Ferrellgas Partners, L.P. Reports Full Fiscal Year and Fourth Quarter 2018 Results
September 27 2018 - 7:00AM
Ferrellgas Partners, L.P. (NYSE:FGP) (“Ferrellgas” or the
“Company”) today reported financial results for its full fiscal
year and fourth quarter ended July 31, 2018.
For the fiscal year, the Company reported a net loss
attributable to Ferrellgas Partners, L.P. of $254.6 million, or
$2.59 per common unit, compared to prior year period net loss of
$54.2 million, or $0.55 per common unit. Net of non-cash charges
due largely to asset sales supporting deleveraging efforts net loss
was $57.2 million, or $0.59 per common unit as compared to a net
loss of $39.8 million, or $0.41 per common unit in the prior year
period.
Reflecting the non-cash losses from strategic asset sales as
well as higher interest expense for the fourth quarter ended July
31, 2018, the Company reported a net loss attributable to
Ferrellgas Partners, L.P. of $215.7 million, or $2.20 per common
unit compared to prior year period net loss of $55.8 million, or
$0.57 per common unit. Adjusted EBITDA, a non-GAAP measure,
for the fourth quarter was $8.2 million compared to $19.2 million
in the prior year on propane volumes that were 1.6 percent higher
than the prior year period. The decrease stemmed from higher
operating expenses as the Company continues to position for
continued future customer and sales growth with the opening of
additional selling locations and related resources to support those
locations.
Adjusted EBITDA was $241.9 million in fiscal 2018 from core
business compared to $230.1 million in the prior year. The
following reconciliation represents the contribution to adjusted
EBITDA from the core propane business separated from the
contribution associated with the various assets that were sold
during 2018:
(in millions) |
|
Fiscal 2018 |
|
Fiscal 2017 |
Propane Operations and
Corporate Support |
|
$227.7 |
|
$219.4 |
EBITDA from Assets
Sold |
|
14.2 |
|
10.7 |
Consolidated Adjusted EBITDA |
|
$241.9 |
|
$230.1 |
The Company’s propane operations reported that total gallons
sold increased 86.5 million gallons, or 11.0 percent, over prior
year. Margins were slightly lower as the Company aggressively
competed for and won new customers. This strategic focus resulted
in over 14,000 new customers, or approximately 2.2 percent more
than prior year. Additionally, the Company’s current Blue Rhino
tank exchange sales locations have increased over 10.0 percent from
the start of the fiscal year to over 53,000 locations.
Overall, the fiscal 2018 increase in gross margin from propane
operations’ sales volume growth was partially offset by slightly
lower margins per gallon and higher operating expenses. The
increase in operating expenses was largely the result of new
locations established to be in closer proximity to current and
potential customers as the company looks to continue increasing
market share and customer density.
“Our Company had many achievements in 2018,” said James E.
Ferrell, Interim Chief Executive Officer and President of
Ferrellgas. “We sold our midstream and Global Sourcing
businesses, enhanced our liquidity, and closed on credit facilities
that provide the essential working capital to run and grow our
business. We also acquired five businesses during the year, and
expanded both our retail customer base and our tank exchange
business.”
“We are working on finding a balance between minimizing our
operating expenses while being ready for continued growth. This
aligns with our strategy of gaining market share by getting closer
to our current and potential customers,” said Ferrell, “We
have added new retail and tank exchange selling locations, trucks,
drivers and sales professionals into our Company. The
operating expenses associated with these gains may not look as good
in one particular quarter, especially the fourth quarter, our
lowest volume quarter of the year. However, over the long
term, this strategy provides the infrastructure to drive growth in
customers, gallon sales, efficiencies through market share and
customer density. We are positioning for future growth in our
propane business, now that we have shed non-core assets.
In addition to improving the Company’s liquidity with the fourth
quarter closing of the $575 million secured credit facility and
extension of its accounts receivable securitization facility, the
Company continues to evaluate various options related to its
outstanding bonds. This may include refinancing on a secured or
unsecured basis or an exchange transaction for some or all of its
bonds due June 2020, or refinancing strategies that address a more
significant portion of the Company’s upcoming maturities of
unsecured bonds maturing between 2020 to 2023.
“Our Company is focused on growth. We have many
opportunities to contine to grow organically, and our national
footprint allows for acquisition opportunities as the industry
continues to consolidate,” said Ferrell. “What we
accomplished in 2018 positions us well for the future. We
have a strong foundation that supports the long-term success of our
Company.”
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. 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 27, 2018. 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. 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 include
those 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, 2018, and in other
documents filed from time to time by these entities with the
Securities and Exchange Commission.
ContactsJim Saladin, Media Relations –
jimsaladin@ferrellgas.com, 913-661-1833 Bill Ruisinger, Investor
Relations – billruisinger@ferrellgas.com, 816-792-7914
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