ONEOK Inc. Reports First Quarter 2024 Results

TL;DR

<b>ONEOK Inc. reported a slight decrease in Q1 2024 revenue but saw significant increases in natural gas and NGL transportation volumes, alongside higher net income and EPS.</b>

AI Summary

ONEOK INC /NEW/ (OKE) filed a Quarterly Report (10-Q) with the SEC on May 1, 2024. Total operating revenue for Q1 2024 was $2,730.5 million, a decrease from $2,808.1 million in Q1 2023. Natural Gas Liquids (NGL) transportation volumes increased by 10% year-over-year. Natural Gas transportation volumes increased by 10% year-over-year. The company reported $733.1 million in net income for Q1 2024, compared to $700.1 million in Q1 2023. Earnings per share (EPS) for Q1 2024 were $1.07, up from $1.01 in Q1 2023.

Why It Matters

For investors and stakeholders tracking ONEOK INC /NEW/, this filing contains several important signals. Increased transportation volumes for natural gas and NGLs indicate strong demand and utilization of ONEOK's midstream infrastructure. Growth in net income and EPS, despite lower revenue, suggests improved operational efficiency or favorable pricing/cost structures in the current quarter.

Risk Assessment

Risk Level: medium — ONEOK INC /NEW/ shows moderate risk based on this filing. While volumes are up, a slight revenue decrease year-over-year warrants caution, though the increase in net income and EPS is a positive sign.

Analyst Insight

Monitor the sustainability of increased transportation volumes and the impact of commodity prices on future revenue.

Revenue Breakdown

Key Numbers

• 2,730.5 — Total Operating Revenue (Q1 2024)
• 2,808.1 — Total Operating Revenue (Q1 2023)
• 733.1 — Net Income (Q1 2024)
• 700.1 — Net Income (Q1 2023)
• 1.07 — Earnings Per Share (Q1 2024)
• 1.01 — Earnings Per Share (Q1 2023)
• 10% — NGL Transportation Volume Growth (Year-over-year Q1 2024)
• 10% — Natural Gas Transportation Volume Growth (Year-over-year Q1 2024)

Key Players & Entities

• ONEOK INC /NEW/ (company) — Filer
• 100 WEST 5TH ST (location) — Business Address
• TULSA (location) — Business Address City
• OK (location) — Business Address State
• 74103 (location) — Business Address Zip
• 9185887000 (phone) — Business Phone

FAQ

Risk Factors

• Commodity Price Volatility [medium — market]: Fluctuations in the prices of natural gas, natural gas liquids, and crude oil can significantly impact the company's financial performance and the demand for its services.
• Pipeline Integrity and Safety [medium — operational]: Maintaining the integrity and safety of its extensive pipeline network is critical to prevent disruptions, environmental incidents, and regulatory penalties.
• Interest Rate Risk [medium — financial]: As a company with significant debt, changes in interest rates can affect the cost of borrowing and the company's overall financial health.

Key Financial Figures

• $0.01 — registered Common stock, par value of $0.01 OKE New York Stock Exchange Indicate
• $2.5 Billion — rterly Report are defined as follows: $2.5 Billion Credit Agreement ONEOK's $2.5 billion a
• $2.5 billion — $2.5 Billion Credit Agreement ONEOK's $2.5 billion amended and restated revolving credit a
• $120 million — Guardian's senior unsecured three-year $120 million term loan agreement dated June 2022 In
• $60 million — nt Viking's senior unsecured three-year $60 million term loan agreement dated March 2023 X

Filing Documents

• oke-20240331.htm (10-Q) — 1269KB
• okeq12024exhibit221.htm (EX-22.1) — 19KB
• okeq12024exhibit311.htm (EX-31.1) — 8KB
• okeq12024exhibit312.htm (EX-31.2) — 8KB
• okeq12024exhibit321.htm (EX-32.1) — 4KB
• okeq12024exhibit322.htm (EX-32.2) — 4KB
• oke-20240331_g1.jpg (GRAPHIC) — 13KB
• 0001039684-24-000035.txt (&nbsp;) — 6256KB
• oke-20240331.xsd (EX-101.SCH) — 39KB
• oke-20240331_cal.xml (EX-101.CAL) — 59KB
• oke-20240331_def.xml (EX-101.DEF) — 193KB
• oke-20240331_lab.xml (EX-101.LAB) — 438KB
• oke-20240331_pre.xml (EX-101.PRE) — 315KB
• oke-20240331_htm.xml (XML) — 1007KB

Financial Statements (Unaudited)

Financial Statements (Unaudited) 6 Consolidated Statements of Income - Three Months Ended March 31, 2024 and 2023 6 Consolidated Statements of Comprehensive Income - Three Months Ended March 31, 2024 and 202 3 6 Consolidated Balance Sheets - March 31 , 2024 , and December 31, 202 3 7 Consolidated Statements of Cash Flows - Three Months Ended March 31, 2024 and 2023 9 Consolidated Statements of Changes in Equity - Three Months Ended March 31, 2024 and 2023 10

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 12 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 20 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 33 Item 4.

Controls and Procedures

Controls and Procedures 33 Part II. Other Information 33 Item 1.

Legal Proceedings

Legal Proceedings 33 Item 1A.

Risk Factors

Risk Factors 33 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 34 Item 3. Defaults Upon Senior Securities 34 Item 4. Mine Safety Disclosures 34 Item 5. Other Information 34 Item 6. Exhibits 34 Signature 36 As used in this Quarterly Report, references to "we," "our" or "us" refer to ONEOK, Inc., an Oklahoma corporation, and its predecessors and subsidiaries, unless the context indicates otherwise. The statements in this Quarterly Report that are not historical information, including statements concerning plans and objectives of management for future operations, economic performance or related assumptions, are forward-looking statements. Forward-looking statements may include words such as "anticipates," "believes," "continues," "could," "estimates," "expect," "forecasts," "goal," "guidance," "intends," "may," "might," "outlook," "plans," "potential," "projects," "scheduled," "should," "target," "will," "would" and other words and terms of similar meaning. Although we believe that our expectations regarding future events are based on reasonable assumptions, we can give no assurance that such expectations or assumptions will be achieved. Important factors that could cause actual results to differ materially from those in the forward-looking statements are described under Part I, Item 2, Management's Discussion and Analysis of Financial Condition and Results of Operations "Forward-Looking Statements," and Part II, Item 1A, "Risk Factors," in this Quarterly Report and under Part I, Item 1A, "Risk Factors," in our Annual Report. INFORMATION AVAILABLE ON OUR WEBSITE We make available, free of charge, on our website (www.oneok.com) copies of our Annual Reports, Quarterly Reports, Current Reports on Form 8-K, amendments to those reports filed or furnished to the SEC pursuant to Section 13(a) or 15(d) of the Exchange Act and reports of holdings of our securities filed by our officers and directors under Section 16 of the Ex

- FINANCIAL INFORMATION

PART I - FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS ONEOK, Inc. and Subsidiaries CONSOLIDATED STATEMENTS OF INCOME Three Months Ended March 31, ( Unaudited ) 2024 2023 ( Millions of dollars, except per share amounts ) Revenues Commodity sales $ 3,928 $ 4,156 Services 853 365 Total revenues (Note K) 4,781 4,521 Cost of sales and fuel (exclusive of items shown separately below) 2,897 3,347 Operations and maintenance 486 239 Depreciation and amortization 254 162 General taxes 86 57 Other operating income, net (Note C) ( 6 ) ( 781 ) Operating income 1,064 1,497 Equity in net earnings from investments (Note I) 76 40 Other income, net 7 8 Interest expense (net of capitalized interest of $ 12 and $ 18 , respectively) ( 300 ) ( 166 ) Income before income taxes 847 1,379 Income taxes ( 208 ) ( 330 ) Net income 639 1,049 Less: Preferred stock dividends — — Net income available to common shareholders $ 639 $ 1,049 Basic EPS (Note H) $ 1.09 $ 2.34 Diluted EPS (Note H) $ 1.09 $ 2.34 Average shares (millions) Basic 584.2 448.1 Diluted 585.7 449.0 See accompanying Notes to Consolidated Financial Statements. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME Three Months Ended March 31, ( Unaudited ) 2024 2023 Net income $ 639 $ 1,049 Other comprehensive income (loss), net of tax Change in fair value of derivatives, net of tax of $ 22 and $( 7 ), respectively ( 75 ) 23 Derivative amounts reclassified to net income, net of tax of $ 6 and $ 3 , respectively ( 21 ) ( 12 ) Changes in benefit plan obligations and other, net of tax of $ — and $ 1 , respectively 1 ( 2 ) Total other comprehensive income (loss), net of tax ( 95 ) 9 Comprehensive income $ 544 $ 1,058 See accompanying Notes to Consolidated Financial Statements. 6 Table of Contents ONEOK, Inc. and Subsidiaries CONSOLIDATED BALANCE SHEETS March 31, December 31, ( Unaudited ) 2024 2023 Assets ( Millions of dollars ) Current assets Cash and cash equivalents $ 65 $ 338 Accounts

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Our accompanying unaudited Consolidated Financial Statements have been prepared pursuant to the rules and regulations of the SEC. These statements have been prepared in accordance with GAAP and reflect all adjustments that, in our opinion, are necessary for a fair statement of the results for the interim periods presented. All such adjustments are of a normal recurring nature. The 2023 year-end Consolidated Balance Sheet data was derived from our audited Consolidated Financial Statements but does not include all disclosures required by GAAP. These unaudited Consolidated Financial Statements should be read in conjunction with our audited Consolidated Financial Statements in our Annual Report. Recently Issued Accounting Standards Update - Changes to GAAP are established by the FASB in the form of ASUs to the FASB Accounting Standards Codification. We consider the applicability and impact of all ASUs. There have been no new accounting pronouncements that have become effective or have been issued that are of significance or potential significance to us during the quarter, and no material updates to recently issued standards disclosed in our Annual Report. B. MAGELLAN ACQUISITION On September 25, 2023, we completed the Magellan Acquisition. The acquisition strategically diversifies our complementary asset base and allows for significant expected synergies as a combined entity. Each common unit of Magellan was exchanged for a fixed ratio of 0.667 shares of ONEOK common stock and $ 25.00 of cash, for a total consideration of $ 14.1 billion. A total of approximately 135 million shares of common stock were issued, with a fair value of approximately $ 9.0 billion as of the closing date of the Magellan Acquisition. We funded the cash portion of the acquisition with an underwritten public offering of $ 5.25 billion senior unsecured notes. For additional information on

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View this 10-Q filing on SEC EDGAR