Summary
ONEOK Inc. reported solid financial results for the second quarter and first half of 2018, demonstrating significant year-over-year growth. Total revenues increased by 9% in the quarter and 11% in the first half, driven by strong performance across its Natural Gas Gathering and Processing and Natural Gas Liquids segments. Operating income and Adjusted EBITDA saw substantial increases, reflecting higher volumes in key basins like the Williston and STACK/SCOOP areas, along with improved optimization and marketing earnings. The company also continued its strategic investment in growth projects, with capital expenditures significantly increasing to support the expansion of its midstream infrastructure. The company highlighted the impact of higher NGL price differentials and increased demand from petrochemical companies and exporters, which benefited its Natural Gas Liquids segment. ONEOK has successfully managed its debt and equity financing, completing a significant common stock offering in January 2018 and a substantial senior unsecured notes offering in July 2018. The company also reaffirmed its commitment to returning capital to shareholders through dividends, with an expectation that a significant portion of these dividends will be treated as a return of capital.
Financial Highlights
51 data points| Revenue | $2.96B |
| Cost of Revenue | $2.18B |
| Gross Profit | $784.71M |
| Operating Income | $448.37M |
| Interest Expense | $113.50M |
| Net Income | $281.05M |
| EPS (Basic) | $0.68 |
| EPS (Diluted) | $0.68 |
| Shares Outstanding (Basic) | 411.95M |
| Shares Outstanding (Diluted) | 414.64M |
Key Highlights
- 1Total revenues increased by 9% for the quarter and 11% for the six-month period compared to the prior year, driven by strong performance in the Natural Gas Gathering and Processing and Natural Gas Liquids segments.
- 2Operating income saw a significant increase of 40% for the quarter and 36% for the six-month period, demonstrating improved operational efficiency and market conditions.
- 3Adjusted EBITDA grew by 30% for the quarter and 27% for the six-month period, reflecting robust operational performance and higher earnings from optimization and marketing activities.
- 4Capital expenditures increased substantially by 268% for the quarter and 420% for the six-month period, primarily due to ongoing investments in growth projects across its operational segments.
- 5The Natural Gas Liquids segment experienced strong growth, with Adjusted EBITDA increasing by 29% for the quarter and 26% for the six-month period, driven by wider NGL price differentials and increased volumes.
- 6ONEOK completed a $1.25 billion senior unsecured notes offering in July 2018 and a $1.2 billion common stock offering in January 2018, strengthening its financial position and funding growth initiatives.
- 7The company continues to focus on returning capital to shareholders, declaring a quarterly dividend of $0.825 per share and expecting 85-95% of 2018 dividends to be a return of capital.