Oklahoma's ONEOK expects bigger profits in 2014

ONEOK Inc. said Monday it will spin off its natural gas distribution segment into ONE Gas Inc. on Jan. 1. The Tulsa company also said it will raise its dividend 53 percent next year as cash flow is expected to increase.
by Adam Wilmoth Modified: December 2, 2013 at 9:15 pm •  Published: December 3, 2013

TULSA — ONEOK Inc. will spin off its natural gas distribution segment in the first quarter of 2014, the Tulsa-based natural gas company said Monday.

ONEOK previously said it would separate its natural gas utilities in Texas and Kansas and Oklahoma — including Oklahoma Natural Gas.

The company said Monday ONE Gas is expected to post a 2014 net income of $95 million to $105 million and that it expects to increase profits 4 percent to 6 percent annually between 2014 and 2018. The company's rate base is expected to grow an average of 5 percent to 6 percent per year from 2013 to 2018.

“It sounds like they have very healthy and realistic expectations for ONE Gas,” said Jake Dollarhide, CEO of Tulsa-based Longbow Asset Management Co. “For two of the last three years, ONEOK has been one of the top-performing stocks in the entire stock market. This is the equivalent of a victory lap. They've had so much success, and the future seems to be bright.”

ONEOK also said Monday its ONEOK Partners is expected to post a 2014 operating income of about $1.2 billion, up 33 percent from the partnership's 2013 guidance.

The natural gas production and transportation business attributed the increase to higher expected natural gas gathering and processing and natural gas liquids volumes.

“As volatile as commodity prices have been, to hear the earnings guidance is based on volume growth and production growth and not commodity prices or cost cuts is music to an investor's ear,” Dollarhide said.

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by Adam Wilmoth
Energy Editor
Adam Wilmoth returned to The Oklahoman as energy editor in 2012 after working for four years in public relations. He previously spent seven years as a business reporter at The Oklahoman, including five years covering the state's energy sector....
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