Oneok, the parent company of Oklahoma Natural Gas, Tuesday
announced a 39 percent increase in first quarter earnings to $64.9
million, or $1.30 per share.
Net income was up from $63 million, or $1.28 per share, for the
same period in 2000. The increase included the effect of the
nonrecurring pretax gain of $26.7 million on the sale of a non-
strategic gas processing plant made in the first quarter of 2000,
Operating revenues for the quarter totaled $2.96 billion, up from
$821.8 million a year earlier.
Oneok's first quarter earnings reflect significant growth that
has come primarily from the successful integration of two major
natural gas midstream acquisitions made in March and April of 2000
as well as the impact from strong natural gas prices in the
production segment, said David Kyle, chairman, president and chief
Kyle said higher gas prices were less positive during the quarter
for other segments of the company, resulting in increased working
capital and higher interest costs that partially offset the
quarter's strong operating results.
He also confirmed the company's earnings expectation for 2001
continues to be 20 percent over last year. The expectations are
based on a full year of results from the midstream assets acquired
during 2000, completion of a 300-megawatt power plant in June 2001,
a full year of weather-normalized rates for Kansas distributions
operations and improved hedges for natural gas production.
Operating income for the company's energy marketing and trading
operations increased 84 percent to $24.1 million from $13.1 million.
This increase is primarily attributable to the marketing and trading
business acquired from Kinder Morgan (KMI) in April 2000 and colder
weather during the three months of this year compared with the same
period in 2000. Greater price volatility in the U.S. natural gas
markets also contributed to the increase. Sales volumes averaged 3.3
billion cubic feet per day (Bcf/d) for the 2001 first quarter,
compared with 1.9 Bcf/d the previous year.
The company's gathering and processing's operating income
increased to $13.2 million from $7.2 million. This increase is
primarily due to increased natural gas and natural gas liquids
prices and increased volumes sold resulting from the acquisition of
gathering and processing assets in March and April 2000. Operating
income was also favorably impacted by ongoing contract restructuring
Other income for the three months ended March 31, 2000, includes
the non-recurring gain of $26. …