What is the main driver behind the significant increase in operating revenues?

The significant increase in operating revenues is primarily attributed to favorable pricing for natural gas processing, improved margins from restructuring contracts, and volumes from newly acquired Texas gas and oil properties. Higher natural gas and NGL prices also contributed positively.

What strategic changes are being made within the Energy Services segment?

ONEOK is reorganizing its Energy Services segment to focus more on physical marketing and storage operations, while de-emphasizing gas options trading and unhedged pipeline arbitrage. They have also begun accounting for certain revenues on a gross rather than net basis, which increases reported revenues and cost of sales but does not impact net margin or operating income.

What is the status of the Northern Plains Natural Gas Company acquisition?

The agreement to purchase Northern Plains Natural Gas Company was announced and is expected to close in the fourth quarter of 2004. This acquisition is significant as it will provide ONEOK with an 82.5% interest in Northern Border Partners, L.P., a major master limited partnership, seen as a new growth vehicle for the company.

How has the company's dividend policy evolved recently?

ONEOK's Board of Directors increased the quarterly dividend to $0.25 per share. This marks the sixth dividend increase in the past two years, representing a 61% increase over that period, demonstrating a commitment to returning value to shareholders.

OKE 10-Q Quarterly Report Q3 FY2004 — Revenue, Net Income, EPS

Summary

ONEOK Inc.'s (OKE) third quarter of 2004 filing shows a significant increase in operating revenues compared to the same period in the prior year, driven by strong performance in its Gathering and Processing segment and favorable natural gas prices. The company raised its full-year 2004 earnings guidance, reflecting this improved financial performance. Management highlighted strategic shifts within the Energy Services segment, moving towards a greater focus on physical marketing and storage while de-emphasizing trading activities, and adopted a new gross revenue reporting basis for certain transactions. The company also announced progress on its acquisition of Northern Plains Natural Gas Company, expected to close in Q4 2004, which is anticipated to provide a new growth vehicle. Furthermore, ONEOK increased its quarterly dividend for the sixth time in two years, signaling confidence in its financial health and commitment to shareholder returns. Despite some challenges like increased operating costs, the overall financial picture presented is positive, supported by favorable market conditions and strategic initiatives.

Key Highlights

1Operating revenues increased substantially year-over-year, driven by strong performance in the Gathering and Processing segment.
2Full-year 2004 earnings guidance was raised, reflecting positive operational results and favorable commodity prices.
3The company is undergoing a strategic shift in its Energy Services segment, focusing more on physical marketing and storage and adopting a gross revenue reporting basis for certain transactions.
4Progress was made on the acquisition of Northern Plains Natural Gas Company, expected to close in Q4 2004, which is seen as a new growth driver.
5The quarterly dividend was increased for the sixth time in two years, underscoring the company's commitment to shareholder returns.
6Operating costs and depreciation, depletion, and amortization increased, primarily due to acquisitions and regulatory matters.
7The company reaffirmed its earnings guidance for 2005, excluding potential benefits from financial trading operations.

ONEOK INC /NEW/ Quarterly Report for Q3 Ended Sep 30, 2004

Summary

Key Highlights

Frequently Asked Questions