ONEOK Profit Slips on Higher Costs Despite Gains From Pipeline Acquisitions
(Reuters) — U.S. pipeline operator ONEOK on April 29 reported a marginal fall in first-quarter profit, hurt by higher operating costs and divestments.
Shares were down 3.7% at $84.60 in extended trading.
Quarterly operating costs jumped about 32% to $752 million from a year earlier, weighed down by higher employee-related expenses.
The company has been diversifying its portfolio through acquisitions over the past two years, including a Gulf Coast NGL pipeline system from Easton Energy and the purchases of Medallion Midstream and EnLink Midstream.
ONEOK moved into transporting refined products and oil in 2023 following its acquisition of rival Magellan Midstream in a $18.8 billion deal.
ONEOK transports natural gas, natural gas liquids (NGLs), refined products and crude oil through its 60,000-mile-long network of pipelines.
The company had also divested three natural gas transmission pipelines to peer DT Midstream for $1.2 billion in cash in 2024.
However, quarterly adjusted core profit for all four of its segments rose on the back of higher contributions from its acquisitions of EnLink and Medallion.
The company continues to expect current-year net income of between $3.21 billion and $3.69 billion.
The Tulsa, Oklahoma-based company reported net income attributable of $636 million, or $1.04 per share, for the quarter ended March 31, compared with $639 million, or $1.09 per share, a year earlier.
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