By Tess Stynes
Williams Cos.'s (WMB) second-quarter earnings rose 7.6% as
affiliate Williams Partners LP's (WPZ) second-quarter earnings grew
5.3% on stronger revenue, improved olefin and marketing margins and
lower expenses.
Williams gathers and transports natural gas, and owns most of
its namesake master limited partnership, Williams Partners.
The company has been investing to take advantage of production
opportunities in the Marcellus and Utica shale plays, including a
project unveiled in March to develop a pipeline in the region with
Boardwalk Pipeline Partners LP (BWP). Williams's acquisition last
year of a 50% stake in privately held Access Midstream Partners GP
was also expected to boost its potential in the area.
For the latest period, Williams reported a profit of $142
million, up from $132 million a year earlier. On a per-share basis,
earnings were flat at 21 cents. Excluding acquisition-related
impacts at Williams Partners and other items, adjusted earnings
from continuing operations were down at 19 cents a share from 22
cents.
Analysts polled by Thomson Reuters recently expected per-share
profit of 15 cents.
Williams Partners reported a profit of $256 million, or 31 cents
a unit, up from $243 million, or 29 cents a unit a share, a year
earlier.
Analysts polled by Thomson Reuters recently expected per-unit
profit of 37 cents.
Fee-based revenue increased 9% to $704 million. However,
natural-gas liquids margins dropped 44% as continued low ethane
prices drove continuing ethane rejection--which means that more
ethane is being left in the natural-gas stream.
"We're pleased to report a solid second quarter due to continued
growth in our growing fee-based business, which more than offset
both lower commodity margins and the impact of downtime at the
Geismar facility," said Alan Armstrong, chief executive of Williams
Partners' general partner.
Williams Partners' Geismar olefins plant is expected to be out
of service until April 2014 amid an expansion of its ethylene
production capacity and repairs following an explosion incident
last month.
Williams shares were up by three cents at $34.20 in recent
after-hours trading Wednesday, while Williams Partners' units were
flat at $50.22.
Write to Tess Stynes at tess.stynes@wsj.com
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