TULSA, Okla., Feb 25, 2008 /PRNewswire-FirstCall via COMTEX News Network/ -- ONEOK, Inc. (NYSE: OKE)
today announced that its fourth-quarter 2007 net income rose 38 percent to
$102.9 million, or 98 cents per diluted share, compared with net income of
$74.6 million, or 66 cents per diluted share, in the fourth quarter 2006.
Net income for the full year 2007 was $304.9 million, or $2.79 per diluted
share, compared with $306.3 million, or $2.68 per diluted share, a year
earlier. 2006 results include ONEOK's share of ONEOK Partners' gain on the
sale of a 20 percent interest in Northern Border Pipeline Company, which had
an after-tax impact of $32.3 million, or 28 cents per diluted share.
Excluding the one-time gain, 2007 net income was up $30.9 million, or 11
percent.
"All of our businesses performed well in the fourth quarter and the year,"
said John W. Gibson, ONEOK chief executive officer.
"Our ONEOK Partners segment benefited from continued supply growth in our
natural gas liquids (NGL) businesses, our October acquisition of an NGL and
refined petroleum products pipeline and higher realized commodity prices,"
Gibson said. "Our distribution segment's performance was solid, benefiting
from new rates in Kansas and Texas and a continued emphasis on cost control.
The energy services segment turned in an exceptional quarter, driven by higher
transportation, storage and marketing activities.
"In 2008, we will continue to see the benefits of ONEOK Partners' $1.6
billion investment in internal growth projects that will start to come on line
this year," Gibson added. "And we will continue to focus on improving the
profitability of our distribution segment."
Fourth-quarter operating income was $255.7 million in 2007, compared with
$202.7 million in 2006, reflecting improvement in all three of the company's
operating segments. ONEOK Partners benefited from higher commodity prices and
the first quarter of earnings from the North System, an interstate NGL and
refined petroleum products pipeline system acquired in October 2007. The
distribution segment benefited from implementing new rate schedules in Kansas
and Texas. And, the energy services segment experienced higher
transportation, storage and marketing margins.
Excluding gains on the sale of assets, full-year 2007 operating income
increased to $820.6 million from $745.7 million in 2006. The distribution
segment improved its margins by the implementation of new rate schedules in
Kansas and Texas. ONEOK Partners increased its margins in its natural gas
liquids businesses from new supply connections that increased NGL volumes
gathered, transported, fractionated and sold; higher isomerization and product
price spreads; and the first quarter of earnings from the recently acquired
North System. These increases were partially offset by reduced transportation
and financial trading margins in the energy services segment.
Operating costs for the year were $761.5 million, compared with $740.8
million in 2006. The increase is due to higher employee-related costs and the
incremental operating expenses associated with the North System acquisition,
and increased bad debt expense and higher property taxes in the distribution
segment. Depreciation and amortization expense decreased for the year,
compared with 2006, primarily as a result of a goodwill and asset impairment
charge of $12.0 million recorded in the second quarter of 2006 related to the
Black Mesa Pipeline, which is included in the ONEOK Partners segment.
2007 SUMMARY INCLUDES:
* Excluding the gains on sale of assets, operating income increased 10
percent to $820.6 million from $745.7 million in 2006;
* Increasing the company's dividend 13 percent during the year and
another 6 percent in January 2008 to 38 cents;
* Receiving regulatory approval of the distribution segment's pipeline
integrity management program in Oklahoma, allowing for recovery of
$7.2 million in deferred costs;
* Filing for a capital investment mechanism for the distribution
segment in Oklahoma that would allow for recovery of and a return on
the capital costs incurred between rate cases to expand and maintain
the natural gas distribution system;
* Filing for new rates in the distribution segment's El Paso
jurisdiction; a $3.1 million annual rate adjustment was approved in
February 2008;
* Increasing by $500 million to $1.6 billion the amount of internal
growth projects under way by ONEOK Partners, including the Piceance
Lateral and Arbuckle Pipeline;
* ONEOK Partners' completing a $300 million acquisition of the North
System, an interstate natural gas liquids and refined petroleum
products pipeline system and related assets in October 2007;
* Distributions declared related to the company's general partner
interest in ONEOK Partners of $58.5 million for the year;
distributions declared from the company's limited partner interest
in ONEOK Partners of $148.9 million for 2007;
* ONEOK, on a stand-alone basis, having $102.6 million of short-term
debt at Dec. 31, 2007, $15.9 million of cash and cash equivalents
and $590.1 million of natural gas in storage;
* ONEOK stand-alone total debt of 51 percent of capitalization;
* ONEOK stand-alone cash flow from continuing operations, before
changes in working capital, of $505.9 million, which exceeded
capital expenditures and dividends of $324.0 million by $181.9
million;
* Completing the repurchase of 7.5 million shares of outstanding
common stock under an accelerated share repurchase program;
* The election of Julie H. Edwards and Jim W. Mogg to the ONEOK board
of directors;
* Electing David Kyle non-executive chairman of the board, effective
Jan. 1, 2008, when he retired as a full-time employee; and
* Completing the first year with a new leadership team: John W.
Gibson, chief executive officer; James C. Kneale, president and
chief operating officer; and Curtis L. Dinan, senior vice president,
chief financial officer and treasurer.
2007 BUSINESS UNIT RESULTS
ONEOK Partners
The ONEOK Partners segment posted fourth-quarter operating income of
$129.7 million versus $90.6 million in the same quarter 2006. The segment's
natural gas gathering and processing business benefited from higher realized
commodity prices and a favorable one-time contract settlement in the fourth
quarter 2007. The fourth quarter also marked the first quarter of earnings
from the recently acquired North System, an interstate natural gas liquids and
refined petroleum products pipeline system and related assets, which improved
the performance of the natural gas liquids pipelines business.
Full-year operating income was $446.8 million in 2007, compared with
$511.2 million in 2006. Operating income for 2006 includes the one-time gain
on sale of assets of $113.9 million related to ONEOK Partners' sale of a 20
percent partnership interest in Northern Border Pipeline in April 2006.
Excluding the gain on sale in 2006, operating income increased $49.5 million,
or 12 percent, in 2007.
Full-year 2007 results reflect increased margins in the segment's natural
gas liquids businesses, which benefited primarily from new supply connections
that increased NGL volumes gathered, transported, fractionated and sold. The
natural gas liquids gathering and fractionation business also benefited from
both higher product and isomerization price spreads, and the natural gas
liquids pipelines business had incremental margin related to the recently
acquired North System. These increases were partially offset by decreased
natural gas processing and transportation margins in the partnership's natural
gas businesses, due primarily to lower natural gas volumes processed and lower
natural gas throughput as a result of various contract terminations in late
2006.
Operating costs were $337.4 million for the full year 2007, compared with
$325.8 million in 2006, increasing primarily as a result of higher employee-
related costs and incremental operating expenses associated with the recently
acquired North System. Depreciation and amortization expense decreased by
$8.3 million for 2007, compared with 2006, primarily due to a goodwill and
asset impairment charge of $12.0 million related to the Black Mesa Pipeline
recorded in the second quarter of 2006.
Equity earnings from investments for the full year 2007 were $89.9
million, compared with $95.9 million in the same period last year. The
reduction is primarily due to ONEOK Partners' share of Northern Border
Pipeline's earnings declining from 70 percent in the first quarter of 2006 to
50 percent beginning in the second quarter of 2006.
Distribution
The distribution segment reported fourth-quarter operating income of $60.7
million versus $49.0 million in the same quarter 2006.
The increase in fourth-quarter 2007 earnings is primarily the result of
implementation of new rate schedules, which included $13.5 million in Kansas
and $0.4 million in Texas, partially offset by reduced volumes due to the
December ice storm in Oklahoma. Operating costs decreased to $98.8 million in
the fourth quarter 2007 versus $100.6 million in 2006. Depreciation and
amortization expense increased $1.3 million in the fourth quarter 2007,
compared with the same period last year.
The distribution segment reported 2007 operating income of $174.2 million,
compared with $117.5 million last year. Net margin increased $63.9 million as
a result of a $55.2 million increase from the implementation of new rate
schedules, which includes $51.1 million in Kansas and $4.1 million in Texas;
and an increase of $8.0 million from higher customer sales volumes due to a
return to more normal weather in the distribution segment's entire service
territory.
Operating costs for 2007 increased to $377.8 million, compared with $371.5
million in 2006, due to $4.8 million in higher bad debt expense, primarily in
Oklahoma, and $5.3 million in higher property taxes in Kansas. These expenses
were partially offset by a decrease of $4.0 million in employee-related costs.
Residential and commercial volumes increased during 2007, compared with
2006, due to a return to more normal weather from the unseasonably warm
weather in 2006.
Energy Services
The energy services segment posted fourth-quarter operating income of
$75.7 million versus $60.9 million in the same quarter 2006. The increase in
earnings for the quarter was due primarily to $10.3 million in improved
transportation margins and $5.8 million in storage and marketing margins
resulting from higher seasonal storage spreads and storage withdrawals,
partially offset by $2.1 million in lower financial trading margins.
Full-year 2007 operating income was $205.3 million, compared with $229.2
million in 2006. The decrease is primarily due to reduced transportation
margins of $14.1 million as a result of narrower location spreads; a $7.9
million impact from the third-quarter 2007 Cheyenne Plains Gas Pipeline
outage; $5.0 million in lower retail margins due to market conditions; and
$4.3 million in lower financial trading margins. These decreases were
partially offset by $4.9 million in improved storage margins due to higher
realized seasonal storage spreads and optimization activities, partially
offset by increased storage fees.
Operating costs for the year decreased to $39.9 million, compared with
$42.5 million in 2006, due primarily to lower legal and employee-related
costs.
On Dec. 31, 2007, natural gas in storage was 66.7 Bcf, compared with 74.1
Bcf a year earlier. Natural gas storage capacity under lease was 96 Bcf on
Dec. 31, 2007, compared with 86 Bcf in 2006.
The net margin for the energy services segment was derived from the
following sources:
Three Months Ended Years Ended
December 31, December 31,
2007 2006 2007 2006
(Thousands of dollars)
Marketing and storage, gross $134,444 $111,943 $409,051 $414,951
Less: Storage and transportation
costs (50,454) (44,079) (191,863) (180,708)
Marketing and storage, net 83,990 67,864 217,188 234,243
Retail marketing 4,613 5,805 13,990 19,006
Financial trading (118) 1,943 16,224 20,569
Net margin $88,485 $75,612 $247,402 $273,818
EARNINGS CONFERENCE CALL
The management of ONEOK and ONEOK Partners will conduct a joint conference
call on Tuesday, Feb. 26, 2008, at 11 a.m. Eastern Standard Time (10 a.m.
Central Standard Time). The call will also be carried live on ONEOK's and
ONEOK Partners' Web sites.
To participate in the telephone conference call, dial 866-244-4616, pass
code 1186879, or log on to the webcast at http://www.oneok.com or
http://www.oneokpartners.com.
For those unable to participate in the conference call or the webcast, the
replay will be available on ONEOK's Web site, http://www.oneok.com, and ONEOK
Partners' Web site, http://www.oneokpartners.com, for 30 days. A recording
will be available by phone for seven days. The playback call may be accessed
at 866-837-8032, pass code 1186879.
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ONEOK, Inc. (NYSE: OKE) is a diversified energy company. We are the
general partner and own 45.7 percent of ONEOK Partners, L.P. (NYSE: OKS), one
of the largest publicly traded limited partnerships, which is a leader in the
gathering, processing, storage and transportation of natural gas in the U.S.
and owns one of the nation's premier natural gas liquids (NGL) systems,
connecting much of the natural gas and NGL supply in the Mid-Continent with
key market centers. ONEOK is among the largest natural gas distributors in
the United States, serving more than 2 million customers in Oklahoma, Kansas
and Texas. Our energy services operation focuses primarily on marketing
natural gas and related services throughout the U.S. ONEOK is a Fortune 500
company.
For information about ONEOK, Inc., visit the Web site:
http://www.oneok.com.
Some of the statements contained and incorporated in this news release are
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. The forward-looking statements relate to our
anticipated financial performance, management's plans and objectives for our
future operations, our business prospects, the outcome of regulatory and legal
proceedings, market conditions and other matters. The Private Securities
Litigation Reform Act of 1995 provides a safe harbor for forward-looking
statements in certain circumstances. The following discussion is intended to
identify important factors that could cause future outcomes to differ
materially from those set forth in the forward-looking statements.
Forward-looking statements include the items identified in the preceding
paragraph, the information concerning possible or assumed future results of
our operations and other statements contained or incorporated in this news
release identified by words such as "anticipate," "estimate," "expect,"
"project," "intend," "plan," "believe," "should," "goal," "forecast" and other
words and terms of similar meaning.
You should not place undue reliance on forward-looking statements. Known
and unknown risks, uncertainties and other factors may cause our actual
results, performance or achievements to be materially different from any
future results, performance or achievements expressed or implied by forward-
looking statements. Those factors may affect our operations, markets,
products, services and prices. In addition to any assumptions and other
factors referred to specifically in connection with the forward-looking
statements, factors that could cause our actual results to differ materially
from those contemplated in any forward-looking statement include, among
others, the following:
* the effects of weather and other natural phenomena on our
operations, including energy sales and demand for our services and
energy prices;
* competition from other United States and Canadian energy suppliers
and transporters as well as alternative forms of energy;
* the capital intensive nature of our businesses;
* the profitability of assets or businesses acquired by us;
* risks of marketing, trading and hedging activities, including the
risks of changes in energy prices or the financial condition of our
counterparties;
* the uncertainty of estimates, including accruals and costs of
environmental remediation;
* the timing and extent of changes in energy commodity prices;
* the effects of changes in governmental policies and regulatory
actions, including changes with respect to income and other taxes,
environmental compliance, and authorized rates or recovery of gas
and gas transportation costs;
* impact on drilling and production by factors beyond our control,
including the demand for natural gas and refinery-grade crude oil;
producers' desire and ability to obtain necessary permits; reserve
performance; and capacity constraints on the pipelines that
transport crude oil, natural gas and NGLs from producing areas and
our facilities;
* changes in demand for the use of natural gas because of market
conditions caused by concerns about global warming or changes in
governmental policies and regulations due to climate change
initiatives;
* the impact of unforeseen changes in interest rates, equity markets,
inflation rates, economic recession and other external factors over
which we have no control, including the effect on pension expense
and funding resulting from changes in stock and bond market returns;
* actions by rating agencies concerning the credit ratings of ONEOK
and ONEOK Partners;
* the results of administrative proceedings and litigation, regulatory
actions and receipt of expected clearances involving the OCC, KCC,
Texas regulatory authorities or any other local, state or federal
regulatory body, including the FERC;
* our ability to access capital at competitive rates or on terms
acceptable to us;
* risks associated with adequate supply to our gathering, processing,
fractionation and pipeline facilities, including production declines
which outpace new drilling;
* the risk that material weaknesses or significant deficiencies in our
internal controls over financial reporting could emerge or that
minor problems could become significant;
* the impact and outcome of pending and future litigation;
* the ability to market pipeline capacity on favorable terms,
including the affects of:
- future demand for and prices of natural gas and NGLs;
- competitive conditions in the overall energy market;
- availability of supplies of Canadian and United States natural
gas;
- availability of additional storage capacity;
- weather conditions; and
- competitive developments by Canadian and U.S. natural gas
transmission peers;
* performance of contractual obligations by our customers, service
providers, contractors and shippers;
* the timely receipt of approval by applicable governmental entities
for construction and operation of our pipeline and other projects
and required regulatory clearances;
* our ability to acquire all necessary rights-of-way permits and
consents in a timely manner, to promptly obtain all necessary
materials and supplies required for construction, and to construct
pipelines without labor or contractor problems;
* the mechanical integrity of facilities operated;
* demand for our services in the proximity of our facilities;
* our ability to control operating costs;
* acts of nature, sabotage, terrorism or other similar acts that cause
damage to our facilities or our suppliers' or shippers' facilities;
* economic climate and growth in the geographic areas in which we do
business;
* the risk of a significant slowdown in growth or decline in the U.S.
economy or the risk of delay in growth recovery in the U.S. economy;
* the impact of recently issued and future accounting pronouncements
and other changes in accounting policies;
* the possibility of future terrorist attacks or the possibility or
occurrence of an outbreak of, or changes in, hostilities or changes
in the political conditions in the Middle East and elsewhere;
* the risk of increased costs for insurance premiums, security or
other items as a consequence of terrorist attacks;
* risks associated with pending or possible acquisitions and
dispositions, including our ability to finance or integrate any such
acquisitions and any regulatory delay or conditions imposed by
regulatory bodies in connection with any such acquisitions and
dispositions;
* the possible loss of gas distribution franchises or other adverse
effects caused by the actions of municipalities;
* the impact of unsold pipeline capacity being greater or less than
expected;
* the ability to recover operating costs and amounts equivalent to
income taxes, costs of property, plant and equipment and regulatory
assets in our state and FERC-regulated rates;
* our ability to promptly obtain all necessary materials and supplies
required for construction of gathering, processing, storage,
fractionation and transportation facilities;
* the composition and quality of the natural gas and NGLs we gather
and process in our plants and transport on our pipelines;
* the efficiency of our plants in processing natural gas and
extracting and fractionating NGLs;
* the impact of potential impairment charges;
* the risk inherent in the use of information systems in our
respective businesses, implementation of new software and hardware,
and the impact on the timeliness of information for financial
reporting;
* our ability to control construction costs and completion schedules
of our pipelines and other projects; and
* the risk factors listed in the reports we have filed and may file
with the SEC, which are incorporated by reference.
These factors are not necessarily all of the important factors that could
cause actual results to differ materially from those expressed in any of our
forward-looking statements. Other factors could also have material adverse
effects on our future results. These and other risks are described in greater
detail in Item 1A, Risk Factors, in our Annual Report on Form 10-K. All
forward-looking statements attributable to us or persons acting on our behalf
are expressly qualified in their entirety by these factors. Other than as
required under securities laws, we undertake no obligation to update publicly
any forward-looking statement whether as a result of new information,
subsequent events or change in circumstances, expectations or otherwise.
OKE-FE
Analyst Contact: Dan Harrison
918-588-7950
Media Contact: Megan Washbourne
918-588-7572
ONEOK, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF INCOME
Three Months Ended Years Ended
December 31, December 31,
(Unaudited) 2007 2006 2007 2006
(Thousands of dollars, except per share amounts)
Revenues
Operating revenues,
excluding energy
trading revenues $3,998,333 $3,069,902 $13,488,027 $11,913,529
Energy trading revenues,
net (13,365) 3,750 (10,613) 6,797
Total Revenues 3,984,968 3,073,652 13,477,414 11,920,326
Cost of sales and fuel 3,447,569 2,602,649 11,667,306 10,198,342
Net Margin 537,399 471,003 1,810,108 1,721,984
Operating Expenses
Operations and maintenance 198,564 191,442 675,575 662,681
Depreciation and
amortization 59,506 56,654 227,964 235,543
General taxes 23,618 20,321 85,935 78,086
Total Operating Expenses 281,688 268,417 989,474 976,310
Gain on sale of assets 16 100 1,909 116,528
Operating Income 255,727 202,686 822,543 862,202
Equity earnings from
investments 24,933 23,133 89,908 95,883
Allowance for equity
funds used during
construction 5,852 1,693 12,538 2,205
Other income 4,488 5,860 21,932 26,030
Other expense 5,666 12,076 7,879 24,154
Interest expense 68,822 63,077 256,325 239,725
Income before Minority
Interests and Income
Taxes 216,512 158,219 682,717 722,441
Minority interests in
income of consolidated
subsidiaries 58,186 37,380 193,199 222,000
Income taxes 55,402 46,259 184,597 193,764
Income from Continuing
Operations 102,924 74,580 304,921 306,677
Income (loss) from
operations of
discontinued
components, net - 45 - (365)
Net Income $102,924 $74,625 $304,921 $306,312
Earnings Per Share of
Common Stock
Net earnings per share,
basic $0.99 $0.68 $2.84 $2.74
Net earnings per share,
diluted $0.98 $0.66 $2.79 $2.68
Average Shares of Common
Stock (Thousands)
Basic 103,763 110,257 107,346 112,006
Diluted 105,555 112,705 109,298 114,477
Dividends Declared Per
Share of Common Stock $0.36 $0.32 $1.40 $1.22
ONEOK, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETS
December 31, December 31,
(Unaudited) 2007 2006
Assets (Thousands of dollars)
Current Assets
Cash and cash equivalents $19,105 $68,268
Short-term investments - 31,125
Trade accounts and notes receivable, net 1,723,212 1,348,490
Gas and natural gas liquids in storage 841,362 925,194
Commodity exchanges and imbalances 82,938 53,433
Energy marketing and risk management assets 168,609 401,670
Other current assets 116,249 296,781
Total Current Assets 2,951,475 3,124,961
Property, Plant and Equipment
Property, plant and equipment 7,893,492 6,724,759
Accumulated depreciation and amortization 2,048,311 1,879,838
Net Property, Plant and Equipment 5,845,181 4,844,921
Deferred Charges and Other Assets
Goodwill and intangible assets 1,043,773 1,051,440
Energy marketing and risk management assets 3,978 91,133
Investments in unconsolidated affiliates 756,260 748,879
Other assets 461,367 529,748
Total Deferred Charges and Other Assets 2,265,378 2,421,200
Total Assets $11,062,034 $10,391,082
ONEOK, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETS
December 31, December 31,
(Unaudited) 2007 2006
Liabilities and Shareholders' Equity (Thousands of dollars)
Current Liabilities
Current maturities of long-term debt $420,479 $18,159
Notes payable 202,600 6,000
Accounts payable 1,436,005 1,076,954
Commodity exchanges and imbalances 252,095 176,451
Energy marketing and risk management
liabilities 133,903 306,658
Other 436,585 366,316
Total Current Liabilities 2,881,667 1,950,538
Long-term Debt, excluding current maturities 4,215,046 4,030,855
Deferred Credits and Other Liabilities
Deferred income taxes 680,543 707,444
Energy marketing and risk management
liabilities 26,861 137,312
Other deferred credits 486,645 548,330
Total Deferred Credits and Other
Liabilities 1,194,049 1,393,086
Commitments and Contingencies
Minority Interests in Consolidated
Subsidiaries 801,964 800,645
Shareholders' Equity
Common stock, $0.01 par value:
authorized 300,000,000 shares; issued
121,115,217 shares and outstanding
103,987,476 shares at December 31, 2007;
issued 120,333,908 shares and
outstanding 110,678,499 shares at
December 31, 2006 1,211 1,203
Paid in capital 1,273,800 1,258,717
Accumulated other comprehensive income
(loss) (7,069) 39,532
Retained earnings 1,411,492 1,256,759
Treasury stock, at cost: 17,127,741
shares at December 31, 2007 and
9,655,409 shares at December 31, 2006 (710,126) (340,253)
Total Shareholders' Equity 1,969,308 2,215,958
Total Liabilities and Shareholders'
Equity $11,062,034 $10,391,082
ONEOK, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWS
Years Ended December 31,
(Unaudited) 2007 2006
Operating Activities (Thousands of dollars)
Net income $304,921 $306,312
Depreciation and amortization 227,964 235,543
Allowance for equity funds used
during construction (12,538) (2,205)
Gain on sale of assets (1,909) (116,528)
Minority interests in income of
consolidated subsidiaries 193,199 222,000
Distributions received from
unconsolidated affiliates 103,785 123,427
Income from equity investments (89,908) (95,883)
Deferred income taxes 65,017 115,384
Stock-based compensation expense 14,639 16,499
Allowance for doubtful accounts 14,578 9,056
Changes in assets and liabilities
(net of acquisition and disposition
effects):
Accounts and notes receivable (378,876) 649,415
Inventories 88,860 (14,107)
Unrecovered purchased gas costs 9,530 (73,534)
Commodity exchanges and imbalances, net 40,572 18,001
Deposits 77,525 50,445
Regulatory assets (2,225) 15,441
Accounts payable and accrued liabilities 353,104 (499,996)
Energy marketing and risk management
assets and liabilities (60,544) (139,488)
Other assets and liabilities 81,966 53,494
Cash Provided by Operating Activities 1,029,660 873,276
Investing Activities
Changes in investments in unconsolidated
affiliates (3,668) (6,608)
Acquisitions (299,560) (148,892)
Capital expenditures (less allowance for
equity funds used during construction) (883,703) (376,306)
Proceeds from sale of discontinued component - 53,000
Changes in short-term investments 31,125 (31,125)
Proceeds from sale of assets 4,022 298,964
Increase in cash and cash equivalents
attributable to previously unconsolidated
subsidiaries - 1,334
Decrease in cash and cash equivalents
attributable to previously consolidated
subsidiaries - (22,039)
Other investing activities - (5,565)
Cash Used in Investing Activities (1,151,784) (237,237)
Financing Activities
Borrowing (repayment) of notes payable, net 196,600 (842,000)
Short-term financing payments - (900,000)
Issuance of debt, net of discounts 598,146 1,397,328
Long-term debt financing costs (5,805) (12,003)
Payment of debt (13,588) (44,359)
Equity unit conversion - 402,448
Repurchase of common stock (390,213) (281,444)
Issuance of common stock 20,730 10,829
Dividends paid (150,188) (135,451)
Distributions to minority interests (182,891) (165,283)
Other financing activities 170 (48,841)
Cash Provided by (Used in) Financing
Activities 72,961 (618,776)
Change in Cash and Cash Equivalents (49,163) 17,263
Cash and Cash Equivalents at Beginning
of Period 68,268 7,915
Effect of Accounting Change on Cash and
Cash Equivalents - 43,090
Cash and Cash Equivalents at End of Period $19,105 $68,268
ONEOK, Inc. and Subsidiaries
INFORMATION AT A GLANCE
Three Months Ended Years Ended
December 31, December 31,
(Unaudited) 2007 2006 2007 2006
(Millions of dollars)
ONEOK Partners
Net margin $259.1 $217.0 $895.9 $843.5
Operating cost $100.0 $98.6 $337.4 $325.8
Depreciation and amortization $29.4 $27.8 $113.7 $122.0
Operating income $129.7 $90.6 $446.8 $511.2
Natural gas gathered (BBtu/d) 1,177 1,182 1,171 1,168
Natural gas processed (BBtu/d) 641 1,010 621 988
Natural gas transported (MMcf/d) 3,639 3,664 3,579 3,634
Natural gas sales (BBtu/d) 287 288 281 302
Natural gas liquids gathered (MBbl/d) 246 211 228 206
Natural gas liquids sales (MBbl/d) 259 222 231 207
Natural gas liquids fractionated (MBbl/d) 385 314 356 313
Natural gas liquids transported (MBbl/d) 305 201 299 200
Capital expenditures $301.5 $87.0 $709.9 $201.7
Conway-to-Mont Belvieu OPIS average
spread Ethane/Propane mixture
($/gallon) $0.07 $0.09 $0.06 $0.05
Natural Gas Gathering and Processing:
Realized composite NGL sales prices
($/gallon) $1.31 $0.87 $1.06 $0.93
Realized condensate sales price
($/Bbl) $85.16 $60.79 $67.35 $57.84
Realized natural gas sales price
($/MMBtu) $6.24 $5.83 $6.21 $6.31
Realized gross processing spread
($/MMBtu) $7.14 $4.51 $5.21 $5.05
Distribution
Net margin $189.0 $177.8 $663.6 $599.8
Operating cost $98.8 $100.6 $377.8 $371.5
Depreciation and amortization $29.5 $28.2 $111.6 $110.9
Operating income $60.7 $49.0 $174.2 $117.5
Customers per employee 727 726 732 713
Capital expenditures $53.3 $44.2 $162.0 $159.0
Natural gas volumes (Bcf)
Gas Sales 56.4 56.0 176.6 178.4
Transportation 55.4 50.8 204.0 200.8
Natural gas margins
Gas Sales $157.6 $148.0 $547.6 $489.9
Transportation $21.8 $21.4 $80.6 $76.9
Energy Services
Net margin $88.5 $75.6 $247.4 $273.8
Operating cost $12.2 $14.2 $39.9 $42.5
Depreciation and amortization $0.5 $0.5 $2.1 $2.1
Operating income $75.7 $60.9 $205.3 $229.2
Natural gas marketed (Bcf) 305 293 1,191 1,132
Natural gas gross margin ($/Mcf) $0.29 $0.22 $0.19 $0.22
Physically settled volumes (Bcf) 576 586 2,370 2,288
Capital expenditures $0.2 $- $0.2 $-
ONEOK, Inc. and Subsidiaries
Consolidating Income Statement
Three Months Ended December 31, 2007
Consoli-
ONEOK dating Consoli-
(Unaudited) ONEOK Partners Entries dated
(Millions of dollars)
Operating Income
ONEOK Partners $- $130 $- $130
Distribution 61 - - 61
Energy Services 76 - - 76
Other (11) - - (11)
Operating Income 126 130 - 256
Equity in earnings of ONEOK Partners 63 - (63) -
Other income (expense) (4) 33 - 29
Interest expense (29) (40) - (69)
Minority interest - - (58) (58)
Income taxes (53) (2) - (55)
Net Income $103 $121 $(121) $103
Year Ended December 31, 2007
Consoli-
ONEOK dating Consoli-
(Unaudited) ONEOK Partners Entries dated
(Millions of dollars)
Operating Income
ONEOK Partners $- $447 $- $447
Distribution 174 - - 174
Energy Services 205 - - 205
Other (3) - - (3)
Operating Income 376 447 - 823
Equity in earnings of ONEOK Partners 215 - (215) -
Other income (expense) 7 109 - 116
Interest expense (117) (139) - (256)
Minority interest - - (193) (193)
Income taxes (176) (9) - (185)
Net Income $305 $408 $(408) $305
ONEOK, Inc. and Subsidiaries
Consolidating Income Statement
Three Months Ended December 31, 2006
Consoli-
ONEOK dating Consoli-
(Unaudited) ONEOK Partners Entries dated
(Millions of dollars)
Operating Income
ONEOK Partners $- $91 $- $91
Distribution 49 - - 49
Energy Services 61 - - 61
Other 2 - - 2
Operating Income 112 91 - 203
Equity in earnings of ONEOK Partners 43 - (43) -
Other income (expense) (7) 25 - 18
Interest expense (29) (34) - (63)
Minority interest - - (37) (37)
Income taxes (44) (2) - (46)
Net Income $75 $80 $(80) $75
Year Ended December 31, 2006
Consoli-
ONEOK dating Consoli-
(Unaudited) ONEOK Partners Entries dated
(Millions of dollars)
Operating Income
ONEOK Partners $- $511 $- $511
Distribution 118 - - 118
Energy Services 229 - - 229
Other 4 - - 4
Operating Income 351 511 - 862
Equity in earnings of ONEOK Partners 225 - (225) -
Other income (expense) 2 98 - 100
Interest expense (106) (134) - (240)
Minority interest - (2) (220) (222)
Income taxes (166) (28) - (194)
Net Income $306 $445 $(445) $306
ONEOK, Inc. and Subsidiaries
REGULATION G GAAP RECONCILIATION
ONEOK, Inc. Stand-Alone Cash Flow, Before Changes in Working Capital
Year Ended
(Unaudited) December 31, 2007
(Millions of dollars)
Net income $304.9
Depreciation and amortization 114.3
Distributions received from unconsolidated affiliates 207.4
Income from equity investments, net (214.9)
Deferred income taxes 65.0
Stock based compensation expense 14.6
Allowance for doubtful accounts 14.6
Cash flow, before changes in working capital (a) $505.9
(a) ONEOK, Inc. stand-alone cash flow, before changes in working capital,
is a non-GAAP financial measure used by management, industry analysts,
investors, lenders, and rating agencies to assess the financial
performance and the operating results of our fundamental business
activities. ONEOK, Inc. stand-alone cash flow, before changes in
working capital, should not be considered in isolation or as a
substitute for net income, income from operations, or other measures
of cash flow.
SOURCE ONEOK, Inc.
http://www.oneok.com