Williams Reports Fourth-Quarter and Full-Year 2009 Financial Results
* Net Income is $285 Million, $0.49 Per Share for 2009
* Recurring Adjusted Income is $552 Million, $0.94 Per Share for 2009
* Recurring Adjusted Earnings Per Share Expected to Double by 2011
* Total Proved Reserves for 2009 were approximately 4.5 Tcfe
* Proved, Probable, Possible Reserves Up 14%
* Completion of Asset Contributions to Williams Partners Paves Way for Enhanced Growth Opportunities
* Long-term Gathering Agreement Leads to Marcellus Expansion via Williams Partners
TULSA, Okla., Feb. 18 /PRNewswire-FirstCall/ -- Williams (NYSE: WMB) announced 2009 unaudited net income attributable to Williams of $285 million, or $0.49 per share on a diluted basis, compared with net income of $1,418 million, or $2.40 cents per share on a diluted basis for 2008.
Year-End Summary Financial Information
Per share amounts are
reported on a diluted
basis. All amounts are 2009 2008
attributable to The -------------------- ---------------------
Williams Companies, Inc. millions per share millions per share
-------- --------- -------- ---------
Income from continuing
operations $438 $0.75 $1,306 $2.21
Income (loss) from
discontinued operations (153) (0.26) 112 0.19
---- ----- --- ----
Net income $285 $0.49 $1,418 $2.40
==== ===== ====== =====
-------------------------------------------------------------------------
Recurring income from
continuing operations* $531 $0.90 $1,290 $2.18
After-tax mark-to-market
adjustments 21 0.04 (47) (0.08)
--- ---- --- -----
Recurring income from
continuing operations -
after mark-to-market
adjustments* $552 $0.94 $1,243 $2.10
==== ===== ====== =====
Quarterly Summary Financial Information
Per share amounts are
reported on a diluted
basis. All amounts are
attributable to The 4Q 2009 4Q 2008
Williams Companies, --------------------- ---------------------
Inc. millions per share millions per share
-------- --------- -------- ---------
Income from continuing
operations $172 $0.29 $123 $0.21
Income (loss) from
discontinued
operations - - (8) (0.01)
--- --- --- -----
Net income $172 $0.29 $115 $0.20
==== ===== ==== =====
--------------------------------------------------------------------------
Recurring income from
continuing operations* $165 $0.28 $201 $0.34
After-tax mark-to-
market adjustments (4) (0.01) (16) ($0.02)
--- ----- --- ------
Recurring income from
continuing operations
- after mark-to-
market adjustments* $161 $0.27 $185 $0.32
==== ===== ==== =====
* A schedule reconciling income from continuing operations to recurring
income from continuing operations and mark-to-market adjustments
(non-GAAP measures) is available at www.williams.com and as an attachment
to this press release.
Lower energy commodity prices in 2009, particularly in the first half of the year, impacted results in Exploration & Production and Midstream, as both businesses' results were lower than 2008.
Higher natural gas production; Exploration & Production's hedge positions, which cover a significant portion of its production; and fee-based revenues from certain of Midstream's gathering and processing services helped mitigate the effect of the lower commodity prices in 2009. Both businesses' results also improved throughout 2009. Gas Pipeline's results, as expected, were relatively steady.
The year-to-date loss from discontinued operations is primarily due to the charges that were recorded in first-quarter 2009 associated with the company's operations in Venezuela. As a result of the Venezuelan government's expropriation of the El Furrial and PIGAP II compression facilities in May, Williams is now reporting the results of those operations in discontinued operations.
Recurring Results Adjusted for Effect of Mark-to-Market Accounting
Recurring income from continuing operations, after adjustments to remove the effect of mark-to-market accounting for certain hedges and other derivatives in Gas Marketing Services, is $552 million, or $0.94 per share for 2009. On the same adjusted basis, recurring income from continuing operations was $1,243 million, or $2.10 per share, for 2008.
The lower recurring adjusted results for the year is due to the large disparity between the relatively low 2009 commodity prices, particularly in the first half of the year, compared with the 2008 prices.
As previously noted, the relatively steady results in Gas Pipeline, as well as higher natural gas production, Exploration & Production's hedge positions and fee-based revenues in Midstream, partially offset some of the negative effect of lower commodity prices.
A reconciliation of the company's income from continuing operations to recurring income from continuing operations and mark-to-market adjustments is available at www.williams.com and as an attachment to this news release.
CEO Comment
"With our transformational asset contributions to Williams Partners complete, we are poised to pursue a greater number of value-creating growth projects throughout our businesses," said Steve Malcolm, chairman, president and chief executive officer. "We will pursue these opportunities with financial discipline using the strength of our investment-grade balance sheet.
"One of the opportunities we are seizing is a midstream expansion in the Marcellus Shale. Williams Partners will fund the construction of a natural gas gathering pipeline to support a long-term agreement with Cabot Oil & Gas, one of the key producers in the area.
"Growing our businesses will benefit our shareholders and also add to our domestic natural gas infrastructure," Malcolm said. "We believe strongly that natural gas is a very important part of our energy future – it's an abundant, job-creating, cleaner domestic energy source. It also will help make renewable energy sources, such as wind and solar, viable long-term options."
Consolidated Earnings Guidance for 2010-11 Unchanged, Recurring Adjusted Earnings Expected to Double by 2011
The chart below shows Williams' 2010-11 commodity price assumptions and the related outlook for its consolidated financial results for 2010-11. The chart reflects the pro-forma post-restructuring reporting of Williams and Williams Partners.
Beginning with reporting in first-quarter 2010, Williams' business segments for financial reporting will be Exploration & Production, Williams Partners and Other. The company's consolidated financial reporting will be unchanged. Exploration & Production will include the former Gas Marketing segment and the Other segment will include the Canadian and Olefins midstream businesses and the retained 25.5-percent interest in Gulfstream.
For Williams Partners' reporting beginning first-quarter 2010, its business segments will be Gas Pipeline and Midstream.
The commodity price assumptions and consolidated earnings outlook for 2010-11 are unchanged from what the company previously provided on Jan. 19. Williams Partners' 2010 capital expenditures have been increased in the consolidated outlook by $100 million to a range of $950 million to $1,200 million. This increase primarily reflects the previously noted Midstream expansion in the Marcellus Shale.
Williams expects to double its recurring adjusted earnings in 2011 compared with 2009 at the midpoint of guidance. Primary drivers for the increase in profits include higher commodity prices, higher natural gas production and the contribution of growth projects.
As previously announced, Williams expects to incur estimated nonrecurring charges totaling approximately $425 million, net of tax, in the first-quarter 2010 in conjunction with the asset contribution transactions with Williams Partners. These are comprised primarily of costs associated with Williams' cash tender offer for debt, including the market-value premium. The company expects lower annual interest expenses associated with the new Williams Partners debt offering to substantially offset the economic effect of the market-value premium over book value.
Commodity Price Assumptions
and Financial Outlook 2010 2011
As of Feb. 18, 2010 ----------------------- -----------------------
Low Midpoint High Low Midpoint High
----------------------------------------------------
Natural Gas
($/MMBtu):
NYMEX $4.50 $5.75 $7.00 $5.00 $6.50 $8.00
Rockies $3.90 $5.00 $6.10 $4.35 $5.65 $6.95
Avg. San Juan/
Mid-Continent $4.05 $5.20 $6.35 $4.55 $5.93 $7.30
Oil / NGL:
Crude Oil -WTI
($ per barrel) $60 $75 $90 $65 $80 $95
Crude to Gas
Ratio 12.9x 13.1x 13.3x 11.9x 12.5x 13.0x
NGL to Crude Oil
Relationship 53% 56% 59% 53% 55% 57%
Average NGL
Margins ($ per
gallon) $0.35 $0.51 $0.67 $0.38 $0.51 $0.64
Capital
Expenditures
(millions)
Exploration &
Production $1,000 $1,200 $1,400 $1,300 $1,700 $2,100
Williams Partners 950 1,075 1,200 675 775 875
Other 100 138 175 360 418 480
--- --- --- --- --- ---
Total Capital
Expenditures (1) $2,050 $2,413 $2,775 $2,300 $2,875 $3,450
Recurring Adj.
Segment Profit
(millions) (2)
Exploration &
Production $285 $605 $925 $390 $973 $1,555
Williams Partners 1,185 1,435 1,685 1,325 1,545 1,765
Other 80 130 180 150 180 210
--- --- --- --- --- ---
Total Recurring
Adj. Segment
Profit (3) $1,575 $2,175 $2,775 $1,900 $2,700 $3,500
Recurring Adj.
Earnings Per
Share (2) $0.80 $1.35 $1.90 $1.10 $1.87 $2.65
(1) Recurring Segment Profit and Earnings Per Share are adjusted to
remove the effect of mark-to-market accounting and EPS is diluted.
The Recurring Adjusted earnings amounts are non-GAAP measures.
Reconciliations to the most relevant GAAP measures are attached to
this news release.
(2) Sum of the ranges for each business line does not necessarily match
total range.
(3) Sum of the ranges for the business units does not match the
consolidated total due to the offsetting effect of natural gas prices
within the business units. Also, corporate is not presented
separately but is included in the total.
Business Segment Results
Williams' business segment results for fourth-quarter and full-year 2009 are presented in the following table. As previously announced, Williams' business segment reporting will change beginning with first-quarter 2010 to reflect the company's new reporting segments as a result of the strategic restructuring. As this table reflects 2009 results, it is being presented in the pre-restructuring form.
Consolidated Segment Profit Full Year 4Q
-------------- --------------
Amounts in millions 2009 2008 2009 2008
Exploration & Production $418 $1,260 $115 ($27)
Midstream Gas & Liquids 640 871 269 134
Gas Pipeline 667 689 169 157
--- --- --- ---
$1,725 $2,820 $553 $264
Gas Marketing Services ($18) $3 ($4) $12
Other (1) (3) (4) (1)
--- --- --- ---
Consolidated Segment Profit $1,706 $2,820 $545 $275
====== ====== ==== ====
Recurring Consolidated Segment
Profit After Mark-to-Market
Adjustments* Full Year 4Q
-------------- --------------
Amounts in millions 2009 2008 2009 2008
Exploration & Production $476 $1,298 $137 $136
Midstream Gas & Liquids 665 834 230 105
Gas Pipeline 671 670 173 157
--- --- --- ---
$1,812 $2,802 $540 $398
Gas Marketing after MTM
Adjustments $16 ($72) ($11) ($14)
Other (1) (3) (4) (1)
--- --- --- ---
Recurring Consolidated Segment
Profit After Mark-to-Market
Adjustments $1,827 $2,727 $525 $383
====== ====== ==== ====
* A schedule reconciling income from continuing operations to recurring
income from continuing operations and mark-to-market adjustments
(non-GAAP measures) is available at www.williams.com and as an attachment
to this press release.
Exploration & Production
Exploration & Production includes natural gas production and development in the U.S. Rocky Mountains, San Juan Basin, Barnett Shale, and oil and gas development in South America. The company also made its initial investment in the Marcellus Shale in 2009.
The business reported segment profit of $418 million for 2009, compared with segment profit of $1,260 million in 2008.
The decline in segment profit is due to lower net realized average prices for natural gas production in 2009 versus 2008. During 2009, Williams' net realized average price for U.S. production was $4.22 per thousand cubic feet of natural gas equivalent (Mcfe), which was 35 percent lower than the $6.48 per Mcfe realized in 2008.
Higher natural gas production for the year and lower operating taxes partially offset the decline in net realized average price. Also contributing to the segment profit decline was higher depletion expense for the year driven by higher capitalized costs.
Average Daily Production Full Year
Amounts in million cubic feet equivalent --------------
of natural gas (MMcfe) 2009 2008 Growth rate
---- ---- -----------
Piceance Basin 697 650 7%
Powder River Basin 244 228 7%
Other Basins 241 216 12%
U.S. Interests only 1,182 1,094 8%
U.S. & International Interests 1,236 1,144 8%
Although full-year average daily natural gas production grew from 2008 to 2009, average daily production declined somewhat throughout 2009 because of the company's reduced drilling activity. Average daily natural gas production on U.S. interests fell 4 percent from first-quarter to fourth-quarter 2009.
For fourth-quarter 2009, Exploration & Production reported a segment profit of $115 million, compared with a segment loss of $27 million in fourth-quarter 2008.
The primary driver of the year-over-year increase in fourth quarter segment profit was the absence of impairment charges of $129 million related to properties in the Arkoma Basin that were recorded in fourth-quarter 2008.
In a separate announcement today, Williams announced that its total proved natural gas and oil reserves as of Dec. 31, 2009, were approximately 4.5 trillion cubic feet equivalent (Tcfe) – including international reserves of approximately 0.2 Tcfe. These numbers are based on the new Securities and Exchange Commission reporting rules.
Before adjusting for the effects of unusually low 2009 prices, total proved reserves would have been up 7 percent to 4.8 Tcfe with a reserves replacement rate of 173 percent. Using the same adjustment method, domestic reserves would have also increased 7 percent to approximately 4.6 Tcfe. Approximately 97 percent of total proved reserves are natural gas, with approximately 57 percent proved developed and 43 percent proved undeveloped reflecting a continuation of the increase in the ratio of proved developed to undeveloped.
Before adjusting for the effects of 2009 natural gas prices, the company's three-year average proved U.S. finding and development (F&D) cost was $2.38 per thousand cubic feet equivalent (Mcfe), down from $2.57 per Mcfe in 2008. The three year average F&D cost for reserves adds from drilling activity was $2.06 per Mcfe. For year 2009 alone, Williams' F&D cost was $1.69 per Mcfe. The 2009 cost from drilling activity was $1.53 per Mcfe.
Please see today's separate news release for the complete discussion of the company's 2009 natural gas reserves.
Midstream Gas & Liquids
Midstream provides natural gas gathering, treating, and processing; deepwater production handling and oil transportation; NGL fractionation and storage services; and olefin production.
The business reported segment profit of $640 million for 2009, compared with segment profit of $871 million for 2008. On a recurring basis, segment profit was $665 million for 2009, compared with recurring segment profit of $834 million for 2008.
The decline in segment profit for the year is primarily because of lower average annual NGL and olefin prices, partially offset by decreased production costs reflecting lower natural gas prices. Higher fee-based revenues also helped mitigate the lower NGL prices. NGL prices, especially ethane prices, have generally been improving during 2009, following significant declines in the fourth quarter of 2008.
The increase in fee-based revenue for the year was attributable to connecting new supplies in the deepwater Gulf of Mexico through the Blind Faith extension in late 2008, as well as new volumes from processing Williams' natural gas production at Willow Creek.
Also contributing to the decline were non-recurring items. These included a $68 million loss in first-quarter 2009 related to Midstream's Venezuelan investment and the absence of $32 million of income related to a partial settlement of litigation in 2008. These items were partially offset by a $40 million pre-tax gain on the sale of the company's Cameron Meadows processing plant in the fourth quarter of 2009.
For fourth-quarter 2009, Midstream reported segment profit of $269 million, compared with $134 million in fourth-quarter 2008.
The improvement in results for the fourth quarter is primarily due to improved NGL and olefin prices and production in the fourth quarter of 2009 over 2008. Equity earnings of the company's Discovery investment were higher in the fourth quarter of 2009 due primarily to the absence of unfavorable hurricane impacts that occurred in the fourth quarter of 2008 and new volumes from Discovery's Tahiti expansion in 2009. In addition, fee revenues were higher as a result of processing volumes at the new Willow Creek plant.
Gas Pipeline
Gas Pipeline, which primarily delivers natural gas to markets along the Eastern Seaboard, in Florida and in the Pacific Northwest, reported 2009 segment profit of $667 million, compared with $689 million for 2008.
The lower segment profit was due primarily to higher operating and maintenance, depreciation and pension expenses, partially offset by higher other service revenues and by lower project development costs.
The 2008 results also included the benefit of a $9 million gain on sale of excess natural gas inventory in the second quarter and a $10 million gain on the sale of certain assets in the third quarter.
For fourth-quarter 2009, Gas Pipeline reported segment profit of $169 million, compared with $157 million for fourth-quarter 2008.
The higher segment profit was due primarily to higher transportation revenues, partially offset by higher SG&A and other expenses.
Gas Marketing
Williams is not including a discussion of Gas Marketing's results in this news release. The full Management Discussion and Analysis of 2009 results will be provided in the company's Form 10-K that it plans to file with the Securities and Exchange Commission next week.
Today's Analyst Call
Management will discuss the year-end 2009 results and 2010-11 consolidated outlook during a live webcast beginning at 9:30 a.m. EST today. Participants are encouraged to access the webcast and slides for viewing, downloading and printing at www.williams.com.
A limited number of phone lines also will be available at (888) 352-6793. International callers should dial (719) 457-2643. Replays of the year-end webcast, in both streaming and downloadable podcast formats, will be available for two weeks at www.williams.com following the event.
Form 10-K
The company plans to file its Form 10-K with the SEC during the week of Feb. 22. The document will be available on both the SEC and Williams websites.
About Williams (NYSE: WMB)
Williams is an integrated natural gas company focused on exploration and production, midstream gathering and processing, and interstate natural gas transportation primarily in the Rocky Mountains, Gulf Coast, Pacific Northwest, Eastern Seaboard and the Marcellus Shale in Pennsylvania. Most of the company's interstate gas pipeline and midstream assets are held through its 84-percent ownership interest (including the general-partner interest) in Williams Partners L.P. (NYSE: WPZ), a leading diversified master limited partnership. More information is available at www.williams.com. Go to http://www.b2i.us/irpass.asp?BzID=630&to=ea&s=0 to join our e-mail list.
Contact: |
Jeff Pounds |
|
Williams (media relations) |
||
(918) 573-3332 |
||
Travis Campbell |
||
Williams (investor relations) |
||
(918) 573-2944 |
||
Richard George |
||
Williams (investor relations) |
||
(918) 573-3679 |
||
Sharna Reingold |
||
Williams (investor relations) |
||
(918) 573-2078 |
||
Our reports, filings, and other public announcements may contain or incorporate by reference statements that do not directly or exclusively relate to historical facts. Such statements are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. You typically can identify forward-looking statements by various forms of words such as "anticipates," "believes," "seeks," "could," "may," "should," "continues," "estimates," "expects," "forecasts," "intends," "might," "goals," "objectives," "targets," "planned," "potential," "projects," "scheduled," "will" or other similar expressions. These forward-looking statements are based on management's beliefs and assumptions and on information currently available to management and include, among others, statements regarding:
- Amounts and nature of future capital expenditures;
- Expansion and growth of our business and operations;
- Financial condition and liquidity;
- Business strategy;
- Estimates of proved gas and oil reserves;
- Reserve potential;
- Development drilling potential;
- Cash flow from operations or results of operations;
- Seasonality of certain business segments; and
- Natural gas and natural gas liquids prices and demand.
Forward-looking statements are based on numerous assumptions, uncertainties and risks that could cause future events or results to be materially different from those stated or implied in this report. Many of the factors that could adversely affect our business, results of operations and financial condition are beyond our ability to control or predict. Specific factors that could cause actual results to differ from results contemplated by the forward-looking statements include, among others, the following:
- Availability of supplies (including the uncertainties inherent in assessing, estimating, acquiring and developing future natural gas reserves), market demand, volatility of prices, and the availability and cost of capital;
- Inflation, interest rates, fluctuation in foreign exchange, and general economic conditions (including future disruptions and volatility in the global credit markets and the impact of these events on our customers and suppliers);
- The strength and financial resources of our competitors;
- Development of alternative energy sources;
- The impact of operational and development hazards;
- Costs of, changes in, or the results of laws, government regulations (including proposed climate change legislation), environmental liabilities, litigation, and rate proceedings;
- Our costs and funding obligations for defined benefit pension plans and other postretirement benefit plans;
- Changes in maintenance and construction costs;
- Changes in the current geopolitical situation;
- Our exposure to the credit risk of our customers;
- Risks related to strategy and financing, including restrictions stemming from our debt agreements, future changes in our credit ratings and the availability and cost of credit;
- Risks associated with future weather conditions;
- Acts of terrorism; and
- Additional risks described in our filings with the Securities and Exchange Commission ("SEC").
Given the uncertainties and risk factors that could cause our actual results to differ materially from those contained in any forward-looking statement, we caution investors not to unduly rely on our forward-looking statements. We disclaim any obligations to and do not intend to update the above list or to announce publicly the result of any revisions to any of the forward-looking statements to reflect future events or developments.
In addition to causing our actual results to differ, the factors listed above may cause our intentions to change from those statements of intention set forth in this report. Such changes in our intentions may also cause our results to differ. We may change our intentions, at any time and without notice, based upon changes in such factors, our assumptions, or otherwise.
Investors are urged to closely consider the disclosures and risk factors in our annual report on Form 10-K filed with the SEC on Feb. 25, 2009, and our quarterly reports on Form 10-Q available from our offices or from our website at www.williams.com.
The SEC requires oil and gas companies, in filings made with the SEC, to disclose proved reserves, which are those quantities of oil and gas, which, by analysis of geoscience and engineering data, can be estimated with reasonable certainty to be economically producible – from a given date forward, from known reservoirs, under existing economic condition, operating methods , and governmental regulations. Beginning with year-end reserves for 2009, the SEC permits the optional disclosure of probable and possible reserves. We have elected to use in this presentation, but not in our Annual Report on Form 10-K, "probable" reserves and "possible" reserves, excluding their valuation. The SEC defines "probable" reserves as "those additional reserves that are less certain to be recovered than proved reserves but which, together with proved reserves, are as likely as not to be recovered." The SEC defines "possible" reserves as "those additional reserves that are less certain to be recovered than probable reserves." Williams has applied these definitions in estimating probable and possible reserves. Statements of reserves are only estimates and may not correspond to the ultimate quantities of oil and gas recovered. Any reserve estimates provided in this presentation that are not specifically designated as being estimates of proved reserves may include estimated reserves not necessarily calculated in accordance with, or contemplated by, the SEC's latest reserve reporting guidelines. Investors are urged to consider closely the disclosure in Williams' Annual Report on Form 10-K for the fiscal year ended December 31, 2008, available from Williams at One Williams Center, Tulsa, OK 74172 (Attn: Investor Relations). You can also obtain this report from the SEC by calling 1-800-SEC-0330 or from the SEC's website at www.sec.gov.
The SEC's rules prohibit us from including in filings with the SEC estimates of resources. Our resource estimations include estimates of hydrocarbon quantities for (i) new areas for which we do not have sufficient information to date to classify as proved, probable or even possible reserves and (ii) other areas to take into account the low level of certainty of recovery of the resources. Resource estimates do not take into account the certainty of resource recovery and are therefore not indicative of the expected future recovery and should not be relied upon. Resource estimates might never be recovered and are contingent on exploration success, technical improvements in drilling access, commerciality and other factors.
Adjustment to remove MTM effect
Dollars in millions except for
per share amounts
4th Quarter YTD
------------- -------------
2009 2008* 2009 2008*
---- ---- ---- ----
Recurring income from cont. ops
available to common shareholders $165 $201 $531 $1,290
Recurring diluted earnings per common
share $0.28 $0.34 $0.90 $2.18
Mark-to-Market (MTM) adjustments for
Gas Marketing (7) (26) 34 (75)
Tax effect of total MTM adjustments 3 10 (13) 28
--- --- --- ---
After tax MTM adjustments (4) (16) 21 (47)
Recurring income from cont. ops available
to common shareholders after MTM
adjust. $161 $185 $552 $1,243
Recurring diluted earnings per share
after MTM adj. $0.27 $0.32 $0.94 $2.10
weighted average shares - diluted
(thousands) 591,439 587,057 589,385 592,719
Note: all amounts attributable to Williams
Adjustments have been made to reverse estimated forward unrealized MTM
gains/losses and add estimated realized gains/losses from MTM previously
recognized, i.e. assumes MTM accounting had never been applied to
designated hedges and other derivatives.
Some annual figures may differ from sum of quarterly figures due to
rounding.
* Amounts have been recast to reflect certain Venezuela operations as
discontinued operations.
Reconciliation of Income from Continuing Operations Attributable to The
Williams Companies, Inc. to Recurring Earnings
(UNAUDITED)
2008
(Dollars in millions, except --------------------------------------------
per-share amounts) 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Year
--------------------------------------------------------------------------
Income from continuing operations
attributable to The Williams
Companies, Inc. available to
common stockholders $411 $412 $360 $123 $1,306
==== ==== ==== ==== ======
Income from continuing
operations - diluted earnings
per common share $0.69 $0.69 $0.61 $0.21 $2.21
===== ===== ===== ===== =====
Nonrecurring items:
Exploration & Production (E&P)
-------------------------------
Gain on sale of Peru
interests $(118) $(30) $- $- $(148)
Reserve for/(recovery of)
receivables from bankrupt
counterparty - 5 4 - 9
Impairments of certain natural
gas properties - - 14 129 143
Accrual for Wyoming severance
taxes - - - 34 34
Penalties from early release
of drilling rigs - - - - -
Depletion expense adjustment
related to new guidance - - - - -
Unclaimed property
assessment accrual - - - - -
--- --- --- --- ---
Total Exploration & Production
nonrecurring items (118) (25) 18 163 38
Gas Pipeline
-------------
Gain on sale of excess
inventory gas - TGPL - (9) - - (9)
Gain on sale of certain south
Texas assets - TGPL - - (10) - (10)
Unclaimed property assessment
accrual - TGPL - - - - -
Unclaimed property assessment
accrual - NWP - - - - -
--- --- --- --- ---
Total Gas Pipeline
nonrecurring items - (9) (10) - (19)
Midstream Gas & Liquids (MGL)
------------------------------
Impairment of Carbonate
Trend pipeline - - - 6 6
Involuntary conversion gain
related to Ignacio gas
processing plant - (3) (6) (3) (12)
Reserve for/(recovery of)
receivables from bankrupt
counterparty - 1 - - 1
Final earnout payment
from 2005 Gulf Liquids
asset sale - - (8) - (8)
Charges from Hurricanes
Gustav & Ike - - 8 5 13
Involuntary conversion gain
from hurricane damage at
Cameron Meadows - - - (5) (5)
Gulf Liquids litigation
partial settlement - - - (32) (32)
Loss from Venezuela investment - - - - -
Gain on sale of Cameron Meadows - - - - -
Restructuring transaction costs - - - - -
--- --- --- --- ---
Total Midstream Gas & Liquids
nonrecurring items - (2) (6) (29) (37)
--- --- --- --- ---
Nonrecurring items included in
segment profit (loss) (118) (36) 2 134 (18)
Nonrecurring items below segment
profit (loss)
--------------------------------
Interest related to Gulf
Liquids litigation partial
settlement - MGL - - - (11) (11)
Interest related to Wyoming
severance taxes - E&P - - - 4 4
Loss associated with Venezuela
investment - E&P - - - - -
Reversal of litigation
contingency - Corporate - - - - -
Impairment of cost-based
investment - Corporate - - - - -
Restructuring transaction
costs - Corporate - - - - -
--- --- --- --- ---
- - - (7) (7)
Total nonrecurring items (118) (36) 2 127 (25)
Tax effect for above items (45) (14) 1 49 (9)
--- --- --- --- ---
Recurring income from continuing
operations available to common
stockholders $338 $390 $361 $201 $1,290
==== ==== ==== ==== ======
Recurring diluted earnings per
common share $0.57 $0.66 $0.61 $0.34 $2.18
===== ===== ===== ===== =====
Weighted-average shares -
diluted (thousands) 598,627 596,187 589,138 587,057 592,719
2009
(Dollars in millions, except --------------------------------------------
per-share amounts) 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Year
--------------------------------------------------------------------------
Income from continuing operations
attributable to The Williams
Companies, Inc. available to
common stockholders $2 $123 $141 $172 $438
=== ==== ==== ==== ====
Income from continuing
operations - diluted earnings
per common share $- $0.21 $0.24 $0.29 $0.75
=== ===== ===== ===== =====
Nonrecurring items:
Exploration & Production (E&P)
-------------------------------
Gain on sale of Peru
interests $- $- $- $- $-
Reserve for/(recovery of)
receivables from bankrupt
counterparty - - - (4) (4)
Impairments of certain natural
gas properties 5 - - 15 20
Accrual for Wyoming severance
taxes - 3 (4) (4) (5)
Penalties from early release
of drilling rigs 34 (2) - - 32
Depletion expense adjustment
related to new guidance - - - 14 14
Unclaimed property
assessment accrual - - - 1 1
--- --- --- --- ---
Total Exploration & Production
nonrecurring items 39 1 (4) 22 58
Gas Pipeline
-------------
Gain on sale of excess
inventory gas - TGPL - - - - -
Gain on sale of certain south
Texas assets - TGPL - - - - -
Unclaimed property assessment
accrual - TGPL - - - 3 3
Unclaimed property assessment
accrual - NWP - - - 1 1
--- --- --- --- ---
Total Gas Pipeline
nonrecurring items - - - 4 4
Midstream Gas & Liquids (MGL)
------------------------------
Impairment of Carbonate
Trend pipeline - - - - -
Involuntary conversion gain
related to Ignacio gas
processing plant 1 - (5) - (4)
Reserve for/(recovery of)
receivables from bankrupt
counterparty - - - - -
Final earnout payment
from 2005 Gulf Liquids
asset sale - - - - -
Charges from Hurricanes
Gustav & Ike - - - - -
Involuntary conversion gain
from hurricane damage at
Cameron Meadows - - - - -
Gulf Liquids litigation
partial settlement - - - - -
Loss from Venezuela investment 68 - - - 68
Gain on sale of Cameron Meadows - - - (40) (40)
Restructuring transaction costs - - - 1 1
--- --- --- --- ---
Total Midstream Gas & Liquids
nonrecurring items 69 - (5) (39) 25
--- --- --- --- ---
Nonrecurring items included in
segment profit (loss) 108 1 (9) (13) 87
Nonrecurring items below segment
profit (loss)
--------------------------------
Interest related to Gulf
Liquids litigation partial
settlement - MGL - - - - -
Interest related to Wyoming
severance taxes - E&P - - - - -
Loss associated with Venezuela
investment - E&P 11 - - - 11
Reversal of litigation
contingency - Corporate - (5) - - (5)
Impairment of cost-based
investment - Corporate - - 7 - 7
Restructuring transaction
costs - Corporate - - - 1 1
--- --- --- --- ---
11 (5) 7 1 14
Total nonrecurring items 119 (4) (2) (12) 101
Tax effect for above items 15 (1) (1) (5) 8
--- --- --- --- ---
Recurring income from continuing
operations available to common
stockholders $106 $120 $140 $165 $531
==== ==== ==== ==== ====
Recurring diluted earnings per
common share $0.18 $0.20 $0.24 $0.28 $0.90
===== ===== ===== ===== =====
Weighted-average shares -
diluted (thousands) 582,361 588,780 590,059 591,439 589,385
Note: The sum of earnings per share for the quarters may not equal the
total earnings per share for the year due to changes in the
weighted-average number of common shares outstanding.
SOURCE Williams
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