10-QPeriod: Q1 FY2023

WILLIAMS COMPANIES, INC. Quarterly Report for Q1 Ended Mar 31, 2023

Filed May 3, 2023For Securities:WMB

Summary

Williams Companies, Inc. (WMB) reported a strong first quarter of 2023, with Net Income Attributable to The Williams Companies, Inc. surging by 144% to $927 million, or $0.76 per diluted share, compared to $380 million, or $0.31 per diluted share, in the prior year period. This significant increase was driven by a substantial rise in total revenues to $3.08 billion, up from $2.52 billion, largely due to a significant gain on commodity derivatives and increased service revenues from recent acquisitions and higher volumes across various segments. The company completed the acquisition of MountainWest for $1.08 billion in February 2023, expanding its transmission and storage infrastructure. Despite this investment, the company maintained a healthy liquidity position with $4.23 billion in available liquidity as of March 31, 2023. Management expressed confidence in their strategy to provide essential energy infrastructure, anticipating continued earnings and cash flow growth in 2023, supported by ongoing expansion projects and strategic acquisitions.

Financial Highlights

50 data points
Beta

Revenue

$3.08B

Net Income

$927.00M

30.1% Net Margin

EPS (Diluted)

$0.76

Total Assets

$48.94B

Cash & Equivalents

$477.00M

Free Cash Flow

$969.00M

Financial Statements
Beta
Revenue$3.08B
SG&A Expenses$176.00M
Operating Expenses$1.72B
Operating Income$1.36B
Interest Expense$294.00M
Net Income$927.00M
EPS (Basic)$0.76
EPS (Diluted)$0.76
Shares Outstanding (Basic)1.22B
Shares Outstanding (Diluted)1.23B

Key Highlights

  • 1Net income attributable to common stockholders increased significantly by 144% to $927 million ($0.76 per diluted share) from $380 million ($0.31 per diluted share) in Q1 2022.
  • 2Total revenues rose by 22% to $3.08 billion, driven by a strong gain on commodity derivatives ($506 million vs. -$194 million) and higher service revenues.
  • 3Completed the acquisition of MountainWest for $1.08 billion on February 14, 2023, expanding transmission and storage infrastructure in key Western markets.
  • 4Operating income more than doubled to $1.36 billion from $654 million, reflecting improved revenue and a favorable net gain on commodity derivatives.
  • 5Maintained a strong liquidity position with $4.23 billion in available liquidity as of March 31, 2023.
  • 6Regular quarterly dividend increased by 5.3% to $0.4475 per share, payable in March 2023.
  • 7Announced several expansion projects across its Transmission & Gulf of Mexico, West, and Northeast G&P segments, indicating continued investment in growth.

Frequently Asked Questions

The primary driver was a substantial increase in total revenues, which rose to $3.08 billion. This was significantly boosted by a large gain on commodity derivatives ($506 million in Q1 2023 compared to a loss of $194 million in Q1 2022) and an increase in service revenues, partly due to contributions from recent acquisitions like MountainWest and higher volumes across various segments.

The most significant strategic development was the completion of the MountainWest acquisition for $1.08 billion on February 14, 2023. This acquisition expands WMB's transmission and storage infrastructure footprint into major markets in Utah, Wyoming, and Colorado. Additionally, the company continues to advance several key expansion projects across its segments, signaling a commitment to organic growth.

Williams Companies reported $4.23 billion in available liquidity as of March 31, 2023, consisting of cash and cash equivalents ($477 million) and available capacity under its credit facility ($3.75 billion). The company issued $1.5 billion in long-term debt in Q1 2023, partly to pay down commercial paper. They have $1.6 billion in long-term debt due within one year and $22.8 billion due after one year, and they expect sufficient liquidity to manage these obligations through cash flow from operations, potential refinancing, and their credit facilities.

Management anticipates continued earnings and cash flow growth in 2023, benefiting from the MountainWest acquisition, volume growth in key areas, and annual inflation-based rate increases. They are focused on delivering essential energy infrastructure and expect capital expenditures for growth to be between $1.6 billion and $1.9 billion, excluding the MountainWest acquisition, primarily funded by cash flow after dividends.