ONEOK profit down from year ago

By ROD WALTON World Staff Writer - 11/4/2009


Both ONEOK Inc. and its subsidiary, ONEOK Partners LP, reaped significant third-quarter profits despite lower natural gas prices compared with the same time last year, the Tulsa companies announced Tuesday.

ONEOK Inc.'s net income totaled $48 million, while ONEOK Partners' profit hit $121.5 million.

"ONEOK continues to benefit from its investment in ONEOK Partners, which successfully completed more than $2 billion in capital investments at the end of the third quarter, providing the company with solid earnings and cash flow growth," CEO John Gibson said in a statement. "These projects, together with additional opportunities the partnership has identified over the next five years, are expected to drive additional growth at the partnership and at ONEOK."

Executives from ONEOK and its partnership will participate in a conference call at 10 a.m. Wednesday to discuss the earnings reports.

Both natural gas companies' quarterly profits were down from 2008's third quarter due to lower commodity prices, officials said.

ONEOK Inc. net income in the most recent quarter, which was 45 cents per diluted share, compared with $58 million, or 55 cents per diluted share, in the same period last year.

Net income for the nine months ending Sept. 30 was $212 million, or $2.00 per diluted share, compared with $243.7 million, or $2.30 per diluted share, in the same period last year.

For ONEOK Partners, its most recent quarterly net income compared with $203.9 million in the same period in 2008.

For the nine months ended Sept. 30, net income at ONEOK Partners was $318.6 million, or $2.67 per unit, down from $503.4 million, or $4.93 per unit, in the same period in 2008.

The upside, however, included benefits from newly completed pipelines, higher earnings on utility rate mechanisms and increased transportation margins.

In fact, both of ONEOK's distribution and energy-services segments enjoyed third-quarter profits compared with losses same time last year. ONEOK Partners completed construction on the Overland Pass, Arbuckle, Piceance Lateral and Fargo pipelines or extensions, thus increasing volumes.

"We successfully completed our more than $2 billion capital investment program," Gibson said. "These investments, coupled with the additional opportunities we've identified over the next five years, establish a strong foundation for growth in both our fee-based earnings and distributions to unitholders."

ONEOK Partners owns and manages natural gas and natural gas liquids gathering, processing and transportation assets nationwide. ONEOK Inc. owns several natural gas utilities, including Oklahoma Natural Gas Co., and a controlling interest in the partnership.

ONG has a $54.5 million annual rate increase pending before the state's Corporation Commission. Hearings on the request begin next week.

ONEOK Inc. increased its anticipated full-year earnings guidance into the $2.65 to $2.85 per share range. The previous guidance was between $2.40 and $2.70.

ONEOK Partners updated its 2009 earnings guidance to the $3.40 to $3.60 per-unit range, up from a previous $3.25-to-$3.65 prediction. Distributable cash flow for the partnerships is expected to total $530 million to $550 million for the year.

Shares of ONEOK Inc. rose 76 cents to $36.93 on the New York Stock Exchange. ONEOK Partners' stock was up 16 cents to $54.62.



Rod Walton 581-8457
rod.walton@tulsaworld.com


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Tulsa World Reader Comments
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born okay the 1st time, tulsa (11/4/2009 8:00:58 AM)
Get ready for another rate increase!



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