Summary
ONEOK Inc. reported a net income of $95.7 million for the first quarter of 2015, a significant decrease from $206.5 million in the prior year period. This decline was primarily driven by lower commodity sales revenues, which fell by 49% to $1.44 billion, impacted by sharp decreases in crude oil, natural gas, and NGL prices. Despite lower revenues, services revenues saw a modest increase of 4%. The company's net income attributable to ONEOK shareholders was $60.8 million, or $0.29 per diluted share, down from $93.5 million, or $0.45 per diluted share, in Q1 2014. The company's operational segments, particularly Natural Gas Gathering and Processing and Natural Gas Liquids, were affected by the challenging commodity price environment. While volumes in some areas increased due to completed growth projects, the lower realized prices for NGLs, condensate, and natural gas significantly impacted net margins and operating income. ONEOK Partners, the company's master limited partnership, saw its debt increase due to a substantial senior notes issuance, but maintained compliance with its financial covenants.
Financial Highlights
50 data points| Revenue | $1.81B |
| Cost of Revenue | $1.34B |
| Gross Profit | $461.44M |
| Operating Expenses | $264.97M |
| Operating Income | $196.46M |
| Interest Expense | $96.75M |
| Net Income | $60.80M |
| EPS (Basic) | $0.29 |
| EPS (Diluted) | $0.29 |
| Shares Outstanding (Basic) | 209.87M |
| Shares Outstanding (Diluted) | 210.47M |
Key Highlights
- 1Net income attributable to ONEOK decreased by 35% to $60.8 million in Q1 2015 from $93.5 million in Q1 2014.
- 2Total revenues declined significantly by 43% to $1.81 billion, primarily due to a 49% drop in commodity sales to $1.44 billion, driven by lower energy prices.
- 3The company's Natural Gas Liquids segment experienced a 1% decrease in net margin to $267.2 million, despite increased transportation and exchange service revenues, due to lower optimization and marketing margins and ethane rejection.
- 4Operating income across all segments decreased by 33% to $196.5 million, reflecting the impact of lower commodity prices and increased operating costs.
- 5ONEOK Partners issued $800 million in senior notes in March 2015, increasing its long-term debt.
- 6Despite a challenging commodity price environment, the company maintained compliance with its financial covenants.
- 7Capital expenditures decreased by 20% to $343.8 million, reflecting the completion of major projects in 2014 and the suspension of some new projects due to market conditions.