10-KPeriod: FY2018

WILLIAMS COMPANIES, INC. Annual Report, Year Ended Dec 31, 2018

Filed February 21, 2019For Securities:WMB

Summary

Williams Companies, Inc. (WMB) reported its 2018 fiscal year results, marked by significant strategic movements, including the completion of its merger with Williams Partners L.P. (WPZ). This integration is expected to streamline operations and enhance financial flexibility. The company's business is structured into three primary segments: Northeast G&P, Atlantic-Gulf, and West, each contributing to its core business of connecting North American hydrocarbon resources to markets. Financially, 2018 presented a mixed picture. While revenue saw an increase primarily driven by higher transportation fees from expansion projects, net income attributable to the company experienced a substantial decline compared to the prior year. This decrease was largely due to significant asset impairments, particularly in the Barnett Shale region, and a higher provision for income taxes in the absence of the prior year's tax reform benefits. Despite these challenges, Williams remains focused on growth through ongoing expansion projects and disciplined capital deployment. The company declared a quarterly dividend of $0.38 per share, signaling continued commitment to shareholder returns.

Financial Highlights

51 data points
Beta

Revenue

$8.60B

Net Income

-$155.00M

-1.8% Net Margin

EPS (Diluted)

$-0.16

Total Assets

$45.30B

Cash & Equivalents

$168.00M

Free Cash Flow

$37.00M

Financial Statements
Beta
Revenue$8.60B
SG&A Expenses$569.00M
Operating Expenses$7.92B
Operating Income$768.00M
Interest Expense$1.11B
Net Income-$155.00M
EPS (Basic)$-0.16
EPS (Diluted)$-0.16
Shares Outstanding (Basic)973.63M
Shares Outstanding (Diluted)973.63M

Key Highlights

  • 1Completed the merger with Williams Partners L.P. (WPZ) on August 10, 2018, to simplify corporate structure and governance.
  • 2Realigned business operations into three reportable segments: Northeast G&P, Atlantic-Gulf, and West.
  • 3Recorded a significant impairment charge of $1.849 billion related to certain assets in the Barnett Shale region.
  • 4Generated higher service revenues, driven by expansion projects on the Transco pipeline system and increased gathering volumes.
  • 5Announced a regular quarterly dividend of $0.38 per share, payable in March 2019.
  • 6Anticipates 2019 growth capital expenditures to be in the range of $2.7 billion to $2.9 billion, focusing on Transco expansions and gathering/processing infrastructure.
  • 7Navigated regulatory changes related to FERC's income tax policy and the Tax Cuts and Jobs Act.

Frequently Asked Questions

The most significant financial event was the completion of the merger with Williams Partners L.P. (WPZ) on August 10, 2018. This transaction aimed to streamline the corporate structure and enhance financial flexibility.

The merger was accounted for as a non-cash equity transaction, leading to increases in common stock and capital in excess of par value, and decreases in accumulated other comprehensive income and noncontrolling interests. It also simplified the company's segment reporting structure.

The decrease was primarily driven by a significant impairment charge of $1.849 billion on certain assets in the Barnett Shale region, coupled with a higher provision for income taxes in 2018 compared to 2017, which benefited from tax reform adjustments. These factors were partially offset by gains from asset sales and the absence of regulatory charges from the prior year.

Williams expects its operating results to increase through organic growth, particularly from expansion projects in the Northeast region and on Transco. Growth capital and investment expenditures for 2019 are projected to be between $2.7 billion and $2.9 billion, focusing on Transco expansions and developing gathering and processing infrastructure.