<PAGE> 1
EXHIBIT 99
News Release [WILLIAMS LOGO]
NYSE: WMB; WCG
================================================================================
Date: Oct. 26, 2000
<TABLE>
<S> <C> <C> <C>
Contact: Jim Gipson Rick Rodekohr Richard George
Media Investor relations Investor relations
(918) 573-2111 (918) 573-2087 (918) 573-3679
[email protected] [email protected] [email protected]
</TABLE>
ROBUST ENERGY PERFORMANCE DRIVES WILLIAMS' 3Q RESULTS OF 27 CENTS PER SHARE
TULSA, Okla. - Williams (NYSE: WMB) today reported unaudited net income of
$121.1 million, or 27 cents per share on a diluted basis, for the third quarter
that ended Sept. 30, compared with $28.1 million, or 6 cents per share, for the
same period last year.
"This excellent performance represents the fourth successive quarter of
year-over-year earnings improvement reflecting growth within our energy
businesses," said Keith E. Bailey, chairman, president and chief executive
officer of Williams. "The earnings growth is being driven largely by our
electric power marketing and trading business, the benefit of higher energy
commodity prices and greater productive capacity fueled by the continuing
investment in the growth of our company.
"We also are very excited that our communications business is nearing
completion of its award-winning, next-generation broadband network," he said.
"As we reported yesterday, network revenues increased significantly due to
record usage of fiber-optic capacity as more business is groomed onto our
network and a growing array of customers select Williams as their carrier of
choice."
For the first nine months of 2000, Williams reported unaudited net income
of $572.6 million, or $1.28 per share on a diluted basis, compared with net
income of $99.1 million, or 22 cents per share, for the same period a year ago.
"While all projections can miss their mark due to any number of factors, we
remain confident that 2000 will end up being a banner year due to our increased
productive capacity, solid operating performance and generally favorable market
conditions," Bailey said. "We expect our energy businesses during this quarter
to continue to produce year-over-year improvement in recurring results."
Bailey will lead a conference call to discuss financial and operating
performance at 10 a.m. EDT today. To participate in the United States, begin
dialing into the call at 9:50 a.m. EDT to (800) 491-3423. International
participants should call the U.S. number (303) 267-1000. A live audio broadcast
of the call will be available at
1
<PAGE> 2
www.williams.com. Audio replay of the call will be available through Nov. 2 at
(800) 625-5288 or (303) 804-1855 (international), by following the automated
prompts and using the code 800891.
Following is a third-quarter 2000 summary of Williams' major business
groups:
GAS PIPELINE, one of the nation's largest transporters of natural gas
through systems that span the United States, reported third-quarter segment
profit of $153.4 million, compared with profit of $142.7 million during the same
period of 1999, or an increase of 7 percent.
Segment profit improved primarily due to the earnings contribution from
joint-venture investments made since the third quarter of 1999 and higher
transportation and storage revenues.
For the first nine months of 2000, Williams' gas pipeline business reported
segment profit of $565.9 million, compared with profit of $504.9 million during
the same period of 1999.
ENERGY SERVICES, which provides a full spectrum of traditional and advanced
energy products and services, reported third-quarter segment profit of $311.5
million, compared with profit of $155.2 million in the third quarter of 1999.
The substantial improvement in segment profit is primarily attributable to
the $133.2 million increase in energy marketing and trading business. The
increase reflects significantly higher electric power marketing and trading
earnings, which benefited from higher volatility and greater overall market
demand. Also contributing to Energy Services' segment profit were increased
natural gas liquids margins and volumes and higher natural gas production
prices.
For the first nine months of 2000, Energy Services reported segment profit
of $928.2 million, compared with profit of $386.2 million during the same period
last year.
COMMUNICATIONS, which includes a leading-edge broadband network,
single-source communications systems integration and multiple technology
applications for businesses, reported a third-quarter segment loss of $119.9
million, compared with a loss of $81.7 million in the same quarter of 1999.
While network revenues were higher than the second quarter of this year and
86 percent higher than the third quarter of last year, segment loss increased
due to ongoing costs of building and staffing Communications' new broadband
network company and by lower new system sales revenues in Solutions. Partially
offsetting the loss was the net favorable effect from transactions involving
technology company investments. Communications' next-generation network is on
schedule to be completed this year, with 26,000 of the planned 33,000 route
miles already in service.
For the first nine months of 2000, Communications reported a segment loss
of $75.9 million compared with a loss of $209.3 million during the same period
of 1999.
2
<PAGE> 3
ABOUT WILLIAMS (NYSE:WMB)
Williams, through its subsidiaries, connects businesses to energy and
communications. The company delivers innovative, reliable products and services
through its extensive networks of energy-distributing pipelines and high-speed
fiber-optic cables. Williams information is available at www.williams.com.
###
Portions of this document may constitute "forward-looking statements" as defined
by federal law. Although the company believes any such statements are based on
reasonable assumptions, there is no assurance that actual outcomes will not be
materially different. Any such statements are made in reliance on the "safe
harbor" protections provided under the Private Securities Reform Act of 1995.
Additional information about issues that could lead to material changes in
performance is contained in the company's annual reports filed with the
Securities and Exchange Commission.
3
<PAGE> 4
FINANCIAL HIGHLIGHTS [WILLIAMS LOGO]
(UNAUDITED)
<TABLE>
<CAPTION>
Three months ended Nine months ended
September 30, September 30,
------------------------- --------------------------
(Millions, except per-share amounts) 2000 1999* 2000 1999*
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Revenues $ 2,881.8 $ 2,207.2 $ 8,168.6 $ 6,144.3
Income before cumulative effect of change in accounting principle $ 121.1 $ 28.1 $ 594.2 $ 104.7
Cumulative effect of change in accounting principle $ -- $ -- $ (21.6) $ (5.6)
Net income $ 121.1 $ 28.1 $ 572.6 $ 99.1
Basic earnings per common share:
Income before cumulative effect of change in accounting principle $ .27 $ .06 $ 1.34 $ .23
Cumulative effect of change in accounting principle $ -- $ -- $ (.05) $ (.01)
Net income $ .27 $ .06 $ 1.29 $ .22
Average shares (thousands) 445,066 436,546 443,914 434,579
Diluted earnings per common share:
Income before cumulative effect of change in accounting principle $ .27 $ .06 $ 1.33 $ .23
Cumulative effect of change in accounting principle $ -- $ -- $ (.05) $ (.01)
Net income $ .27 $ .06 $ 1.28 $ .22
Average shares (thousands) 450,294 442,244 449,010 440,347
Shares outstanding at September 30 (thousands) 443,909 434,674
</TABLE>
* Certain amounts have been restated as described in Note 1 of Notes to
Consolidated Statement of Income.
THIRD QUARTER 2000
<PAGE> 5
CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED) [WILLIAMS LOGO]
<TABLE>
<CAPTION>
Three months ended Nine months ended
September 30, September 30,
----------------------- -----------------------
(Millions, except per-share amounts) 2000 1999* 2000 1999*
---------- ---------- ---------- ---------
<S> <C> <C> <C> <C>
REVENUES Gas Pipeline $ 437.4 $ 409.5 $ 1,410.7 $ 1,300.9
Energy Services 2,555.3 1,657.4 6,982.7 4,166.9
Communications 544.7 504.6 1,608.6 1,516.7
Other 35.7 40.7 102.5 70.7
Intercompany eliminations (691.3) (405.0) (1,935.9) (910.9)
---------- ---------- ---------- ---------
Total revenues 2,881.8 2,207.2 8,168.6 6,144.3
---------- ---------- ---------- ---------
SEGMENT Costs and operating expenses 2,193.2 1,666.9 5,952.6 4,501.3
COSTS AND Selling, general and administrative expenses 345.0 311.2 1,076.7 939.7
EXPENSES Other (income) expense - net 11.4 (6.2) 25.6 24.4
---------- ---------- ---------- ---------
Total segment costs and expenses 2,549.6 1,971.9 7,054.9 5,465.4
---------- ---------- ---------- ---------
General corporate expenses 16.0 12.7 56.3 46.2
---------- ---------- ---------- ---------
OPERATING Gas Pipeline 153.4 142.7 565.9 504.9
INCOME (LOSS) Energy Services 311.5 155.2 928.2 386.2
Communications (140.2) (81.7) (399.2) (209.3)
Other 7.5 19.1 18.8 (2.9)
General corporate expenses (16.0) (12.7) (56.3) (46.2)
---------- ---------- ---------- ---------
Total operating income 316.2 222.6 1,057.4 632.7
Interest accrued (263.4) (168.6) (708.1) (446.5)
Interest capitalized 66.6 10.6 155.2 37.5
Investing income 51.7 7.2 432.6 19.5
Minority interest in (income) loss and preferred
returns of consolidated subsidiaries 17.9 (2.9) 30.9 (6.9)
Other income (expense) - net (5.0) (.4) .6 (.2)
---------- ---------- ---------- ---------
Income before income taxes and cumulative effect
of change in accounting principle 184.0 68.5 968.6 236.1
Provision for income taxes 62.9 40.4 374.4 131.4
---------- ---------- ---------- ---------
Income before cumulative effect of change in
accounting principle 121.1 28.1 594.2 104.7
Cumulative effect of change in accounting principle -- -- (21.6) (5.6)
---------- ---------- ---------- ---------
Net income 121.1 28.1 572.6 99.1
Preferred stock dividends -- .3 -- 2.8
Income applicable to common stock $ 121.1 $ 27.8 $ 572.6 $ 96.3
========== ========== ========== =========
EARNINGS Basic earnings per common share:
PER SHARE Income before cumulative effect of change in
accounting principle $ .27 $ .06 $ 1.34 $ .23
Cumulative effect of change in accounting principle -- -- (.05) (.01)
---------- ---------- ---------- ---------
Net income $ .27 $ .06 $ 1.29 $ .22
========== ========== ========== =========
Diluted earnings per common share:
Income before cumulative effect of change in
accounting principle $ .27 $ .06 $ 1.33 $ .23
Cumulative effect of change in accounting principle -- -- (.05) (.01)
---------- ---------- ---------- ---------
Net income $ .27 $ .06 $ 1.28 $ .22
========== ========== ========== =========
</TABLE>
* Certain amounts have been restated as described in Note 1 of Notes to
Consolidated Statement of Income.
See accompanying notes.
THIRD QUARTER 2000
<PAGE> 6
NOTES TO CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED) [WILLIAMS LOGO]
1. BASIS OF PRESENTATION
During first-quarter 2000, management of certain activities related to
the marketing of products from the Alaska refinery were transferred from Energy
Marketing & Trading to Petroleum Services. Prior year amounts for Petroleum
Services and Energy Marketing & Trading have been restated to reflect the
transfer of these operations.
In fourth-quarter 1999, Williams conformed its accounting for all of
its inventories of non-trading crude oil and refined products to the
average-cost method or market, if lower, the method used for the majority of
such inventories. Previously, certain of these inventories were carried on the
last-in, first-out cost method. All previously reported results have been
restated to reflect the retroactive application of this accounting change. The
accounting change increased net income for the three and nine months ended
September 30, 1999, by $12.4 million and $16.1 million, respectively. Diluted
earnings per share for the three and nine months ended September 30, 1999,
increased $.03 and $.04 per share, respectively, as a result of the accounting
change.
Segment profit of operating companies may vary by quarter. Based on
current rate structures and/or historical maintenance schedules of certain of
its pipelines, Gas Pipeline generally experiences lower segment profits in the
second and third quarters as compared with the first and fourth quarters.
Certain other amounts in the Consolidated Statement of Income for 1999
have been reclassified to conform to the current classifications.
2. SEGMENT REVENUES AND PROFIT (LOSS)
Segment revenues and profit (loss) for the three and nine months ended
September 30, 2000 and 1999, are as follows:
<TABLE>
<CAPTION>
Three months ended September 30,
Revenues Segment Profit (Loss)
------------------------ ------------------------
(millions) 2000 1999* 2000 1999*
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Gas Pipeline $ 437.4 $ 409.5 $ 153.4 $ 142.7
---------- ---------- ---------- ----------
Energy Services:
Energy Marketing
& Trading 855.1 446.5 143.5 10.3
Exploration & Production 90.0 57.2 18.0 8.1
Midstream Gas & Liquids 345.1 276.7 84.3 68.2
Petroleum Services 1,265.1 877.0 67.1 71.8
Merger-related costs and
non-compete amortization -- -- (1.4) (3.2)
---------- ---------- ---------- ----------
Total Energy Services 2,555.3 1,657.4 311.5 155.2
---------- ---------- ---------- ----------
Communications:
Network 180.7 97.2 (81.1) (55.5)
Broadband Media 38.9 39.6 (10.1) (10.5)
Solutions 329.1 365.2 (23.6) (11.2)
Strategic Investments (4.0) 2.6 (5.1) (4.5)
---------- ---------- ---------- ----------
Total Communications 544.7 504.6 (119.9) (81.7)
---------- ---------- ---------- ----------
Other 35.7 40.7 7.5 19.1
Intercompany eliminations (691.3) (405.0) -- --
---------- ---------- ---------- ----------
Total Segments $ 2,881.8 $ 2,207.2 $ 352.5 $ 235.3
========== ========== ========== ==========
</TABLE>
* Certain amounts have been restated or reclassified as described in Notes
1 and 2.
<TABLE>
<CAPTION>
Nine months ended September 30,
Revenues Segment Profit (Loss)
------------------------ ------------------------
(millions) 2000 1999* 2000 1999*
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Gas Pipeline $ 1,410.7 $ 1,300.9 $ 565.9 $ 504.9
---------- ---------- ---------- ----------
Energy Services:
Energy Marketing
& Trading 2,427.9 1,178.2 486.5 65.5
Exploration & Production 217.5 127.7 39.4 19.8
Midstream Gas & Liquids 996.3 731.7 240.7 168.4
Petroleum Services 3,341.0 2,129.3 167.2 142.5
Merger-related costs and
non-compete amortization -- -- (5.6) (10.0)
---------- ---------- ---------- ----------
Total Energy Services 6,982.7 4,166.9 928.2 386.2
---------- ---------- ---------- ----------
Communications:
Network 457.6 314.0 21.6 (103.7)
Broadband Media 118.0 119.9 (24.7) (20.4)
Solutions 1,041.6 1,065.1 (80.4) (28.9)
Strategic Investments (8.6) 17.7 7.6 (56.3)
---------- ---------- ---------- ----------
Total Communications 1,608.6 1,516.7 (75.9) (209.3)
---------- ---------- ---------- ----------
Other 102.5 70.7 18.8 (2.9)
Intercompany eliminations (1,935.9) (910.9) -- --
---------- ---------- ---------- ----------
Total Segments $ 8,168.6 $ 6,144.3 $ 1,437.0 $ 678.9
========== ========== ========== ==========
</TABLE>
* Certain amounts have been restated or reclassified as described in Notes
1 and 2.
THIRD QUARTER 2000
<PAGE> 7
NOTES TO CONSOLIDATED STATEMENT OF INCOME (CONTINUED)
(UNAUDITED)
[WILLIAMS LOGO]
2. SEGMENT REVENUES AND PROFIT (LOSS) (continued)
Prior year amounts of Communications' operating segments have been
restated to reflect first-quarter 2000 segment realignment.
As a result of the assumption of investment management activities
within the operating segments, the definition of segment profit (loss) was
modified during first-quarter 2000 to include income (loss) from investments
resulting from the management of investments in equity instruments. This income
(loss) from investments is reported in investing income in the Consolidated
Statement of Income. The prior year segment information has been restated to
conform to the current year presentation. The primary components of income from
investments included in segment profit (loss) are the net gains from certain
marketable equity securities (in Network) and the gain on the sale of
investments in ATL-Algar Telecom Leste, S.A. (in Strategic Investments) (see
Note 4).
Based on Federal Energy Regulatory Commission and judicial rulings
received in 2000 regarding regulatory proceedings, two of the gas pipelines made
reductions to certain rate refund liabilities and related interest accruals
totaling approximately $75 million, of which $63.8 million is included in Gas
Pipeline's segment revenues and segment profit for the nine months ended
September 30, 2000. The balance of $11.2 million is included as a reduction of
interest accrued for the nine months ended September 30, 2000.
Based on second-quarter 1999 regulatory proceedings involving
rate-of-return methodology, three of the gas pipelines made reductions to
certain rate refund liabilities and related interest accruals totaling
approximately $51 million, of which $38.2 million is included in Gas Pipeline's
segment revenues and segment profit for the nine months ended September 30,
1999. The balance is included primarily as a reduction of interest accrued for
the nine months ended September 30, 1999.
The following table reflects the reconciliation of operating income
(loss) as reported in the Consolidated Statement of Income to segment profit
(loss).
<TABLE>
<CAPTION>
Three months ended September 30, 2000 Three months ended September 30, 1999
Operating Income Operating Income
Income from Segment Income from Segment
(millions) (Loss) Investments Profit (Loss) (Loss) Investments Profit (Loss)
---------- ----------- ------------- ---------- ---------- -------------
<S> <C> <C> <C> <C> <C> <C>
Gas Pipeline $ 153.4 $ -- $ 153.4 $ 142.7 $ -- $ 142.7
Energy Services 311.5 -- 311.5 155.2 -- 155.2
Communications (140.2) 20.3 (119.9) (81.7) -- (81.7)
Other 7.5 -- 7.5 19.1 -- 19.1
---------- ---------- ---------- ---------- ---------- ----------
Total segments 332.2 $ 20.3 $ 352.5 235.3 $ -- $ 235.3
---------- ---------- ---------- ---------- ---------- ----------
General corporate
expenses (16.0) (12.7)
---------- ----------
Total operating
income $ 316.2 $ 222.6
========== ==========
</TABLE>
<TABLE>
<CAPTION>
Nine months ended September 30, 2000 Nine months ended September 30, 1999
Operating Income Operating Income
Income from Segment Income from Segment
(millions) (Loss) Investments Profit (Loss) (Loss) Investments Profit (Loss)
---------- ----------- ------------- ---------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Gas Pipeline $ 565.9 $ -- $ 565.9 $ 504.9 $ -- $ 504.9
Energy Services 928.2 -- 928.2 386.2 -- 386.2
Communications (399.2) 323.3 (75.9) (209.3) -- (209.3)
Other 18.8 -- 18.8 (2.9) -- (2.9)
---------- ---------- ---------- ---------- ---------- ----------
Total segments 1,113.7 $ 323.3 $ 1,437.0 678.9 $ -- $ 678.9
---------- ---------- ---------- ---------- ---------- ----------
General corporate
expenses (56.3) (46.2)
---------- ----------
Total operating
income $ 1,057.4 $ 632.7
========== ==========
</TABLE>
3. ASSET IMPAIRMENT
Included in other (income) expense-net within segment costs and
expenses and Strategic Investments' segment loss for the nine months ended
September 30, 1999, are pre-tax charges totaling $26.7 million relating to
management's second-quarter 1999 decision and commitment to sell certain audio
and video conferencing and closed-circuit video broadcasting businesses. The
$26.7 million charge consists of a $22.8 million impairment of the assets to
fair value based on the expected net proceeds of approximately $50 million and
$3.9 million in exit costs consisting of contractual obligations related to the
sales of these businesses. The sales were completed during fourth-quarter 1999
with an additional $1.7 million impairment charge recorded. These transactions
resulted in an income tax provision of approximately $7.9 million, which
reflects the impact of goodwill not deductible for tax purposes. Segment losses
for the operations related to these assets for the three and nine months ended
September 30, 1999, were approximately $.9 million and $10 million,
respectively.
THIRD QUARTER 2000
<PAGE> 8
NOTES TO CONSOLIDATED STATEMENT OF INCOME (CONTINUED)
(UNAUDITED)
[WILLIAMS LOGO]
4. INVESTING INCOME
Williams sold a portion of its investment in certain marketable equity
securities for gains of $40.2 million and $108.3 million for the three and nine
months ended September 30, 2000, respectively. In third-quarter 2000, Williams
recognized a loss of $20 million related to the write-down of certain cost-based
and equity-method investments resulting from management's estimate of the
permanent decline in the value of these investments.
In second-quarter 2000, Williams recognized a gain of $214.7 million
resulting from the conversion of Williams' shares of Concentric Network
Corporation's common stock into shares of XO Communications, Inc.'s common stock
pursuant to a merger of those companies completed in June 2000.
In a series of transactions during first-quarter 2000, Williams sold a
portion of its investment in ATL-Algar Telecom Leste S.A. (ATL) for
approximately $168 million in cash to SBC Communications, Inc., which became a
related party in first-quarter 2000. This investment had a carrying value of $30
million. Williams recognized a gain on the sale of $16.5 million and deferred a
gain of approximately $121 million associated with $150 million of the proceeds,
which were subsequently advanced to ATL.
In addition to those items noted above, investing income also includes
interest income primarily related to short-term investments and notes
receivable.
5. CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE
In December 1999, the Securities and Exchange Commission issued Staff
Accounting Bulletin No. 101 (SAB 101), "Revenue Recognition in Financial
Statements." Among other things, SAB 101 clarifies certain conditions regarding
the culmination of an earnings process and customer acceptance requirements in
order to recognize revenue. Prior to January 1, 2000, Solutions' revenue
recognition policy had been to recognize revenues on new systems sales and
upgrades under the percentage-of-completion method. A portion of the revenues on
the contracts was initially recognized upon delivery of equipment with the
remaining revenues under the contract being recognized over the installation
period based on the relationship of incurred labor to total estimated labor. In
light of the new guidance issued in SAB 101, effective January 1, 2000,
Solutions changed its method of accounting for new systems sales and upgrades
from the percentage-of-completion method to the completed-contract method. The
provisions of SAB 101 permit Solutions to treat this change in accounting
principle as a cumulative effect adjustment consistent with rules issued under
Accounting Principles Board Opinion No. 20. The cumulative effect of the
accounting change resulted in a charge to first-quarter 2000 of $21.6 million
(net of income tax benefits of $14.9 million and minority interest of $21
million). Solutions recognized $7.3 million and $208.7 million of revenue for
the three and nine months ended September 30, 2000, respectively, for contracts
completed in 2000 which were previously reported under the
percentage-of-completion method.
Effective January 1, 1999, Williams adopted Statement of Position (SOP)
98-5, "Reporting on the Costs of Start-Up Activities." The SOP requires that all
start-up costs be expensed as incurred, and the expense related to the initial
application of this SOP of $5.6 million (net of a $3.6 million benefit for
income taxes) is reported as the cumulative effect of change in accounting
principle in first-quarter 1999.
THIRD QUARTER 2000
<PAGE> 9
OPERATING STATISTICS
(UNAUDITED)
[WILLIAMS LOGO]
<TABLE>
<CAPTION>
Three months ended Nine months ended
September 30, September 30,
------------------ -----------------
2000 1999 2000 1999
------ ------ ------ ------
<S> <C> <C> <C> <C>
GAS PIPELINE:
CENTRAL
Throughput (TBtu) 69.9 69.9 230.3 239.8
Average daily transportation volumes (TBtu) .8 .8 .8 .9
Average daily firm reserved capacity (TBtu) 2.1 2.2 2.2 2.2
KERN RIVER GAS TRANSMISSION
Throughput (TBtu) 75.7 73.3 229.1 225.1
Average daily transportation volumes (TBtu) .8 .8 .8 .8
Average daily firm reserved capacity (TBtu) .8 .7 .7 .7
NORTHWEST PIPELINE
Throughput (TBtu) 165.0 145.4 536.0 511.3
Average daily transportation volumes (TBtu) 1.8 1.6 1.9 1.9
Average daily firm reserved capacity (TBtu) 2.0 2.5 2.4 2.5
TEXAS GAS TRANSMISSION
Throughput (TBtu) 154.2 156.8 531.8 558.0
Average daily transportation volumes (TBtu) 1.7 1.7 1.9 2.0
Average daily firm reserved capacity (TBtu) 1.6 1.7 2.1 2.1
TRANSCONTINENTAL GAS PIPE LINE
Throughput (TBtu) 401.7 387.2 1,306.8 1,223.0
Average daily transportation volumes (TBtu) 4.4 4.2 4.8 4.5
Average daily firm reserved capacity (TBtu) 6.3 6.6 6.3 6.3
ENERGY SERVICES:
ENERGY MARKETING & TRADING
Physical Trading
Natural gas (Bcf/d) 3.0 3.7 3.4 3.4
Power (GWh) 38,191 31,379 87,771 59,983
EXPLORATION & PRODUCTION
Natural gas production (TBtu) 16.1 13.4 48.4 40.1
MIDSTREAM GAS & LIQUIDS
Field Services
Gathering volumes (TBtu) 529.0 514.1 1,569.2 1,584.7
Processing volumes (TBtu) 135.8 136.1 419.8 404.1
Natural gas liquids sales (million gallons) 309.7 252.2 871.9 590.8
Natural Gas Liquids Pipeline
Barrel miles - total system (billions) 37.5 35.3 109.0 100.9
Mid-America Pipeline deliveries (million barrels) 69.8 62.9 208.0 199.4
Seminole Pipeline deliveries (million barrels) 23.1 24.3 73.8 69.4
Rocky Mountain Extension deliveries (million barrels) 11.5 9.3 33.3 24.5
PETROLEUM SERVICES
Petroleum Products Pipeline
Shipments (million barrels) 61.6 58.4 170.0 163.3
Barrel miles (billions) 17.8 18.7 49.7
49.3
Ethanol sales (million gallons) 58.0 51.8 166.2 140.9
Refining (crude runs)
Memphis (MBPD) 162.2 140.0 153.8 134.6
North Pole (MBPD) 204.6 185.5 193.8 179.9
Retail locations
Average monthly gasoline and diesel
sales per store (thousand gallons) 234.2 188.5 236.8 187.5
Average number of stores 273 261 273 259
</TABLE>
THIRD QUARTER 2000
<PAGE> 10
OPERATING STATISTICS (CONTINUED)
(UNAUDITED)
[WILLIAM LOGO]
<TABLE>
<CAPTION>
At September 30,
-----------------
2000 1999
------ ------
<S> <C> <C>
COMMUNICATIONS:
NETWORK
Planned route miles:
Single fiber network route miles 9,700
Other route miles wholly owned 12,800
Route miles under the asset defeasance program 3,200
Route miles jointly owned 1,500
Route miles through dark fiber rights 6,800
------ ------
Total planned route miles 34,000*
------ ------
Planned retained fiber miles 530,000
Route miles in operation 25,916 19,607
Route miles lit 26,834 19,607
Cable miles in the ground 30,489 22,556
------ ------
</TABLE>
* Planned route miles are anticipated to total approximately 33,000 route
miles by the end of 2000, with the remaining route miles to be
completed by the end of first-quarter 2001.
THIRD QUARTER 2000
