FGP
$4.58
Ferrellgas Partners LP
$.06
1.33%
Earnings Details
4th Quarter July 2017
Thursday, September 28, 2017 7:00:15 AM
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Summary

Ferrellgas Partners LP (FGP) Recent Earnings

Ferrellgas Partners LP (FGP) reported a 4th Quarter July 2017 loss of $0.57 per share on revenue of $433.4 million. The consensus estimate was a loss of $0.45 per share on revenue of $427.3 million. Revenue grew 5.8% on a year-over-year basis.

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

Results
Reported Earnings
($0.57)
Earnings Whisper
-
Consensus Estimate
($0.45)
Reported Revenue
$433.4 Mil
Revenue Estimate
$427.3 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

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

Ferrellgas Partners, L.P. (FGP) ("Ferrellgas" or the "Company") today announced financial results for its fiscal year ended July 31, 2017. The Company reported net loss attributable to Ferrellgas Partners, L.P. of $54.2 million, compared to net loss of $665.4 million for the same period in 2016.

Adjusted EBITDA was $230.1 million compared to $344.7 million in the prior year period primarily due to decreased contributions from the midstream operations segment.

"Weather for fiscal 2017 was a stunning 18% warmer than normal, and significantly affected our financial results," said James E. Ferrell, the Company’s interim President and Chief Executive Officer. "Our strategy is to increase market share as reflected in our 2% increase in retail gallons sold, exceeding those of prior year on an absolute and weather adjusted basis. Overall gross margin was lower than the prior year period due to customer mix and an increase in the overall wholesale cost of propane."

Propane gallons sold were 791.1 million gallons, compared to 778.9 million gallons in the prior year. Operating income generated by the propane operations and related equipment sales segment was $187.9 million, compared to $204.9 million in the prior year period.

Our midstream operations segment generated an operating loss of $26.3 million this year compared to $648.3 million in fiscal 2016 primarily due to the impairment charge of $658.1 million recorded last year.

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, 2017. 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, Ferrellgas’ leverage ratio reduction plans, statements regarding future unitholder returns, growth and improved results, plans to increase the utilization of certain assets, the anticipated impact of Ferrellgas’ actions on its balance sheet and liquidity position, and the anticipated impact of Ferrellgas’ leadership changes. 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, 2017, 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.

Contacts

Jack Herrold, Investor Relations -- jackherrold@ferrellgas.com, 913-661-1851

Jim Saladin, Media Relations -- jimsaladin@ferrellgas.com, 913-661-1833

FERRELLGAS PARTNERS, L.P.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except unit data)
(unaudited)
ASSETS
July 31, 2017
July 31, 2016
Current Assets:
Cash and cash equivalents
$
5,760
$
4,965
Accounts and notes receivable, net (including $109,407 and $106,464 of
accounts receivable pledged as collateral at July 31, 2017 and
July 31, 2016, respectively and net of allowance for doubtful accounts of
$1,976 and $5,067 at 2017 and 2016, respectively)
165,084
149,583
Inventories
92,552
90,594
Prepaid expenses and other current assets
33,388
39,973
Total Current Assets
296,784
285,115
Property, plant and equipment, net
731,923
774,680
Goodwill
256,103
256,103
Intangible assets, net
251,102
280,185
Other assets, net
74,057
87,223
Total Assets
$
1,609,969
$
1,683,306
LIABILITIES AND PARTNERS’ DEFICIT
Current Liabilities:
Accounts payable
$
85,561
$
67,928
Short-term borrowings
59,781
101,291
Collateralized note payable
69,000
64,000
Other current liabilities
126,224
128,958
Total Current Liabilities
340,566
362,177
Long-term debt (a)
1,995,795
1,941,335
Other liabilities
31,118
31,574
Contingencies and commitments
Partners Deficit:
Common unitholders (97,152,665 and 98,002,665 units outstanding at
July 31, 2017 and July 31, 2016)
(701,188
)
(570,754
)
General partner unitholder (989,926 units outstanding at July 31, 2017 and July 31, 2016)
(66,991
)
(65,835
)
Accumulated other comprehensive income (loss)
14,601
(10,468
)
Total Ferrellgas Partners, L.P. Partners’ Deficit
(753,578
)
(647,057
)
Noncontrolling Interest
(3,932
)
(4,723
)
Total Partners’ Deficit
(757,510
)
(651,780
)
Total Liabilities and Partners’ Deficit
$
1,609,969
$
1,683,306
(a) The principal difference between the Ferrellgas Partners, L.P. balance sheet and that of Ferrellgas, L.P., is $357 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
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per unit data)
(unaudited)
Three months ended
Twelve months ended
July 31
July 31
2017
2016
2017
2016
Revenues:
Propane and other gas liquids sales
$
269,201
$
241,282
$
1,318,412
$
1,202,368
Midstream operations
135,196
137,811
466,703
625,238
Other
28,979
30,418
145,162
211,761
Total revenues
433,376
409,511
1,930,277
2,039,367
Cost of sales:
Propane and other gas liquids sales
142,427
115,592
694,155
564,433
Midstream operations
129,006
97,335
429,439
471,234
Other
14,054
14,812
67,267
126,237
Gross profit
147,889
181,772
739,416
877,463
Operating expense
109,477
111,326
431,751
457,910
Depreciation and amortization expense
25,805
37,815
103,351
150,513
General and administrative expense
13,091
11,923
46,980
48,579
Equipment lease expense
7,089
7,279
29,124
28,833
Non-cash employee stock ownership plan compensation charge
3,692
9,220
15,088
27,595
Non-cash stock-based compensation charge (a)
-
2,567
3,298
9,324
Asset impairments
-
628,802
-
658,118
Loss on asset sales and disposal
5,596
7,615
14,457
30,835
Operating income (loss)
(16,861
)
(634,775 )
95,367
(534,244
)
Interest expense
(40,378
)
(35,048
)
(152,485
)
(137,937
)
Other income (expense), net
41
199
1,474
110
Loss before income taxes
(57,198
)
(669,624 )
(55,644
)
(672,071
)
Income tax benefit
(949
)
(1,482
)
(1,143
)
(36
)
Net loss
(56,249
)
(668,142 )
(54,501
)
(672,035
)
Net loss attributable to noncontrolling interest (b)
(481
)
(6,708
)
(294
)
(6,620
)
Net loss attributable to Ferrellgas Partners, L.P.
(55,768
)
(661,434 )
(54,207
)
(665,415
)
Less: General partner’s interest in net loss
(558
)
(6,614
)
(542
)
(6,654
)
Common unitholders’ interest in net loss
$
(55,210
)
$
(654,820 )
$
(53,665
)
$
(658,761
)
Loss Per Common Unit
Basic and diluted net loss per common unitholders’ interest
$
(0.57
)
$
(6.68
)
$
(0.55
)
$
(6.68
)
Weighted average common units outstanding - basic
97,152.7
98,002.7
97,229.5
98,682.8
Supplemental Data and Reconciliation of Non-GAAP Items:
Three months ended
Twelve months ended
July 31
July 31
2017
2016
2017
2016
Net loss attributable to Ferrellgas Partners, L.P.
$
(55,768
)
$
(661,434 )
$
(54,207
)
$
(665,415
)
Income tax benefit
(949
)
(1,482
)
(1,143
)
(36
)
Interest expense
40,378
35,048
152,485
137,937
Depreciation and amortization expense
25,805
37,815
103,351
150,513
EBITDA
9,466
(590,053 )
200,486
(377,001
)
Non-cash employee stock ownership plan compensation charge
3,692
9,220
15,088
27,595
Non-cash stock based compensation charge (a)
-
2,567
3,298
9,324
Asset impairments
-
628,802
-
658,118
Loss on asset sales and disposal
5,596
7,615
14,457
30,835
Other (income) expense, net
(41
)
(199
)
(1,474
)
(110
)
Change in fair value of contingent consideration (included in operating expense)
-
-
-
(100
)
Severance expense $414 included in operating expense for the twelve months ended period July 31, 2017
and $1,545 included in general and administrative expense for the twelve months ended July 31, 2017.
Also includes $128 and $1,329 in operating expense for the three and twelve months ended July 31, 2017
and $124 general and administrative expense for the twelve months ended July 31, 2017.
-
128
1,959
1,453
Unrealized (non-cash) losses (gains) on changes in fair value of derivatives $1,751, and $540
included in cost of sales for the three and twelve months ended July 31, 2017, respectively, and
$(1,849) and $(448) for the three and twelve months ended July 31, 2016, respectively. Also includes $(759) and
$(3,997) included in operating expense for the three and twelve months ended July 31, 2017, respectively, and
$(7) and $1,585 for the three and twelve months ended July 31, 2016, respectively.
992
(1,856
)
(3,457
)
1,137
Acquisition and transition expenses (included in general and administrative expense)
-
-
-
99
Net loss attributable to noncontrolling interest (b)
(481
)
(6,708
)
(294
)
(6,620
)
Adjusted EBITDA (c)
19,224
49,516
230,063
344,730
Net cash interest expense (d)
(38,118
)
(33,604
)
(143,588
)
(132,860
)
Maintenance capital expenditures (e)
(6,417
)
(3,549
)
(16,935
)
(17,137
)
Cash paid for taxes
(282
)
(345
)
(310
)
(777
)
Proceeds from asset sales
3,789
51
7,952
6,023
Distributable cash flow attributable to equity investors (f)
(21,804
)
12,069
77,182
199,979
Distributable cash flow attributable to general partner and non-controlling interest
(436
)
241
1,544
4,000
Distributable cash flow attributable to common unitholders
(21,368
)
11,828
75,638
195,979
Less: Distributions paid to common unitholders
9,715
50,226
78,936
202,119
Distributable cash flow shortage
$
(31,083
)
$
(38,398
)
$
(3,298
)
$
(6,140
)
Propane gallons sales
Retail - Sales to End Users
91,778
87,625
564,872
552,771
Wholesale - Sales to Resellers
56,218
56,129
226,251
226,121
Total propane gallons sales
147,996
143,754
791,123
778,892

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