SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report: May 22, 2003
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(Date of earliest event reported)
The Williams Companies, Inc.
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(Exact Name of Registrant as Specified in Charter)
Delaware 1-4174 73-0569878
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(State or Other (Commission File Number) (IRS Employer
Jurisdiction of Identification No.)
Incorporation)
One Williams Center Tulsa, Oklahoma 74172
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (918) 573-2000
Not Applicable
(Former name or former address, if changed since last report)
Item 5. Other Events
The Williams Companies, Inc.("Williams") is filing with the Securities
& Exchange Commission supplemental pro forma financial information reflecting
its Texas Gas pipeline system and its Williams Energy Partners segment as
discontinued operations to supplement Williams' previously issued consolidated
statement of operations and balance sheet included in Williams' Quarterly Report
on Form 10-Q for the quarterly period ended March 31, 2003.
Item 7. Financial Statements and Exhibits
The Company files the following exhibits as part of this report:
Exhibit 99.1 Pro forma Financial Information presenting Williams Energy
Partners and Texas Gas Transmission Corporation as
discontinued operations
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
The Williams Companies, Inc.
Date: May 22, 2003 /s/ Brian K. Shore
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Name: Brian K. Shore
Title: Corporate Secretary
INDEX TO EXHIBITS
Exhibit
Number Description
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Exhibit 99.1 Pro forma Financial Information presenting Williams Energy
Partners and Texas Gas Transmission Corporation as
discontinued operations
EXHIBIT 99.1
PRO FORMA FINANCIAL INFORMATION PRESENTING WILLIAMS ENERGY PARTNERS
AND TEXAS GAS TRANSMISSION CORPORATION AS DISCONTINUED OPERATIONS
As previously announced on February 20, 2003, Williams reported it intended
to offer for sale its general partner and limited partner interests in Williams
Energy Partners and its 5,800-mile Texas Gas pipeline system. In April 2003,
Williams' Board of Directors approved resolutions that authorized management to
execute and deliver, in the name of the sellers, agreements for the sales of the
above mentioned businesses. The following unaudited pro forma financial
information is included to supplement Williams' previously issued consolidated
statements of operations and balance sheets included in Williams' Quarterly
Report on Form 10-Q for the quarterly period ended March 31, 2003, to present
the operations of Williams Energy Partners and Texas Gas as discontinued
operations. The combined revenues of these operations previously included in
consolidated revenues as reported in Williams' Quarterly Report on Form 10-Q
were $187.4 million and $168.9 million for the three months ended March 31, 2003
and 2002, respectively, and the combined net loss of these entities previously
included in income (loss) from continuing operations was $27.2 million for the
three months ended March 31, 2003 and the combined net income of these entities
previously included in income (loss) from continuing operations was $38.7
million for the three months ended March 31, 2002. The unaudited pro forma
consolidated statement of operations does not reflect any potential gain or loss
related to the expected sales. Consistent with Williams' previously issued
consolidated financial statements, other assets and/or businesses are also
reported as discontinued operations, those being Kern River, Central, soda ash
mining operations, Mid-America and Seminole pipelines, Midsouth refinery and
related assets, Williams travel centers, and bio-energy facilities.
For comparative purposes, income (loss) from continuing operations as
reported in Williams' Form 10-Q was a loss of $57.7 million for the three months
ended March 31, 2003 and income of $98.4 million for the three months ended
March 31, 2002. Additionally, the reported income from discontinued operations
was $4.5 million and $9.3 million for the three months ended March 31, 2003 and
2002, respectively.
The unaudited pro forma financial information on the following pages should
be read in conjunction with the historical financial statements and notes
thereto included in the Williams Quarterly Report on Form 10-Q for the quarterly
period ended March 31, 2003 and other information filed with the Securities and
Exchange Commission.
THE WILLIAMS COMPANIES, INC.
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED)
Three months
(Dollars in millions, except per-share amounts) ended March 31,
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2003 2002
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Revenues:
Energy Marketing & Trading $ 3,781.5 $ 340.9
Gas Pipeline 323.3 305.0
Exploration & Production 266.4 227.7
Midstream Gas & Liquids 1,133.2 400.0
Petroleum Services 239.7 187.5
Other 14.0 16.8
Intercompany eliminations (585.3) (24.8)
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Total revenues 5,172.8 1,453.1
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Segment costs and expenses:
Costs and operating expenses 4,764.1 742.9
Selling, general and administrative expenses 130.0 141.2
Other expense - net 7.6 .3
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Total segment costs and expenses 4,901.7 884.4
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General corporate expenses 22.9 38.2
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Operating income (loss):
Energy Marketing & Trading (130.5) 273.0
Gas Pipeline 149.4 115.2
Exploration & Production 124.0 106.7
Midstream Gas & Liquids 110.1 52.7
Petroleum Services 18.5 22.6
Other (0.4) (1.5)
General corporate expenses (22.9) (38.2)
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Total operating income 248.2 530.5
Interest accrued (358.2) (204.0)
Interest capitalized 11.9 4.9
Interest rate swap income (loss) (2.8) 10.2
Investing income (loss) 46.4 (216.4)
Minority interest in income and preferred returns
of consolidated subsidiaries (3.5) (12.0)
Other income (expense) - net 22.0 (5.2)
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Income (loss) from continuing operations before
income taxes and cumulative effect of change
in accounting principles (36.0) 108.0
Provision (benefit) for income taxes (5.5) 48.3
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Income (loss) from continuing operations (30.5) 59.7
Income (loss) from discontinued operations (22.7) 48.0
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Income (loss) before cumulative effect of change in accounting principles (53.2) 107.7
Cumulative effect of change in accounting principles (761.3) --
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Net income (loss) (814.5) 107.7
Preferred stock dividends 6.8 69.7
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Income (loss) applicable to common stock $ (821.3) $ 38.0
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Basic and diluted earnings (loss) per common share:
Loss from continuing operations $ (.08) $ (.02)
Income (loss) from discontinued operations (.04) .09
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Income (loss) before cumulative effect of change in accounting principles (.12) .07
Cumulative effect of change in accounting principles (1.47) --
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Net income (loss) $ (1.59) $ .07
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Basic weighted-average shares (thousands) 517,652 519,224
Diluted weighted-average shares (thousands) 517,652 519,224
THE WILLIAMS COMPANIES, INC.
PRO FORMA CONSOLIDATED BALANCE SHEET
(UNAUDITED)
(Dollars in millions, except per-share amounts) March 31, December 31,
2003 2002
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ASSETS
Current assets:
Cash and cash equivalents $ 1,405.9 $ 1,652.2
Restricted cash 323.1 102.8
Accounts and notes receivable less allowance of $114.3 ($111.2 in 2002) 2,507.1 2,459.9
Inventories 365.0 427.3
Energy risk management and trading assets -- 296.7
Derivative assets 7,772.8 5,024.3
Margin deposits 853.5 804.8
Assets of discontinued operations 415.6 1,155.0
Deferred income taxes 572.9 569.2
Other current assets and deferred charges 396.5 393.9
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Total current assets 14,612.4 12,886.1
Restricted cash 216.5 188.3
Investments 1,510.8 1,475.3
Property, plant and equipment, at cost 16,542.5 16,437.4
Less accumulated depreciation and depletion (3,733.4) (3,711.5)
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12,809.1 12,725.9
Energy risk management and trading assets -- 1,821.6
Derivative assets 2,415.2 1,865.1
Goodwill 1,060.2 1,060.2
Assets of discontinued operations 2,071.4 2,222.4
Other assets and deferred charges 746.7 743.6
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Total assets $ 35,442.3 $ 34,988.5
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable $ 967.6 $ 934.8
Accounts payable 1,912.2 2,000.0
Accrued liabilities 1,255.5 1,411.3
Liabilities of discontinued operations 351.3 466.9
Energy risk management and trading liabilities -- 244.4
Derivative liabilities 7,807.5 5,168.3
Long-term debt due within one year 2,214.5 1,082.8
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Total current liabilities 14,508.6 11,308.5
Long-term debt 9,761.4 11,076.7
Deferred income taxes 2,799.5 3,353.6
Liabilities and minority interests of discontinued operations 1,168.9 1,254.7
Energy risk management and trading liabilities -- 680.9
Derivative liabilities 2,023.0 1,209.8
Other liabilities and deferred income 941.2 971.6
Contingent liabilities and commitments
Minority interests in consolidated subsidiaries 86.8 83.7
Stockholders' equity:
Preferred stock, $1 per share par value, 30 million shares
authorized, 1.5 million issued in 2003 and 2002 271.3 271.3
Common stock, $1 per share par value, 960 million shares
authorized, 520.8 million issued in 2003, 519.9 million
issued in 2002 520.8 519.9
Capital in excess of par value 5,186.6 5,177.2
Accumulated deficit (1,710.8) (884.3)
Accumulated other comprehensive income (loss) (48.3) 33.8
Other (28.1) (30.3)
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4,191.5 5,087.6
Less treasury stock (at cost), 3.2 million shares of common stock in 2003 and 2002 (38.6) (38.6)
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Total stockholders' equity 4,152.9 5,049.0
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Total liabilities and stockholders' equity $ 35,442.3 $ 34,988.5
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