10-QPeriod: Q1 FY2010

WILLIAMS COMPANIES, INC. Quarterly Report for Q1 Ended Mar 31, 2010

Filed May 5, 2010For Securities:WMB

Summary

Williams Companies, Inc. (WMB) reported a net loss of $193 million, or $0.33 per diluted share, for the first quarter of 2010. This compares unfavorably to a net loss of $172 million, or $0.29 per diluted share, in the same period of the prior year. The increased loss was significantly impacted by $606 million in early debt retirement costs, primarily premiums paid, related to a strategic restructuring completed in February 2010. This restructuring involved contributing substantial midstream and gas pipeline assets to Williams Partners L.P. (WPZ). Despite the net loss, the company's financial condition shows some positive signs. Revenues increased to $2.596 billion from $1.922 billion in the prior year, driven by higher natural gas liquids (NGL) and crude oil marketing revenues, as well as improved natural gas prices. The company also highlighted a focus on growth strategies and cost management. Liquidity remains a key focus, with approximately $4.7 billion in consolidated liquidity available as of March 31, 2010, comprising cash and cash equivalents and unused credit facilities.

Financial Highlights

43 data points
Beta

Revenue

$2.59B

Net Income

-$193.00M

-7.4% Net Margin

EPS (Diluted)

$-0.33

Total Assets

$25.13B

Cash & Equivalents

$1.64B

Free Cash Flow

$617.00M

Financial Statements
Beta
Revenue$2.59B
SG&A Expenses$111.00M
Operating Income$479.00M
Net Income-$193.00M
EPS (Basic)$-0.33
EPS (Diluted)$-0.33
Shares Outstanding (Basic)583.93M
Shares Outstanding (Diluted)583.93M

Key Highlights

  • 1Reported a net loss of $193 million for Q1 2010, an increase from the $172 million net loss in Q1 2009.
  • 2Earnings per diluted share were ($0.33) for Q1 2010, compared to ($0.29) in Q1 2009.
  • 3Total revenues increased to $2.596 billion in Q1 2010 from $1.922 billion in Q1 2009, driven by higher NGL and crude oil marketing revenues and improved commodity prices.
  • 4Incurred $606 million in early debt retirement costs as part of a significant strategic restructuring completed in February 2010.
  • 5The strategic restructuring involved contributing midstream and gas pipeline assets to Williams Partners L.P. (WPZ).
  • 6Maintained substantial consolidated liquidity of approximately $4.7 billion as of March 31, 2010.
  • 7Capital expenditures for Q1 2010 were $428 million, down from $612 million in Q1 2009.

Frequently Asked Questions

The primary driver for the increased net loss was $606 million in early debt retirement costs, which included significant premiums paid, related to the company's strategic restructuring completed in February 2010. This restructuring involved contributing a substantial portion of its midstream and gas pipeline businesses to Williams Partners L.P. (WPZ).

The restructuring led to a change in the company's segment reporting structure. Beginning in Q1 2010, the reportable segments are Williams Partners, Exploration & Production, and Other. This aligns the reporting with the new parent-level focus and management of WPZ as a distinct entity. Prior periods were recast to reflect this new structure.

Williams Companies maintained a strong liquidity position, with approximately $4.7 billion in consolidated liquidity as of March 31, 2010. This includes cash and cash equivalents of $1.644 billion and available capacity under various credit facilities totaling $3.056 billion.

The company anticipates improved operating results and cash flows for 2010 compared to 2009, largely due to expected higher energy commodity prices. Key risks include lower-than-expected energy commodity prices, lower-than-anticipated cash flow from operations, challenges in capital availability, counterparty credit risk, and general economic or industry downturns. The company plans to fund capital expenditures and other requirements through cash flow from operations, existing cash, credit facilities, and potential debt or equity issuances.