WHIPPANY, N.J., Nov. 12, 2015 /PRNewswire/ -- Suburban Propane
Partners, L.P. (NYSE: SPH), a nationwide distributor of propane,
fuel oil and related products and services, as well as a marketer
of natural gas and electricity, today announced results for its
full year and fourth quarter ended September
26, 2015.
Fiscal Year 2015 Results
Net income for fiscal 2015 was $84.4
million, or $1.39 per Common
Unit, compared to $94.5 million, or
$1.56 per Common Unit, in fiscal
2014.
Net income and EBITDA (as defined and reconciled below) for
fiscal 2015 included: (i) a loss on debt extinguishment of
$15.1 million; (ii) $11.5 million in expenses related to the
integration of Inergy Propane; (iii) an $11.3 million charge related to the Partnership's
voluntary partial withdrawal from a multi-employer pension plan
covering certain employees acquired in the Inergy Propane
acquisition; and (iv) a pension settlement charge of $2.0 million. Net income and EBITDA for fiscal
2014 included: (i) a loss on debt extinguishment of $11.6 million; and (ii) $12.3 million in expenses related to the
integration of Inergy Propane.
Excluding the effects of the foregoing items and unrealized
(non-cash) mark-to-market adjustments on derivative instruments in
both years, Adjusted EBITDA (as defined and reconciled below)
amounted to $334.0 million in fiscal
2015, compared to Adjusted EBITDA of $338.5
million in fiscal 2014.
In announcing these results, President and Chief Executive
Officer Michael A. Stivala said,
"While fiscal 2015 got off to a slow start due to near record warm
temperatures in the first quarter, our results for the remaining
nine months benefited from colder average temperatures, lower
commodity prices and our ongoing focus on cost savings and
efficiencies. As a result, we finished the year strong with
three consecutive quarters of year-over-year growth in Adjusted
EBITDA. We also accomplished our goals for the third and final year
of integration of the Inergy Propane operations. As we enter fiscal
2016, all of our operations are working under a common operating
philosophy, one common system platform, one brand and one
culture."
Mr. Stivala continued, "In addition to achieving our operational
goals, we continued to strengthen our balance sheet with the
successful refinancing of our 7 3/8% Senior Notes due 2020 with 5
3/4% Senior Notes due 2025. Once again, we funded all working
capital needs from cash on hand without the need to borrow under
our revolving credit facility, and ended the year with more than
$152.0 million of cash."
Concluding his remarks, Mr. Stivala said, "With the integration
of the Inergy Propane business effectively behind us, and with the
strength of our balance sheet, we are well positioned to increase
our focus on the next phase of strategic growth – both internal and
external."
Retail propane gallons sold in fiscal 2015 decreased 50.4
million gallons, or 9.5%, to 480.4 million gallons from 530.7
million gallons in fiscal 2014. Sales of fuel oil and other refined
fuels decreased 7.2 million gallons, or 14.7%, to 41.9 million
gallons from 49.1 million gallons in fiscal 2014. According
to the National Oceanic and Atmospheric Administration, average
temperatures (as measured by heating degree days) across all of the
Partnership's service territories for fiscal 2015 were 2% warmer
than normal and 5% warmer than the prior year. The fiscal 2015
heating season started with unseasonably warm temperatures
throughout much of the first quarter, inclusive of a December that
was one of the warmest on record, followed by inconsistent
temperatures across the Partnership's eastern and mid-western
service territories for the remainder of the heating season. The
Partnership's western service territories experienced sustained
warmer than normal temperatures throughout the year with average
temperatures that were 23% warmer than normal and 9% warmer than
the prior year.
Revenues for fiscal 2015 of $1,417.0
million decreased $521.3
million, or 26.9%, compared to the prior year, primarily due
to lower retail selling prices associated with lower wholesale
costs and, to a lesser extent, lower volumes sold. Average posted
propane prices (basis Mont Belvieu,
Texas) for fiscal 2015 were 52.7% lower than the prior year,
and average posted prices for fuel oil were 35.5% lower than the
prior year.
Cost of products sold for fiscal 2015 of $593.4 million decreased $487.4 million, or 45.1%, compared to
$1,080.8 million in the prior year,
primarily due to lower wholesale propane costs and, to a lesser
extent, lower volumes sold. Cost of products sold for fiscal 2015
and fiscal 2014 included unrealized (non-cash) gains of
$1.9 million and $0.3 million, respectively, attributable to the
mark-to-market adjustment for derivative instruments used in risk
management activities. These unrealized gains and losses are
excluded from Adjusted EBITDA for both periods in the table
below.
Combined operating and general and administrative expenses of
$512.5 million for fiscal 2015 were
$18.4 million, or 3.5%, lower than
fiscal 2014. Excluding integration-related expenses for both
periods, as well as the multi-employer pension plan withdrawal and
pension settlement charges in fiscal 2015 discussed above, combined
operating and general administrative expenses decreased 6.0%
compared to the prior year. The Partnership continued to
realize operating efficiencies and synergies as a result of the
integration of Inergy Propane, including lower headcount and lower
vehicle count, and lower general insurance and bad debt
expense.
Depreciation and amortization expense of $133.3 million for fiscal 2015 decreased
$3.1 million, or 2.3%, primarily due
to the acceleration of depreciation expense recorded in the prior
year for assets taken out of service as a result of integration
activities. Net interest expense of $77.6
million for fiscal 2015 decreased $5.6 million, or 6.8%, primarily due to savings
from the refinancing of certain of the Partnership's senior notes
completed in the third quarter of fiscal 2014 and in the second
quarter of fiscal 2015.
Fourth Quarter 2015 Results
Consistent with the seasonal nature of the propane and fuel oil
businesses, the Partnership typically reports a net loss for its
fiscal fourth quarter. Net loss for the fourth quarter of fiscal
2015 was $67.1 million, or
$1.11 per Common Unit, compared to a
net loss of $54.7 million, or
$0.90 per Common Unit, for the fourth
quarter of fiscal 2014.
Net loss and EBITDA for the fourth quarter of fiscal 2015
included: (i) an $11.3 million charge
related to the Partnership's voluntary partial withdrawal from a
multi-employer pension plan covering certain employees acquired in
the Inergy Propane acquisition; (ii) $6.4
million in expenses related to the integration of Inergy
Propane; and (iii) the pension settlement charge of $2.0 million. Net loss and EBITDA for the fourth
quarter of fiscal 2014 included $3.2
million in expenses related to the integration of Inergy
Propane.
Excluding these items and the effects of unrealized (non-cash)
mark-to-market adjustments on derivative instruments used in risk
management activities in both quarters, Adjusted EBITDA for the
fourth quarter of fiscal 2015 improved to $6.7 million, compared to $4.5 million for the fourth quarter of fiscal
2014.
Retail propane gallons sold in the fourth quarter of fiscal 2015
decreased 7.5 million gallons, or 9.9%, to 68.5 million gallons
compared to 76.0 million gallons in the prior year fourth quarter.
Sales of fuel oil and other refined fuels decreased 0.9 million
gallons, to 4.5 million gallons during the fourth quarter of fiscal
2015.
As previously announced on October 22,
2015, the Partnership's Board of Supervisors had declared a
quarterly distribution of $0.8875 per
Common Unit for the three months ended September 26, 2015. On an annualized basis, this
distribution rate equates to $3.55
per Common Unit, an increase of 1.4% compared to the annualized
rate at the end of the prior fiscal year. The distribution
was paid on November 10,
2015 to Common Unitholders of record as of November 3, 2015.
Suburban Propane Partners, L.P. is a publicly-traded master
limited partnership listed on the New York Stock Exchange.
Headquartered in Whippany, New
Jersey, Suburban has been in the customer service business
since 1928. The Partnership serves the energy needs of
approximately 1.1 million residential, commercial, industrial and
agricultural customers through 700 locations in 41 states.
This press release contains certain forward-looking
statements relating to future business expectations and financial
condition and results of operations of the Partnership, based on
management's current good faith expectations and beliefs concerning
future developments. These forward-looking statements are
subject to certain risks and uncertainties that could cause actual
results to differ materially from those discussed or implied in
such forward-looking statements, including the following:
- The impact of weather conditions on the demand for propane,
fuel oil and other refined fuels, natural gas and
electricity;
- Volatility in the unit cost of propane, fuel oil and other
refined fuels and natural gas, the impact of the
Partnership's hedging and risk management activities, and the
adverse impact of price increases on volumes as a result of
customer conservation;
- The ability of the Partnership to compete with other
suppliers of propane, fuel oil and other energy sources;
- The impact on the price and supply of propane, fuel oil and
other refined fuels from the political, military or economic
instability of the oil producing nations, global terrorism and
other general economic conditions;
- The ability of the Partnership to acquire sufficient volumes
of, and the costs to the Partnership of acquiring, transporting and
storing, propane, fuel oil and other refined fuels;
- The ability of the Partnership to acquire and maintain
reliable transportation for its propane, fuel oil and other refined
fuels;
- The ability of the Partnership to retain customers or
acquire new customers;
- The impact of customer conservation, energy efficiency and
technology advances on the demand for propane, fuel oil and other
refined fuels, natural gas and electricity;
- The ability of management to continue to control
expenses;
- The impact of changes in applicable statutes and government
regulations, or their interpretations, including those relating to
the environment and global warming, derivative instruments and
other regulatory developments on the Partnership's
business;
- The impact of changes in tax laws that could adversely
affect the tax treatment of the Partnership for income tax
purposes;
- The impact of legal proceedings on the Partnership's
business;
- The impact of operating hazards that could adversely affect
the Partnership's operating results to the extent not covered by
insurance;
- The Partnership's ability to make strategic acquisitions and
successfully integrate them;
- The impact of current conditions in the global capital and
credit markets, and general economic pressures;
- The operating, legal and regulatory risks the Partnership
may face; and
- Other risks referenced from time to time in filings with the
Securities and Exchange Commission ("SEC") and those factors listed
or incorporated by reference into the Partnership's Annual Report
under "Risk Factors."
Some of these risks and uncertainties are discussed in more
detail in the Partnership's Annual Report on Form 10-K for its
fiscal year ended September 27, 2014
and other periodic reports filed with the SEC. Readers are
cautioned not to place undue reliance on forward-looking
statements, which reflect management's view only as of the date
made. The Partnership undertakes no obligation to update any
forward-looking statement, except as otherwise required by
law.
Suburban Propane
Partners, L.P. and Subsidiaries
|
|
Consolidated
Statements of Operations
|
|
For the Three and
Twelve Months Ended September 26, 2015 and September 27,
2014
|
|
(in thousands,
except per unit amounts)
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
|
|
September
26,
2015
|
|
September
27,
2014
|
|
September
26,
2015
|
|
September
27,
2014
|
|
Revenues
|
|
|
|
|
|
|
|
|
|
Propane
|
|
$
142,455
|
|
$
197,569
|
|
$
1,176,980
|
|
$
1,606,840
|
|
Fuel oil and refined
fuels
|
|
11,096
|
|
19,796
|
|
127,495
|
|
194,684
|
|
Natural gas and
electricity
|
|
10,756
|
|
12,782
|
|
66,865
|
|
87,093
|
|
All
other
|
|
10,037
|
|
11,139
|
|
45,639
|
|
49,640
|
|
|
|
174,344
|
|
241,286
|
|
1,416,979
|
|
1,938,257
|
|
|
|
|
|
|
|
|
|
|
|
Costs and
expenses
|
|
|
|
|
|
|
|
|
|
Cost of products
sold
|
|
57,594
|
|
121,544
|
|
593,380
|
|
1,080,750
|
|
Operating
|
|
116,501
|
|
105,354
|
|
444,251
|
|
466,389
|
|
General and
administrative
|
|
13,510
|
|
13,488
|
|
68,296
|
|
64,593
|
|
Depreciation and
amortization
|
|
34,706
|
|
35,298
|
|
133,294
|
|
136,399
|
|
|
|
222,311
|
|
275,684
|
|
1,239,221
|
|
1,748,131
|
|
|
|
|
|
|
|
|
|
|
|
Operating (loss)
income
|
|
(47,967)
|
|
(34,398)
|
|
177,758
|
|
190,126
|
|
Loss on debt
extinguishment
|
|
-
|
|
-
|
|
15,072
|
|
11,589
|
|
Interest expense,
net
|
|
18,991
|
|
20,166
|
|
77,634
|
|
83,261
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) income before
provision for income taxes
|
|
(66,958)
|
|
(54,564)
|
|
85,052
|
|
95,276
|
|
Provision for income
taxes
|
|
179
|
|
156
|
|
700
|
|
767
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss)
income
|
|
$
(67,137)
|
|
$
(54,720)
|
|
$
84,352
|
|
$
94,509
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income per
Common Unit - basic
|
|
$
(1.11)
|
|
$
(0.90)
|
|
$
1.39
|
|
$
1.56
|
|
Weighted average
number of Common Units outstanding - basic
|
60,706
|
|
60,495
|
|
60,650
|
|
60,481
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income per
Common Unit - diluted
|
|
$
(1.11)
|
|
$
(0.90)
|
|
$
1.38
|
|
$
1.56
|
|
Weighted average
number of Common Units outstanding - diluted
|
60,706
|
|
60,495
|
|
60,907
|
|
60,751
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental
Information:
|
|
|
|
|
|
|
|
|
|
EBITDA (a)
|
|
$
(13,261)
|
|
$
900
|
|
$
295,980
|
|
$
314,936
|
|
Adjusted EBITDA
(a)
|
|
$
6,651
|
|
$
4,502
|
|
$
334,039
|
|
$
338,502
|
|
Retail gallons
sold:
|
|
|
|
|
|
|
|
|
|
Propane
|
|
68,515
|
|
76,040
|
|
480,372
|
|
530,743
|
|
Refined
fuels
|
|
4,538
|
|
5,476
|
|
41,878
|
|
49,071
|
|
Capital
expenditures:
|
|
|
|
|
|
|
|
|
|
Maintenance
|
|
$
4,744
|
|
$
5,185
|
|
$
19,353
|
|
$
18,158
|
|
Growth
|
|
$
5,468
|
|
$
3,224
|
|
$
21,860
|
|
$
11,894
|
|
|
|
|
|
|
|
|
|
|
|
(more)
|
|
|
|
|
|
|
|
|
|
|
|
(a) EBITDA
represents net income before deducting interest expense, income
taxes, depreciation and amortization. Adjusted EBITDA
represents EBITDA excluding the unrealized net gain or loss on
mark-to-market activity for derivative instruments and other items,
as applicable, as provided in the table below. Our management
uses EBITDA and Adjusted EBITDA as supplemental measures of
operating performance and we are including them because we believe
that they provide our investors and industry analysts with
additional information to evaluate our operating
results.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA and Adjusted
EBITDA are not recognized terms under accounting principles
generally accepted in the United States of America ("US GAAP") and
should not be considered as an alternative to net income or net
cash provided by operating activities determined in accordance with
US GAAP. Because EBITDA and Adjusted EBITDA as determined by
us excludes some, but not all, items that affect net income, they
may not be comparable to EBITDA and Adjusted EBITDA or similarly
titled measures used by other companies.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following
table sets forth our calculations of EBITDA and Adjusted
EBITDA:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
|
|
September
26,
2015
|
|
September
27,
2014
|
|
September
26,
2015
|
|
September
27,
2014
|
|
Net (loss)
income
|
|
$
(67,137)
|
|
$
(54,720)
|
|
$
84,352
|
|
$
94,509
|
|
Add:
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
|
179
|
|
156
|
|
700
|
|
767
|
|
Interest expense,
net
|
|
18,991
|
|
20,166
|
|
77,634
|
|
83,261
|
|
Depreciation and
amortization
|
|
34,706
|
|
35,298
|
|
133,294
|
|
136,399
|
|
EBITDA
|
|
(13,261)
|
|
900
|
|
295,980
|
|
314,936
|
|
Unrealized (non-cash)
losses (gains) on changes in
fair value of derivatives
|
|
180
|
|
402
|
|
(1,855)
|
|
(306)
|
|
Integration-related
costs
|
|
6,432
|
|
3,200
|
|
11,542
|
|
12,283
|
|
Loss on debt
extinguishment
|
|
-
|
|
-
|
|
15,072
|
|
11,589
|
|
Multi-employer
pension plan withdrawal charge
|
|
11,300
|
|
-
|
|
11,300
|
|
-
|
|
Pension settlement
charge
|
|
2,000
|
|
-
|
|
2,000
|
|
-
|
|
Adjusted
EBITDA
|
|
$
6,651
|
|
$
4,502
|
|
$
334,039
|
|
$
338,502
|
|
|
|
|
|
|
|
|
|
|
|
The unaudited
financial information included in this document is intended only as
a summary provided for your convenience, and should be read in
conjunction with the complete consolidated financial statements of
the Partnership (including the Notes thereto, which set forth
important information) contained in its Annual Report on Form 10-K
to be filed by the Partnership with the United States Securities
and Exchange Commission ("SEC"). Such report, once filed,
will be available on the public EDGAR electronic filing system
maintained by the SEC.
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|
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|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/suburban-propane-partners-lp-announces-full-year-and-fourth-quarter-results-300177231.html
SOURCE Suburban Propane Partners, L.P.