WILLIAMS PARTNERS L.P. - FORM 8-K - EX-99.2

Attached files

file	filename
EX-99.1 - EX-99.1 - WILLIAMS PARTNERS L.P.	wpz_20171231xer.htm
8-K - 8-K - WILLIAMS PARTNERS L.P.	wpz_20171231x8kxer.htm

EXHIBIT 99.2






	Non-GAAP Reconciliations,
	Financial Highlights, and Operating Statistics

	(UNAUDITED)

	Final

	December 31, 2017



Williams Partners L.P.
Reconciliation of Non-GAAP Measures
(UNAUDITED)
	2016															2017
(Dollars in millions, except coverage ratios)	1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			Year			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			Year

Williams Partners L.P.
Reconciliation of "Net Income (Loss)" to "Modified EBITDA", Non-GAAP "Adjusted EBITDA" and "Distributable cash flow"

Net income (loss)	$	79		$	(77	)	$	351		$	166		$	519		$	660		$	348		$	284		$	(317	)	$	975
Provision (benefit) for income taxes	1			(80		)	(6		)	5			(80		)	3			1			(1		)	3			6
Interest expense	229			231			229			227			916			214			205			202			201			822
Equity (earnings) losses	(97		)	(101		)	(104		)	(95		)	(397		)	(107		)	(125		)	(115		)	(87		)	(434		)
Impairment of equity-method investments	112			—			—			318			430			—			—			—			—			—
Other investing (income) loss - net	—			(1		)	(28		)	—			(29		)	(271		)	(2		)	(4		)	(4		)	(281		)
Proportional Modified EBITDA of equity-method investments	189			191			194			180			754			194			215			202			184			795
Depreciation and amortization expenses	435			432			426			427			1,720			433			423			424			420			1,700
Accretion expense associated with asset retirement obligations for nonregulated operations	7			9			8			7			31			6			11			8			8			33
Modified EBITDA	955			604			1,070			1,235			3,864			1,132			1,076			1,000			408			3,616
Adjustments
Estimated minimum volume commitments	60			64			70			(194		)	—			15			15			18			(48		)	—
Severance and related costs	25			—			—			12			37			9			4			5			4			22
Potential rate refunds associated with rate case litigation	15			—			—			—			15			—			—			—			—			—
Settlement charge from pension early payout program	—			—			—			—			—			—			—			—			35			35
Regulatory charges resulting from Tax Reform	—			—			—			—			—			—			—			—			713			713
Share of regulatory charges resulting from Tax Reform for equity-method investments	—			—			—			—			—			—			—			—			11			11
ACMP Merger and transition costs	5			—			—			—			5			—			4			3			4			11
Constitution Pipeline project development costs	—			8			11			9			28			2			6			4			4			16
Share of impairment at equity-method investment	—			—			6			19			25			—			—			1			—			1
Geismar Incident adjustment	—			—			—			(7		)	(7		)	(9		)	2			8			(1		)	—
Gain on sale of Geismar Interest	—			—			—			—			—			—			—			(1,095		)	—			(1,095		)
Impairment of certain assets	—			389			—			22			411			—			—			1,142			9			1,151
Ad valorem obligation timing adjustment	—			—			—			—			—			—			—			7			—			7
Organizational realignment-related costs	—			—			—			24			24			4			6			6			2			18
Loss related to Canada disposition	—			—			32			2			34			(3		)	(1		)	4			4			4
Gain on asset retirement	—			—			—			(11		)	(11		)	—			—			(5		)	5			—
Gains from contract settlements and terminations	—			—			—			—			—			(13		)	(2		)	—			—			(15		)
Accrual for loss contingency	—			—			—			—			—			9			—			—			—			9
Gain on early retirement of debt	—			—			—			—			—			(30		)	—			3			—			(27		)
Gain on sale of RGP Splitter	—			—			—			—			—			—			(12		)	—			—			(12		)
Expenses associated with Financial Repositioning	—			—			—			—			—			—			2			—			—			2
Expenses associated with strategic asset monetizations	—			—			—			2			2			1			4			—			—			5
Total EBITDA adjustments	105			461			119			(122		)	563			(15		)	28			101			742			856
Adjusted EBITDA	1,060			1,065			1,189			1,113			4,427			1,117			1,104			1,101			1,150			4,472

Maintenance capital expenditures ⁽¹⁾	(58		)	(75		)	(121		)	(147		)	(401		)	(53		)	(100		)	(136		)	(154		)	(443		)
Interest expense (cash portion) ⁽²⁾	(241		)	(245		)	(244		)	(239		)	(969		)	(224		)	(216		)	(207		)	(208		)	(855		)
Cash taxes	—			—			—			(3		)	(3		)	(5		)	(1		)	(4		)	(2		)	(12		)
Income attributable to noncontrolling interests ⁽³⁾	(29		)	(13		)	(31		)	(27		)	(100		)	(27		)	(32		)	(27		)	(27		)	(113		)
WPZ restricted stock unit non-cash compensation	7			5			2			2			16			2			1			1			1			5
Amortization of deferred revenue associated with certain 2016 contract restructurings	—			—			—			—			—			(58		)	(58		)	(59		)	(58		)	(233		)
Distributable cash flow attributable to Partnership Operations ⁽⁴⁾	739			737			795			699			2,970			752			698			669			702			2,821

Total cash distributed ⁽⁵⁾	$	725		$	725		$	734		$	762		$	2,946		$	567		$	574		$	574		$	574		$	2,289

Coverage ratios:
Distributable cash flow attributable to partnership operations divided by Total cash distributed	1.02			1.02			1.08			0.92			1.01			1.33			1.22			1.17			1.22			1.23
Net income (loss) divided by Total cash distributed	0.11			(0.11		)	0.48			0.22			0.18			1.16			0.61			0.49			(0.55		)	0.43

(1) Includes proportionate share of maintenance capital expenditures of equity investments.
(2) Includes proportionate share of interest expense of equity investments.
(3) Excludes allocable share of certain EBITDA adjustments.
(4) The fourth quarter of 2016 includes income of $183 million associated with proceeds from the contract restructuring in the Barnett Shale and Mid-Continent region as the cash was received during 2016.
(5) In order to exclude the impact of the IDR waiver associated with the WPZ merger termination fee from the determination of coverage ratios, cash distributions have been increased by $10 million in the first quarter of 2016. Cash distributions for the third quarter of 2016 have been increased to exclude the impact of the $150 million IDR waiver associated with the sale of our Canadian operations. Cash distributions for the fourth quarter of 2016 and the first quarter of 2017 have been decreased by $50 million and $6 million, respectively, to reflect the amount paid by WMB to WPZ pursuant to the January 2017 Common Unit Purchase Agreement.



Williams Partners L.P.
Reconciliation of “Modified EBITDA” to Non-GAAP “Adjusted EBITDA”
(UNAUDITED)
	2016													2017
(Dollars in millions)	1st Qtr		2nd Qtr			3rd Qtr		4th Qtr			Year			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			Year

Modified EBITDA:
Northeast G&P	$	220	$	222		$	214	$	197		$	853		$	226		$	247		$	115		$	231		$	819
Atlantic-Gulf	382		360			423		456			1,621			450			454			430			(96		)	1,238
West	327		312			363		542			1,544			385			356			(615		)	286			412
NGL & Petchem Services	26		(290		)	70		49			(145		)	51			30			1,084			(4		)	1,161
Other	—		—			—		(9		)	(9		)	20			(11		)	(14		)	(9		)	(14		)
Total Modified EBITDA	$	955	$	604		$	1,070	$	1,235		$	3,864		$	1,132		$	1,076		$	1,000		$	408		$	3,616

Adjustments:
Northeast G&P
Severance and related costs	$	3	$	—		$	—	$	—		$	3		$	—		$	—		$	—		—			$	—
Share of impairment at equity-method investments	—		—			6		19			25			—			—			1			—			1
ACMP Merger and transition costs	2		—			—		—			2			—			—			—			—			—
Impairment of certain assets	—		—			—		—			—			—			—			121			—			121
Ad valorem obligation timing adjustment	—		—			—		—			—			—			—			7			—			7
Settlement charge from pension early payout program	—		—			—		—			—			—			—			—			7			7
Organizational realignment-related costs	—		—			—		3			3			1			1			2			—			4
Total Northeast G&P adjustments	5		—			6		22			33			1			1			131			7			140
Atlantic-Gulf
Potential rate refunds associated with rate case litigation	15		—			—		—			15			—			—			—			—			—
Severance and related costs	8		—			—		—			8			—			—			—			—			—
Constitution Pipeline project development costs	—		8			11		9			28			2			6			4			4			16
Settlement charge from pension early payout program	—		—			—		—			—			—			—			—			15			15
Regulatory charges resulting from Tax Reform	—		—			—		—			—												493			493
Share of regulatory charges resulting from Tax Reform for equity-method investments	—		—			—		—			—			—			—			—			11			11
Organizational realignment-related costs	—		—			—		—			—			1			2			2			1			6
Gain on asset retirement	—		—			—		(11		)	(11		)	—			—			(5		)	5			—
Total Atlantic-Gulf adjustments	23		8			11		(2		)	40			3			8			1			529			541
West
Estimated minimum volume commitments	60		64			70		(194		)	—			15			15			18			(48		)	—
Severance and related costs	10		—			—		3			13			—			—			—			—			—
ACMP Merger and transition costs	3		—			—		—			3			—			—			—			—			—
Impairment of certain assets	—		48			—		22			70			—			—			1,021			9			1,030
Settlement charge from pension early payout program	—		—			—		—			—			—			—			—			13			13
Regulatory charge associated with Tax Reform	—		—			—		—			—			—			—			—			220			220
Organizational realignment-related costs	—		—			—		21			21			2			3			2			1			8
Gains from contract settlements and terminations	—		—			—		—			—			(13		)	(2		)	—			—			(15		)
Total West adjustments	73		112			70		(148		)	107			4			16			1,041			195			1,256
NGL & Petchem Services
Impairment of certain assets	—		341			—		—			341			—			—			—			—			—
Loss related to Canada disposition	—		—			32		2			34			(3		)	(1		)	4			4			4
Severance and related costs	4		—			—		—			4			—			—			—			—			—
Expenses associated with strategic asset monetizations	—		—			—		2			2			1			4			—			—			5
Geismar Incident adjustments	—		—			—		(7		)	(7		)	(9		)	2			8			(1		)	—
Gain on sale of Geismar Interest	—		—			—		—			—			—			—			(1,095		)	—			(1,095		)
Gain on sale of RGP Splitter	—		—			—		—			—			—			(12		)				—			(12		)
Accrual for loss contingency	—		—			—		—			—			9			—			—			—			9
Total NGL & Petchem Services adjustments	4		341			32		(3		)	374			(2		)	(7		)	(1,083		)	3			(1,089		)
Other
Severance and related costs	—		—			—		9			9			9			4			5			4			22
ACMP Merger and transition costs	—		—			—		—			—			—			4			3			4			11
Expenses associated with Financial Repositioning	—		—			—		—			—			—			2			—			—			2
Gain on early retirement of debt	—		—			—		—			—			(30		)	—			3			—			(27		)
Total Other adjustments	—		—			—		9			9			(21		)	10			11			8			8

Total Adjustments	$	105	$	461		$	119	$	(122	)	$	563		$	(15	)	$	28		$	101		$	742		$	856

Adjusted EBITDA:
Northeast G&P	$	225	$	222		$	220	$	219		$	886		$	227		$	248		$	246		$	238		$	959
Atlantic-Gulf	405		368			434		454			1,661			453			462			431			433			1,779
West	400		424			433		394			1,651			389			372			426			481			1,668
NGL & Petchem Services	30		51			102		46			229			49			23			1			(1		)	72
Other	—		—			—		—			—			(1		)	(1		)	(3		)	(1		)	(6		)
Total Adjusted EBITDA	$	1,060	$	1,065		$	1,189	$	1,113		$	4,427		$	1,117		$	1,104		$	1,101		$	1,150		$	4,472



Williams Partners L.P.
Consolidated Statement of Income (Loss)
(UNAUDITED)
	2016															2017
(Dollars in millions, except per-unit amounts)	1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			Year			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			Year

Revenues:
Service revenues	$	1,226		$	1,210		$	1,252		$	1,485		$	5,173		$	1,256		$	1,277		$	1,304		$	1,455		$	5,292
Product sales	428			530			655			705			2,318			727			642			581			768			2,718
Total revenues	1,654			1,740			1,907			2,190			7,491			1,983			1,919			1,885			2,223			8,010
Costs and expenses:
Product costs	317			403			463			545			1,728			579			537			504			680			2,300
Operating and maintenance expenses	382			386			385			395			1,548			361			384			396			421			1,562
Depreciation and amortization expenses	435			432			426			427			1,720			433			423			424			420			1,700
Selling, general, and administrative expenses	181			139			147			163			630			156			154			140			160			610
Impairment of certain assets	6			396			1			54			457			1			2			1,142			11			1,156
Gain on sale of Geismar Interest	—			—			—			—			—			—			—			(1,095		)	—			(1,095		)
Regulatory charges resulting from Tax Reform	—			—			—			—			—			—			—			—			674			674
Other (income) expense - net	24			24			59			4			111			3			7			22			38			70
Total costs and expenses	1,345			1,780			1,481			1,588			6,194			1,533			1,507			1,533			2,404			6,977
Operating income (loss)	309			(40		)	426			602			1,297			450			412			352			(181		)	1,033
Equity earnings (losses)	97			101			104			95			397			107			125			115			87			434
Impairment of equity-method investments	(112		)	—			—			(318		)	(430		)	—			—			—			—			—
Other investing income (loss) - net	—			1			28			—			29			271			2			4			4			281
Interest incurred	(240		)	(239		)	(236		)	(234		)	(949		)	(221		)	(214		)	(210		)	(210		)	(855		)
Interest capitalized	11			8			7			7			33			7			9			8			9			33
Other income (expense) - net	15			12			16			19			62			49			15			14			(23		)	55
Income (loss) before income taxes	80			(157		)	345			171			439			663			349			283			(314		)	981
Provision (benefit) for income taxes	1			(80		)	(6		)	5			(80		)	3			1			(1		)	3			6
Net income (loss)	79			(77		)	351			166			519			660			348			284			(317		)	975
Less: Net income attributable to noncontrolling interests	29			13			25			21			88			26			28			25			25			104
Net income (loss) attributable to controlling interests	$	50		$	(90	)	$	326		$	145		$	431		$	634		$	320		$	259		$	(342	)	$	871

Allocation of net income (loss) for calculation of earnings per common unit:
Net income (loss) attributable to controlling interests	$	50		$	(90	)	$	326		$	145		$	431		$	634		$	320		$	259		$	(342	)	$	871
Allocation of net income (loss) to general partner ⁽¹⁾	202			207			72			—			517			—			—			—			—			—
Allocation of net income (loss) to Class B units ⁽¹⁾	(4		)	(8		)	7			2			12			11			6			4			(6		)	15
Allocation of net income (loss) to common units ⁽¹⁾	$	(148	)	$	(289	)	$	247		$	143		$	(98	)	$	623		$	314		$	255		$	(336	)	$	856

Diluted earnings (loss) per common unit:
Net income (loss) per common unit ⁽¹⁾	$	(0.25	)	$	(0.49	)	$	0.42		$	0.24		$	(0.17	)	$	0.68		$	0.33		$	0.27		$	(0.35	)	$	0.90
Weighted average number of common units outstanding (thousands)	588,562			588,607			591,567			601,738			592,519			920,250			955,986			956,365			956,558			947,485

Cash distributions per common unit	$	0.85		$	0.85		$	0.85		$	0.85		$	3.40		$	0.60		$	0.60		$	0.60		$	0.60		$	2.40

(1) The sum for the quarters may not equal the total for the year due to timing of unit issuances.



Williams Partners L.P.
Northeast G&P
(UNAUDITED)
	2016															2017
(Dollars in millions)	1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			Year			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			Year

Revenues:
Service revenues:
Nonregulated gathering and processing fee-based revenue	$	186		$	182		$	179		$	184		$	731		$	182		$	183		$	182		$	191		$	738
Other fee revenues	37			40			39			42			158			40			38			36			38			152
Product sales:
NGL sales from gas processing	4			3			3			4			14			4			4			2			4			14
Marketing sales	19			31			40			58			148			64			48			59			106			277
	246			256			261			288			1,051			290			273			279			339			1,181
Intrasegment eliminations	(4		)	(6		)	(4		)	(5		)	(19		)	(5		)	(4		)	(4		)	(5		)	(18		)
Total revenues	242			250			257			283			1,032			285			269			275			334			1,163

Segment costs and expenses:
NGL cost of goods sold	1			2			1			2			6			4			1			2			1			8
Marketing cost of goods sold	20			32			41			60			153			65			48			59			106			278
Other segment costs and expenses ⁽¹⁾	99			91			95			98			383			91			93			102			118			404
Impairment of certain assets	4			4			—			5			13			1			1			121			1			124
Intrasegment eliminations	(4		)	(6		)	(4		)	(5		)	(19		)	(5		)	(4		)	(4		)	(5		)	(18		)
Total segment costs and expenses	120			123			133			160			536			156			139			280			221			796

Proportional Modified EBITDA of equity-method investments	98			95			90			74			357			97			117			120			118			452
Modified EBITDA	220			222			214			197			853			226			247			115			231			819
Adjustments	5			—			6			22			33			1			1			131			7			140
Adjusted EBITDA	$	225		$	222		$	220		$	219		$	886		$	227		$	248		$	246		$	238		$	959

Statistics for Operated Assets

Gathering and Processing
Gathering volumes (Bcf per day) - Consolidated ⁽²⁾	3.34			3.15			3.16			3.19			3.21			3.32			3.28			3.28			3.37			3.31
Gathering volumes (Bcf per day) - Non-consolidated ⁽³⁾	3.21			3.16			3.08			3.20			3.16			3.55			3.58			3.48			3.61			3.55
Plant inlet natural gas volumes (Bcf per day) ⁽²⁾	0.31			0.31			0.34			0.37			0.33			0.39			0.40			0.45			0.50			0.43

Ethane equity sales (Mbbls/d)	6			4			3			3			4			2			2			2			1			2
Non-ethane equity sales (Mbbls/d)	1			1			1			1			1			1			1			1			1			1
NGL equity sales (Mbbls/d)	7			5			4			4			5			3			3			3			2			3

Ethane production (Mbbls/d)	14			18			22			20			18			17			22			17			22			20
Non-ethane production (Mbbls/d)	11			12			16			15			14			15			17			19			22			18
NGL production (Mbbls/d)	25			30			38			35			32			32			39			36			44			38

(1) Includes operating expenses, general and administrative expenses, and other income or expenses.
(2) Includes gathering volumes associated with Susquehanna Supply Hub, Ohio Valley Midstream, and Utica Supply Hub, all of which are consolidated.
(3) Includes 100% of the volumes associated with operated equity-method investments, including the Laurel Mountain Midstream partnership; and the Bradford Supply Hub and a portion of the Marcellus South Supply Hub within the Appalachia Midstream Services partnership. Volumes handled by Blue Racer Midstream (gathering and processing) and UEOM (processing only), which we do not operate, are not included.



Williams Partners L.P.
Atlantic-Gulf
(UNAUDITED)
	2016															2017
(Dollars in millions)	1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			Year			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			Year

Revenues:
Service revenues:
Nonregulated gathering & processing fee-based revenue	$	92		$	76		$	131		$	137		$	436		$	127		$	136		$	133		$	132		$	528
Regulated transportation revenue	349			331			339			348			1,367			354			358			381			408			1,501
Other fee revenues	24			41			41			42			148			54			42			38			39			173
Product sales:
NGL sales from gas processing	8			11			24			32			75			27			16			13			14			70
Marketing sales	45			75			78			84			282			90			75			66			81			312
Other sales	—			—			4			3			7			1			—			1			—			2
Tracked revenues	38			39			51			39			167			36			52			47			44			179
	556			573			668			685			2,482			689			679			679			718			2,765
Intrasegment eliminations	(9		)	(10		)	(9		)	(6		)	(34		)	(19		)	(7		)	(9		)	(7		)	(42		)
Total revenues	547			563			659			679			2,448			670			672			670			711			2,723
Segment costs and expenses:
NGL cost of goods sold	3			4			15			15			37			13			7			6			3			29
Marketing cost of goods sold	45			74			78			83			280			88			75			65			80			308
Other cost of goods sold	—			—			2			1			3			—			—			—			—			—
Impairment of certain assets	1			1			—			—			2			—			—			—			—			—
Other segment costs and expenses ⁽¹⁾	153			163			174			169			659			174			171			195			242			782
Regulatory charges resulting from Tax Reform	—			—			—			—			—			—			—			—			493			493
Tracked costs	38			39			51			39			167			36			52			47			44			179
Intrasegment eliminations	(9		)	(10		)	(9		)	(6		)	(34		)	(19		)	(7		)	(9		)	(7		)	(42		)
Total segment costs and expenses	231			271			311			301			1,114			292			298			304			855			1,749
Proportional Modified EBITDA of equity-method investments	66			68			75			78			287			72			80			64			48			264
Modified EBITDA	382			360			423			456			1,621			450			454			430			(96		)	1,238
Adjustments	23			8			11			—			42			3			8			1			529			541
Adjusted EBITDA	$	405		$	368		$	434		$	456		$	1,663		$	453		$	462		$	431		$	433		$	1,779

Statistics for Operated Assets
Gathering, Processing and Crude Oil Transportation
Gathering volumes (Bcf per day) - Consolidated ⁽²⁾	0.30			0.30			0.52			0.53			0.41			0.32			0.29			0.31			0.30			0.31
Gathering volumes (Bcf per day) - Non-consolidated ⁽³⁾	0.53			0.54			0.60			0.60			0.56			0.55			0.54			0.39			0.28			0.44
Plant inlet natural gas volumes (Bcf per day) - Consolidated ⁽²⁾	0.64			0.60			0.84			0.78			0.72			0.56			0.57			0.52			0.54			0.55
Plant inlet natural gas volumes (Bcf per day) - Non-consolidated ⁽³⁾	0.56			0.54			0.60			0.60			0.57			0.54			0.53			0.39			0.27			0.43
Crude transportation volumes (Mbbls/d)	98			99			126			128			113			131			135			137			136			134
Consolidated ⁽²⁾
Ethane margin ($/gallon)	$	.03		$	.05		$	(.03	)	$	(.01	)	$	—		$	.02		$	.03		$	.04		$	.09		$	.04
Non-ethane margin ($/gallon)	$	.30		$	.38		$	.26		$	.35		$	.31		$	.42		$	.36		$	.53		$	.72		$	.47
NGL margin ($/gallon)	$	.21		$	.18		$	.16		$	.20		$	.19		$	.26		$	.23		$	.26		$	.46		$	.28
Ethane equity sales (Mbbls/d)	2			6			6			8			5			6			4			4			2			4
Non-ethane equity sales (Mbbls/d)	4			4			11			12			8			9			6			3			3			5
NGL equity sales (Mbbls/d)	6			10			17			20			13			15			10			7			5			9
Ethane production (Mbbls/d)	13			17			16			19			16			14			14			13			14			14
Non-ethane production (Mbbls/d)	20			20			31			30			25			20			19			18			19			19
NGL production (Mbbls/d)	33			37			47			49			41			34			33			31			33			33
Non-consolidated ⁽³⁾
NGL equity sales (Mbbls/d)	5			5			5			5			5			5			4			5			4			5
NGL production (Mbbls/d)	17			19			21			21			20			21			22			22			19			21
Transcontinental Gas Pipe Line
Throughput (Tbtu)	927.2			815.9			878.1			881.5			3,502.7			939.1			887.6			938.5			1,017.5			3,782.7
Avg. daily transportation volumes (Tbtu)	10.2			9.0			9.5			9.6			9.6			10.4			9.8			10.2			11.1			10.4
Avg. daily firm reserved capacity (Tbtu)	12.0			11.5			11.6			11.9			11.7			12.8			13.2			14.1			14.9			13.8

(1) Includes operating expenses, general and administrative expenses, and other income or expenses.
(2) Excludes volumes associated with equity-method investments that are not consolidated in our results.
(3) Includes 100% of the volumes associated with operated equity-method investments.



Williams Partners L.P.
West
(UNAUDITED)
	2016															2017
(Dollars in millions)	1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			Year			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			Year

Revenues:
Service revenues:
Nonregulated gathering & processing fee-based revenue	$	376		$	379		$	374		$	593		$	1,722		$	364		$	382		$	398		$	500		$	1,644
Regulated transportation revenue	118			111			114			117			460			117			112			113			118			460
Other fee revenues	42			44			43			44			173			43			38			39			44			164
Product sales:
NGL sales from gas processing	38			54			53			58			203			64			61			68			82			275
Olefin sales	—			—			—			—			—			1			—			—			—			1
Marketing sales	269			342			396			504			1,511			506			490			561			708			2,265
Other sales	6			4			5			4			19			6			8			12			23			49
Tracked revenues	—			1			—			—			1			—			1			—			1			2
	849			935			985			1,320			4,089			1,101			1,092			1,191			1,476			4,860
Intrasegment eliminations	(76		)	(101		)	(95		)	(109		)	(381		)	(127		)	(130		)	(162		)	(182		)	(601		)
Total revenues	773			834			890			1,211			3,708			974			962			1,029			1,294			4,259
Segment costs and expenses:
NGL cost of goods sold	18			22			26			25			91			27			31			31			32			121
Marketing cost of goods sold	271			345			396			494			1,506			505			498			550			701			2,254
Other cost of goods sold	5			3			5			3			16			5			4			12			20			41
Other segment costs and expenses ⁽¹⁾	252			231			223			235			941			204			220			209			224			857
Impairment of certain assets	1			49			1			49			100			—			1			1,021			10			1,032
Regulatory charge resulting from Tax Reform	—			—			—			—			—			—			—			—			220			220
Tracked costs	—			1			—			—			1			—			—			1			1			2
Intrasegment eliminations	(76		)	(101		)	(95		)	(109		)	(381		)	(127		)	(130		)	(162		)	(182		)	(601		)
Total segment costs and expenses	471			550			556			697			2,274			614			624			1,662			1,026			3,926
Proportional Modified EBITDA of equity-method investments	25			28			29			28			110			25			18			18			18			79
Modified EBITDA	327			312			363			542			1,544			385			356			(615		)	286			412
Adjustments	73			112			70			(148		)	107			4			16			1,041			195			1,256
Adjusted EBITDA	$	400		$	424		$	433		$	394		$	1,651		$	389		$	372		$	426		$	481		$	1,668

Statistics for Operated Assets
Gathering and Processing
Gathering volumes (Bcf per day)	4.60			4.68			4.72			4.50			4.62			4.23			4.40			4.62			4.86			4.53
Plant inlet natural gas volumes (Bcf per day)	2.51			2.51			2.48			2.32			2.45			1.99			2.00			2.11			2.17			2.07

Ethane equity sales (Mbbls/d)	4			15			6			4			7			3			11			11			12			9
Non-ethane equity sales (Mbbls/d)	20			22			23			21			21			20			20			20			21			20
NGL equity sales (Mbbls/d)	24			37			29			25			28			23			31			31			33			29
Ethane margin ($/gallon)	$	.03		$	.00		$	.00		$	.00		$	.01		$	.04		$	.00		$	.02		$	.02		$	.02
Non-ethane margin ($/gallon)	$	.26		$	.39		$	.31		$	.41		$	.34		$	.49		$	.40		$	.45		$	.61		$	.49
NGL margin ($/gallon)	$	.22		$	.23		$	.24		$	.34		$	.26		$	.43		$	.26		$	.30		$	.39		$	.34
Ethane production (Mbbls/d)	12			25			10			9			14			8			18			19			26			18
Non-ethane production (Mbbls/d)	64			66			65			62			64			55			57			62			63			59
NGL production (Mbbls/d)	76			91			75			71			78			63			75			81			89			77
Northwest Pipeline LLC
Throughput (Tbtu)	205.6			168.0			161.9			191.6			727.1			219.0			165.4			156.4			209.1			749.9
Avg. daily transportation volumes (Tbtu)	2.3			1.8			1.8			2.1			2.0			2.4			1.8			1.7			2.3			2.1
Avg. daily firm reserved capacity (Tbtu)	3.0			3.0			3.0			3.0			3.0			3.0			3.0			3.0			3.0			3.0
Overland Pass Pipeline Company LLC (equity investment) - 100%
NGL Transportation volumes (Mbbls)	16,814			18,410			18,535			18,078			71,837			18,338			20,558			21,015			21,425			81,336
(1) Includes operating expenses, general and administrative expenses, and other income or expenses.



Williams Partners L.P.
NGL & Petchem Services
(UNAUDITED)
	2016															2017
(Dollars in millions)	1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			Year			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			Year

Revenues:
Service revenue:
Nonregulated gathering & processing fee-based revenue	$	1		$	4		$	—		$	—		$	5		$	—		$	—		$	—		$	—		$	—
Other fee-based revenues	7			19			14			3			43			3			4			—			—			7
Product sales:
NGL sales from gas processing	17			3			16			—			36			—			—			—			—			—
Olefin sales	136			151			202			160			649			160			145			6			—			311
Marketing sales	28			27			45			39			139			56			38			3			—			97
Other sales	—			—			2			—			2			—			—			—			—			—
	189			204			279			202			874			219			187			9			—			415
Intrasegment eliminations	(13		)	(8		)	(21		)	(5		)	(47		)	(17		)	(26		)	—			—			(43		)
Total revenues	176			196			258			197			827			202			161			9			—			372

Segment costs and expenses:
NGL cost of goods sold	12			2			10			—			24			—			—			—			—			—
Olefins cost of goods sold	65			77			84			86			312			89			93			4			—			186
Marketing cost of goods sold	28			29			41			40			138			52			40			3			—			95
Other cost of goods sold	1			—			2			—			3			—			—			—			—			—
Gain on sale of Geismar Interest	—			—			—			—			—			—			—			(1,095		)	—			(1,095		)
Impairment of certain assets	—			341			—			1			342			—			—			—			—			—
Other segment costs and expenses ⁽¹⁾	57			45			72			26			200			27			24			13			4			68
Intrasegment eliminations	(13		)	(8		)	(21		)	(5		)	(47		)	(17		)	(26		)	—			—			(43		)
Total segment costs and expenses	150			486			188			148			972			151			131			(1,075		)	4			(789		)

Modified EBITDA	26			(290		)	70			49			(145		)	51			30			1,084			(4		)	1,161
Adjustments	4			341			32			(3		)	374			(2		)	(7		)	(1,083		)	3			(1,089		)
Adjusted EBITDA	$	30		$	51		$	102		$	46		$	229		$	49		$	23		$	1		$	(1	)	$	72

Statistics for Operated Assets

Ethane equity sales (Mbbls/d)	10			1			8			—			7			—			—			—			—			—
Non-ethane equity sales (Mbbls/d)	10			1			6			—			6			—			—			—			—			—
NGL equity sales (Mbbls/d)	20			2			14			—			13			—			—			—			—			—

Ethane production (Mbbls/d)	10			1			8			—			—			—			—			—			—			—
Non-ethane production (Mbbls/d)	8			2			8			—			—			—			—			—			—			—
NGL production (Mbbls/d)	18			3			16			—			—			—			—			—			—			—

Petrochemical Services
Geismar ethylene sales volumes (million lbs)	423			391			419			405			1,638			266			300			—			—			566
Geismar ethylene margin ($/lb) ⁽²⁾	$	.13		$	.15		$	.21		$	.15		$	.16		$	.19		$	.13		$	—		$	—		$	.16
Canadian propylene sales volumes (millions lbs)	33			8			46			—			87			—			—			—			—			—
Canadian alky feedstock sales volumes (million gallons)	7			2			6			—			15			—			—			—			—			—

(1) Includes operating expenses, general and administrative expenses, and other income or expenses.
(2) Ethylene margin and ethylene margin per pound are calculated using financial results determined in accordance with GAAP, which include realized ethylene sales prices and ethylene COGS. Realized sales and COGS per unit metrics may vary from publicly quoted market indices or spot prices due to various factors, including, but not limited to, basis differentials, transportation costs, contract provisions, and inventory accounting methods.



Williams Partners L.P.
Capital Expenditures and Investments
(UNAUDITED)
	2016												2017
(Dollars in millions)	1st Qtr			2nd Qtr		3rd Qtr			4th Qtr		Year		1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			Year

Capital expenditures:
Northeast G&P	$	67		$	55	$	46		$	56	$	224	$	58		$	81		$	173		$	101		$	413
Atlantic-Gulf	300			410		380			345		1,435		388			398			371			508			1,665
West	62			33		63			70		228		57			58			94			76			285
NGL & Petchem Services	34			18		4			1		57		6			1			(1		)	—			6
Other	—			2		(2		)	—		—		—			2			1			2			5
Total ⁽¹⁾	$	463		$	518	$	491		$	472	$	1,944	$	509		$	540		$	638		$	687		$	2,374

Purchases of investments:
Northeast G&P	$	24		$	40	$	(16	)	$	24	$	72	$	20		$	26		$	24		$	29		$	99
Atlantic-Gulf	—			—		—			—		—		—			1			—			—			1
West	39			19		26			21		105		32			—			—			—			32
Total	$	63		$	59	$	10		$	45	$	177	$	52		$	27		$	24		$	29		$	132

Summary:
Northeast G&P	$	91		$	95	$	30		$	80	$	296	$	78		$	107		$	197		$	130		$	512
Atlantic-Gulf	300			410		380			345		1,435		388			399			371			508			1,666
West	101			52		89			91		333		89			58			94			76			317
NGL & Petchem Services	34			18		4			1		57		6			1			(1		)	—			6
Other	—			2		(2		)	—		—		—			2			1			2			5
Total	$	526		$	577	$	501		$	517	$	2,121	$	561		$	567		$	662		$	716		$	2,506

Capital expenditures incurred and purchases of investments:
Increases to property, plant, and equipment	$	498		$	485	$	446		$	442	$	1,871	$	569		$	586		$	660		$	824		$	2,639
Purchases of investments	63			59		10			45		177		52			27			24			29			132
Total	$	561		$	544	$	456		$	487	$	2,048	$	621		$	613		$	684		$	853		$	2,771

⁽¹⁾ Increases to property, plant, and equipment	$	498		$	485	$	446		$	442	$	1,871	$	569		$	586		$	660		$	824		$	2,639
Changes in related accounts payable and accrued liabilities	(35		)	33		45			30		73		(60		)	(46		)	(22		)	(137		)	(265		)
Capital expenditures	$	463		$	518	$	491		$	472	$	1,944	$	509		$	540		$	638		$	687		$	2,374



Selected Financial Information
(UNAUDITED)
	2016								2017
(Dollars in millions)	1st Qtr		2nd Qtr		3rd Qtr		4th Qtr		1st Qtr		2nd Qtr		3rd Qtr		4th Qtr

Cash and cash equivalents	$	125	$	101	$	68	$	145	$	625	$	1,908	$	1,165	$	881

Capital structure:
Debt:
Commercial paper	$	135	$	196	$	2	$	93	$	—	$	—	$	—	$	—
Current	$	976	$	786	$	785	$	785	$	—	$	1,951	$	502	$	501
Noncurrent	$	18,504	$	19,116	$	18,918	$	17,685	$	17,065	$	16,614	$	16,000	$	15,996



WPZ Reconciliation of "Net Income (Loss)" to "Modified EBITDA",
Non-GAAP "Adjusted EBITDA" and "Distributable Cash Flow"
	2018 Guidance Range
(Dollars in billions, except coverage ratios)	Low			Mid			High

Net income (loss)	$	1.500		$	1.600		$	1.700
Provision (benefit) for income taxes				—
Interest expense				0.825
Equity (earnings) losses				(0.325		)
Proportional Modified EBITDA of equity-method investments				0.700
Depreciation and amortization expenses and accretion for asset retirement obligations associated with nonregulated operations				1.750
Modified EBITDA	4.450			4.550			4.650

Total EBITDA adjustments				—
Adjusted EBITDA	4.450			4.550			4.650

Maintenance capital expenditures ⁽¹⁾	(0.550		)	(0.500		)	(0.450		)
Interest expense (cash portion) ⁽²⁾				(0.875		)
Income attributable to noncontrolling interests, cash taxes and other				(0.125		)

Distributable cash flow attributable to Partnership Operations	$	2.900		$	3.050		$	3.200

Total cash distributed	$	2.450		$	2.450		$	2.450

Cash Coverage Ratio (Distributable cash flow attributable to Partnership Operations / Total cash distributed)	1.18		x	1.24		x	1.31		x

(1) Includes proportionate share of maintenance capital expenditures of equity investments.
(2) Includes proportionate share of interest expense of equity investments.

WILLIAMS PARTNERS L.P. - FORM 8-K - EX-99.2 - February 14, 2018

Attached files

WILLIAMS PARTNERS L.P. Reports