Williams Companies Exceeds Q3 Profit Estimates on Higher Revenue, Boost from Transco Pipeline
(Reuters) — U.S. pipeline operator Williams Companies beat third-quarter profit estimates on Wednesday by one cent, helped by increased service revenues and higher flows of natural gas liquids.
Higher operating costs and lower net realized product sales from upstream operations weighed on earnings, leading to the narrow beat.
The U.S. Energy Information Administration, earlier this month, said that it expects gas consumption to rise from a record 89.1 billion cubic feet per day (Bcf/d) in 2023 to 90.1 Bcf/d in 2024.
Additionally, like many of its peers, Williams is pinning its hopes on the increased demand for artificial intelligence boom-driven data center power to boost its natural gas sales.
"We executed a precedent agreement on another expansion to the Transco Dalton Lateral driven by load growth from data center demand and industrial re-shoring in the Atlanta area," Chief Executive Officer Alan Armstrong said.
The Transco, or Transcontinental Gas, pipeline transports about 15% of the nation's natural gas.
Willams also raised its adjusted core profit range for the year to between $7 billion and $7.15 billion, compared to between $6.8 billion and $7.1 billion previously.
The company reported revenues of $2.65 billion in the quarter, a 3.6% rise from the previous year, beating analysts' average estimate of $2.52 billion.
The company's quarterly natural gas transportation volumes from its Transco pipeline were up 2.1% to 14.3 million dekatherms from a year earlier.
However, quarterly crude oil transportation volumes were down 18.7% to 109,000 barrels per day (mbpd), from a year earlier.
The company posted an adjusted profit of 43 cents per share for the quarter ended Sept. 30, compared with analysts' average estimate of 42 cents per share, according to data compiled by LSEG.
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