ONEOK Announces Higher Third Quarter 2024 Earnings; Increases 2024 Financial Guidance
Increases Financial Guidance for the Second Time in 2024
TULSA, Okla., Oct. 29, 2024 /PRNewswire/ -- ONEOK, Inc. (NYSE:OKE) today announced higher third quarter 2024 results and provided 2024 financial guidance on a consolidated basis that includes contributions from EnLink Midstream (EnLink) and the pending Medallion Midstream (Medallion) acquisition. ONEOK also increased its 2024 financial guidance on a stand-alone basis to be comparable with the previous guidance provided on April 30, 2024.
Third Quarter 2024 Results, Compared With Third Quarter 2023:
Net income of $693 million, resulting in $1.18 per diluted share.
Adjusted EBITDA of $1.55 billion.
7% increase in Rocky Mountain region NGL raw feed throughput volumes.
5% increase in Rocky Mountain region natural gas volumes processed.
22% increase in Natural Gas Pipelines segment adjusted EBITDA.
Increased 2024 Financial Guidance:
ONEOK Consolidated (includes expected future contributions from EnLink and Medallion):
Net income midpoint of $2.995 billion.
Earnings per diluted share midpoint of $5.11.
Adjusted EBITDA midpoint of $6.625 billion.
ONEOK's consolidated 2024 net income guidance range is $2.895 billion to $3.095 billion, with an adjusted EBITDA guidance range of $6.525 billion to $6.725 billion, which excludes related transaction costs.
ONEOK Stand-Alone (excludes contributions from EnLink and Medallion):
Net income increased by $65 million to a midpoint of $2.945 billion compared with a previous midpoint of $2.88 billion.
Earnings per diluted share increased to a midpoint of $5.02 compared with a previous midpoint of $4.92.
Adjusted EBITDA increased by $100 million to a midpoint of $6.275 billion compared with a previous midpoint of $6.175 billion.
ONEOK increased 2024 net income guidance to a range of $2.87 billion to $3.02 billion, compared with the previous range of $2.73 billion to $3.03 billion. Adjusted earnings before interest, taxes, depreciation and amortization (adjusted EBITDA) guidance increased to a range of $6.20 billion to $6.35 billion, compared with ONEOK's previous range of $6.025 billion to $6.325 billion.
These midpoints and ranges exclude the contribution from ONEOK's acquisition of the controlling interest in EnLink, the pending acquisition of Medallion and related transaction costs, to be comparable with ONEOK's guidance provided on April 30, 2024.
Increased financial guidance reflects continued confidence in 2024 synergy expectations and fee-based earnings strength across ONEOK's operations.
Total 2024 stand-alone capital expenditure guidance remains unchanged at $1.75 billion to $1.95 billion.
"ONEOK delivered solid results in the third quarter, supported by continued Rocky Mountain region strength, record refined products volumes, increased demand for natural gas transportation services and acquisition-related synergies," said Pierce H. Norton II, ONEOK president and chief executive officer.
"Our ability to continue delivering on synergy opportunities through asset integration and connectivity efforts, coupled with strong fee-based earnings, drove ONEOK's second financial guidance increase in 2024," added Norton. "This combination of value creation through new and existing platforms demonstrates the strength of ONEOK's integrated system and continued commitment to delivering exceptional value."
THIRD QUARTER 2024 FINANCIAL HIGHLIGHTS
Three Months Ended
Nine Months Ended
Sept. 30,
Sept. 30,
2024
2023
2024
2023
(Millions of dollars, except per share amounts)
Net income (a) (b)
$ 693
$ 454
$ 2,112
$ 1,971
Diluted earnings per common share (a) (b)
$ 1.18
$ 0.99
$ 3.60
$ 4.36
Adjusted EBITDA (c) (d)
$ 1,545
$ 1,015
$ 4,610
$ 3,729
Operating income (c)
$ 1,128
$ 739
$ 3,421
$ 2,973
Operating costs
$ 582
$ 352
$ 1,720
$ 981
Depreciation and amortization
$ 274
$ 177
$ 790
$ 509
Equity in net earnings from investments
$ 92
$ 49
$ 256
$ 132
Maintenance capital
$ 109
$ 62
$ 275
$ 138
Capital expenditures (includes maintenance)
$ 468
$ 398
$ 1,459
$ 992
(a) The three and nine months ended Sept. 30, 2024, include pre-tax impacts of $10 million and $17 million, respectively, in transaction and integration costs related to ONEOK's acquisitions; and $23 million in interest expense related to transaction financing in both periods; resulting in total unfavorable EPS impacts of 4 cents and 5 cents per diluted share after tax, respectively.
(b) The nine months ended Sept. 30, 2023, includes $667 million related to the Medford incident, including a settlement gain of $779 million, offset partially by $112 million of third-party fractionation costs. The three and nine months ended Sept. 30, 2023, include $123 million and $133 million, respectively, in transaction costs related to the Magellan acquisition, offset partially by interest income of $26 million and $42 million, respectively.
(c) The three and nine months ended Sept. 30, 2024, include $10 million and $17 million, respectively, in transaction and integration costs related to ONEOK's acquisitions. The three and nine months ended Sept. 30, 2023, include $35 million and $112 million, respectively, in third-party fractionation costs and $123 million and $133 million, respectively, in transaction costs. The nine-month 2023 period also includes a one-time insurance settlement gain of $779 million related to the Medford incident.
(d) Adjusted earnings before interest, taxes, depreciation and amortization (adjusted EBITDA) is a non-GAAP measure. Beginning in 2023, ONEOK updated its calculation methodology of adjusted EBITDA to include adjusted EBITDA from unconsolidated affiliates. This change resulted in an additional $14 million and $40 million of adjusted EBITDA for the three and nine months ended Sept. 30, 2023, respectively.
HIGHLIGHTS:
In August 2024, ONEOK announced a project to rebuild its 210,000 barrel per day (bpd) fractionator in Medford, Oklahoma. The project is expected to cost approximately $385 million and be completed in two phases, with the first expected to be completed in the fourth quarter of 2026 and the second expected to be completed in the first quarter of 2027.
In August 2024, ONEOK announced an agreement to acquire Medallion Midstream from Global Infrastructure Partners (GIP) for $2.6 billion in cash.
In September 2024, ONEOK completed a $7 billion senior notes offering to fund the EnLink controlling interest acquisition and the pending Medallion Midstream acquisition.
In September 2024, ONEOK repaid the remaining $484 million of 2.75% senior notes at maturity with cash on hand.
In October 2024, ONEOK completed the acquisition of GIP's entire interest in EnLink Midstream, consisting of ...
