Company leaders said a strategy of exploiting its natural gas infrastructure paid off in 2023. (Source: Shutterstock)
Tulsa-based midstream company Williams (WMB) reported a record year and end-of-year results that beat estimates at its fourth-quarter earnings call on Feb. 14.
Company leaders said a strategy of exploiting its natural gas infrastructure paid off in 2023.
“Our natural gas-focused strategy delivered excellent financial results again in 2023 with contracted transmission capacity, gathering volumes and adjusted EBITDA surpassing previous highs, demonstrating our ability to grow despite low natural gas prices,” said Alan Armstrong, Williams’ president and CEO.
According to market analyst TPH & Co., WMB’s reported fourth-quarter EBITDA of $1.721 billion handily beat Wall Street estimates of $1.67 billion. The company was lifted by favorable transport rates in marketing, earning $69 million versus an expected $27 million.
The company also had favorable results in its crude oil and NGL sales, listed in the company report’s “Other” segment, bringing in $92 million in sales, topping expected sales of $68 million.
For the year, the company’s EBITDA grew to $6.779 billion —6% higher than 2022 — with earnings per share increasing 5% to $1.91 billion. Williams also increased its capital investments to $2.7 billion (compared to $2.1 billion in 2022), with a growth capex of $1.89 billion. Cash flow from operations totaled $6.055 billion, up 24% from 2022, the company reported.
Throughout 2023, the company continued to add to its assets through gathering and storage facilities in the Rockies and on the Gulf Coast. WMB expects transmission projects will drive additional growth in 2024, reporting that it strengthened its position in 2023 in the Denver-Julesburg Basin with transactions to enhance its natural gas and NGL value chain. The company also grew its natural gas storage portfolio to 115 Bcf, making it the largest storage owner on the Gulf Coast.
WMB expects the natural gas sector to continue growing.
“Looking ahead, Williams is excited to provide additional natural gas solutions to support the reliability of the U.S. power sector as it faces growing regional demand driven in large part by the emergence of new, large-scale data centers that are accelerating throughout our key markets,” Armstrong said.
For its 2024 EBITDA guidance, WMB estimated a generating $6.8 billion to 7.1 billion. TPH predicted a final EBITDA of $6.92 billion.
Armstrong also took time this week to weigh in on the national political winds facing the natural gas industry.
A day before the earnings call, Armstrong took aim at the Biden administration’s recent pause on new LNG export projects, saying that the move would hurt growth in the market.
"We had a huge opportunity as a country to grab market share that was getting scared away by Russia's activity, and now we've pretty well destroyed what was on the bubble," Armstrong said at the company’s Clean Energy Expo on Feb. 13 in Washington, D.C., according to Reuters.
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