Williams Reports First-Quarter 2019 Financial Results

TULSA, Okla.–Williams (NYSE: WMB) today announced its unaudited financial results for the three months ended March 31, 2019.

Strong 1Q 2019 Results Compared with 1Q 2018

• Net Income Attributable to Williams available to common stockholders of $194 million; up $42 million or 28%
• Net Income Per Share of $0.16 – down $0.02; Adjusted Income Per Share of $0.22; up 16%
• Cash Flow From Operations of $775 million; up $81 million or 12%
• Adjusted EBITDA of $1.216 billion; up $81 million or 7%
• Distributable Cash Flow (“DCF”) of $780 million; up $57 million or 8%
• Dividend Coverage Ratio is 1.70x

Solid Execution While Fortifying our Balance Sheet

• Placed Gulf Connector LNG supply project into full service on Jan. 4.
• Two recent deleveraging transactions expected to result in a net of approximately $1.085 billion that Williams plans to use for debt reduction and for funding the company’s extensive portfolio of growth capital:
  • On March 18, announced the formation of new strategic joint venture in the Marcellus/Utica Basins with the Canada Pension Plan Investment Board (“CPPIB”);
  • On April 10, announced completion of sale of our 50% Interest in Jackalope Gas Gathering Services, LLC to an affiliate of Crestwood Equity Partners LP.

2019 Financial Guidance Updates

• Raising guidance for Net Income and Adjusted EPS.
• Maintaining 2019 guidance for Adjusted EBITDA, DCF and Dividend Coverage Ratio.
• Growth capital expenditures guidance midpoint lowered to $2.4 billion from $2.8 billion in part due to lower capital requirements in the Northeast and lower capital requirements from our Jackalope Gas Gathering Services deleveraging transaction.
• 2019 year-end Debt-to-Adjusted EBITDA now expected to be < 4.6x.

CEO Perspective

Alan Armstrong, president and chief executive officer, made the following comments:

“Our first-quarter 2019 performance produced strong results and solid execution while fortifying our balance sheet. Led by our Atlantic-Gulf and Northeast G&P segments, each showing EBITDA growth of more than 20%, our key financial metrics reflected year-over-year growth. On the execution front, our project teams continue to meet or exceed their goals as well. Gulf Connector, Fort Lupton III, St. James Supply and the work on Shell’s Norphlet project are now all complete and will add cash flows through the balance of the year. Also, numerous projects have been executed in our Northeast G&P area to deliver 15% year-over-year growth in gathered volumes. And while lower commodity prices combined with strict capital discipline are pressuring a few of our producing customers’ forecasts in the near-term, those same lower commodity prices are fundamental to driving demand and ultimately volumes in these key gas basins.”

Armstrong added, “Importantly, we are raising our EPS and income guidance, maintaining our EBITDA and DCF all while lowering capital expenditures for this year. This is the result of the crisp execution of our portfolio optimization transactions and continued tight discipline around capital deployment. This, along with expected contributions from our Northeast JV partner, has added momentum to our deleveraging efforts as we now see 2019 leverage coming in below 4.6x versus our earlier guidance of less than 4.75x.”

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