UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of Report (Date of Earliest Event Reported):  December 10, 2014 (December 10, 2014)

 

Ferrellgas Partners, L.P.

(Exact name of registrant as specified in its charter)

 

Delaware

 

001-11331

 

43-1698480

(State or other jurisdiction

 

(Commission

 

(I.R.S. Employer

of incorporation)

 

File Number)

 

Identification No.)

 

7500 College Blvd., Suite 1000,
Overland Park, Kansas

 

66210

(Address of principal executive offices)

 

(Zip Code)

 

Registrant’s telephone number, including area code:  913-661-1500

 

n/a

Former name or former address, if changed since last report

 

Ferrellgas Partners Finance Corp.

(Exact name of registrant as specified in its charter)

 

Delaware

 

333-06693

 

43-1742520

(State or other jurisdiction

 

(Commission

 

(I.R.S. Employer

of incorporation)

 

File Number)

 

Identification No.)

 

7500 College Blvd., Suite 1000,
Overland Park, Kansas

 

66210

(Address of principal executive offices)

 

(Zip Code)

 

Registrant’s telephone number, including area code:  913-661-1500

 

n/a

Former name or former address, if changed since last report

 

Ferrellgas, L.P.

(Exact name of registrant as specified in its charter)

 

Delaware

 

000-50182

 

43-1698481

(State or other jurisdiction

 

(Commission

 

(I.R.S. Employer

of incorporation)

 

File Number)

 

Identification No.)

 

7500 College Blvd., Suite 1000,
Overland Park, Kansas

 

66210

(Address of principal executive offices)

 

(Zip Code)

 

Registrant’s telephone number, including area code:  913-661-1500

 

n/a

Former name or former address, if changed since last report

 

Ferrellgas Finance Corp.

(Exact name of registrant as specified in its charter)

 

Delaware

 

000-50183

 

14-1866671

(State or other jurisdiction

 

(Commission

 

(I.R.S. Employer

of incorporation)

 

File Number)

 

Identification No.)

 

7500 College Blvd., Suite 1000,
Overland Park, Kansas

 

66210

(Address of principal executive offices)

 

(Zip Code)

 

Registrant’s telephone number, including area code:  913-661-1500

 

n/a

Former name or former address, if changed since last report

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

o        Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o        Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o        Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o        Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 



 

Item 2.02 Results of Operations and Financial Condition.

 

The information included in Item 7.01 of this Current Report on Form 8-K is incorporated by reference into this Item 2.02 of this Current Report on Form 8-K.

 

Item 7.01 Regulation FD Disclosure.

 

On December 10, 2014, Ferrellgas Partners, L.P. issued a press release regarding its financial results for the first fiscal quarter ended October 31, 2014. A copy of this press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

 

Item 9.01 Financial Statements and Exhibits.

 

Exhibit 99.1 — Press release of Ferrellgas Partners, L.P. dated December 10, 2014, reporting its financial results for the first fiscal quarter ended October 31, 2014.

 

Limitation on Materiality and Incorporation by Reference
The information in this Current Report on Form 8-K related to Items 2.02 and 7.01, including Exhibit 99.1 furnished herewith, is being furnished to the SEC pursuant to Item 2.02 and Item 7.01 of Form 8-K and is not deemed to be “filed” with the SEC for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of Section 18. In addition, such information is not to be incorporated by reference into any registration statement of Ferrellgas Partners, L.P., Ferrellgas Partners Finance Corp., Ferrellgas, L.P. or Ferrellgas Finance Corp. or other filings of such entities made pursuant to the Exchange Act or the Securities Act, unless specifically identified as being incorporated therein by reference.

 

The furnishing of particular information in this Current Report, including Exhibit 99.1 furnished herewith, pursuant to Item 7.01 of Form 8-K is not intended to, and does not, constitute a determination or admission by Ferrellgas Partners, L.P., Ferrellgas Partners Finance Corp., Ferrellgas, L.P. or Ferrellgas Finance Corp. as to the materiality or completeness of any such information that is required to be disclosed solely by Regulation FD of the Exchange Act.

 

2



 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrants have duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

 

 

FERRELLGAS PARTNERS, L.P.

 

 

 

 

 

 

 

 

Date:

December 10, 2014

By

/s/ J. Ryan VanWinkle

 

 

 

J. Ryan VanWinkle

 

 

 

Executive Vice President and Chief Financial Officer; President, Midstream Operations; Treasurer (Principal Financial and Accounting Officer) of Ferrellgas, Inc., the general partner

 

 

 

 

 

 

 

 

 

 

FERRELLGAS PARTNERS FINANCE CORP.

 

 

 

 

 

 

 

 

Date:

December 10, 2014

By

/s/ J. Ryan VanWinkle

 

 

 

J. Ryan VanWinkle

 

 

 

Chief Financial Officer and Sole Director

 

 

 

 

 

 

 

 

 

 

FERRELLGAS, L.P.

 

 

 

 

 

 

 

 

Date:

December 10, 2014

By

/s/ J. Ryan VanWinkle

 

 

 

J. Ryan VanWinkle

 

 

 

Executive Vice President and Chief Financial Officer; President, Midstream Operations; Treasurer (Principal Financial and Accounting Officer) of Ferrellgas, Inc., the general partner

 

 

 

 

 

 

 

 

 

 

FERRELLGAS FINANCE CORP.

 

 

 

 

 

 

 

 

Date:

December 10, 2014

By

/s/ J. Ryan VanWinkle

 

 

 

J. Ryan VanWinkle

 

 

 

Chief Financial Officer and Sole Director

 

3



 

Exhibit Index

 

Exhibit No.

 

Description

 

 

 

99.1

 

Press release of Ferrellgas Partners, L.P. dated December 10, 2014, reporting its financial results for the first fiscal quarter ended October 31, 2014.

 

4




Exhibit 99.1

 

FERRELLGAS PARTNERS REPORTS STRONG FIRST QUARTER;

REAFFIRMS FISCAL 2015 EARNINGS GUIDANCE

 

OVERLAND PARK, KAN., December 10, 2014 (GLOBENEWSWIRE) – Ferrellgas Partners, L.P. (NYSE:FGP) today reported results for fiscal 2015’s first quarter ended October 31, 2014.

 

Gross profit grew 8% to a record $154.7 million on improved retail propane margins and contributions from recently acquired midstream operations.  Adjusted EBITDA climbed nearly 30% to $34.4 million reflecting the aforementioned gross profit contributions.  These results produced trailing 12-month distributable cash flow coverage to equity investors of 1.18x, providing the partnership $30 million of excess cash flow to fund organic and acquired growth.

 

President and Chief Executive Officer Steve Wambold commented, “Fiscal 2015 is off to an excellent start with operations delivering first-quarter results in line with our expectations.  November, the start of our second quarter, also looks to be in line with our expectations as seasonably cold temperatures boosted the demand for propane consumption.  We remain comfortable with our previous guidance of Adjusted EBITDA in the range of $300 million to $320 million for fiscal 2015.”

 

The partnership previously reported record Adjusted EBITDA for fiscal 2014 of $288.1 million.  For the trailing 12 months ended October 31, the partnership produced Adjusted EBITDA of $296.1 million.

 

Propane sales for the quarter were 186.1 million gallons compared to 191.0 million gallons sold in the year-earlier quarter.  Retail sales volumes nearly matched prior-year levels despite nationwide temperatures that were 20% warmer than normal.

 

- more -

 



 

“During the first quarter, we remained focused on operational efficiency and were very pleased with the results,” Wambold pointed out.  “Both operating expense and general and administrative expense were practically unchanged at $102.9 million and $10.8 million, respectively, despite acquired midstream and retail propane operations in 2014.”

 

Interest expense increased to $23.9 million from $22.1 million primarily reflecting debt attributable to merger and acquisition activity.

 

“Our focus remains on the profitable growth of the partnership, both through acquisition and organic means,” Wambold explained.  “We have identified a range of possibilities that would further our diversification initiative and we continue to selectively expand our propane footprint.  Further, Blue Rhino’s sales volumes continue to grow through same-store sales and increased selling locations that now exceed 46,500 nationwide.”

 

Ferrellgas Partners, L.P., through its operating partnership, Ferrellgas, L.P., and subsidiaries, serves propane customers in all 50 states, the District of Columbia and Puerto Rico, and provides midstream services to major energy companies in the United States.  Ferrellgas employees indirectly own more than 22 million common units of the partnership through an employee stock ownership plan.  More information about the partnership can be found online at www.ferrellgas.com.

 

1



 

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, 2014 and in other documents filed from time to time by these entities with the Securities and Exchange Commission.

 

Contacts:

Alan Heitmann, Investor Relations

alheitmann@ferrellgas.com or (816) 792-6879

Scott Brockelmeyer, Media Relations

scottbrockelmeyer@ferrelllgas.com or (913) 661-1830

 

# # #

 

2



 

FERRELLGAS PARTNERS, L.P. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF EARNINGS

FOR THE THREE AND TWELVE MONTHS ENDED OCTOBER 31, 2014 AND 2013

(in thousands, except per unit data)

(unaudited)

 

 

 

Three months ended

 

Twelve months ended

 

 

 

October 31

 

October 31

 

 

 

2014

 

2013

 

2014

 

2013

 

Revenues:

 

 

 

 

 

 

 

 

 

Propane and other gas liquids sales

 

$

394,361

 

$

382,223

 

$

2,159,481

 

$

1,786,209

 

Other

 

48,994

 

32,807

 

274,704

 

241,379

 

Total revenues

 

443,355

 

415,030

 

2,434,185

 

2,027,588

 

 

 

 

 

 

 

 

 

 

 

Cost of product sold:

 

 

 

 

 

 

 

 

 

Propane and other gas liquids sales

 

264,814

 

258,754

 

1,462,448

 

1,137,358

 

Other

 

23,860

 

13,346

 

168,666

 

148,605

 

 

 

 

 

 

 

 

 

 

 

Gross profit

 

154,681

 

142,930

 

803,071

 

741,625

 

 

 

 

 

 

 

 

 

 

 

Operating expense (including $(1,800) and $3,300 of change in fair value of contingent consideration for the three and twelve month periods ended October 31, 2014)

 

102,883

 

102,966

 

446,110

 

416,591

 

Depreciation and amortization expense

 

23,309

 

20,215

 

87,296

 

82,684

 

General and administrative expense

 

10,828

 

10,781

 

46,030

 

44,034

 

Equipment lease expense

 

5,532

 

4,066

 

19,211

 

16,126

 

Non-cash employee stock ownership plan compensation charge

 

4,374

 

3,043

 

23,120

 

16,410

 

Non-cash stock-based compensation charge (a)

 

16,112

 

4,431

 

36,189

 

14,884

 

Loss on disposal of assets

 

961

 

357

 

7,090

 

10,507

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

(9,318

)

(2,929

)

138,025

 

140,389

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

(23,912

)

(22,093

)

(88,321

)

(88,803

)

Loss on extinguishment of debt

 

 

(301

)

(20,901

)

(301

)

Other income (expense), net

 

(449

)

216

 

(1,144

)

690

 

 

 

 

 

 

 

 

 

 

 

Earnings (loss) before income taxes

 

(33,679

)

(25,107

)

27,659

 

51,975

 

 

 

 

 

 

 

 

 

 

 

Income tax expense (benefit)

 

(510

)

(50

)

2,056

 

2,069

 

 

 

 

 

 

 

 

 

 

 

Net earnings (loss)

 

(33,169

)

(25,057

)

25,603

 

49,906

 

 

 

 

 

 

 

 

 

 

 

Net earnings (loss) attributable to noncontrolling interest (b)

(294

)

(214

)

424

 

665

 

 

 

 

 

 

 

 

 

 

 

Net earnings (loss) attributable to Ferrellgas Partners, L.P.

 

(32,875

)

(24,843

)

25,179

 

49,241

 

 

 

 

 

 

 

 

 

 

 

Less: General partner’s interest in net earnings (loss)

 

(329

)

(248

)

252

 

492

 

 

 

 

 

 

 

 

 

 

 

Common unitholders’ interest in net earnings (loss)

 

$

(32,546

)

$

(24,595

)

$

24,927

 

$

48,749

 

 

 

 

 

 

 

 

 

 

 

Earnings (loss) Per Unit

 

 

 

 

 

 

 

 

 

Basic and diluted net earnings (loss) per common unitholders’ interest

 

$

(0.40

)

$

(0.31

)

$

0.31

 

$

0.62

 

 

 

 

 

 

 

 

 

 

 

Weighted average common units outstanding

 

82,179.7

 

79,075.8

 

80,433.5

 

78,338.3

 

 



 

Supplemental Data and Reconciliation of Non-GAAP Items:

 

 

 

Three months ended

 

Twelve months ended

 

 

 

October 31

 

October 31

 

 

 

2014

 

2013

 

2014

 

2013

 

 

 

 

 

 

 

 

 

 

 

Net earnings (loss) attributable to Ferrellgas Partners, L.P.

 

$

(32,875

)

$

(24,843

)

$

25,179

 

$

49,241

 

Income tax expense (benefit)

 

(510

)

(50

)

2,056

 

2,069

 

Interest expense

 

23,912

 

22,093

 

88,321

 

88,803

 

Depreciation and amortization expense

 

23,309

 

20,215

 

87,296

 

82,684

 

EBITDA

 

13,836

 

17,415

 

202,852

 

222,797

 

Loss on extinguishment of debt

 

 

301

 

20,901

 

301

 

Non-cash employee stock ownership plan compensation charge

 

4,374

 

3,043

 

23,120

 

16,410

 

Non-cash stock based compensation charge (a)

 

16,112

 

4,431

 

36,189

 

14,884

 

Loss on disposal of assets

 

961

 

357

 

7,090

 

10,507

 

Other income (expense), net

 

449

 

(216

)

1,144

 

(690

)

Change in fair value of contingent consideration

 

(1,800

)

 

3,200

 

 

Litigation accrual and related legal fees associated with a class action lawsuit

 

723

 

1,325

 

1,147

 

2,205

 

Net earnings (loss) attributable to noncontrolling interest (b)

 

(294

)

(214

)

424

 

665

 

Adjusted EBITDA (c)

 

34,361

 

26,442

 

296,067

 

267,079

 

Net cash interest expense (d)

 

(22,890

)

(20,586

)

(85,990

)

(83,006

)

Maintenance capital expenditures (e)

 

(5,088

)

(4,137

)

(18,624

)

(14,932

)

Cash paid for taxes

 

(260

)

 

(1,076

)

(532

)

Proceeds from asset sales

 

1,417

 

1,317

 

4,624

 

6,526

 

Distributable cash flow to equity investors (f)

 

7,540

 

3,036

 

195,001

 

175,135

 

Distributable cash flow attributable to general partner and non-controlling interest

 

151

 

61

 

3,900

 

3,503

 

Distributable cash flow attributable to common unitholders

 

7,389

 

2,975

 

191,101

 

171,632

 

Less: Distributions paid to common unitholders

 

41,356

 

39,536

 

161,136

 

158,115

 

Distributable cash flow excess/(shortage)

 

$

(33,967

)

$

(36,561

)

$

29,965

 

$

13,517

 

 

 

 

 

 

 

 

 

 

 

Propane gallons sales

 

 

 

 

 

 

 

 

 

Retail - Sales to End Users

 

124,147

 

125,252

 

650,253

 

638,292

 

Wholesale - Sales to Resellers

 

61,935

 

65,779

 

291,368

 

274,671

 

Total propane gallons sales

 

186,082

 

191,031

 

941,621

 

912,963

 

 

 

 

 

 

 

 

 

 

 

Midstream operations (barrels processed)

 

3,997

 

 

6,497

 

 

 


(a)         Non-cash stock-based compensation charges consist of the following:

 

 

 

Three months ended

 

Twelve months ended

 

 

 

October 31

 

October 31

 

 

 

2014

 

2013

 

2014

 

2013

 

Operating expense

 

$

3,545

 

$

798

 

$

8,082

 

$

2,478

 

General and administrative expense

 

12,567

 

3,633

 

28,107

 

12,406

 

Total

 

$

16,112

 

$

4,431

 

$

36,189

 

$

14,884

 

 

(b)         Amounts allocated to the general partner for its 1.0101% interest in the operating partnership, Ferrellgas, L.P.

(c)          Adjusted EBITDA is calculated as net earnings (loss) attributable to Ferrellgas Partners, L.P., income tax expense (benefit), interest expense, depreciation and amortization expense, loss on extinguishment of debt, non-cash employee stock ownership plan compensation charge, non-cash stock-based compensation charge, loss on disposal of assets, other income (expense), net, change in fair value of contingent consideration, litigation accrual and related legal fees associated with a class action lawsuit and net earnings (loss) attributable to noncontrolling interest.  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 makes it easier to compare its results with other companies that have different financing and capital structures. 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 other income (expense), net. This amount 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 equity investors. Distributable cash flow to equity investors, as management defines it, may not be comparable to distributable cash flow to equity investors or similarly titled measurements used by other corporations and partnerships. Items added into our calculation of distributable cash flow to equity investors that will not occur on a continuing basis may have associated cash payments. Distributable cash flow to equity investors may not be consistent with that of other companies and should be viewed in conjunction with measurements that are computed in accordance with GAAP.

 



 

FERRELLGAS PARTNERS, L.P.  AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except unit data)

(unaudited)

 

ASSETS

 

October 31, 2014

 

July 31, 2014

 

 

 

 

 

 

 

Current Assets:

 

 

 

 

 

Cash and cash equivalents

 

$

9,869

 

$

8,289

 

Accounts and notes receivable, net (including $161,715 and $159,003 of accounts receivable pledged as collateral at October 31, 2014 and July 31, 2014, respectively)

 

180,556

 

178,602

 

Inventories

 

177,558

 

145,969

 

Prepaid expenses and other current assets

 

44,602

 

32,071

 

Total Current Assets

 

412,585

 

364,931

 

 

 

 

 

 

 

Property, plant and equipment, net

 

618,302

 

611,787

 

Goodwill

 

285,658

 

273,210

 

Intangible assets, net

 

316,634

 

276,171

 

Other assets, net

 

47,256

 

46,171

 

Total Assets

 

$

1,680,435

 

$

1,572,270

 

 

 

 

 

 

 

LIABILITIES AND PARTNERS’ DEFICIT

 

 

 

 

 

 

 

 

 

 

 

Current Liabilities:

 

 

 

 

 

Accounts payable

 

$

74,847

 

$

69,360

 

Short-term borrowings

 

122,230

 

69,519

 

Collateralized note payable

 

105,000

 

91,000

 

Other current liabilities

 

147,649

 

125,161

 

Total Current Liabilities

 

449,726

 

355,040

 

 

 

 

 

 

 

Long-term debt (a)

 

1,332,089

 

1,292,214

 

Other liabilities

 

37,373

 

36,662

 

Contingencies and commitments

 

 

 

 

 

 

 

 

 

 

 

Partners’ Deficit:

 

 

 

 

 

Common unitholders (82,711,820 and 81,228,237 units outstanding at October 31, 2014 and July 31, 2014, respectively)

 

(69,770

)

(57,893

)

General partner unitholder (835,473 and 820,487 units outstanding at October 31, 2014 and July 31, 2014, respectively)

 

(60,775

)

(60,654

)

Accumulated other comprehensive income (loss)

 

(8,692

)

6,181

 

Total Ferrellgas Partners, L.P. Partners’ Deficit

 

(139,237

)

(112,366

)

Noncontrolling Interest

 

484

 

720

 

Total Partners’ Deficit

 

(138,753

)

(111,646

)

Total Liabilities and Partners’ Deficit

 

$

1,680,435

 

$

1,572,270

 

 


(a)         The principal difference between the Ferrellgas Partners, L.P. balance sheet and that of Ferrellgas, L.P., is $182 million of 8.625% notes which are liabilities of Ferrellgas Partners, L.P. and not of Ferrellgas, L.P.

 


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