FGP
$8.74
Ferrellgas Partners LP
$.27
3.19%
Earnings Details
1st Quarter October 2016
Friday, December 09, 2016 7:00:28 AM
Tweet Share Watch
Summary

Ferrellgas Partners LP (FGP) Recent Earnings

Ferrellgas Partners LP (FGP) reported a 1st Quarter October 2016 loss of $0.44 per share on revenue of $379.5 million. The consensus estimate was a loss of $0.51 per share on revenue of $357.3 million. Revenue fell 19.4% compared to the same quarter a year ago.

Ferrellgas Partners LP is engaged in the retail distribution of propane and related equipment and midstream operations.

Results
Reported Earnings
($0.44)
Earnings Whisper
-
Consensus Estimate
($0.51)
Reported Revenue
$379.5 Mil
Revenue Estimate
$357.3 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Ferrellgas Partners, L.P. Reports Results for First Quarter Fiscal 2017

Ferrellgas Partners, L.P. (FGP) ("Ferrellgas" or the "Company") today reported financial results for its first fiscal quarter ended October 31, 2016. The Company reported a net loss attributable to Ferrellgas Partners, L.P. of $43.1 million, compared to a net loss of $79.8 million for the same period in 2015.

Adjusted EBITDA was $29.0 million, compared to $48.9 million in the prior year period primarily due to the effect of the Jamex settlement reached in early September.

"While unusually warm weather conditions - including temperatures during our first quarter that were 35% higher than normal - continued to negatively impact our propane revenue, we are taking aggressive actions to position Ferrellgas for long-term growth and profitability," said James E. Ferrell, the Company’s interim President and Chief Executive Officer. "This quarter’s results include a 9% reduction in operating expenses, reflecting our ongoing efforts to meaningfully reduce costs. We also remain focused on growing our customer base, and are very pleased with our success winning new customers and retaining existing customers during the quarter."

Mr. Ferrell continued, "Although the termination of the Jamex contract impacted our crude oil logistics segment, we believe in the potential of this business and are taking steps to maximize profitability by increasing utilization of our assets. We remain confident in the upside potential of our company and believe we are taking the right steps to advance the long-term interests of our unitholders, employees and other stakeholders."

Operating income generated by the propane and related equipment sales segment was up over 20% to $16.5 million, compared to $13.7 million in the prior year period despite temperatures that were 6% warmer than those of the prior year period. The increase was primarily due to decreased operating expenses related to vehicle fuel costs.

At the end of the first fiscal quarter, the Company’s leverage ratio was 5.81x, which was lower than the 6.05x limit allowed under its secured credit facility and accounts receivable securitization facility, as amended in September 2016.

Mr. Ferrell added, "We are committed to reducing debt and strengthening our balance sheet, with the goal of returning to a leverage ratio of 4.5x or below. While debt reduction is our primary objective at this time, increasing returns to our unitholders remains the top priority for Ferrellgas, and we will continue to take actions to deliver value to all stakeholders over the long term."

About Ferrellgas

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 22.8 million common units of the partnership, through an employee stock ownership plan. Ferrellgas Partners, L.P. filed a Form 10-K with the Securities and Exchange Commission on September 28, 2016. Investors can request a hard copy of this filing free of charge and obtain more information about the partnership online at www.ferrellgas.com.

Forward Looking Statements

Statements in this release concerning expectations for the future are forward-looking statements. These statements often use words such as "anticipate," "believe," "intend," "plan," "projection," "forecast," "strategy," "position," "continue," "estimate," "expect," "may," "will," or the negative of those terms or other variations of them or comparable terminology. Forward-looking statements, include, but are not limited to: Ferrellgas’ debt reduction plans, statements regarding future unitholder returns, plans to increase the utilization of certain assets, and the anticipated impact of Ferrellgas’ actions on its balance sheet and liquidity position. While Ferrellgas believes that the assumptions concerning future events are reasonable, it cautions that there are inherent difficulties in predicting certain important factors that could impact the future performance or results of its business. Among the factors that could cause results to differ materially from those indicated by such forward-looking statements are: risks related to Ferrellgas’ ability to generate sufficient cash flow to pay distributions, to make payments on its debt obligations and to execute its business plan; Ferrellgas’ ability to access funds on acceptable terms, if at all, because of the terms and conditions governing its indebtedness or otherwise; local, regional and national economic conditions and the impact they may have on Ferrellgas and its customers; the effect of weather conditions on the demand for propane; the prices of wholesale propane, motor fuel and crude oil; disruptions to the supply of propane; the termination or non-renewal of certain arrangements or agreements; adverse changes in our relationships with our national propane customers; significant delays in the collection of, or uncollectibility of, accounts or notes receivable; the financial condition of Ferrellgas’ customers; and the failure of any customer to perform its contractual obligations. 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, 2016, the Form 10-Q of these entities for the fiscal quarter ended October 31, 2016, and in other documents filed from time to time by these entities with the Securities and Exchange Commission.

You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. All forward-looking statements in this press release are qualified in their entirety by these cautionary statements. Except as required by law, Ferrellgas undertakes no obligation and does not intend to update or revise any forward-looking statements, whether as a result of new information, future results or otherwise.

FERRELLGAS PARTNERS, L.P.
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except unit data)
(unaudited)
ASSETS
October 31, 2016
July 31, 2016
Current Assets:
Cash and cash equivalents
$
12,639
$
4,965
Accounts and notes receivable, net (including $105,320 and $106,464 of
accounts receivable pledged as collateral at October 31, 2016
and July 31, 2016, respectively)
148,283
149,583
Inventories
100,296
90,594
Prepaid expenses and other current assets
31,820
39,973
Total Current Assets
293,038
285,115
Property, plant and equipment, net
757,940
774,680
Goodwill, net
256,103
256,103
Intangible assets, net
272,031
280,185
Other assets, net
88,103
87,223
Total Assets
$
1,667,215
$
1,683,306
LIABILITIES AND PARTNERS’ DEFICIT
Current Liabilities:
Accounts payable
$
74,788
$
67,928
Short-term borrowings
96,824
101,291
Collateralized note payable
74,000
64,000
Other current liabilities
170,527
128,958
Total Current Liabilities
416,139
362,177
Long-term debt (a)
1,965,219
1,941,335
Other liabilities
32,755
31,574
Contingencies and commitments
Partners’ Deficit:
Common unitholders (97,152,665 and 98,002,665 units outstanding at
October 31, 2016 and July 31, 2016, respectively)
(673,516
)
(570,754
)
General partner unitholder (989,926 units outstanding at October 31, 2016
and July 31, 2016)
(66,713
)
(65,835
)
Accumulated other comprehensive loss
(1,186
)
(10,468
)
Total Ferrellgas Partners, L.P. Partners’ Deficit
(741,415
)
(647,057
)
Noncontrolling Interest
(5,483
)
(4,723
)
Total Partners’ Deficit
(746,898
)
(651,780
)
Total Liabilities and Partners’ Deficit
$
1,667,215
$
1,683,306
(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.
FERRELLGAS PARTNERS, L.P. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
FOR THE THREE AND TWELVE MONTHS ENDED OCTOBER 31, 2016 AND 2015
(in thousands, except per unit data)
(unaudited)
Three months ended
Twelve months ended
October 31
October 31
2016
2015
2016
2015
Revenues:
Propane and other gas liquids sales
$
242,399
$
245,301
$
1,199,466
$
1,507,956
Midstream operations
108,044
193,670
539,612
292,943
Other
29,099
32,175
208,685
251,282
Total revenues
379,542
471,146
1,947,763
2,052,181
Cost of sales:
Propane and other gas liquids sales
119,212
121,751
561,894
834,161
Midstream operations
94,642
153,604
412,272
228,226
Other
11,746
14,448
123,535
163,253
Gross profit
153,942
181,343
850,062
826,541
Operating expense
104,992
114,981
447,921
444,380
Depreciation and amortization expense
26,202
36,979
139,736
112,249
General and administrative expense
12,482
12,240
48,821
57,843
Equipment lease expense
7,349
7,032
29,150
25,773
Non-cash employee stock ownership plan compensation charge
3,754
5,256
26,093
25,595
Non-cash stock-based compensation charge (a)
1,881
8,122
3,083
17,992
Asset impairments
-
29,316
628,802
29,316
Loss on asset sales and disposal
6,423
14,917
22,341
21,055
Operating income (loss)
(9,141
)
(47,500
)
(495,885
)
92,338
Interest expense
(35,428
)
(33,788
)
(139,577
)
(110,272
)
Other income (expense), net
508
(122
)
740
(23
)
Loss before income taxes
(44,061
)
(81,410
)
(634,722
)
(17,957
)
Income tax expense (benefit)
(590
)
(844
)
218
(649
)
Net loss
(43,471
)
(80,566
)
(634,940
)
(17,308
)
Net loss attributable to noncontrolling interest (b)
(398
)
(773
)
(6,245
)
(10
)
Net loss attributable to Ferrellgas Partners, L.P.
(43,073
)
(79,793
)
(628,695
)
(17,298
)
Less: General partner’s interest in net loss
(431
)
(798
)
(6,287
)
(173
)
Common unitholders’ interest in net loss
$
(42,642
)
$
(78,995
)
$
(622,408
)
$
(17,125
)
Loss Per Unit
Basic and diluted net loss per common unitholders’ interest
$
(0.44
)
$
(0.79
)
$
(6.35
)
$
(0.19
)
Weighted average common units outstanding
97,457.6
100,376.8
97,949.0
89,232.9
Supplemental Data and Reconciliation of Non-GAAP Items:
Three months ended
Twelve months ended
October 31
October 31
2016
2015
2016
2015
Net loss attributable to Ferrellgas Partners, L.P.
$
(43,073
)
$
(79,793
)
$
(628,695
)
$
(17,298
)
Income tax expense (benefit)
(590
)
(844
)
218
(649
)
Interest expense
35,428
33,788
139,577
110,272
Depreciation and amortization expense
26,202
36,979
139,736
112,249
EBITDA
17,967
(9,870
)
(349,164
)
204,574
Non-cash employee stock ownership plan compensation charge
3,754
5,256
26,093
25,595
Non-cash stock based compensation charge (a)
1,881
8,122
3,083
17,992
Asset impairments
-
29,316
628,802
29,316
Loss on asset sales and disposal
6,423
14,917
22,341
21,055
Other (income) expense, net
(508
)
122
(740
)
23
Change in fair value of contingent consideration (included in operating expense)
-
(100
)
-
(4,600
)
Severance costs $414 and $938 included in operating costs for the three and twelve months ended period
October 31, 2016 and $1,055 and $1,128 included in general and administrative costs for the three and twelve months
ended period October 31, 2016. Also includes $805 in operating costs for the three and twelve months ended
October 31, 2015 and $51 included in general and administrative costs for the three and twelve months ended
October 31, 2015.
1,469
856
2,066
856
Litigation accrual and related legal fees associated with a class action lawsuit (included in general
and administrative expense)
-
-
-
83
Unrealized (non-cash) losses (gains) on changes in fair value of derivatives $(1,877) and $(1,330) included in operating
expense for the three and twelve months ended October 31, 2016 and $1,038 and $3,450 for the three and twelve
months ended October 31, 2015. Also includes $308 and $(140) included in midstream operations cost of sales
for the three and twelve months ended October 31, 2016, respectively.
(1,569
)
1,038
(1,470
)
3,450
Acquisition and transition expenses (included in general and administrative expense)
-
15
84
16,388
Net loss attributable to noncontrolling interest (b)
(398
)
(773
)
(6,245
)
(10
)
Adjusted EBITDA (c)
29,019
48,899
324,850
314,722
Net cash interest expense (d)
(33,618
)
(32,502
)
(133,976
)
(105,762
)
Maintenance capital expenditures (e)
(3,322
)
(6,215
)
(14,244
)
(20,739
)
Cash paid for taxes
(1
)
-
(778
)
(452
)
Proceeds from asset sales
1,720
1,013
6,730
5,501
Distributable cash flow to equity investors (f)
(6,202
)
11,195
182,582
193,270
Distributable cash flow attributable to general partner and non-controlling interest
(124
)
224
3,652
3,865
Distributable cash flow attributable to common unitholders
(6,078
)
10,971
178,930
189,405
Less: Distributions paid to common unitholders
49,791
51,443
200,467
175,520
Distributable cash flow excess/(shortage)
$
(55,869
)
$
(40,472
)
$
(21,537
)
$
13,885
Propane gallons sales
Retail - Sales to End Users
111,188
110,973
552,986
595,607
Wholesale - Sales to Resellers
51,990
50,566
227,545
258,696
Contacts
Jack Herrold, Investor Relations - jackherrold@ferrellgas.com, 913-661-1851
Jim Saladin, Media Relations - jimsaladin@ferrellgas.com, 913-661-1833

<img src="http://www.globenewswire.com/newsroom/ti?ndecode=MTUwIzY2NTE3MDA=" alt="" width="1" height="1"/>