OVERLAND PARK, Kan., Dec. 9 /PRNewswire-FirstCall/ -- Ferrellgas Partners,
L.P. (NYSE: FGP), one of the largest distributors of propane, today reported
sharply improved results for fiscal 2009's first quarter ended October 31,
2008.
Adjusted EBITDA increased more than 50 percent to a record $35.2 million
from the previous record of $23.3 million in the year-earlier period. The
partnership also reported significant improvement in the seasonal net loss,
$14.9 million, or $0.23 per common unit, contrasted with $22.9 million, or
$0.36 per common unit, in fiscal 2008's first quarter. Strong sales volumes,
improved margins, and reduced general and administrative expense and equipment
lease expense contributed to the favorable performance.
Revenues rose nearly 22 percent to $480.9 million from $394.9 million,
while gross profit improved to a record $145.5 million from $131.4 million.
Total propane gallon sales were up more than 10 percent, totaling 172.2
million compared with 155.9 million the year before.
Chairman and Chief Executive Officer James E. Ferrell observed, "We
previously noted that the partnership had entered fiscal 2009 with positive
momentum, and results exceeded expectations, as well as the analysts' mean of
a $0.33 loss." He continued, "Based on the strong first-quarter performance
and momentum carrying over into the second quarter, we are increasing our
guidance for fiscal 2009 Adjusted EBITDA to $255 million from $245 million."
The partnership reported Adjusted EBITDA of $222 million for fiscal 2008 and a
record $237 million for fiscal 2007.
President and Chief Operating Officer Steve Wambold explained,
"Particularly gratifying was the increase in propane gallon sales that in part
reflect organic growth in spite of the continuing, negative impact of customer
conservation. It's also noteworthy that general and administrative expense and
equipment lease expense decreased nearly 23 percent and 16 percent,
respectively in the quarter."
Wambold also pointed out, "The increase in operating expenses reflects in
part the double-digit percentage gain in sales volume. In fact, operating
expenses per gallon declined two cents per gallon delivered highlighting our
continued focus on operating efficiencies."
Ferrellgas Partners, L.P., through its operating partnership, Ferrellgas,
L.P., serves approximately one million customers in all 50 states, the
District of Columbia, and Puerto Rico. Ferrellgas employees indirectly own
more than 20 million common units of the partnership through an employee stock
ownership plan. More information about the partnership can be found online at
http://www.ferrellgas.com.
Statements in this release concerning expectations for the future are
forward-looking statements. A variety of known and unknown risks,
uncertainties, and other factors could cause results, performance, and
expectations to differ materially from anticipated results, performance, and
expectations. These risks, uncertainties, and other factors are discussed in
the Form 10-K of Ferrellgas Partners, L.P., Ferrellgas Partners Finance Corp.,
Ferrellgas, L.P., and Ferrellgas Finance Corp. for the fiscal year ended July
31, 2008, and other documents filed from time to time by these entities with
the Securities and Exchange Commission.
Contact:
Tom Colvin, Investor Relations, (913) 661-1530
Scott Brockelmeyer, Media Relations, (913) 661-1830
FERRELLGAS PARTNERS, L.P. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except unit data)
(unaudited)
ASSETS October 31, 2008 July 31, 2008
Current Assets:
Cash and cash equivalents $19,319 $16,614
Accounts and notes receivable, net 126,657 145,081
Inventories 161,232 152,301
Price risk management assets 2,649 26,086
Prepaid expenses and other current assets 23,145 10,924
Total Current Assets 333,002 351,006
Property, plant and equipment, net 683,789 685,328
Goodwill 248,939 248,939
Intangible assets, net 224,201 225,273
Other assets, net 20,259 18,685
Total Assets $1,510,190 $1,529,231
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
Current Liabilities:
Accounts payable $98,868 $71,348
Short term borrowings 105,419 125,729
Price risk management liabilities 122,158 7,336
Other current liabilities (a) 120,379 100,518
Total Current Liabilities 446,824 304,931
Long-term debt (a) 1,052,886 1,034,719
Other liabilities 22,870 23,237
Contingencies and commitments - -
Minority interest 3,873 4,220
Partners' Capital (Deficit):
Common unitholders (63,192,503 and
62,961,674 units outstanding at
October 2008 and July 2008, respectively) 161,900 201,618
General partner unitholder (638,308 and
635,977 units outstanding at October 2008
and July 2008, respectively) (58,438) (58,036)
Accumulated other comprehensive income
(loss) (119,725) 18,542
Total Partners' Capital (Deficit) (16,263) 162,124
Total Liabilities and Partners'
Capital (Deficit) $1,510,190 $1,529,231
(a) The principal difference between the Ferrellgas Partners, L.P.
balance sheet and that of Ferrellgas, L.P., is $268 million of 8 3/4%
notes which are liabilities of Ferrellgas Partners, L.P. and not of
Ferrellgas, L.P.
FERRELLGAS PARTNERS, L.P. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
FOR THE THREE MONTHS ENDED OCTOBER 31, 2008 AND 2007
(in thousands, except per unit data)
(unaudited)
Three months ended Twelve months ended
October 31, October 31,
2008 2007 2008 2007
Revenues:
Propane and other gas
liquids sales $436,888 $358,935 $2,133,234 $1,771,439
Other 44,031 35,981 243,458 239,504
Total revenues 480,919 394,916 2,376,692 2,010,943
Cost of product sold:
Propane and other gas
liquids sales 318,590 252,519 1,557,989 1,165,002
Other 16,814 10,960 142,332 153,563
Gross profit 145,515 131,437 676,371 692,378
Operating expense 96,217 90,459 377,836 381,286
Depreciation and amortization
expense 21,316 21,365 85,472 87,092
General and administrative
expense 9,086 11,793 42,905 45,578
Equipment lease expense 5,355 6,351 23,482 25,849
Employee stock ownership plan
compensation charge 1,749 3,174 10,988 11,558
Loss on disposal of assets and
other 2,582 2,387 11,445 10,206
Operating income (loss) 9,210 (4,092) 124,243 130,809
Interest expense (23,670) (22,286) (88,096) (87,859)
Other income (expense), net (818) 817 (596) 2,992
Earnings (loss) before income
taxes and minority interest (15,278) (25,561) 35,551 45,942
Income tax expense (benefit) -
current (269) (311) 1,774 3,169
Income tax expense (benefit) -
deferred (32) (2,177) 495 693
Minority interest (a) (90) (173) 580 667
Net earnings (loss) (14,887) (22,900) 32,702 41,413
Net earnings (loss) available
to general partner (149) (229) 327 414
Net earnings (loss) available
to common unitholders $(14,738) $(22,671) $32,375 $40,999
Earnings Per Unit
Basic and diluted net earnings
(loss) available per common
unit $(0.23) $(0.36) $0.51 $0.65
Dilutive effect of EITF 03-6 (b) - - - -
Adjusted net earnings (loss)
per unit available to common
unitholders $(0.23) $(0.36) $0.51 $0.65
Weighted average common units
outstanding 63,052.0 62,958.7 62,999.3 62,937.3
Supplemental Data and Reconciliation of Non-GAAP Items:
Three months ended Twelve months ended
October 31, October 31,
2008 2007 2008 2007
Net earnings (loss) $(14,887) $(22,900) $32,702 $41,413
Income tax expense (benefit) (301) (2,488) 2,269 3,862
Interest expense 23,670 22,286 88,096 87,859
Depreciation and
amortization expense 21,316 21,365 85,472 87,092
Other income (expense), net 818 (817) 596 (2,992)
EBITDA 30,616 17,446 209,135 217,234
Employee stock ownership
plan compensation charge 1,749 3,174 10,988 11,558
Unit and stock-based
compensation charge (b) 328 450 1,694 1,006
Loss on disposal of assets
and other 2,582 2,387 11,445 10,206
Minority interest (90) (173) 580 667
Adjusted EBITDA (c) 35,185 23,284 233,842 240,671
Net cash interest expense (d) (23,759) (21,983) (91,557) (88,941)
Maintenance capital
expenditures (e) (5,026) (3,124) (22,496) (16,075)
Cash paid for taxes (8) (1,211) (2,638) (3,188)
Proceeds from asset sales 2,318 2,938 10,254 9,144
Distributable cash flow to
equity investors (f) $8,710 $(96) $127,405 $141,611
Propane gallons sales
Retail - Sales to End Users 126,533 119,175 664,190 683,609
Wholesale - Sales to
Resellers 45,676 36,708 190,983 183,913
Total propane gallons sales 172,209 155,883 855,173 867,522
(a) Amounts allocated to the general partner for its 1.0101% interest in
the operating partnership, Ferrellgas, L.P.
(b) Statement of Financial Accounting Standards ("SFAS") No. 123(R),
"Share-Based Payment" requires that the cost resulting from all
share-based payment transactions be recognized in the financial
statements. Share-based payment transactions resulted in a non-cash
compensation charge of $0.1 million and $0.1 million to operating
expense for the three months ended October 31, 2008 and 2007,
respectively, and $0.5 million and $0.3 million to operating expense
for the twelve months ending October 31, 2008 and 2007, respectively.
A non-cash compensation charge of $0.2 million and $0.3 million was
recorded to general and administrative expense for the three months
ended October 31, 2008 and 2007, respectively, and $1.2 million and
$0.7 million to general and administrative expense for the twelve
months ending October 31, 2008 and 2007, respectively.
(c) Management considers Adjusted EBITDA to be a chief measurement of the
partnership's overall economic performance and return on invested
capital. Adjusted EBITDA is calculated as earnings before interest,
income taxes, depreciation and amortization, employee stock ownership
plan compensation charge, unit and stock-based compensation charge,
loss on disposal of assets and other, minority interest, and other
non-cash and non-operating charges. Management believes the
presentation of this measure is relevant and useful because it allows
investors to view the partnership's performance in a manner similar
to the method management uses, adjusted for items management believes
are unusual or non-recurring, and makes it easier to compare its
results with other companies that have different financing and
capital structures. In addition, management believes this measure is
consistent with the manner in which the partnership's lenders and
investors measure its overall performance and liquidity, including
its ability to pay quarterly equity distributions, service its
long-term debt and other fixed obligations and fund its capital
expenditures and working capital requirements. This method of
calculating Adjusted EBITDA may not be consistent with that of other
companies and should be viewed in conjunction with measurements that
are computed in accordance with GAAP.
(d) Net cash interest expense is the sum of interest expense less
non-cash interest expense and interest income. This amount also
includes interest expense related to the accounts receivable
securitization facility.
(e) Maintenance capital expenditures include capitalized expenditures for
betterment and replacement of property, plant and equipment.
(f) Management considers Distributable cash flow to equity investors a
meaningful non-GAAP measure of the partnership's ability to declare
and pay quarterly distributions to common unitholders. Distributable
cash flow to equity investors, as management defines it, may not be
comparable to distributable cash flow or similarly titled measures
used by other corporations and partnerships.
SOURCE Ferrellgas Partners, L.P.
CONTACT:
Investor Relations
Tom Colvin
+1-913-661-1530
or
Media
Relations
Scott Brockelmeyer
+1-913-661-1830, both of Ferrellgas Partners,
L.P.
Web site: http://www.ferrellgas.com
