Williams Companies, Inc. (the) · NYSE:WMB

Williams Companies, Inc. (the) — The Williams Companies — Q3 2020 Earnings Presentation

28 slides from Williams Companies, Inc. (the)'s earnings presentation, Nov 3, 2020

  1. Slide 1: Williams 3rd Quarter 2020 Earnings Call

    NYSE: WMB | www.williams.com Williams 3rd Quarter 2020 Earnings Call November 3, 2020

  2. Slide 2: Northeast G&P segment hits record volumes

    Northeast G&P segment hits record volumes Natural Gas Natural Gas Processing NGL Production Gathering Volumes Plant Inlet Volumes Volumes 9.4 1.4 114 Bcf/d Bcf/d Mbbls/d up 8.4% up 17.2% up 23.9% v. 3Q‘19 v. 3Q‘19 v. 3Q‘19 Note: Includes 100% of the volumes associated with operated consolidated and

  3. Slide 3: 3Q 2020 results demonstrate continued stability despite external volatility

    3Q 2020 results demonstrate continued stability despite external volatility Stable Financial Performance 3Q 3Q 3Q YTD 3Q YTD Change Change Across Key Metrics 2020 2019 2020 2019 Adjusted EBITDA $1,267 $1,274 (1%) $3,769 $3,731 1% Adjusted Earnings per Share $0.27 $0.26 4% $0.78 $0.75 4% Cash Flow fr

  4. Slide 4: WMB third quarter results stable

    WMB third quarter results stable ONGOING WMB Adjusted EBITDA ($MM): 3Q 2019 vs. 3Q 2020 PERFORMANCE DRIVERS Ongoing Performance > TRANSMISSION & GOM $1,300 Increased revenue from transmission $1,274 ($60) $53 $0 ($3) expansion projects; Partially offset by $15 $1,267 West million of hurricane-relate

  5. Slide 5: WMB 3Q year-to-date results stable

    WMB 3Q year-to-date results stable ONGOING WMB Adjusted EBITDA ($MM): 3Q ‘19 YTD vs. 3Q ’20 YTD PERFORMANCE DRIVERS > TRANSMISSION & GOM Ongoing Performance $3,900 Increased revenue from transmission expansion projects and lower segment costs; $165 ($46) Partially offset by $38 million of Deepwater

  6. Slide 6: Key investor focus areas

    Key investor focus areas Resilient Business Strategically Aligned with Low-Carbon Energy Future FINANCIAL GROWTH $ EXPECTATIONS OUTLOOK SUSTAINABILITY 2021 outlook Gathering & processing ESG momentum • Expecting free cash flow generation • Williams positioned for volume above all capex and dividends

  7. Slide 7: Appendix

    Appendix WILLIAMS © 2020 The Williams Companies, Inc. All rights reserved. NYSE: WMB I Williams 3rd Quarter 2020 Earnings Call 11/03/2020 I www.williams.com 6

  8. Slide 8: WMB sequential quarter results up 2%

    WMB sequential quarter results up 2% WMB Adjusted EBITDA ($MM): 2Q 2020 vs. 3Q 2020 ONGOING PERFORMANCE DRIVERS $1,300 Ongoing Performance > TRANSMISSION & GOM $33 $0 ($4) Higher revenues due to one more $1,267 West billable day at Transco and decreased Other Deepwater shut-ins; Offset by slightly $

  9. Slide 9: Natural gas demand resilient in 2020

    Natural gas demand resilient in 2020 3Q YTD demand averaged 91.5 bcf/d in 2020 compared to 91.8 Bcf/d in 2019 POWER GEN LNG & MEXICAN INDUSTRIAL RES / COM EXPORTS Bcf/d Bcf/d Bcf/d Bcf/d 35 35 35 35 +3.4% 30 30 30 30 25 25 25 25 -3.3% -9.2% 20 20 20 20 2,235 15 15 15 HDD 1,925 15 Jan-Mar -14% HDD +1

  10. Slide 10: Growth across Williams assets outpaces market rate

    Growth across Williams assets outpaces market rate LOWER-48 + GOM NATURAL WILLIAMS NATURAL GAS GAS WELLHEAD PRODUCTION GATHERING VOLUMES Bcf/d Bcf/d 110 14 -0.1% +3.1% 100 12 90 80 10 70 60 8 3Q ‘19 3Q ‘20 3Q ‘19 3Q ‘20 YTD YTD YTD YTD STRATEGICALLY POSITIONED TO CONNECT BEST SUPPLIES TO BEST MARKET

  11. Slide 11: 2020 Guidance Ranges

    2020 Guidance Ranges FINANCIAL METRIC 2020 GUIDANCE Adjusted Net Income1 $1.160 - $1.460 Bn Adjusted Diluted EPS1 $0.95 - $1.20 Adjusted EBITDA $4.950 - $5.250 Bn Distributable Cash Flow (DCF) $3.050 - $3.450 Bn DCF per share $2.50 - $2.83 $1.0 Bn - $1.2 Bn Growth Capex Prior guidance: $1.1 - $1.3 B

  12. Slide 12: Recent accomplishments

    Recent accomplishments Record Volumes Achieved record Northeast natural gas gathering, natural gas processing plant inlet and NGL production volumes in 3Q 2020, despite a volatile market environment Commenced partial in-service of 150 MMcf/d on November 1 for a 296 MMcf/d expansion Transco – project

  13. Slide 13: Executing significant portfolio of gas transmission growth projects

    Executing significant portfolio of gas transmission growth projects PROJECTS IN EXECUTION $2.2B Target Current Project Project Markets Served In-service Status1 Capacity2 Commenced Service Hillabee Ph. 2 2Q ‘20 206 MMcf/d Power demand in FL May ‘20 Commenced Partial Res/Com & Power demand in 4Q ’20/

  14. Slide 14: Unique Deepwater opportunities available due to incumbent position

    Unique Deepwater opportunities available due to incumbent position Recent Deepwater Project Milestones Western Gulf Eastern Gulf Discovery Whale Ballymore Taggart Positive FIDs Under existing dedication Under existing Positive FID June Signed Definitive dedication 2020 Agreements Reimbursement execu

  15. Slide 15: Gas transmission business built on high credit-quality, demand-pull customer base

    Gas transmission business built on high credit-quality, demand-pull customer base Firm Contracted Capacity By Credit Rating Profile Of Williams 2019 Gas Customer Type1 Transmission Revenue From Top 100 Customers2 1% 4% 8% 9% 7% Investment Utilities/Power Grade 13% 68% LNG / Industrial 90% High Yield

  16. Slide 16: Stable and diversified EBITDA, limiting exposure to any one basin

    Stable and diversified EBITDA, limiting exposure to any one basin $5 B 2019 ADJ. EBITDA Other Onshore Oil Basin1 2% Only 7% EBITDA from Eagle Ford 5% Marketing & NGL Services2 2% G&P serving on-shore Blue Racer & Aux Sable 2% SW Wyoming / Wamsutter 2% oil-directed supply areas Piceance 2% Marcellus

  17. Slide 17: Forward Looking Statements

    Forward Looking Statements WILLIAMS © 2020 The Williams Companies, Inc. All rights reserved. NYSE: WMB I Williams 3rd Quarter 2020 Earnings Call 11/03/2020 I www.williams.com 16

  18. Slide 18: Forward-looking statements

    Forward-looking statements > The reports, filings, and other public announcements of The Williams Companies, Inc. (Williams) may contain or incorporate by reference statements that do not directly or exclusively relate to historical facts. Such statements are “forward-looking statements” within the

  19. Slide 19: Forward-looking statements (cont'd)

    Forward-looking statements (cont’d) > Forward-looking statements are based on numerous assumptions, uncertainties, and risks that could cause future events or results to be materially different from those stated or implied in this report. Many of the factors that will determine these results are bey

  20. Slide 20: Forward-looking statements (cont'd)

    Forward-looking statements (cont’d) – The ability of the members of the Organization of Petroleum Exporting Countries and other oil exporting nations to agree to and maintain oil price and production controls and the impact on domestic production; – Changes in the current geopolitical situation; – W

  21. Slide 21: Non-GAAP Reconciliations

    Non-GAAP Reconciliations WILLIAMS © 2020 The Williams Companies, Inc. All rights reserved. NYSE: WMB I Williams 3rd Quarter 2020 Earnings Call 11/03/2020 I www.williams.com 20

  22. Slide 22: Non-GAAP Disclaimer

    Non-GAAP Disclaimer > This presentation may include certain financial measures – adjusted EBITDA, adjusted income (“earnings”), adjusted earnings per share, distributable cash flow and dividend coverage ratio – that are non-GAAP financial measures as defined under the rules of the Securities and Exc

  23. Slide 23: Reconciliation of Income (Loss) Attributable to The Williams Companies, Inc. to Adjusted Income

    Reconciliation of Income (Loss) Attributable to The Williams Companies, Inc. to Adjusted Income 2019 2020 (Dollars in millions, except per-share amounts) 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Year 1st Qtr 2nd Qtr 3rd Qtr Year Income (loss) from continuing operations attributable to The Williams Companies,

  24. Slide 24: Reconciliation of Income (Loss) Attributable to The Williams Companies, Inc. to Adjusted Income (con't)

    Reconciliation of Income (Loss) Attributable to The Williams Companies, Inc. to Adjusted Income (con’t) 2019 2020 (Dollars in millions, except per-share amounts) 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Year 1st Qtr 2nd Qtr 3rd Qtr Year Other Adjustment of Transco’s regulatory asset for post-WPZ Merger state

  25. Slide 25: Reconciliation of Net Income to Modified EBITDA, Non-GAAP Adjusted EBITDA and Distributable Cash Flow

    Reconciliation of Net Income to Modified EBITDA, Non-GAAP Adjusted EBITDA and Distributable Cash Flow 2019 2020 (Dollars in millions, except coverage ratios) 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Year 1st Qtr 2nd Qtr 3rd Qtr Year The Williams Companies, Inc. Reconciliation of GAAP "Net Income (Loss)" to N

  26. Slide 26: Reconciliation of Modified EBITDA to Non-GAAP Adjusted EBITDA

    Reconciliation of Modified EBITDA to Non-GAAP Adjusted EBITDA 2019 2020 (Dollars in millions) 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Year 1st Qtr 2nd Qtr 3rd Qtr Year Net income (loss) $ 214 $ 324 $ 242 $ (66) $ 714 $ (570) $ 315 $ 323 $ 68 Provision (benefit) for income taxes 69 98 77 91 335 (204) 117 111

  27. Slide 27: Reconciliation of Net Income to Modified EBITDA, Non-GAAP Adjusted EBITDA and Distributable Cash Flow

    Reconciliation of Net Income to Modified EBITDA, Non-GAAP Adjusted EBITDA and Distributable Cash Flow 2020 Guidance (Dollars in millions, except per share amounts and coverage ratio) Low Mid High Net income (loss) $ 304 $ 454 $ 604 Provision (benefit) for income taxes 134 Interest expense 1,180 Equi

  28. Slide 28: Reconciliation of GAAP Net Income (Loss) to Non-GAAP Adjusted Income Available to Common Stockholders

    Reconciliation of GAAP Net Income (Loss) to Non-GAAP Adjusted Income Available to Common Stockholders 2020 Guidance (Dollars in millions, except per-share amounts) Low Mid High Net income (loss) $ 304 $ 454 $ 604 Less: Net income (loss) attributable to noncontrolling interests & preferred dividends

The Williams Companies — Q3 2020 Earnings Presentation on 6ix