AmeriGas Propane, Inc., general partner of AmeriGas Partners,
L.P. (NYSE: APU), reported GAAP net income attributable to AmeriGas
Partners for the quarter ended March 31, 2017 of $135.1 million,
compared to GAAP net income of $245.9 million for the quarter ended
March 31, 2016. Adjusted net income attributable to AmeriGas
Partners for the quarter ended March 31, 2017 was $185.6 million
compared to adjusted net income of $206.9 million in the prior-year
quarter. Adjusted net income excludes the impact of unrealized
gains and losses on commodity derivative instruments and a loss
from an early extinguishment of debt. A reconciliation of adjusted
net income to GAAP net income is set forth at the end of this
release.
The Partnership’s adjusted earnings before interest expense,
income taxes, depreciation and amortization (Adjusted EBITDA) was
$271.2 million for the quarter ended March 31, 2017 compared to
$295.4 million in the prior-year quarter.
Degree days for the quarter were 13.3% warmer than normal and
2.9% warmer than the prior year; combined heating degree days for
January and February, which account for approximately 75% of second
quarter heating degree days, were more than 9% warmer than the same
period in the prior year, and the month of February was the warmest
in 122 years.
Operating and financial highlights were as follows:
- Retail volumes were 6% lower than the
prior year primarily as a result of the warm weather.
- Unit margins were slightly higher than
last year, despite average propane prices at Mt. Belvieu, TX that
were $0.33 per gallon (85%) higher than last year's quarter.
- During the quarter, the Partnership
completed the issuance of $525 million of 5.75% notes due in May
2027, tendered for $378.4 million of its 7.00% notes due May 2022,
and announced the redemption of the remaining $102.5 million of
7.00% notes. The redemption will be completed on May 20, 2017 and
will mark the last step of a complete refinancing of the
Partnership's long-term debt.
- On April 24th, the Partnership
announced an increase in its quarterly distribution to $0.95 per
unit ($3.80 annualized), marking the 13th consecutive year of
distribution increases for its unitholders.
Jerry E. Sheridan, president and chief executive officer of
AmeriGas, said, “Our operations were clearly impacted by the very
warm weather during the quarter. We met this challenge by
maintaining our focus on operational efficiency and containing
operating expenses. Our teams did a nice job offsetting increases
in the cost of fuel with reductions in overtime and travel expenses
while continuing to drive improvement in our unit margins.
Considering these difficult conditions, we were pleased with the
performance of the business in the second quarter. Another
significant accomplishment in the quarter was completing the steps
to de-risk our debt structure by extending maturities and lowering
average interest rates by over 100 basis points in total. Finally,
as was recently announced, our Board approved our 13th consecutive
distribution increase for our unitholders, underscoring their
confidence in our ability to withstand warm weather in the
near-term while focusing on creating long-term, sustainable value
for our investors."
Based on the results through the first half of the year, and
expectations for the remainder of the year, the company now expects
Adjusted EBITDA of $550 million to $580 million for the fiscal year
ending September 30, 2017.
About AmeriGas
AmeriGas is the nation’s largest retail propane marketer,
serving approximately two million customers in all 50 states from
approximately 1,900 distribution locations. UGI Corporation,
through subsidiaries, is the sole General Partner and owns 26% of
the Partnership and the public owns the remaining 74%.
AmeriGas Partners, L.P. will hold a live Internet Audio Webcast
of its conference call to discuss fiscal 2017 second quarter
earnings and other current activities at 9:00 AM ET on Tuesday, May
2, 2017. Interested parties may listen to the audio webcast both
live and in replay on the Internet at http://investors.amerigas.com/investor-relations/events-presentations
or at the company website http://www.amerigas.com under Investor
Relations. A telephonic replay will be available from 12:00 PM
ET on May 2 through 11:59 PM on May 9, 2017. The replay
may be accessed at (855) 859-2056, and internationally at (404)
537-3406, conference ID 5910598.
Comprehensive information about AmeriGas is available on the
Internet at http://www.amerigas.com
This press release contains certain forward-looking statements
that management believes to be reasonable as of today’s date only.
Actual results may differ significantly because of risks and
uncertainties that are difficult to predict and many of which are
beyond management’s control. You should read the Partnership’s
Annual Report on Form 10-K for a more extensive list of factors
that could affect results. Among them are adverse weather
conditions, cost volatility and availability of propane, increased
customer conservation measures, the capacity to transport propane
to our market areas, the impact of pending and future legal
proceedings, liability for uninsured claims and for claims in
excess of insurance coverage, political, economic and regulatory
conditions in the U.S. and abroad, our ability to successfully
integrate acquisitions and achieve anticipated synergies, and the
interruption, disruption, failure, malfunction, or breach of our
information technology systems, including due to cyber-attack. The
Partnership undertakes no obligation to release revisions to its
forward-looking statements to reflect events or circumstances
occurring after today.
AMERIGAS PARTNERS, L.P. AND SUBSIDIARIES
REPORT OF EARNINGS (Thousands, except per unit and where otherwise
indicated) (Unaudited) Three Months EndedMarch 31, Six
Months EndedMarch 31, Twelve Months EndedMarch 31, 2017 2016
2017 2016 2017 2016 Revenues: Propane $ 795,806 $
759,278 $ 1,399,862 $ 1,333,182 $ 2,119,840 $ 2,104,768 Other
67,854 68,209 140,964 138,403 261,218
263,030 863,660 827,487 1,540,826
1,471,585 2,381,058 2,367,798 Costs and
expenses: Cost of sales - propane 367,079 241,621 581,484 469,543
831,783 780,424 Cost of sales - other 17,327 17,161 37,909 38,028
78,738 83,804 Operating and administrative expenses 240,006 238,535
466,808 469,424 926,170 918,710 Depreciation 34,420 36,533 68,409
75,139 140,075 151,259 Amortization 10,592 10,886 21,214 21,486
42,903 42,763 Other operating income, net (5,628 ) (7,131 ) (2,493
) (16,038 ) (14,707 ) (29,853 ) 663,796 537,605
1,173,331 1,057,582 2,004,962 1,947,107
Operating income 199,864 289,882 367,495 414,003 376,096 420,691
Loss on extinguishments of debt (22,144 ) — (55,295 ) — (104,184 )
— Interest expense (39,991 ) (40,806 ) (80,019 ) (81,831 ) (162,283
) (162,543 ) Income before income taxes 137,729 249,076 232,181
332,172 109,629 258,148 Income tax (expense) benefit (646 ) (290 )
(1,483 ) (1,200 ) 1,290 (2,422 ) Net income including
noncontrolling interest 137,083 248,786 230,698 330,972 110,919
255,726 Deduct net income attributable to noncontrolling interest
(1,995 ) (2,878 ) (3,656 ) (4,091 ) (3,774 ) (4,118 ) Net income
attributable to AmeriGas Partners, L.P. $ 135,088 $ 245,908
$ 227,042 $ 326,881 $ 107,145 $ 251,608
General partner’s interest in net income attributable to
AmeriGas Partners, L.P. $ 11,786 $ 11,107 $ 23,138
$ 20,562 $ 42,803 $ 37,098
Limited partners’ interest in net income attributable to AmeriGas
Partners, L.P. $ 123,302 $ 234,801 $ 203,904 $
306,319 $ 64,342 $ 214,510 Income per
limited partner unit (a) Basic $ 1.14 $ 1.74 $ 2.04
$ 2.58 $ 0.68 $ 2.29 Diluted $ 1.14
$ 1.74 $ 2.04 $ 2.58 $ 0.68 $
2.29 Weighted average limited partner units outstanding:
Basic 93,003 92,954 92,987 92,939
92,977 92,931 Diluted 93,045 93,020
93,039 93,014 93,040 93,003
SUPPLEMENTAL INFORMATION: Retail gallons sold (millions) 362.7
385.8 668.4 680.9 1,053.0 1,077.0 Wholesale gallons sold (millions)
15.9 16.4 29.5 31.3 47.9 54.9 Total margin (b) $ 479,254 $ 568,705
$ 921,433 $ 964,014 $ 1,470,537 $ 1,503,570 Adjusted total margin
(c) $ 507,874 $ 529,251 $ 924,322 $ 930,193 $ 1,441,168 $ 1,454,099
EBITDA (c) $ 220,737 $ 334,423 $ 398,167 $ 506,537 $ 451,116 $
610,595 Adjusted EBITDA (c) $ 271,212 $ 295,368 $ 456,322 $ 473,058
$ 526,228 $ 561,624 Adjusted net income attributable to AmeriGas
Partners, L.P. (c) $ 185,563 $ 206,853 $ 285,197 $ 293,402 $
182,257 $ 202,637 Expenditures for property, plant and equipment:
Maintenance capital expenditures $ 14,053 $ 13,375 $ 29,432 $
26,290 $ 55,247 $ 52,332 Growth capital expenditures $ 13,182 $
14,438 $ 24,184 $ 29,497 $ 44,275 $ 48,247 (a) Income per
limited partner unit is computed in accordance with accounting
guidance regarding the application of the two-class method for
determining earnings per share as it relates to master limited
partnerships. Refer to Note 2 to the consolidated financial
statements included in the AmeriGas Partners, L.P. Annual Report on
Form 10-K for the fiscal year ended September 30, 2016. (b) Total
margin represents "total revenues" less "cost of sales - propane"
and "cost of sales - other." (c) The Partnership’s management uses
certain non-GAAP financial measures, including adjusted total
margin, EBITDA, adjusted EBITDA and adjusted net income
attributable to AmeriGas Partners, L.P., when evaluating the
Partnership’s overall performance. These financial measures are not
in accordance with, or an alternative to, GAAP and should be
considered in addition to, and not as a substitute for, the
comparable GAAP measures. Management believes earnings
before interest, income taxes, depreciation and amortization
(“EBITDA”), as adjusted for the effects of gains and losses on
commodity derivative instruments not associated with current-period
transactions and other gains and losses that competitors do not
necessarily have ("Adjusted EBITDA"), is a meaningful non-GAAP
financial measure used by investors to (1) compare the
Partnership’s operating performance with that of other companies
within the propane industry and (2) assess the Partnership’s
ability to meet loan covenants. The Partnership’s definition of
Adjusted EBITDA may be different from those used by other
companies. Management uses Adjusted EBITDA to compare
year-over-year profitability of the business without regard to
capital structure as well as to compare the relative performance of
the Partnership to that of other master limited partnerships
without regard to their financing methods, capital structure,
income taxes, the effects of gains and losses on commodity
derivative instruments not associated with current-period
transactions or historical cost basis. In view of the omission of
interest, income taxes, depreciation and amortization, gains and
losses on commodity derivative instruments not associated with
current-period transactions and other gains and losses that
competitors do not necessarily have from Adjusted EBITDA,
management also assesses the profitability of the business by
comparing net income attributable to AmeriGas Partners, L.P. for
the relevant periods. Management also uses Adjusted EBITDA to
assess the Partnership’s profitability because its parent, UGI
Corporation, uses the Partnership’s Adjusted EBITDA to assess the
profitability of the Partnership which is one of UGI Corporation’s
industry segments. UGI Corporation discloses the Partnership’s
Adjusted EBITDA as the profitability measure for its domestic
propane segment. Management believes the presentation of
other non-GAAP financial measures, comprised of adjusted total
margin and adjusted net income attributable to AmeriGas Partners,
L.P., provide useful information to investors to more effectively
evaluate the period-over-period results of operations of the
Partnership. Management uses these non-GAAP financial measures
because they eliminate the impact of (1) gains and losses on
commodity derivative instruments that are not associated with
current-period transactions and (2) other gains and losses that
competitors do not necessarily have to provide insight into the
comparison of period-over-period profitability to that of other
master limited partnerships. The following tables include
reconciliations of adjusted total margin, EBITDA, adjusted EBITDA
and adjusted net income attributable to AmeriGas Partners, L.P. to
the most directly comparable financial measure calculated and
presented in accordance with GAAP for all the periods presented:
Three Months EndedMarch 31, Six Months
EndedMarch 31, Twelve Months EndedMarch 31, 2017 2016 2017
2016 2017 2016 Adjusted total margin: Total revenues
$ 863,660 $ 827,487 $ 1,540,826 $ 1,471,585 $ 2,381,058 $ 2,367,798
Cost of sales - propane (367,079 ) (241,621 ) (581,484 ) (469,543 )
(831,783 ) (780,424 ) Cost of sales - other (17,327 ) (17,161 )
(37,909 ) (38,028 ) (78,738 ) (83,804 ) Total margin 479,254
568,705 921,433 964,014 1,470,537 1,503,570 Add net losses
(subtract net gains) on commodity derivative instruments not
associated with current-period transactions 28,620 (39,454 )
2,889 (33,821 ) (29,369 ) (49,471 ) Adjusted total margin $
507,874 $ 529,251 $ 924,322 $ 930,193 $
1,441,168 $ 1,454,099 Adjusted net income
attributable to AmeriGas Partners, L.P.: Net income attributable to
AmeriGas Partners, L.P. $ 135,088 $ 245,908 $ 227,042 $ 326,881 $
107,145 $ 251,608 Add net losses (subtract net gains) on commodity
derivative instruments not associated with current-period
transactions 28,620 (39,454 ) 2,889 (33,821 ) (29,369 ) (49,471 )
Noncontrolling interest in net (losses) gains on commodity
derivative instruments not associated with current-period
transactions (289 ) 399 (29 ) 342 297 500 Loss on extinguishments
of debt 22,144 — 55,295 — 104,184
— Adjusted net income attributable to AmeriGas
Partners, L.P. $ 185,563 $ 206,853 $ 285,197 $
293,402 $ 182,257 $ 202,637
Three Months EndedMarch 31, Six Months EndedMarch 31, Twelve
Months EndedMarch 31, 2017 2016 2017 2016 2017
2016 EBITDA and Adjusted EBITDA: Net income attributable to
AmeriGas Partners, L.P. $ 135,088 $ 245,908 $ 227,042 $ 326,881 $
107,145 $ 251,608 Income tax expense (benefit) 646 290 1,483 1,200
(1,290 ) 2,422 Interest expense 39,991 40,806 80,019 81,831 162,283
162,543 Depreciation 34,420 36,533 68,409 75,139 140,075 151,259
Amortization 10,592 10,886 21,214 21,486
42,903 42,763 EBITDA 220,737 334,423 398,167
506,537 451,116 610,595 Add net losses (subtract net gains) on
commodity derivative instruments not associated with current-period
transactions 28,620 (39,454 ) 2,889 (33,821 ) (29,369 ) (49,471 )
Noncontrolling interest in net (losses) gains on commodity
derivative instruments not associated with current-period
transactions (289 ) 399 (29 ) 342 297 500 Loss on extinguishments
of debt 22,144 — 55,295 — 104,184
— Adjusted EBITDA $ 271,212 $ 295,368 $
456,322 $ 473,058 $ 526,228 $ 561,624
The following table includes a quantification of interest
expense, income tax expense, depreciation and amortization included
in the calculation of forecasted Adjusted EBITDA guidance range for
the fiscal year ending September 30, 2017:
Forecast Fiscal Year EndingSeptember 30, 2017 (Low End)
(High End) Adjusted EBITDA (estimate) $ 550,000 $ 580,000
Interest expense (estimate) 157,000 157,000 Income tax expense
(estimate) 3,000 3,000 Depreciation (estimate) 139,000 139,000
Amortization (estimate) 43,000 43,000
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170501006392/en/
AmeriGas Partners, L.P.Will Ruthrauff, 610-337-7000 ext.
6571Shelly Oates, 610-337-7000 ext. 3202
AmeriGas Partners (NYSE:APU)
Historical Stock Chart
From Sep 2024 to Oct 2024
AmeriGas Partners (NYSE:APU)
Historical Stock Chart
From Oct 2023 to Oct 2024