Tulsa-based ONEOK, Inc. announced its third quarter 2019 financial results showing an 11 percent increase in net income.
The company said its net income for the quarter was $309.2 million or 74 cents a share while adjusted EBITDA was $649.8 million, up 5 percent.
Results were driven primarily by natural gas liquids (NGL) and natural gas volume growth, higher average fee rates in the natural gas liquids segment and increased transportation services in the natural gas pipelines segment, compared with the third quarter 2018.
“Growth across our business segments continues to drive strong results, providing another year of increased companywide earnings in 2019,” said Terry K. Spencer, ONEOK president and chief executive officer. “Our outlook for greater than 20% earnings growth in 2020 is supported by the upcoming completion of critical ONEOK natural gas and NGL infrastructure, including assets to help significantly reduce natural gas flaring in the Williston Basin. These projects will provide immediate earnings and volume uplift in 2020 and stable fee-based growth for years to come.”
As a result of the earnings, the company’s full-year 2019 net income is expected to be decreased in the range of $1.2 to $1.3 billion compared with the guidance of $1.1 billion to $1.4 billion announced in February.
Adjusted earnings for the year were lowered slightly from $2.7 billion down to a range of $2.5 to $2.6 billion.
The increase in adjusted EBITDA for the third quarter 2019, compared with the third quarter 2018, primarily reflects:
- A $15.9 million increase from higher transportation services due primarily to firm transportation capacity contracted due to completed expansion projects; offset partially by
- A $3.2 million increase in operating costs due primarily to higher materials expenses and property taxes due to operational growth.
The increase in adjusted EBITDA for the nine-month 2019 period, compared with the same period last year, primarily reflects:
- A $50.6 million increase from higher transportation services due primarily to firm transportation capacity contracted due to completed expansion projects; and
- A $4.7 million increase due primarily to higher equity in net earnings from investments due to increased firm transportation capacity contracted on Roadrunner Gas Transmission; offset partially by
- A $7.9 million increase in operating costs due primarily to higher employee-related costs and property taxes due to operational growth; and
- A $7.2 million decrease from lower net retained fuel and the timing of equity gas sales.
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