Increased income for the quarter and all of 2022 was reported this week by Williams Cos.
Adjusted net income was $2.228 billion or $1.82 per diluted share, an increase of 34% compared to 2021 announced the Tulsa company.
Adjusted EBITDA was $6.418 billion, a gain of $783 million or 14% over the previous year.
Adjusted net income in the fourth quarter was $653 million or 53 cents a diluted share, which resulted in gains of 37% and 36% respectively compared to the fourth quarter of 2021.
The fourth quarter adjusted EBITDA was $1.774 billion, a gain of $291 million or 20% over the 2021 fourth quarter.
“Williams finished the year strong with 20% Adjusted EBITDA growth in the fourth quarter, driven by our core business, upstream JVs and commodity marketing segment,” stated Alan Armstrong, Williams president and chief executive officer.
“Our natural gas-focused strategy once again resulted in record performance in 2022 with contracted transmission capacity, gathering volumes and Adjusted EBITDA all surpassing previous highs. Despite macroeconomic impacts of inflation, higher interest rates and recession risks, Williams delivered outstanding results that exceeded our financial guidance, even after we raised it twice during the year,” he added.
Armstrong believes the company will continue to set the pace for sustainable midstream companies by driving best-in-class emissions performance throughout the company chain.
“We significantly expanded our footprint with the strategic acquisitions of NorTex Midstream and Trace Midstream’s Haynesville assets, a key link in our Gulf Coast wellhead-to-water strategy. And just last week, we closed on our acquisition of MountainWest, enhancing our asset footprint in the western U.S. and growing our fully contracted demand based services,” continued Armstrong.
Fourth-quarter 2022 net income increased by $47 million compared to the prior year reflecting the benefit of higher service revenues driven by increased Haynesville gathering volumes including the Trace Acquisition, as well as higher commodity margins, which included unfavorable write-downs of inventory to lower period-end market prices, and increased results from our upstream operations.
Williams stated these improvements were partially offset by an unfavorable change of $128 million in net unrealized gains/losses on commodity derivatives, higher operating expenses, including higher employee-related costs, and increased intangible asset amortization. The tax provision increased primarily due to higher pretax income.
Full-year 2022 net income increased by $532 million compared to the prior year reflecting the benefit of higher service revenues as described above and also reflecting higher commodity-based rates and Transco’s Leidy South project being in service, higher results from our upstream operations, and higher commodity margins, which include unfavorable write-downs of inventory to lower period-end market prices.
These improvements were partially offset by higher operating and administrative expenses driven by the increased scale of our upstream operations and higher employee-related costs, including costs from the Sequent acquisition for the full 2022 period, increased intangible asset amortization, an unfavorable change of $140 million in net unrealized gains and losses on commodity derivatives and the absence of a $77 million favorable impact in 2021 from Winter Storm Uri.
The tax provision changed favorably as the impact of higher pretax income was more than offset by $134 million associated with the release of valuation allowances on deferred income tax assets and federal income tax settlements in the second quarter and the net benefit from a lower estimated state deferred income tax rate in the third quarter.
Looking ahead for the remainder of 2023, the company expects Adjusted EBITDA to be between $6.4 billion and $6.8 billion. It also anticipates 2023 growth capex to be between $1.4 billion and $1.7 billion while maintenance capex could be between $750 million and $850 million.
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