Williams Companies Beats on Q4 Earnings, Raises Guidance

Core Insights - Williams Companies, Inc. (WMB) reported fourth-quarter 2024 adjusted earnings per share of 47 cents, exceeding the Zacks Consensus Estimate of 45 cents, but down from 48 cents in the prior year due to weak performance in Gas & NGL Marketing Services and rising expenses in Transmission & Gulf of Mexico [1][2] - The company's revenues of $2.7 billion fell short of the Zacks Consensus Estimate of$ 2.9 billion and decreased from $2.8 billion in the year-ago quarter, attributed to lower service revenues [2] Financial Performance - Adjusted EBITDA for the quarter was$ 1.8 billion, reflecting a 3.2% year-over-year increase, driven by strong natural gas demand [5] - Cash flow from operations was $1.2 billion, down 32.8% from the same quarter in 2023 [5] - Total costs and expenses reached$ 2 billion, an increase of 17.6% year-over-year [10] Segment Analysis - Transmission & Gulf of Mexico segment reported adjusted EBITDA of $826 million, up 9.8% year-over-year but below the consensus estimate of$ 849 million due to higher costs [6] - West segment's adjusted EBITDA was $345 million, a 6.8% increase from the prior year, outperforming the consensus mark of$ 332 million despite lower gathering volumes [7] - Northeast G&P segment achieved adjusted EBITDA of $499 million, up 2.9% year-over-year, beating the consensus estimate by 2.8% [8] - Gas & NGL Marketing Services reported adjusted EBITDA of$ 36 million, down from $69 million in the prior year due to lower marketing margins [9] Strategic Developments - In 2024, Williams advanced several key projects, including Transco's Regional Energy Access and Carolina Market Link expansions, and integrated Gulf Coast storage to support LNG exports [3][4] - The company consolidated interests in the Gulf Discovery system and made a bolt-on acquisition at DJ Basin, while also focusing on emissions reduction and sustainability [4] Capital Expenditure and Guidance - Total capital expenditure for the quarter was$ 2.6 billion, with expectations for 2025 adjusted EBITDA between $7.45 billion and$ 7.85 billion, indicating a 3% rise at the midpoint [11] - The company plans to maintain its capital expenditure plans for 2025, with growth Capex ranging from $1.65 billion to$ 1.95 billion [11] - Williams improved its leverage ratio for 2025 to a midpoint of 3.55x and raised its dividend by 5.3% to $2 per share for 2025 [12]