LIBERTY, Mo., Nov. 24 /PRNewswire-FirstCall/ -- Ferrellgas Partners, L.P.
(NYSE: FGP), one of the nation's largest retail marketers of propane, today
reported earnings for the first quarter of fiscal year 2004. The first
quarter covers the three-month period ended October 31, 2003.
Retail propane sales volume for the first quarter was 176 million gallons,
a 2 percent increase, as compared to 172 million gallons sold in the first
quarter of fiscal year 2003. This increase in sales volume was primarily the
result of acquisitions, partially offset by the lack of sustained cold
temperatures this fall which helps to initiate the winter heating season.
First quarter gross profit and operating expense were $96.2 million and
$72.5 million, respectively, as compared to $92.6 million and $68.4 million
recognized in the first quarter of fiscal year 2003, again primarily the
result of this quarter's increased retail sales volume.
General and administrative expense for the quarter was $6.9 million,
essentially unchanged in comparison to the first quarter of fiscal year 2003.
Equipment lease expense for the quarter decreased 25 percent to $4.5 million,
from $6.0 million, primarily reflecting the Partnership's fiscal year 2003
refinancing of certain operating lease obligations.
The resulting Adjusted EBITDA for the quarter was $12.3 million, as
compared to $11.3 million in the first quarter of fiscal year 2003. The
Partnership historically experiences a seasonal loss during its first quarter,
as sales volumes typically represent less than 20 percent of annual gallon
sales, causing fixed costs to exceed off-season cash flow. The first quarter
seasonal net loss was $18.6 million, as compared to the prior year's first
quarter net loss of $25.0 million, and was consistent with the Partnership's
expectations.
"Our first quarter's performance is a good start to fiscal 2004 and
continues our history of consistent, stable earnings," said James E. Ferrell,
Chairman, President and Chief Executive Officer. "This performance comes on
the heels of three consecutive fiscal years in which we achieved record or
near-record earnings, which should give investors confidence that we know how
to effectively manage our business."
Ferrellgas Partners, L.P., through its operating partnership, Ferrellgas,
L.P., currently serves more than one million customers in 45 states.
Ferrellgas employees indirectly own more than 17 million common units of the
Partnership through an employee stock ownership plan.
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 Partnership's Form 10-K for the fiscal year ended July 31, 2003 and other
documents filed from time to time by the Partnership with the Securities and
Exchange Commission.
FERRELLGAS PARTNERS, L.P. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except unit data)
(unaudited)
ASSETS October 31, 2003 July 31, 2003
Current assets:
Cash and cash equivalents $12,351 $11,154
Accounts and notes receivable, net 63,495 56,742
Inventories 103,232 69,077
Prepaid expenses and other current assets 10,893 8,306
Total current assets 189,971 145,279
Property, plant and equipment, net 683,581 684,917
Goodwill 124,190 124,190
Intangible assets, net 96,743 98,157
Other assets 9,420 8,853
Total assets $1,103,905 $1,061,396
LIABILITIES AND PARTNERS' CAPITAL
Current liabilities:
Accounts payable $119,389 $59,454
Other current liabilities (a) 74,838 89,687
Short-term borrowings 21,800 -
Total current liabilities 216,027 149,141
Long-term debt (a) 900,807 888,226
Other liabilities 19,607 18,747
Contingencies and commitments - -
Minority interest 2,036 2,363
Partners' capital:
Senior unitholder (1,994,146 units
outstanding at both October 2003
and July 2003 - liquidation
preference $79,766 at both
October 2003 and July 2003) 79,766 79,766
Common unitholders (37,707,434 and
37,673,455 units outstanding
at October 2003 and July 2003,
respectively) (52,381) (15,602)
General partner unitholder (401,026
and 400,683 units outstanding
at October 2003 and July 2003,
respectively) (59,670) (59,277)
Accumulated other comprehensive loss (2,287) (1,968)
Total partners' capital (34,572) 2,919
Total liabilities and partners'
capital $1,103,905 $1,061,396
(a) The principal difference between the Ferrellgas Partners, L.P.
balance sheet and that of Ferrellgas, L.P., is $218 million of 8 3/4%
notes and a $10 million short-term note payable, 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, 2003 AND 2002
(in thousands, except per unit data)
(unaudited)
Three months ended October 31
2003 2002
Revenues:
Propane and other gas liquids sales $232,054 $194,900
Other 23,360 21,414
Total revenues 255,414 216,314
Cost of product sold 159,249 123,672
Gross profit 96,165 92,642
Operating expense 72,479 68,428
Depreciation and amortization expense 11,195 9,895
General and administrative expense 6,891 6,902
Equipment lease expense 4,511 5,992
Employee stock ownership plan
compensation charge 1,784 1,395
Loss on disposal of assets and other 1,626 671
Operating loss (2,321) (641)
Interest expense (16,794) (14,696)
Interest income 331 62
Early extinguishment of debt expense (a) - (7,052)
Loss before minority interest and
cumulative effect of change in
accounting principle (18,784) (22,327)
Minority interest (b) (138) (115)
Loss before cumulative effect of
change in accounting principle (18,646) (22,212)
Cumulative effect of change in
accounting principle, net of minority
interest of $28 (c) - (2,754)
Net loss (18,646) (24,966)
Distribution to senior unitholder 1,994 2,782
Net loss available to general partner (206) (277)
Net loss available to common
unitholders $(20,434) $(27,471)
Basic loss per common unit:
Loss before cumulative effect of
change in accounting principle (d) $(0.54) $(0.69)
Net loss available to common
unitholders $(0.54) $(0.76)
Weighted average common units
outstanding 37,704.7 36,088.1
Supplemental Data and Reconciliation of Non-GAAP Item:
Three months ended October 31
2003 2002
Retail gallons 175,572 172,026
Net loss $(18,646) $(24,966)
Interest expense 16,794 14,696
Depreciation and amortization
expense 11,195 9,895
Interest income (331) (62)
EBITDA $9,012 $(437)
Employee stock ownership plan
compensation charge 1,784 1,395
Loss on disposal of assets and
other 1,626 671
Minority interest (b) (138) (115)
Early extinguishment of debt
expense (a) - 7,052
Cumulative effect of change in
accounting principle (c) - 2,754
Adjusted EBITDA (e) $12,284 $11,320
(a) Expenses related to the refinancing of the $160 million Ferrellgas
Partners, L.P. senior secured debt in September 2002.
(b) Amounts allocated to the general partner for its 1.0101% interest in
the operating partnership, Ferrellgas, L.P.
(c) Amount related to recognition of liabilities for future retirements
of underground storage facilities, as required by SFAS No. 143.
(d) Amount calculated as 99% of the earnings (loss) before cumulative
effect of change in accounting principle less distribution to
senior unitholder; the result then divided by the weighted average
common units outstanding.
(e) 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 compensation charge, loss from
disposal of assets and other, minority interest, early extinguishment
of debt expense, cumulative effect of change in accounting principle
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 to 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.
Contact:
Ryan VanWinkle, Investor Relations, 816-792-7998
Scott Brockelmeyer, Media Relations, 816-792-7837
SOURCE Ferrellgas Partners, L.P.
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Related links:
http://www.ferrellgas.com
CONTACT:
Investor Relations, Ryan VanWinkle,
+1-816-792-7998, or Media Relations, Scott Brockelmeyer,
+1-816-792-7837, both of Ferrellgas Partners, L.P.
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