Summary
ONEOK Inc. (OKE) reported its third-quarter and nine-month results for 2013, demonstrating resilience amidst a changing market landscape. The company's total revenues saw an increase, driven by higher volumes from ONEOK Partners' completed capital projects and adjusted rates in the Natural Gas Distribution segment. However, operating income experienced a decrease, primarily attributed to noncash charges related to the wind-down of the Energy Services segment, narrower NGL price differentials, and the impact of ethane rejection within ONEOK Partners' natural gas liquids business. A significant strategic development during this period was the announcement and commencement of the separation of ONEOK's natural gas distribution business into a standalone entity, ONE Gas. This move aims to streamline operations and potentially unlock greater value for shareholders. The company also continued to invest heavily in growth projects within ONEOK Partners, particularly in gathering and processing, and natural gas liquids infrastructure, anticipating future demand from producers in key resource areas.
Financial Highlights
51 data points| Revenue | $3.14B |
| Cost of Revenue | $2.71B |
| Gross Profit | $424.22M |
| Operating Expenses | $192.85M |
| Operating Income | $231.39M |
| Interest Expense | $66.19M |
| Net Income | $62.36M |
| EPS (Basic) | $0.30 |
| EPS (Diluted) | $0.30 |
| Shares Outstanding (Basic) | 206.24M |
| Shares Outstanding (Diluted) | 209.89M |
Key Highlights
- 1Total revenues increased by 18% for the three months and 17% for the nine months ended September 30, 2013, compared to the prior year, primarily due to higher volumes and new rates.
- 2Operating income decreased by 5% for the three months and 21% for the nine months ended September 30, 2013, year-over-year, largely due to noncash charges from the Energy Services segment wind-down and narrower NGL price differentials.
- 3Net income attributable to ONEOK decreased by 4% for the three months and 29% for the nine months ended September 30, 2013, reflecting the impact of lower earnings in the ONEOK Partners segment.
- 4The company announced plans to separate its natural gas distribution business into a standalone company, ONE Gas, signaling a strategic shift towards operational focus.
- 5Capital expenditures increased by 17% for the three months and 29% for the nine months, driven by significant growth projects within ONEOK Partners, particularly in natural gas gathering and processing, and NGL infrastructure.
- 6ONEOK Partners completed a significant acquisition of natural gas gathering and processing assets in Wyoming for $305 million, expanding its footprint in the NGL-rich Niobrara Shale.
- 7The company's Energy Services segment is undergoing an accelerated wind-down process, leading to substantial noncash charges but also a reduction in future commodity-price risk exposure.