Summary
ONEOK, Inc. reported a decrease in diluted earnings per share (EPS) from continuing operations for both the three-month ($0.31 vs. $0.65) and six-month ($1.67 vs. $1.80) periods ending June 30, 2007, compared to the prior year. This decline is attributed to a decrease in operating income, primarily driven by lower storage, marketing, and financial trading margins in the Energy Services segment, partially offset by rate schedule implementations in the Distribution segment. Despite these challenges, the company highlighted the upcoming acquisition of a natural gas liquids (NGL) pipeline system by its ONEOK Partners segment for approximately $300 million, expected to close in Q3 2007. ONEOK also declared an increased quarterly dividend and ONEOK Partners announced an increase in its unit distribution, signaling confidence in future performance.
Key Highlights
- 1Diluted EPS from continuing operations declined to $0.31 for Q2 2007 and $1.67 for the first six months, down from $0.65 and $1.80 respectively in the prior year.
- 2Operating income decreased significantly for the three-month period ($135.7M vs. $269.6M) and for the six-month period ($464.0M vs. $539.9M) primarily due to lower margins in the Energy Services segment.
- 3ONEOK Partners announced an agreement to acquire an NGL and refined products pipeline system for approximately $300 million, expected to close in Q3 2007.
- 4The company declared an increased quarterly dividend of $0.36 per share, an increase of approximately 13% year-over-year.
- 5ONEOK Partners increased its quarterly unit distribution to $1.00 per unit, a 5% increase year-over-year.
- 6Capital expenditures increased notably, especially within the ONEOK Partners segment, driven by ongoing capital projects like the Overland Pass Pipeline.
- 7The company reported strong liquidity with no commercial paper outstanding and significant availability under its credit facilities at June 30, 2007.