US Williams lowers earnings outlook for 2012, 2013

23 July 2012 22:40  [Source: ICIS news]

HOUSTON (ICIS)--Williams lowered its earnings forecast for 2012 and 2013 because of low prices for commodities, the US-based midstream company said on Monday.

Williams now expects its second-quarter adjusted earnings/share will be 21 cents, the company said. That compares with 39 cents/share for the first quarter and 29 cents/share for the second quarter of 2011.

Second-quarter earnings fell because of a sharp decline in margins for natural gas liquids (NGLs) at Williams Partners.

Williams owns 68% of Williams Partners.

In particular, the warm winter caused propane inventories to increase, Williams said. That, in turn, affected ethane inventories and pricing.

Other factors pressuring second-quarter earnings include acquisition costs and maintenance at Williams Partners' gas pipelines, the company said. Volumes were also lower than expected because of the timing of construction.

In Canada, sales volumes were lower because of third-party outages, Williams said. The company did not specify where the outages took place.

Another factor pressuring earnings was the effect of filling out the company's new Boreal pipeline, which went into service in late June.

For all of 2012, adjusted earnings per share should be $1.15/share, Williams said. For 2013, they should be $1.38/share.

Despite the expected declines, Williams did not lower its previous forecast for dividend payouts to shareholders.

For 2014, Williams is increasing its earnings forecast to $1.95/share. Williams increased its 2014 earnings forecast mainly because it expects that ethylene crack spreads should match those in the first half of 2012, it said.

By: Al Greenwood
+1 713 525 2645

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