) before income taxes | 422 | 321 | 705 | 646 | |||||||||||
Provision (benefit) for income taxes | 98 | 52 | 167 | 107 | |||||||||||
Net income (loss) | 324 | 269 | 538 | 539 | |||||||||||
Less: Net income (loss) attributable to noncontrolling interests | 14 | 134 | 33 | 252 | |||||||||||
Net income (loss) attributable to The Williams Companies, Inc. | 310 | 135 | 505 | 287 | |||||||||||
Preferred stock dividends | — | — | 1 | — | |||||||||||
Net income (loss) available to common stockholders | $ | 310 | $ | 135 | $ | 504 | $ | 287 | |||||||
Basic earnings (loss) per common share: | |||||||||||||||
Net income (loss) | $ | .26 | $ | .16 | $ | .42 | $ | .35 | |||||||
Weighted-average shares (thousands) | 1,212,045 | 827,868 | 1,211,769 | 827,689 | |||||||||||
Diluted earnings (loss) per common share: | |||||||||||||||
Net income (loss) | $ | .26 | $ | .16 | $ | .41 | $ | .35 | |||||||
Weighted-average shares (thousands) | 1,214,065 | 830,107 | 1,213,830 | 830,151 |
June 30, 2019 | December 31, 2018 | |||||||
(Millions, except per-share amounts) | ||||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 806 | $ | 168 | ||||
Trade accounts and other receivables (net of allowance of $6 at June 30, 2019 and $9 at December 31, 2018) | 879 | 992 | ||||||
Inventories | 134 | 130 | ||||||
Other current assets and deferred charges | 209 | 174 | ||||||
Total current assets | 2,028 | 1,464 | ||||||
Investments | 6,261 | 7,821 | ||||||
Property, plant, and equipment | 40,868 | 38,661 | ||||||
Accumulated depreciation and amortization | (11,737 | ) | (11,157 | ) | ||||
Property, plant, and equipment – net | 29,131 | 27,504 | ||||||
Intangible assets – net of accumulated amortization | 8,123 | 7,767 | ||||||
Regulatory assets, deferred charges, and other | 966 | 746 | ||||||
Total assets | $ | 46,509 | $ | 45,302 | ||||
LIABILITIES AND EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 627 | $ | 662 | ||||
Accrued liabilities | 1,199 | 1,102 | ||||||
Long-term debt due within one year | 1,563 | 47 | ||||||
Total current liabilities | 3,389 | 1,811 | ||||||
Long-term debt | 20,711 | 22,367 | ||||||
Deferred income tax liabilities | 1,567 | 1,524 | ||||||
Regulatory liabilities, deferred income, and other | 3,761 | 3,603 | ||||||
Contingent liabilities | ||||||||
Equity: | ||||||||
Stockholders’ equity: | ||||||||
Preferred stock | 35 | 35 | ||||||
Common stock ($1 par value; 1,470 million shares authorized at June 30, 2019 and December 31, 2018; 1,246 million shares issued at June 30, 2019 and 1,245 million shares issued at December 31, 2018) | 1,246 | 1,245 | ||||||
Capital in excess of par value | 24,296 | 24,693 | ||||||
Retained deficit | (10,423 | ) | (10,002 | ) | ||||
Accumulated other comprehensive income (loss) | (265 | ) | (270 | ) | ||||
Treasury stock, at cost (35 million shares of common stock) | (1,041 | ) | (1,041 | ) | ||||
Total stockholders’ equity | 13,848 | 14,660 | ||||||
Noncontrolling interests in consolidated subsidiaries | 3,233 | 1,337 | ||||||
Total equity | 17,081 | 15,997 | ||||||
Total liabilities and equity | $ | 46,509 | $ | 45,302 |
Six Months Ended June 30, | |||||||
2019 | 2018 | ||||||
(Millions) | |||||||
OPERATING ACTIVITIES: | |||||||
Net income (loss) | $ | 538 | $ | 539 | |||
Adjustments to reconcile to net cash provided (used) by operating activities: | |||||||
Depreciation and amortization | 840 | 865 | |||||
Provision (benefit) for deferred income taxes | 182 | 142 | |||||
Equity (earnings) losses | (167 | ) | (174 | ) | |||
Distributions from unconsolidated affiliates | 327 | 316 | |||||
Net (gain) loss on disposition of equity-method investments | (122 | ) | — | ||||
Impairment of equity-method investments | 72 | — | |||||
(Gain) loss on deconsolidation of businesses | 2 | (62 | ) | ||||
Impairment of certain assets | 76 | 66 | |||||
Amortization of stock-based awards | 30 | 30 | |||||
Cash provided (used) by changes in current assets and liabilities: | |||||||
Accounts and notes receivable | 149 | 121 | |||||
Inventories | 4 | (33 | ) | ||||
Other current assets and deferred charges | (16 | ) | (63 | ) | |||
Accounts payable | (98 | ) | (70 | ) | |||
Accrued liabilities | 70 | (7 | ) | ||||
Other, including changes in noncurrent assets and liabilities | (43 | ) | (85 | ) | |||
Net cash provided (used) by operating activities | 1,844 | 1,585 | |||||
FINANCING ACTIVITIES: | |||||||
Proceeds from (payments of) commercial paper – net | (4 | ) | — | ||||
Proceeds from long-term debt | 720 | 2,179 | |||||
Payments of long-term debt | (868 | ) | (1,761 | ) | |||
Proceeds from issuance of common stock | 6 | 11 | |||||
Proceeds from sale of partial interest in consolidated subsidiary | 1,330 | — | |||||
Common dividends paid | (921 | ) | (563 | ) | |||
Dividends and distributions paid to noncontrolling interests | (68 | ) | (356 | ) | |||
Contributions from noncontrolling interests | 32 | 11 | |||||
Payments for debt issuance costs | — | (18 | ) | ||||
Other – net | (9 | ) | (43 | ) | |||
Net cash provided (used) by financing activities | 218 | (540 | ) | ||||
INVESTING ACTIVITIES: | |||||||
Property, plant, and equipment: | |||||||
Capital expenditures (1) | (919 | ) | (1,890 | ) | |||
Dispositions – net | (15 | ) | 3 | ||||
Contributions in aid of construction | 18 | 339 | |||||
Purchases of businesses, net of cash acquired | (727 | ) | — | ||||
Proceeds from dispositions of equity-method investments | 485 | — | |||||
Purchases of and contributions to equity-method investments | (242 | ) | (91 | ) | |||
Other – net | (24 | ) | (30 | ) | |||
Net cash provided (used) by investing activities | (1,424 | ) | (1,669 | ) | |||
Increase (decrease) in cash and cash equivalents | 638 | (624 | ) | ||||
Cash and cash equivalents at beginning of year | 168 | 899 | |||||
Cash and cash equivalents at end of period | $ | 806 | $ | 275 | |||
_____________ | |||||||
(1) Increases to property, plant, and equipment | $ | (977 | ) | $ | (1,864 | ) | |
Changes in related accounts payable and accrued liabilities | 58 | (26 | ) | ||||
Capital expenditures | $ | (919 | ) | $ | (1,890 | ) |
Atlantic-Gulf | ||||||||||||||||||||||||||
(UNAUDITED) | ||||||||||||||||||||||||||
2018 | 2019 | |||||||||||||||||||||||||
(Dollars in millions) | 1st Qtr | 2nd Qtr | 3rd Qtr | 4th Qtr | Year | 1st Qtr | 2nd Qtr | Year | ||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||
Service revenues: | ||||||||||||||||||||||||||
Nonregulated gathering & processing fee-based revenue | $ | 138 | $ | 128 | $ | 138 | $ | 137 | $ | 541 | $ | 128 | $ | 119 | $ | 247 | ||||||||||
Regulated transportation revenue | 413 | 406 | 411 | 508 | 1,738 | 517 | 514 | 1,031 | ||||||||||||||||||
Other fee revenues | 32 | 34 | 34 | 34 | 134 | 34 | 40 | 74 | ||||||||||||||||||
Tracked service revenue | 26 | 22 | 24 | 24 | 96 | 30 | 25 | 55 | ||||||||||||||||||
Nonregulated commodity consideration | 15 | 12 | 18 | 14 | 59 | 13 | 13 | 26 | ||||||||||||||||||
Product sales: | ||||||||||||||||||||||||||
NGL sales from gas processing | 15 | 10 | 16 | 15 | 56 | 12 | 12 | 24 | ||||||||||||||||||
Marketing sales | 45 | 57 | 67 | 53 | 222 | 40 | 32 | 72 | ||||||||||||||||||
Other sales | 1 | 1 | 1 | — | 3 | 2 | 1 | 3 | ||||||||||||||||||
Tracked product sales | 32 | 37 | 47 | 38 | 154 | 28 | 23 | 51 | ||||||||||||||||||
Total revenues | 717 | 707 | 756 | 823 | 3,003 | 804 | 779 | 1,583 | ||||||||||||||||||
Segment costs and expenses: | ||||||||||||||||||||||||||
NGL cost of goods sold | 15 | 12 | 19 | 14 | 60 | 13 | 14 | 27 | ||||||||||||||||||
Marketing cost of goods sold | 44 | 56 | 67 | 53 | 220 | 41 | 28 | 69 | ||||||||||||||||||
Other cost of goods sold | — | — | — | — | — | — | 2 | 2 | ||||||||||||||||||
Tracked cost of goods sold | 33 | 38 | 48 | 39 | 158 | 28 | 25 | 53 | ||||||||||||||||||
Processing commodity expenses | 5 | 2 | 3 | 6 | 16 | 5 | 5 | 10 | ||||||||||||||||||
Operating and administrative costs | 177 | 181 | 181 | 197 | 736 | 168 | 198 | 366 | ||||||||||||||||||
Tracked operating and administrative costs | 26 | 22 | 24 | 23 | 95 | 30 | 25 | 55 | ||||||||||||||||||
Other segment costs and expenses | (2 | ) | (15 | ) | (29 | ) | 14 | (32 | ) | 1 | 2 | 3 | ||||||||||||||
Gain on sale of certain assets | — | — | — | (81 | ) | (81 | ) | — | — | — | ||||||||||||||||
Regulatory charges resulting from Tax Reform | 11 | (20 | ) | — | — | (9 | ) | — | — | — | ||||||||||||||||
Total segment costs and expenses | 309 | 276 | 313 | 265 | 1,163 | 286 | 299 | 585 | ||||||||||||||||||
Proportional Modified EBITDA of equity-method investments | 43 | 44 | 49 | 47 | 183 | 42 | 44 | 86 | ||||||||||||||||||
Modified EBITDA | 451 | 475 | 492 | 605 | 2,023 | 560 | 524 | 1,084 | ||||||||||||||||||
Adjustments | 15 | (19 | ) | (12 | ) | (76 | ) | (92 | ) | — | 35 | 35 | ||||||||||||||
Adjusted EBITDA | $ | 466 | $ | 456 | $ | 480 | $ | 529 | $ | 1,931 | $ | 560 | $ | 559 | $ | 1,119 | ||||||||||
NGL Margin | $ | 10 | $ | 8 | $ | 12 | $ | 9 | $ | 39 | $ | 7 | $ | 6 | $ | 13 | ||||||||||
Statistics for Operated Assets | ||||||||||||||||||||||||||
Gathering, Processing and Crude Oil Transportation | ||||||||||||||||||||||||||
Gathering volumes (Bcf per day) - Consolidated (1) | 0.29 | 0.23 | 0.26 | 0.24 | 0.26 | 0.25 | 0.25 | 0.25 | ||||||||||||||||||
Gathering volumes (Bcf per day) - Non-consolidated (2) | 0.24 | 0.25 | 0.25 | 0.31 | 0.26 | 0.35 | 0.38 | 0.37 | ||||||||||||||||||
Plant inlet natural gas volumes (Bcf per day) - Consolidated (1) | 0.54 | 0.43 | 0.51 | 0.53 | 0.50 | 0.53 | 0.55 | 0.54 | ||||||||||||||||||
Plant inlet natural gas volumes (Bcf per day) - Non-consolidated (2) | 0.24 | 0.25 | 0.25 | 0.32 | 0.27 | 0.35 | 0.39 | 0.37 | ||||||||||||||||||
Crude transportation volumes (Mbbls/d) | 142 | 132 | 147 | 140 | 140 | 146 | 136 | 141 | ||||||||||||||||||
Consolidated (1) | ||||||||||||||||||||||||||
Ethane margin ($/gallon) | $ | .03 | $ | .16 | $ | .24 | $ | .14 | $ | .14 | $ | .10 | $ | .02 | $ | .06 | ||||||||||
Non-ethane margin ($/gallon) | $ | .66 | $ | .74 | $ | .76 | $ | .58 | $ | .68 | $ | .48 | $ | .28 | $ | .36 | ||||||||||
NGL margin ($/gallon) | $ | .40 | $ | .48 | $ | .51 | $ | .36 | $ | .43 | $ | .26 | $ | .17 | $ | .21 | ||||||||||
Ethane equity sales (Mbbls/d) | 2.82 | 1.91 | 3.05 | 2.98 | 2.69 | 4.16 | 4.11 | 4.13 | ||||||||||||||||||
Non-ethane equity sales (Mbbls/d) | 3.87 | 2.35 | 3.14 | 3.21 | 3.14 | 3.28 | 5.34 | 4.32 | ||||||||||||||||||
NGL equity sales (Mbbls/d) | 6.69 | 4.26 | 6.19 | 6.19 | 5.83 | 7.44 | 9.45 | 8.45 | ||||||||||||||||||
Ethane production (Mbbls/d) | 12 | 12 | 15 | 16 | 14 | 17 | 14 | 15 | ||||||||||||||||||
Non-ethane production (Mbbls/d) | 19 | 17 | 18 | 19 | 18 | 19 | 19 | 19 | ||||||||||||||||||
NGL production (Mbbls/d) | 31 | 29 | 33 | 35 | 32 | 36 | 33 | 34 | ||||||||||||||||||
Non-consolidated (2) | ||||||||||||||||||||||||||
NGL equity sales (Mbbls/d) | 3 | 5 | 4 | 5 | 4 | 7 | 8 | 8 | ||||||||||||||||||
NGL production (Mbbls/d) | 18 | 20 | 20 | 23 | 20 | 24 | 27 | 25 | ||||||||||||||||||
Transcontinental Gas Pipe Line | ||||||||||||||||||||||||||
Throughput (Tbtu) | 1,099.9 | 965.5 | 1,092.3 | 1,150.9 | 4,308.5 | 1,183.9 | 1,109.4 | 2,293.3 | ||||||||||||||||||
Avg. daily transportation volumes (Tbtu) | 12.2 | 10.6 | 11.9 | 12.5 | 11.8 | 13.2 | 12.2 | 12.7 | ||||||||||||||||||
Avg. daily firm reserved capacity (Tbtu) | 15.4 | 15.0 | 15.0 | 16.4 | 15.5 | 17.1 | 17.0 | 17.1 | ||||||||||||||||||
(1) Excludes volumes associated with equity-method investments that are not consolidated in our results. | ||||||||||||||||||||||||||
(2) Includes 100% of the volumes associated with operated equity-method investments. |
West | ||||||||||||||||||||||||||
(UNAUDITED) | ||||||||||||||||||||||||||
2018 | 2019 | |||||||||||||||||||||||||
(Dollars in millions) | 1st Qtr | 2nd Qtr | 3rd Qtr | 4th Qtr | Year | 1st Qtr | 2nd Qtr | Year | ||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||
Service revenues: | ||||||||||||||||||||||||||
Nonregulated gathering & processing fee-based revenue | $ | 386 | $ | 398 | $ | 387 | $ | 335 | $ | 1,506 | $ | 319 | $ | 331 | $ | 650 | ||||||||||
Regulated transportation revenue | 109 | 104 | 106 | 110 | 429 | 110 | 104 | 214 | ||||||||||||||||||
Other fee revenues | 36 | 32 | 40 | 41 | 149 | 44 | 42 | 86 | ||||||||||||||||||
Nonregulated commodity consideration | 82 | 78 | 97 | 64 | 321 | 46 | 40 | 86 | ||||||||||||||||||
Tracked service revenues | — | 1 | — | — | 1 | — | 1 | 1 | ||||||||||||||||||
Product sales: | ||||||||||||||||||||||||||
NGL sales from gas processing | 85 | 76 | 90 | 71 | 322 | 48 | 41 | 89 | ||||||||||||||||||
Marketing sales | 419 | 465 | 615 | 571 | 2,070 | 426 | 389 | 815 | ||||||||||||||||||
Other sales | 10 | 9 | 16 | 3 | 38 | 1 | 1 | 2 | ||||||||||||||||||
Tracked product sales | 16 | 10 | 11 | (19 | ) | 18 | 4 | 3 | 7 | |||||||||||||||||
Total revenues | 1,143 | 1,173 | 1,362 | 1,176 | 4,854 | 998 | 952 | 1,950 | ||||||||||||||||||
Segment costs and expenses: | ||||||||||||||||||||||||||
NGL cost of goods sold | 85 | 81 | 101 | 66 | 333 | 49 | 41 | 90 | ||||||||||||||||||
Marketing cost of goods sold | 418 | 458 | 605 | 587 | 2,068 | 421 | 389 | 810 | ||||||||||||||||||
Other cost of goods sold | 7 | 8 | 12 | 2 | 29 | 2 | 3 | 5 | ||||||||||||||||||
Tracked cost of goods sold | 16 | 10 | 12 | (20 | ) | 18 | 3 | 4 | 7 | |||||||||||||||||
Processing commodity expenses | 30 | 20 | 26 | 40 | 116 | 31 | 19 | 50 | ||||||||||||||||||
Operating and administrative costs | 193 | 215 | 200 | 166 | 774 | 166 | 180 | 346 | ||||||||||||||||||
Tracked operating and administrative costs | — | 1 | — | — | 1 | — | 1 | 1 | ||||||||||||||||||
Other segment costs and expenses | 6 | 10 | 19 | 15 | 50 | 6 | 1 | 7 | ||||||||||||||||||
Impairment of certain assets | — | — | — | 1,849 | 1,849 | 12 | 64 | 76 | ||||||||||||||||||
Gain on sale of certain assets | — | — | — | (591 | ) | (591 | ) | 2 | — | 2 | ||||||||||||||||
Regulatory charges resulting from Tax Reform | (7 | ) | — | — | — | (7 | ) | — | — | — | ||||||||||||||||
Total segment costs and expenses | 748 | 803 | 975 | 2,114 | 4,640 | 692 | 702 | 1,394 | ||||||||||||||||||
Proportional Modified EBITDA of equity-method investments | 18 | 19 | 25 | 32 | 94 | 26 | 28 | 54 | ||||||||||||||||||
Modified EBITDA | 413 | 389 | 412 | (906 | ) | 308 | 332 | 278 | 610 | |||||||||||||||||
Adjustments | (7 | ) | — | 12 | 1,264 | 1,269 | 14 | 78 | 92 | |||||||||||||||||
Adjusted EBITDA | $ | 406 | $ | 389 | $ | 424 | $ | 358 | $ | 1,577 | $ | 346 | $ | 356 | $ | 702 | ||||||||||
NGL margin | $ | 52 | $ | 53 | $ | 60 | $ | 29 | $ | 194 | $ | 14 | $ | 21 | $ | 35 | ||||||||||
Statistics for Operated Assets | ||||||||||||||||||||||||||
Gathering and Processing | ||||||||||||||||||||||||||
Gathering volumes (Bcf per day) - Consolidated (1) | 4.58 | 4.60 | 4.48 | 3.44 | 4.27 | 3.42 | 3.53 | 3.48 | ||||||||||||||||||
Gathering volumes (Bcf per day) - Non-consolidated (2) | — | — | 0.15 | 0.16 | 0.08 | 0.17 | 0.15 | 0.16 | ||||||||||||||||||
Plant inlet natural gas volumes (Bcf per day) - Consolidated (1) | 2.16 | 2.12 | 2.11 | 1.65 | 2.01 | 1.41 | 1.52 | 1.46 | ||||||||||||||||||
Plant inlet natural gas volumes (Bcf per day) - Non-consolidated (2) | — | — | 0.14 | 0.17 | 0.08 | 0.17 | 0.14 | 0.16 | ||||||||||||||||||
Ethane equity sales (Mbbls/d) | 19.01 | 10.23 | 12.19 | 16.40 | 14.44 | 14.63 | 14.59 | 14.61 | ||||||||||||||||||
Non-ethane equity sales (Mbbls/d) | 19.83 | 18.80 | 19.48 | 14.40 | 18.12 | 12.59 | 13.54 | 13.07 | ||||||||||||||||||
NGL equity sales (Mbbls/d) | 38.84 | 29.03 | 31.67 | 30.80 | 32.56 | 27.22 | 28.13 | 27.68 | ||||||||||||||||||
Ethane margin ($/gallon) | $ | .01 | $ | .07 | $ | .18 | $ | .02 | $ | .06 | $ | (.03 | ) | $ | (.03 | ) | $ | (.03 | ) | |||||||
Non-ethane margin ($/gallon) | $ | .69 | $ | .71 | $ | .69 | $ | .49 | $ | .65 | $ | .34 | $ | .42 | $ | .38 | ||||||||||
NGL margin ($/gallon) | $ | .35 | $ | .48 | $ | .49 | $ | .24 | $ | .39 | $ | .14 | $ | .19 | $ | .16 | ||||||||||
Ethane production (Mbbls/d) | 31 | 26 | 28 | 29 | 28 | 29 | 22 | 26 | ||||||||||||||||||
Non-ethane production (Mbbls/d) - Consolidated (1) | 62 | 61 | 59 | 41 | 55 | 33 | 37 | 35 | ||||||||||||||||||
Non-ethane production (Mbbls/d) - Jackalope equity-method investment - 100% | — | — | 5 | 5 | 3 | 6 | 1 | 4 | ||||||||||||||||||
NGL production (Mbbls/d) | 93 | 87 | 92 | 75 | 86 | 68 | 60 | 65 | ||||||||||||||||||
NGL and Crude Transportation volumes (Mbbls) (3) | 21,263 | 21,334 | 22,105 | 23,049 | 87,751 | 22,848 | 24,465 | 47,313 | ||||||||||||||||||
Northwest Pipeline LLC | ||||||||||||||||||||||||||
Throughput (Tbtu) | 226.1 | 188.1 | 193.5 | 212.3 | 820.0 | 243.5 | 184.6 | 428.1 | ||||||||||||||||||
Avg. daily transportation volumes (Tbtu) | 2.5 | 2.1 | 2.1 | 2.3 | 2.2 | 2.7 | 2.0 | 2.4 | ||||||||||||||||||
Avg. daily firm reserved capacity (Tbtu) | 3.1 | 3.1 | 3.1 | 3.1 | 3.1 | 3.1 | 3.0 | 3.0 | ||||||||||||||||||
(1) Excludes volumes associated with equity-method investments that are not consolidated in our results. | ||||||||||||||||||||||||||
(2) Includes 100% of the volumes associated with operated equity-method investments, including the Jackalope Gas Gathering System and Rocky Mountain Midstream. | ||||||||||||||||||||||||||
(3) Includes 100% of the volumes associated with operated equity-method investments, including the Overland Pass Pipeline Company and Rocky Mountain Midstream. |
Northeast G&P | ||||||||||||||||||||||||||
(UNAUDITED) | ||||||||||||||||||||||||||
2018 | 2019 | |||||||||||||||||||||||||
(Dollars in millions) | 1st Qtr | 2nd Qtr | 3rd Qtr | 4th Qtr | Year | 1st Qtr | 2nd Qtr | Year | ||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||
Service revenues: | ||||||||||||||||||||||||||
Nonregulated gathering and processing fee-based revenue | $ | 189 | $ | 196 | $ | 211 | $ | 226 | $ | 822 | $ | 230 | $ | 267 | $ | 497 | ||||||||||
Other fee revenues | 39 | 36 | 36 | 43 | 154 | 46 | 63 | 109 | ||||||||||||||||||
Nonregulated commodity consideration | 4 | 4 | 6 | 6 | 20 | 5 | 3 | 8 | ||||||||||||||||||
Product sales: | ||||||||||||||||||||||||||
NGL sales from gas processing | 4 | 5 | 6 | 5 | 20 | 5 | 3 | 8 | ||||||||||||||||||
Marketing sales | 89 | 65 | 57 | 35 | 246 | 37 | 28 | 65 | ||||||||||||||||||
Tracked product sales | 5 | 5 | 6 | 5 | 21 | 5 | 6 | 11 | ||||||||||||||||||
Total revenues | 330 | 311 | 322 | 320 | 1,283 | 328 | 370 | 698 | ||||||||||||||||||
Segment costs and expenses: | ||||||||||||||||||||||||||
NGL cost of goods sold | 4 | 5 | 6 | 5 | 20 | 5 | 3 | 8 | ||||||||||||||||||
Marketing cost of goods sold | 90 | 65 | 57 | 36 | 248 | 37 | 29 | 66 | ||||||||||||||||||
Processing commodity expenses | 2 | 2 | 3 | 2 | 9 | 3 | 2 | 5 | ||||||||||||||||||
Operating and administrative costs | 85 | 91 | 96 | 108 | 380 | 97 | 130 | 227 | ||||||||||||||||||
Other segment costs and expenses | 2 | 1 | 4 | 5 | 12 | 4 | — | 4 | ||||||||||||||||||
Tracked cost of goods sold | 5 | 7 | 6 | 3 | 21 | 5 | 6 | 11 | ||||||||||||||||||
Total segment costs and expenses | 188 | 171 | 172 | 159 | 690 | 151 | 170 | 321 | ||||||||||||||||||
Proportional Modified EBITDA of equity-method investments | 108 | 115 | 131 | 139 | 493 | 122 | 103 | 225 | ||||||||||||||||||
Modified EBITDA | 250 | 255 | 281 | 300 | 1,086 | 299 | 303 | 602 | ||||||||||||||||||
Adjustments | — | — | — | 4 | 4 | 3 | 16 | 19 | ||||||||||||||||||
Adjusted EBITDA | $ | 250 | $ | 255 | $ | 281 | $ | 304 | $ | 1,090 | $ | 302 | $ | 319 | $ | 621 | ||||||||||
NGL margin | $ | 2 | $ | 2 | $ | 3 | $ | 4 | $ | 11 | $ | 2 | $ | 1 | $ | 3 | ||||||||||
Statistics for Operated Assets | ||||||||||||||||||||||||||
Gathering and Processing | ||||||||||||||||||||||||||
Gathering volumes (Bcf per day) - Consolidated (1) | 3.38 | 3.45 | 3.67 | 4.02 | 3.63 | 4.05 | 4.16 | 4.11 | ||||||||||||||||||
Gathering volumes (Bcf per day) - Non-consolidated (2) | 3.82 | 3.59 | 3.73 | 3.89 | 3.76 | 4.27 | 4.08 | 4.17 | ||||||||||||||||||
Plant inlet natural gas volumes (Bcf per day) | 0.49 | 0.55 | 0.52 | 0.52 | 0.52 | 0.63 | 1.04 | 0.83 | ||||||||||||||||||
Ethane equity sales (Mbbls/d) | 1.33 | 3.17 | 2.74 | 2.80 | 2.52 | 2.73 | 1.83 | 2.27 | ||||||||||||||||||
Non-ethane equity sales (Mbbls/d) | 0.79 | 1.09 | 1.49 | 1.28 | 1.16 | 1.21 | 1.09 | 1.15 | ||||||||||||||||||
NGL equity sales (Mbbls/d) | 2.12 | 4.26 | 4.23 | 4.08 | 3.68 | 3.94 | 2.92 | 3.42 | ||||||||||||||||||
Ethane production (Mbbls/d) | 23 | 27 | 26 | 20 | 24 | 22 | 24 | 23 | ||||||||||||||||||
Non-ethane production (Mbbls/d) | 21 | 21 | 23 | 22 | 22 | 22 | 34 | 29 | ||||||||||||||||||
NGL production (Mbbls/d) | 44 | 48 | 49 | 42 | 46 | 44 | 58 | 52 | ||||||||||||||||||
(1) Includes gathering volumes associated with Susquehanna Supply Hub, the Northeast JV, and Utica Supply Hub, all of which are consolidated. | ||||||||||||||||||||||||||
(2) Includes 100% of the volumes associated with operated equity-method investments, including the Laurel Mountain Midstream partnership; and the Bradford Supply Hub and a portion of the Marcellus South Supply Hub within the Appalachia Midstream Services partnership. Volumes handled by Blue Racer Midstream (gathering and processing), which we do not operate, are not included. |
Capital Expenditures and Investments | ||||||||||||||||||||||||||
(UNAUDITED) | ||||||||||||||||||||||||||
2018 | 2019 | |||||||||||||||||||||||||
(Dollars in millions) | 1st Qtr | 2nd Qtr | 3rd Qtr | 4th Qtr | Year | 1st Qtr | 2nd Qtr | Year | ||||||||||||||||||
Capital expenditures: | ||||||||||||||||||||||||||
Northeast G&P | $ | 114 | $ | 104 | $ | 114 | $ | 139 | $ | 471 | $ | 152 | $ | 177 | $ | 329 | ||||||||||
Atlantic-Gulf | 764 | 746 | 549 | 359 | 2,418 | 193 | 234 | 427 | ||||||||||||||||||
West | 69 | 74 | 96 | 93 | 332 | 69 | 80 | 149 | ||||||||||||||||||
Other | 10 | 9 | 10 | 6 | 35 | 8 | 6 | 14 | ||||||||||||||||||
Total (1) | $ | 957 | $ | 933 | $ | 769 | $ | 597 | $ | 3,256 | $ | 422 | $ | 497 | $ | 919 | ||||||||||
Purchases of investments: | ||||||||||||||||||||||||||
Northeast G&P | $ | 20 | $ | 70 | $ | 114 | $ | 58 | $ | 262 | $ | 47 | $ | 61 | $ | 108 | ||||||||||
Atlantic-Gulf | 1 | — | 5 | — | 6 | — | 12 | 12 | ||||||||||||||||||
West | — | — | 593 | 271 | 864 | 52 | 70 | 122 | ||||||||||||||||||
Total | $ | 21 | $ | 70 | $ | 712 | $ | 329 | $ | 1,132 | $ | 99 | $ | 143 | $ | 242 | ||||||||||
Summary: | ||||||||||||||||||||||||||
Northeast G&P | $ | 134 | $ | 174 | $ | 228 | $ | 197 | $ | 733 | $ | 199 | $ | 238 | $ | 437 | ||||||||||
Atlantic-Gulf | 765 | 746 | 554 | 359 | 2,424 | 193 | 246 | 439 | ||||||||||||||||||
West | 69 | 74 | 689 | 364 | 1,196 | 121 | 150 | 271 | ||||||||||||||||||
Other | 10 | 9 | 10 | 6 | 35 | 8 | 6 | 14 | ||||||||||||||||||
Total | $ | 978 | $ | 1,003 | $ | 1,481 | $ | 926 | $ | 4,388 | $ | 521 | $ | 640 | $ | 1,161 | ||||||||||
Capital investments: | ||||||||||||||||||||||||||
Increases to property, plant, and equipment | $ | 934 | $ | 930 | $ | 618 | $ | 539 | $ | 3,021 | $ | 418 | $ | 559 | $ | 977 | ||||||||||
Purchases of businesses, net of cash acquired | — | — | — | — | — | 727 | — | 727 | ||||||||||||||||||
Purchases of investments | 21 | 70 | 712 | 329 | 1,132 | 99 | 143 | 242 | ||||||||||||||||||
Total | $ | 955 | $ | 1,000 | $ | 1,330 | $ | 868 | $ | 4,153 | $ | 1,244 | $ | 702 | $ | 1,946 | ||||||||||
(1) Increases to property, plant, and equipment | $ | 934 | $ | 930 | $ | 618 | $ | 539 | $ | 3,021 | $ | 418 | $ | 559 | $ | 977 | ||||||||||
Changes in related accounts payable and accrued liabilities | 23 | 3 | 151 | 58 | 235 | 4 | (62 | ) | (58 | ) | ||||||||||||||||
Capital expenditures | $ | 957 | $ | 933 | $ | 769 | $ | 597 | $ | 3,256 | $ | 422 | $ | 497 | $ | 919 | ||||||||||
Contributions from noncontrolling interests | $ | 3 | $ | 8 | $ | 2 | $ | 2 | $ | 15 | $ | 4 | $ | 28 | $ | 32 | ||||||||||
Contributions in aid of construction | $ | 190 | $ | 149 | $ | 56 | $ | 16 | $ | 411 | $ | 10 | $ | 8 | $ | 18 | ||||||||||
Proceeds from sale of businesses, net of cash divested | $ | — | $ | — | $ | — | $ | 1,296 | $ | 1,296 | $ | (2 | ) | $ | — | $ | (2 | ) | ||||||||
Proceeds from sale of partial interest in consolidated subsidiary | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 1,330 | $ | 1,330 | ||||||||||
Proceeds from disposition of equity-method investments | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 485 | $ | 485 |
Reconciliation of Income (Loss) Attributable to The Williams Companies, Inc. to Adjusted Income | ||||||||||||||||||||||||||
(UNAUDITED) | ||||||||||||||||||||||||||
2018 | 2019 | |||||||||||||||||||||||||
(Dollars in millions, except per-share amounts) | 1st Qtr | 2nd Qtr | 3rd Qtr | 4th Qtr | Year | 1st Qtr | 2nd Qtr | Year | ||||||||||||||||||
Income (loss) attributable to The Williams Companies, Inc. available to common stockholders | $ | 152 | $ | 135 | $ | 129 | $ | (572 | ) | $ | (156 | ) | $ | 194 | $ | 310 | $ | 504 | ||||||||
Income (loss) - diluted earnings (loss) per common share (1) | $ | .18 | $ | .16 | $ | .13 | $ | (.47 | ) | $ | (.16 | ) | $ | .16 | $ | .26 | $ | .41 | ||||||||
Adjustments: | ||||||||||||||||||||||||||
Northeast G&P | ||||||||||||||||||||||||||
Expenses associated with new venture | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 3 | $ | 6 | $ | 9 | ||||||||||
Settlement charge from pension early payout program | — | — | — | 4 | 4 | — | — | — | ||||||||||||||||||
Severance and related costs | — | — | — | — | — | — | 10 | 10 | ||||||||||||||||||
Total Northeast G&P adjustments | — | — | — | 4 | 4 | 3 | 16 | 19 | ||||||||||||||||||
Atlantic-Gulf | ||||||||||||||||||||||||||
Constitution Pipeline project development costs | 2 | 1 | 1 | — | 4 | — | 1 | 1 | ||||||||||||||||||
Settlement charge from pension early payout program | — | — | — | 7 | 7 | — | — | — | ||||||||||||||||||
Regulatory adjustments resulting from Tax Reform | 11 | (20 | ) | — | — | (9 | ) | — | — | — | ||||||||||||||||
Benefit of regulatory asset associated with increase in Transco’s estimated deferred state income tax rate following WPZ Merger | — | — | (3 | ) | — | (3 | ) | — | — | — | ||||||||||||||||
Share of regulatory charges resulting from Tax Reform for equity-method investments | 2 | — | — | — | 2 | — | — | — | ||||||||||||||||||
Reversal of expenditures capitalized in prior years | — | — | — | — | — | — | 15 | 15 | ||||||||||||||||||
Gain on sale of certain Gulf Coast pipeline assets | — | — | — | (81 | ) | (81 | ) | — | — | — | ||||||||||||||||
Gain on asset retirement | — | — | (10 | ) | (2 | ) | (12 | ) | — | — | — | |||||||||||||||
Severance and related costs | — | — | — | — | — | — | 19 | 19 | ||||||||||||||||||
Total Atlantic-Gulf adjustments | 15 | (19 | ) | (12 | ) | (76 | ) | (92 | ) | — | 35 | 35 | ||||||||||||||
West | ||||||||||||||||||||||||||
Impairment of certain assets | — | — | — | 1,849 | 1,849 | 12 | 64 | 76 | ||||||||||||||||||
Settlement charge from pension early payout program | — | — | — | 6 | 6 | — | — | — | ||||||||||||||||||
Regulatory adjustments resulting from Tax Reform | (7 | ) | — | — | — | (7 | ) | — | — | — | ||||||||||||||||
Charge for regulatory liability associated with the decrease in Northwest Pipeline’s estimated deferred state income tax rates following WPZ Merger | — | — | 12 | — | 12 | — | — | — | ||||||||||||||||||
Gain on sale of Four Corners assets | — | — | — | (591 | ) | (591 | ) | 2 | — | 2 | ||||||||||||||||
Severance and related costs | — | — | — | — | — | — | 14 | 14 | ||||||||||||||||||
Total West adjustments | (7 | ) | — | 12 | 1,264 | 1,269 | 14 | 78 | 92 | |||||||||||||||||
Other | ||||||||||||||||||||||||||
Loss on early retirement of debt | 7 | — | — | — | 7 | — | — | — | ||||||||||||||||||
Impairment of certain assets | — | 66 | — | — | 66 | — | — | — | ||||||||||||||||||
Settlement charge from pension early payout program | — | — | — | 5 | 5 | — | — | — | ||||||||||||||||||
Regulatory adjustments resulting from Tax Reform | — | 1 | — | — | 1 | — | — | — | ||||||||||||||||||
(Benefit) adjustment of regulatory assets associated with increase in Transco’s estimated deferred state income tax rate following WPZ Merger | — | — | (45 | ) | — | (45 | ) | 12 | — | 12 | ||||||||||||||||
WPZ Merger costs | — | 4 | 15 | 1 | 20 | — | — | — | ||||||||||||||||||
Gain on sale of certain Gulf Coast pipeline systems | — | — | — | (20 | ) | (20 | ) | — | — | — | ||||||||||||||||
Charitable contribution of preferred stock to Williams Foundation | — | — | 35 | — | 35 | — | — | — | ||||||||||||||||||
Total Other adjustments | 7 | 71 | 5 | (14 | ) | 69 | 12 | — | 12 | |||||||||||||||||
Adjustments included in Modified EBITDA | 15 | 52 | 5 | 1,178 | 1,250 | 29 | 129 | 158 | ||||||||||||||||||
Adjustments below Modified EBITDA | ||||||||||||||||||||||||||
Gain on deconsolidation of Jackalope interest | — | (62 | ) | — | — | (62 | ) | — | — | — | ||||||||||||||||
Gain on deconsolidation of certain Permian assets | — | — | — | (141 | ) | (141 | ) | 2 | — | 2 | ||||||||||||||||
Impairment of equity-method investments | — | — | — | 32 | 32 | 74 | (2 | ) | 72 | |||||||||||||||||
Gain on sale of equity-method investments | — | — | — | — | — | — | (122 | ) | (122 | ) | ||||||||||||||||
Allocation of adjustments to noncontrolling interests | (5 | ) | 21 | — | — | 16 | — | (1 | ) | (1 | ) | |||||||||||||||
(5 | ) | (41 | ) | — | (109 | ) | (155 | ) | 76 | (125 | ) | (49 | ) | |||||||||||||
Total adjustments | 10 | 11 | 5 | 1,069 | 1,095 | 105 | 4 | 109 | ||||||||||||||||||
Less tax effect for above items | (3 | ) | (3 | ) | (1 | ) | (267 | ) | (274 | ) | (26 | ) | (1 | ) | (27 | ) | ||||||||||
Adjustments for tax-related items (2) | — | — | 110 | — | 110 | — | — | — | ||||||||||||||||||
Adjusted income available to common stockholders | $ | 159 | $ | 143 | $ | 243 | $ | 230 | $ | 775 | $ | 273 | $ | 313 | $ | 586 | ||||||||||
Adjusted diluted earnings per common share (1) | $ | .19 | $ | .17 | $ | .24 | $ | .19 | $ | .79 | $ | .22 | $ | .26 | $ | .48 | ||||||||||
Weighted-average shares - diluted (thousands) | 830,197 | 830,107 | 1,026,504 | 1,212,822 | 976,097 | 1,213,592 | 1,214,065 | 1,213,830 | ||||||||||||||||||
(1) The sum of earnings per share for the quarters may not equal the total earnings per share for the year due to changes in the weighted-average number of common shares outstanding. | ||||||||||||||||||||||||||
(2) The third quarter of 2018 reflects tax adjustments driven by the WPZ Merger, primarily a valuation allowance for foreign tax credits. |
Reconciliation of Distributable Cash Flow (DCF) | ||||||||||||||||||||||||||
(UNAUDITED) | ||||||||||||||||||||||||||
2018 | 2019 | |||||||||||||||||||||||||
(Dollars in millions, except coverage ratios) | 1st Qtr | 2nd Qtr | 3rd Qtr | 4th Qtr | Year | 1st Qtr | 2nd Qtr | Year | ||||||||||||||||||
The Williams Companies, Inc. | ||||||||||||||||||||||||||
Reconciliation of GAAP "Net Income (Loss)" to Non-GAAP "Modified EBITDA", "Adjusted EBITDA" and "Distributable cash flow" | ||||||||||||||||||||||||||
Net income (loss) | $ | 270 | $ | 269 | $ | 200 | $ | (546 | ) | $ | 193 | $ | 214 | $ | 324 | $ | 538 | |||||||||
Provision (benefit) for income taxes | 55 | 52 | 190 | (159 | ) | 138 | 69 | 98 | 167 | |||||||||||||||||
Interest expense | 273 | 275 | 270 | 294 | 1,112 | 296 | 296 | 592 | ||||||||||||||||||
Equity (earnings) losses | (82 | ) | (92 | ) | (105 | ) | (117 | ) | (396 | ) | (80 | ) | (87 | ) | (167 | ) | ||||||||||
Other investing (income) loss - net | (4 | ) | (68 | ) | (2 | ) | (113 | ) | (187 | ) | 73 | (126 | ) | (53 | ) | |||||||||||
Proportional Modified EBITDA of equity-method investments | 169 | 178 | 205 | 218 | 770 | 190 | 175 | 365 | ||||||||||||||||||
Depreciation and amortization expenses | 431 | 434 | 425 | 435 | 1,725 | 416 | 424 | 840 | ||||||||||||||||||
Accretion for asset retirement obligations associated with nonregulated operations | 8 | 10 | 8 | 7 | 33 | 9 | 8 | 17 | ||||||||||||||||||
Modified EBITDA | 1,120 | 1,058 | 1,191 | 19 | 3,388 | 1,187 | 1,112 | 2,299 | ||||||||||||||||||
EBITDA adjustments | 15 | 52 | 5 | 1,178 | 1,250 | 29 | 129 | 158 | ||||||||||||||||||
Adjusted EBITDA | 1,135 | 1,110 | 1,196 | 1,197 | 4,638 | 1,216 | 1,241 | 2,457 | ||||||||||||||||||
Maintenance capital expenditures (1) | (110 | ) | (160 | ) | (138 | ) | (122 | ) | (530 | ) | (93 | ) | (130 | ) | (223 | ) | ||||||||||
Preferred dividends | — | — | — | (1 | ) | (1 | ) | (1 | ) | — | (1 | ) | ||||||||||||||
Net interest expense - cash portion (2) | (276 | ) | (279 | ) | (274 | ) | (299 | ) | (1,128 | ) | (304 | ) | (302 | ) | (606 | ) | ||||||||||
Cash taxes | (1 | ) | (10 | ) | (1 | ) | 1 | (11 | ) | 3 | 85 | 88 | ||||||||||||||
Income attributable to noncontrolling interests (3) | (25 | ) | (24 | ) | (19 | ) | (28 | ) | (96 | ) | ||||||||||||||||
Dividend and distributions paid to noncontrolling interests | (41 | ) | (27 | ) | (68 | ) | ||||||||||||||||||||
Distributable cash flow | $ | 723 | $ | 637 | $ | 764 | $ | 748 | $ | 2,872 | $ | 780 | $ | 867 | $ | 1,647 | ||||||||||
Total cash distributed (4) | $ | 438 | $ | 443 | $ | 412 | $ | 411 | $ | 1,704 | $ | 460 | $ | 461 | $ | 921 | ||||||||||
Coverage ratios: | ||||||||||||||||||||||||||
Distributable cash flow divided by Total cash distributed | 1.65 | 1.44 | 1.85 | 1.82 | 1.69 | 1.70 | 1.88 | 1.79 | ||||||||||||||||||
Net income (loss) divided by Total cash distributed | 0.62 | 0.61 | 0.49 | (1.33 | ) | 0.11 | 0.47 | 0.70 | 0.58 | |||||||||||||||||
(1) Includes proportionate share of maintenance capital expenditures of equity-method investments. | ||||||||||||||||||||||||||
(2) Includes proportionate share of interest expense of equity-method investments. | ||||||||||||||||||||||||||
(3) Excludes allocable share of certain EBITDA adjustments. | ||||||||||||||||||||||||||
(4) Includes cash dividends paid on common stock each quarter by WMB, as well as the public unitholders share of distributions declared by WPZ for the first two quarters of 2018. |
Reconciliation of "Net Income (Loss)" to “Modified EBITDA” and Non-GAAP “Adjusted EBITDA” | ||||||||||||||||||||||||||
(UNAUDITED) | ||||||||||||||||||||||||||
2018 | 2019 | |||||||||||||||||||||||||
(Dollars in millions) | 1st Qtr | 2nd Qtr | 3rd Qtr | 4th Qtr | Year | 1st Qtr | 2nd Qtr | Year | ||||||||||||||||||
Net income (loss) | $ | 270 | $ | 269 | $ | 200 | $ | (546 | ) | $ | 193 | $ | 214 | $ | 324 | $ | 538 | |||||||||
Provision (benefit) for income taxes | 55 | 52 | 190 | (159 | ) | 138 | 69 | 98 | 167 | |||||||||||||||||
Interest expense | 273 | 275 | 270 | 294 | 1,112 | 296 | 296 | 592 | ||||||||||||||||||
Equity (earnings) losses | (82 | ) | (92 | ) | (105 | ) | (117 | ) | (396 | ) | (80 | ) | (87 | ) | (167 | ) | ||||||||||
Other investing (income) loss - net | (4 | ) | (68 | ) | (2 | ) | (113 | ) | (187 | ) | 73 | (126 | ) | (53 | ) | |||||||||||
Proportional Modified EBITDA of equity-method investments | 169 | 178 | 205 | 218 | 770 | 190 | 175 | 365 | ||||||||||||||||||
Depreciation and amortization expenses | 431 | 434 | 425 | 435 | 1,725 | 416 | 424 | 840 | ||||||||||||||||||
Accretion expense associated with asset retirement obligations for nonregulated operations | 8 | 10 | 8 | 7 | 33 | 9 | 8 | 17 | ||||||||||||||||||
Modified EBITDA | $ | 1,120 | $ | 1,058 | $ | 1,191 | $ | 19 | $ | 3,388 | $ | 1,187 | $ | 1,112 | $ | 2,299 | ||||||||||
Northeast G&P | $ | 250 | $ | 255 | $ | 281 | $ | 300 | $ | 1,086 | $ | 299 | $ | 303 | $ | 602 | ||||||||||
Atlantic-Gulf | 451 | 475 | 492 | 605 | 2,023 | 560 | 524 | 1,084 | ||||||||||||||||||
West | 413 | 389 | 412 | (906 | ) | 308 | 332 | 278 | 610 | |||||||||||||||||
Other | 6 | (61 | ) | 6 | 20 | (29 | ) | (4 | ) | 7 | 3 | |||||||||||||||
Total Modified EBITDA | $ | 1,120 | $ | 1,058 | $ | 1,191 | $ | 19 | $ | 3,388 | $ | 1,187 | $ | 1,112 | $ | 2,299 | ||||||||||
Adjustments included in Modified EBITDA (1): | ||||||||||||||||||||||||||
Northeast G&P | $ | — | $ | — | $ | — | $ | 4 | $ | 4 | $ | 3 | $ | 16 | $ | 19 | ||||||||||
Atlantic-Gulf | 15 | (19 | ) | (12 | ) | (76 | ) | (92 | ) | — | 35 | 35 | ||||||||||||||
West | (7 | ) | — | 12 | 1,264 | 1,269 | 14 | 78 | 92 | |||||||||||||||||
Other | 7 | 71 | 5 | (14 | ) | 69 | 12 | — | 12 | |||||||||||||||||
Total Adjustments included in Modified EBITDA | $ | 15 | $ | 52 | $ | 5 | $ | 1,178 | $ | 1,250 | $ | 29 | $ | 129 | $ | 158 | ||||||||||
Adjusted EBITDA: | ||||||||||||||||||||||||||
Northeast G&P | $ | 250 | $ | 255 | $ | 281 | $ | 304 | $ | 1,090 | $ | 302 | $ | 319 | $ | 621 | ||||||||||
Atlantic-Gulf | 466 | 456 | 480 | 529 | 1,931 | 560 | 559 | 1,119 | ||||||||||||||||||
West | 406 | 389 | 424 | 358 | 1,577 | 346 | 356 | 702 | ||||||||||||||||||
Other | 13 | 10 | 11 | 6 | 40 | 8 | 7 | 15 | ||||||||||||||||||
Total Adjusted EBITDA | $ | 1,135 | $ | 1,110 | $ | 1,196 | $ | 1,197 | $ | 4,638 | $ | 1,216 | $ | 1,241 | $ | 2,457 | ||||||||||
(1) Adjustments by segment are detailed in the "Reconciliation of Income (Loss) Attributable to The Williams Companies, Inc. to Adjusted Income," which is also included in these materials. |
Reconciliation of GAAP "Net Income (Loss)" to Non-GAAP "Modified EBITDA", "Adjusted EBITDA" and "Distributable Cash Flow" | ||||||||||||
2019 Guidance | ||||||||||||
(Dollars in millions, except coverage ratio) | Low | Mid | High | |||||||||
Net income (loss) | $ | 1,100 | $ | 1,250 | $ | 1,400 | ||||||
Provision (benefit) for income taxes | 425 | |||||||||||
Interest expense | 1,200 | |||||||||||
Equity (earnings) losses | (410 | ) | ||||||||||
Impairment of equity-method investments | 74 | |||||||||||
Estimated 2Q 2019 gain on sale of equity-method investment (Jackalope) | (120 | ) | ||||||||||
Proportional Modified EBITDA of equity-method investments | 780 | |||||||||||
Depreciation and amortization expenses and accretion for asset retirement obligations associated with nonregulated operations | 1,760 | |||||||||||
Other | 2 | |||||||||||
Modified EBITDA | $ | 4,811 | $ | 4,961 | $ | 5,111 | ||||||
EBITDA Adjustments (1) | 39 | |||||||||||
Adjusted EBITDA | $ | 4,850 | $ | 5,000 | $ | 5,150 | ||||||
Net interest expense - cash portion (2) | (1,210 | ) | ||||||||||
Maintenance capital expenditures (2) | (625 | ) | (575 | ) | (525 | ) | ||||||
Cash taxes | 75 | |||||||||||
Dividends and distributions paid to noncontrolling interests and other | (190 | ) | ||||||||||
Distributable cash flow (DCF) | $ | 2,900 | $ | 3,100 | $ | 3,300 | ||||||
Dividends paid | (1,850 | ) | ||||||||||
Excess cash available after dividends | $ | 1,050 | $ | 1,250 | $ | 1,450 | ||||||
Dividend per share | $ | 1.52 | ||||||||||
Coverage ratio (Distributable cash flow / Dividends paid) | 1.57x | 1.68x | 1.78x | |||||||||
(1) Includes 1Q 2019 adjustments of $29 and anticipated future adjustments of $10. | ||||||||||||
(2) Includes proportionate share of equity investments. |
Reconciliation of Income (Loss) Attributable to The Williams Companies, Inc. to Adjusted Income | ||||||||||||
2019 Guidance | ||||||||||||
(Dollars in millions, except per-share amounts) | Low | Mid | High | |||||||||
Net income (loss) | $ | 1,100 | $ | 1,250 | $ | 1,400 | ||||||
Less: Net income (loss) attributable to noncontrolling interests | 90 | 90 | 90 | |||||||||
Less: Preferred stock dividends | 3 | 3 | 3 | |||||||||
Net income (loss) attributable to The Williams Companies, Inc. available to common stockholders | 1,007 | 1,157 | 1,307 | |||||||||
Adjustments: | ||||||||||||
Adjustments included in Modified EBITDA (1) | 39 | |||||||||||
Adjustments below Modified EBITDA (2) | (44 | ) | ||||||||||
Total adjustments | (5 | ) | ||||||||||
Less tax effect for above items (3) | 4 | |||||||||||
Adjusted income available to common stockholders | $ | 1,006 | $ | 1,156 | $ | 1,306 | ||||||
Adjusted diluted earnings per common share | $ | 0.83 | $ | 0.95 | $ | 1.07 | ||||||
Weighted-average shares - diluted (millions) | 1,217 | 1,217 | 1,217 | |||||||||
(1) Includes 1Q 2019 adjustments of $29 and anticipated future adjustments of $10. | ||||||||||||
(2) Includes 1Q 2019 adjustments of $76 and anticipated gain on sale of Jackalope equity investment of ~($120). | ||||||||||||
(3) Includes 1Q 2019 tax effect for adjustments of ($26) and taxes on anticipated gain on sale of Jackalope equity investment of ~$30. |
• | Levels of dividends to Williams stockholders; |
• | Future credit ratings of Williams and its affiliates; |
• | Amounts and nature of future capital expenditures; |
• | Expansion and growth of our business and operations; |
• | Expected in-service dates for capital projects; |
• | Financial condition and liquidity; |
• | Business strategy; |
• | Cash flow from operations or results of operations; |
• | Seasonality of certain business components; |
• | Natural gas and natural gas liquids prices, supply, and demand; |
• | Demand for our services. |
• | Whether we are able to pay current and expected levels of dividends; |
• | Whether we will be able to effectively execute our financing plan; |
• | Availability of supplies, market demand, and volatility of prices; |
• | Inflation, interest rates, and general economic conditions (including future disruptions and volatility in the global credit markets and the impact of these events on customers and suppliers); |
• | The strength and financial resources of our competitors and the effects of competition; |
• | Whether we are able to successfully identify, evaluate and timely execute our capital projects and investment opportunities; |
• | Our ability to acquire new businesses and assets and successfully integrate those operations and assets into existing businesses as well as successfully expand our facilities, and to consummate asset sales on acceptable terms; |
• | Development and rate of adoption of alternative energy sources; |
• | The impact of operational and developmental hazards and unforeseen interruptions; |
• | The impact of existing and future laws and regulations, the regulatory environment, environmental liabilities, and litigation, as well as our ability to obtain necessary permits and approvals, and achieve favorable rate proceeding outcomes; |
• | Our costs and funding obligations for defined benefit pension plans and other postretirement benefit plans; |
• | Changes in maintenance and construction costs as well as our ability to obtain sufficient construction related inputs including skilled labor; |
• | Changes in the current geopolitical situation; |
• | Our exposure to the credit risk of our customers and counterparties; |
• | Risks related to financing, including restrictions stemming from debt agreements, future changes in credit ratings as determined by nationally recognized credit rating agencies and the availability and cost of capital; |
• | The amount of cash distributions from and capital requirements of our investments and joint ventures in which we participate; |
• | Risks associated with weather and natural phenomena, including climate conditions and physical damage to our facilities; |
• | Acts of terrorism, cybersecurity incidents, and related disruptions; |
• | Additional risks described in our filings with the Securities and Exchange Commission (SEC). |