Williams (NYSE:WMB) today announced its unaudited financial results for the three and six months ended June 30, 2024.

Financial results build on track record of year-over-year consecutive growth

GAAP net income of $401 million, or $0.33 per diluted share (EPS)
Adjusted net income of $521 million, or $0.43 per diluted share (Adj. EPS)
Record 2Q Adjusted EBITDA of $1.667 billion – up $56 million or 3% vs. 2Q 2023
Cash flow from operations (CFFO) of $1.279 billion
Available funds from operations (AFFO) of $1.250 billion – up $35 million or 3% vs. 2Q 2023
Dividend coverage ratio of 2.16x (AFFO basis)
On track to achieve top half of 2024 financial guidance

Crisp project execution and accelerating natural gas demand drive strong financial outlook

Optimized portfolio by exiting Aux Sable joint venture position and consolidating ownership interest in Gulf of Mexico Discovery system
Placed Transco's Regional Energy Access into full service ahead of schedule on Aug. 1
Placed Marcellus South and MountainWest's Uinta Basin expansions in-service
Significant emissions reductions and cost savings accomplished in replacing 57 Transco and Northwest Pipeline compressor units to date
Initiated construction activities on Louisiana Energy Gateway gathering, treating and carbon capture & sequestration project
Began construction on Transco's Texas to Louisiana Energy Pathway expansion
Signed precedent agreement on Transco's Gillis West expansion
Published 2023 Sustainability Report; set 2028 methane intensity goal for OGMP 2.0

CEO Perspective

Alan Armstrong, president and chief executive officer, made the following comments:

"Our record second quarter Adjusted EBITDA was driven primarily by the strong performance of our transmission and storage business. Even in this environment of low gas prices, we continue to deliver and are on track to achieve the top half of financial guidance this year and even higher levels of growth in 2025 with an expected five-year compound annual growth rate of over 12 percent on our Adjusted EPS, 2020 to 2025.

"Our teams have continued to execute on our strategy across all fronts, including placing projects into service in the Northeast, the West and the Deepwater Gulf of Mexico. In addition to bringing Transco's Regional Energy Access expansion fully online ahead of schedule, we have initiated construction activities on the Louisiana Energy Gateway gathering, treating and carbon capture & sequestration project as well as Transco's Texas to Louisiana Energy Pathway expansion. We also continued to optimize our portfolio by selling our stake in the Aux Sable joint venture at an attractive premium and consolidated our ownership interest in the Gulf of Mexico Discovery system at an attractive value, which allows us to improve efficiencies in this commercially active and growing region."

Armstrong added, "We've been delivering consecutive year-over-year growth for more than a decade at Williams, and all signals indicate that the future will be even stronger as demand for natural gas accelerates due to increasing electrification and LNG exports. With our powerful backlog of projects and outstanding track record of execution, no other company is better positioned than Williams to convert these opportunities into compounding returns for our shareholders."

Williams Summary Financial Information	2Q		Year to Date
Amounts in millions, except ratios and per-share amounts. Per share amounts are reported on a diluted basis. Net income amounts are from continuing operations attributable to The Williams Companies, Inc. available to common stockholders.	2024	2023	2024	2023

GAAP Measures
Net Income	$401	$547	$1,032	$1,473
Net Income Per Share	$0.33	$0.45	$0.84	$1.20
Cash Flow From Operations	$1,279	$1,377	$2,513	$2,891

Non-GAAP Measures (1)
Adjusted EBITDA	$1,667	$1,611	$3,601	$3,406
Adjusted Net Income	$521	$515	$1,240	$1,199
Adjusted Earnings Per Share	$0.43	$0.42	$1.01	$0.98
Available Funds from Operations	$1,250	$1,215	$2,757	$2,660
Dividend Coverage Ratio	2.16x	2.23x	2.38x	2.44x

Other
Debt-to-Adjusted EBITDA at Quarter End (2)	3.76x	3.50x
Capital Investments (Excluding Acquisitions) (3) (4)	$663	$715	$1,226	$1,240

(1) Schedules reconciling Adjusted Net Income, Adjusted EBITDA, Available Funds from Operations and Dividend Coverage Ratio (non-GAAP measures) to the most comparable GAAP measure are available at www.williams.com and as an attachment to this news release.
(2) Does not represent leverage ratios measured for WMB credit agreement compliance or leverage ratios as calculated by the major credit ratings agencies. Debt is net of cash on hand, and Adjusted EBITDA reflects the sum of the last four quarters.
(3) Capital Investments include increases to property, plant, and equipment (growth & maintenance capital), purchases of and contributions to equity-method investments and purchases of other long-term investments.
(4) Year-to-date 2024 capital excludes $1.844 billion for the acquisition of the Gulf Coast Storage assets, which closed in January 2024. Year-to-date 2023 capital excludes $1.053 billion for the acquisition of MountainWest, which closed in February 2023.

GAAP Measures

Second-quarter 2024 net income decreased by $146 million compared to the prior year reflecting an unfavorable change of $214 million in net unrealized gains/losses on commodity derivatives, higher net interest expense from recent debt issuances and retirements, as well as higher operating costs, depreciation and interest expense resulting from recent acquisitions. These unfavorable changes were partially offset by a $89 million increase in service revenues driven by acquisitions and expansion projects, as well as higher equity allowance for funds used during construction (equity AFUDC) associated with ongoing capital projects at our regulated natural gas pipelines. The tax provision decreased primarily due to lower pretax income.

Year-to-date 2024 net income decreased by $441 million compared to the prior year reflecting an unfavorable change of $633 million in net unrealized gains/losses on commodity derivatives, higher net interest expense from recent debt issuances and retirements, lower realized hedge gains in the West, as well as higher operating costs, depreciation and interest expense resulting from recent acquisitions. These unfavorable changes were partially offset by a $300 million increase in service revenues driven by acquisitions and expansion projects, higher commodity margins, and higher equity AFUDC. The tax provision decreased primarily due to lower pretax income.

Second-quarter and year-to-date 2024 cash flow from operations decreased compared to the prior year primarily due to unfavorable net changes in both working capital and derivative collateral requirements, partially offset by higher operating results exclusive of non-cash items.

Non-GAAP Measures

Second-quarter 2024 Adjusted EBITDA increased by $56 million over the prior year, driven by the previously described favorable net contributions from acquisitions and expansion projects. Year-to-date 2024 Adjusted EBITDA increased by $195 million over the prior year, similarly reflecting favorable net contributions from acquisitions and expansion projects, as well as higher commodity margins.

Second-quarter and year-to-date 2024 Adjusted Net Income improved by $6 million and $41 million, respectively, over the prior year, driven by the previously described impacts to net income, adjusted primarily to remove the effects of net unrealized gains/losses on commodity derivatives and the related income tax effects.

Second-quarter and year-to-date Available Funds From Operations (AFFO) increased by $35 million and $97 million, respectively, compared to the prior year primarily due to higher results from continuing operations exclusive of non-cash items.

Business Segment Results & Form 10-Q

Williams' operations are comprised of the following reportable segments: Transmission & Gulf of Mexico, Northeast G&P, West and Gas & NGL Marketing Services, as well as Other. For more information, see the company's second-quarter 2024 Form 10-Q.

	Second Quarter											Year to Date
Amounts in millions	Modified EBITDA					Adjusted EBITDA						Modified EBITDA					Adjusted EBITDA
Amounts in millions	2Q 2024		2Q 2023	Change		2Q 2024		2Q 2023		Change		2024		2023	Change		2024	2023	Change
Transmission & Gulf of Mexico	$808		$731	$77		$812		$748		$64		$1,637		$1,446	$191		$1,651	$1,476	$175
Northeast G&P	481		515	(34	)	479		515		(36	)	985		985	—		983	985	(2	)
West	318		312	6		319		312		7		645		616	29		647	598	49
Gas & NGL Marketing Services	(126	)	68	(194	)	(14	)	(16	)	2		(25	)	635	(660	)	175	215	(40	)
Other	47		41	6		71		52		19		123		115	8		145	132	13
Total	$1,528		$1,667	($139	)	$1,667		$1,611		$56		$3,365		$3,797	($432	)	$3,601	$3,406	$195

Note: Williams uses Modified EBITDA for its segment reporting. Definitions of Modified EBITDA and Adjusted EBITDA and schedules reconciling to net income are included in this news release.

Transmission & Gulf of Mexico

Second-quarter 2024 Modified and Adjusted EBITDA improved compared to the prior year driven by favorable net contributions from the Gulf Coast Storage acquisition and the Regional Energy Access expansion project, as well as higher equity AFUDC. Year-to-date 2024 Modified and Adjusted EBITDA also benefited from the MountainWest acquisition. Modified EBITDA for all periods was impacted by one-time acquisition costs, which are excluded from Adjusted EBITDA.

Northeast G&P

Second-quarter 2024 Modified and Adjusted EBITDA decreased compared to the prior year driven by lower gathering volumes, partially offset by higher rates at Susquehanna Supply Hub and Bradford. For the year-to-date comparison, both metrics were largely unchanged as these higher rates offset the lower gathering volumes.

West

Second-quarter 2024 Modified and Adjusted EBITDA increased compared to the prior year benefiting from the DJ Basin Acquisitions and higher volumes on the Overland Pass Pipeline, partially offset by lower gathering volumes and lower realized gains on natural gas hedges. Both metrics also improved for the year-to-date period reflecting similar drivers, as well as improved commodity margins reflecting favorable changes in shrink prices related to the absence of a short-term gas price spike at Opal in 2023. The year-to-date Modified EBITDA was also impacted by the absence of a first-quarter 2023 favorable contract settlement, which is excluded from Adjusted EBITDA.

Gas & NGL Marketing Services

Second-quarter 2024 Modified EBITDA decreased from the prior year primarily reflecting a $200 million net unfavorable change in unrealized gains/losses on commodity derivatives, which is excluded from Adjusted EBITDA. Year-to-date 2024 Modified EBITDA also decreased from the prior year reflecting a decline in gas marketing margins and a $628 million net unfavorable change in unrealized gains/losses on commodity derivatives, which is excluded from Adjusted EBITDA.

Strategic Transactions

Williams recently closed two strategic transactions to further derisk its portfolio from commodity price volatility and enhance the performance of commercially active and growing Gulf of Mexico assets.

Williams sold its 14 percent stake in a joint venture with Aux Sable for $160 million. The non-operated joint venture assets include a processing and fractionation facility near Chicago and a rich gas gathering pipeline and conditioning plant in North Dakota. Williams' ownership in the joint venture was subject to cash flow volatility because the keep-whole arrangement made distributions sensitive to commodity prices.

Separately, Williams purchased from Phillips 66 for $170 million its 40 percent stake in Discovery pipeline in the Gulf of Mexico, bringing Williams' ownership interest to 100 percent, as well as Phillips 66's Dauphin Island Gathering Partners system. Discovery's assets include approximately 600 miles of offshore gas pipelines, a 600 MMcf/d gas processing plant and a 35 Mbbls/d fractionator, both in Louisiana.

2024 Financial Guidance

Williams continues to expect Adjusted EBITDA at the top half of its 2024 guidance range of $6.8 billion and $7.1 billion. In addition, the company continues to expect 2024 growth capex between $1.45 billion and $1.75 billion and maintenance capex between $1.1 billion and $1.3 billion, which includes capital of $350 million for emissions reduction and modernization initiatives. For 2025, the company continues to expect Adjusted EBITDA between $7.2 billion and $7.6 billion with growth capex between $1.65 billion and $1.95 billion and maintenance capex between $750 million and $850 million, which includes capital of $100 million based on midpoint for emissions reduction and modernization initiatives. Williams continues to anticipate a leverage ratio midpoint for 2024 of 3.85x and increased the dividend by 6.1% on an annualized basis to $1.90 in 2024 from $1.79 in 2023.

Williams' Second-Quarter 2024 Materials to be Posted Shortly; Q&A Webcast Scheduled for Tomorrow

Williams' second-quarter 2024 earnings presentation will be posted at www.williams.com. The company's second-quarter 2024 earnings conference call and webcast with analysts and investors is scheduled for Tuesday, Aug. 6, at 9:30 a.m. Eastern Time (8:30 a.m. Central Time). Participants who wish to join the call by phone must register using the following link: https://register.vevent.com/register/BI8cf6dbf9f06f47fabd194ab9f38a7eb8

A webcast link to the conference call will be provided on Williams' Investor Relations website. A replay of the webcast will also be available on the website for at least 90 days following the event.

About Williams

Williams (NYSE:WMB) is a trusted energy industry leader committed to safely, reliably, and responsibly meeting growing energy demand. We use our 33,000-mile pipeline infrastructure to move a third of the nation's natural gas to where it's needed most, supplying the energy used to heat our homes, cook our food and generate low-carbon electricity. For over a century, we've been driven by a passion for doing things the right way. Today, our team of problem solvers is leading the charge into the clean energy future – by powering the global economy while delivering immediate emissions reductions within our natural gas network and investing in new energy technologies. Learn more at www.williams.com.


The Williams Companies, Inc.
Consolidated Statement of Income
(Unaudited)

		Three Months Ended June 30,						Six Months Ended June 30,
		2024			2023			2024			2023
	(Millions, except per-share amounts)
Revenues:
Service revenues		$	1,837		$	1,748		$	3,742		$	3,442
Service revenues – commodity consideration			18			27			48			63
Product sales			610			593			1,455			1,438
Net gain (loss) from commodity derivatives			(129	)		115			(138	)		621
Total revenues			2,336			2,483			5,107			5,564
Costs and expenses:
Product costs			424			421			950			974
Net processing commodity expenses			17			44			22			98
Operating and maintenance expenses			522			481			1,033			944
Depreciation and amortization expenses			540			515			1,088			1,021
Selling, general, and administrative expenses			164			161			350			337
Other (income) expense – net			(27	)		(9	)		(44	)		(40	)
Total costs and expenses			1,640			1,613			3,399			3,334
Operating income (loss)			696			870			1,708			2,230
Equity earnings (losses)			147			160			284			307
Other investing income (loss) – net			18			13			42			21
Interest expense			(339	)		(306	)		(688	)		(600	)
Other income (expense) – net			33			19			64			39
Income (loss) before income taxes			555			756			1,410			1,997
Less: Provision (benefit) for income taxes.			129			175			322			459
Income (loss) from continuing operations			426			581			1,088			1,538
Income (loss) from discontinued operations)			—			(87	)		—			(87	)
Net income (loss)			426			494			1,088			1,451
Less: Net income (loss) attributable to noncontrolling interests.			25			34			55			64
Net income (loss) attributable to The Williams Companies, Inc.			401			460			1,033			1,387
Less: Preferred stock dividends.			—			—			1			1
Net income (loss) available to common stockholders		$	401		$	460		$	1,032		$	1,386
Amounts attributable to The Williams Companies, Inc. available to common stockholders:
Income (loss) from continuing operations		$	401		$	547		$	1,032		$	1,473
Income (loss) from discontinued operations			—			(87	)		—			(87	)
Net income (loss) available to common stockholders		$	401		$	460		$	1,032		$	1,386
Basic earnings (loss) per common share:
Income (loss) from continuing operations		$	.33		$	.45		$	.85		$	1.21
Income (loss) from discontinued operations			—			(.07	)		—			(.07	)
Net income (loss) available to common stockholders		$	.33		$	.38		$	.85		$	1.14
Weighted-average shares (thousands)			1,219,367			1,217,673			1,218,761			1,218,564
Diluted earnings (loss) per common share:
Income (loss) from continuing operations		$	.33		$	.45		$	.84		$	1.20
Income (loss) from discontinued operations			—			(.07	)		—			(.07	)
Net income (loss) available to common stockholders		$	.33		$	.38		$	.84		$	1.13
Weighted-average shares (thousands)			1,222,236			1,219,915			1,222,229			1,223,429


The Williams Companies, Inc.
Consolidated Balance Sheet
(Unaudited)

	June 30,			December 31,
	2024			2023
	(Millions, except per-share amounts)
ASSETS
Current assets:
Cash and cash equivalents.	$	55		$	2,150
Trade accounts and other receivables (net of allowance of $4 at June 30, 2024 and $3 at December 31, 2023)		1,398			1,655
Inventories.		274			274
Derivative assets.		218			239
Other current assets and deferred charges.		170			195
Total current assets		2,115			4,513
Investments.		4,612			4,637
Property, plant, and equipment.		54,930			51,842
Accumulated depreciation and amortization.		(18,228	)		(17,531	)
Property, plant, and equipment – net.		36,702			34,311
Intangible assets – net of accumulated amortization.		7,402			7,593
Regulatory assets, deferred charges, and other.		1,578			1,573
Total assets	$	52,409		$	52,627

LIABILITIES AND EQUITY
Current liabilities:
Accounts payable.	$	1,192		$	1,379
Derivative liabilities.		109			105

Williams Delivers Strong Second-Quarter Results