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Amerigas Partners Lp (APU) SEC Filing 8-K Material Event for the period ending Tuesday, February 5, 2019

Amerigas Partners Lp

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CIK: 932628 Ticker: APU



 amerigas.jpg    Press Release


AmeriGas Reports First Quarter Results
February 5, 2019
 
VALLEY FORGE, PA - AmeriGas Propane, Inc., the general partner of AmeriGas Partners, L.P. (the "Partnership," NYSE: APU), today reported financial results for the fiscal quarter ended December 31, 2018.
HIGHLIGHTS
•
GAAP net income of $44.5 million, compared with $104.4 million in the prior-year period; Adjusted net income of $122.2 million, compared with $103.7 million in the prior-year period
•
Adjusted EBITDA of $210.7 million, compared with $194.1 million in the prior-year period
•
Strongest first quarter since Fiscal 2014
Hugh J. Gallagher, president and chief executive officer of AmeriGas, said, "We are pleased to report our strongest first quarter in five years, with Adjusted EBITDA up 9% over the last year. Our teams did an excellent job of managing expenses despite the increased activity associated with colder weather, and we continue to see solid volume growth in our National Accounts and Cylinder Exchange programs. As the heating season continues, we remain focused on leveraging technology to drive operational excellence while providing great customer service when it is most needed."
KEY DRIVERS OF FIRST QUARTER RESULTS
•
Degree days for the quarter were 5% colder than normal and 6% colder than last year
•
Retail volumes sold increased by 5 million gallons over the prior year due to the colder weather
•
Unit margins increased compared to the prior-year period reflecting, in part, declining wholesale propane prices later in the period
•
Our National Accounts and Cylinder Exchange programs continued to show solid volume growth, with volumes up over 10% from last year

EARNINGS CALL and WEBCAST
AmeriGas Partners, L.P. will hold a live Internet Audio Webcast of its conference call to discuss first quarter earnings and other current activities at 9:00 AM ET on Wednesday, February 6, 2019. Interested parties may listen to the audio webcast both live and in replay on the Internet at http://investors.amerigas.com/investor-relations/events-presentations or at the company website http://www.amerigas.com under Investor Relations. A telephonic replay will be available from 2:00 PM ET on February 6th through 11:59 PM on February 13th. The replay may be accessed at (855) 859-2056, and internationally at 1-404-537-3406, conference ID 2974015.

CONTACT INVESTOR RELATIONS
610-337-1000
Brendan Heck, ext. 6608
Shelly Oates, ext. 3202
 






ABOUT AMERIGAS
AmeriGas is the nation’s largest retail propane marketer, serving over 1.7 million customers in all 50 states from approximately 1,900 distribution locations. UGI Corporation, through subsidiaries, is the sole General Partner and owns 26% of the Partnership and the public owns the remaining 74%. Comprehensive information about AmeriGas is available on the Internet at http://www.amerigas.com


USE OF NON-GAAP MEASURES
The Partnership’s management uses certain non-GAAP financial measures, including adjusted total margin, EBITDA, Adjusted EBITDA and adjusted net income (loss) attributable to AmeriGas Partners, L.P., when evaluating the Partnership’s overall performance. These financial measures are not in accordance with, or an alternative to, GAAP and should be considered in addition to, and not as a substitute for, the comparable GAAP measures.
Management believes earnings before interest, income taxes, depreciation and amortization (“EBITDA”), as adjusted for the effects of gains and losses on commodity derivative instruments not associated with current-period transactions and other gains and losses that competitors do not necessarily have ("Adjusted EBITDA"), is a meaningful non-GAAP financial measure used by investors to (1) compare the Partnership’s operating performance with that of other companies within the propane industry and (2) assess the Partnership’s ability to meet loan covenants. The Partnership’s definition of Adjusted EBITDA may be different from those used by other companies. Management uses Adjusted EBITDA to compare year-over-year profitability of the business without regard to capital structure as well as to compare the relative performance of the Partnership to that of other master limited partnerships without regard to their financing methods, capital structure, income taxes, the effects of gains and losses on commodity derivative instruments not associated with current-period transactions or historical cost basis. In view of the omission of interest, income taxes, depreciation and amortization, gains and losses on commodity derivative instruments not associated with current-period transactions and other gains and losses that competitors do not necessarily have from Adjusted EBITDA, management also assesses the profitability of the business by comparing net income attributable to AmeriGas Partners, L.P. for the relevant periods. Management also uses Adjusted EBITDA to assess the Partnership’s profitability because its parent, UGI Corporation, uses the Partnership’s Adjusted EBITDA to assess the profitability of the Partnership, which is one of UGI Corporation’s industry segments. UGI Corporation discloses the Partnership’s Adjusted EBITDA as the profitability measure for its domestic propane segment.
Management believes the presentation of other non-GAAP financial measures, comprised of adjusted total margin and adjusted net income (loss) attributable to AmeriGas Partners, L.P., provide useful information to investors to more effectively evaluate the period-over-period results of operations of the Partnership. Management uses these non-GAAP financial measures because they eliminate the impact of (1) gains and losses on commodity derivative instruments that are not associated with current-period transactions and (2) other gains and losses that competitors do not necessarily have to provide insight into the comparison of period-over-period profitability to that of other master limited partnerships.
Reconciliations of adjusted total margin, EBITDA, Adjusted EBITDA and adjusted net income attributable to AmeriGas Partners, L.P. to the most directly comparable financial measure calculated and presented in accordance with GAAP are presented at the end of this press release.

USE OF FORWARD-LOOKING STATEMENTS
This press release contains certain forward-looking statements that management believes to be reasonable as of today’s date only. Actual results may differ significantly because of risks and uncertainties that are difficult to predict and many of which are beyond management’s control. You should read the Partnership’s Annual Report on Form 10-K for a more extensive list of factors that could affect results. Among them are adverse weather conditions, cost volatility and availability of propane, increased customer conservation measures, the capacity to transport propane to our market areas, the impact of pending and future legal proceedings, liability for uninsured claims and for claims in excess of insurance coverage, political, economic and regulatory conditions in the U.S. and abroad, the availability, timing and success of our acquisitions, commercial initiatives and investments to grow our business, our ability to successfully integrate acquisitions and achieve anticipated synergies, and the interruption, disruption, failure, malfunction or breach of our information technology systems, including due to cyber-attack. The Partnership undertakes no obligation to release revisions to its forward-looking statements to reflect events or circumstances occurring after today.
 





REPORT OF EARNINGS
AMERIGAS PARTNERS, L.P. AND SUBSIDIARIES
(Thousands, except per unit and where otherwise indicated)
(Unaudited)
 
 
Three Months Ended
December 31,
 
Twelve Months Ended
December 31,
 
 
2018
 
2017
 
2018
 
2017
Revenues:
 
 
 
 
 
 
 
 
Propane
 
$
742,900

 
$
711,464

 
$
2,577,230

 
$
2,290,946

Other
 
77,313

 
75,832

 
278,665

 
272,679

 
 
820,213

 
787,296

 
2,855,895

 
2,563,625

Costs and expenses:
 
 
 
 
 
 
 
 
Cost of sales — propane
 
435,415

 
344,351

 
1,306,680

 
1,021,207

Cost of sales — other
 
21,586

 
20,994

 
87,168

 
81,023

Operating and administrative expenses
 
235,138

 
230,339

 
927,863

 
918,670

Impairment of tradenames and trademarks
 
—

 
—

 
75,000

 
—

Depreciation and amortization
 
45,709

 
47,424

 
184,038

 
193,318

Other operating income, net
 
(5,719
)
 
(4,637
)
 
(25,455
)
 
(19,645
)
 
 
732,129

 
638,471

 
2,555,294

 
2,194,573

Operating income
 
88,084

 
148,825

 
300,601

 
369,052

Loss on extinguishments of debt
 
—

 
—

 
—

 
(26,578
)
Interest expense
 
(42,354
)
 
(40,577
)
 
(164,902
)
 
(160,775
)
Income before income taxes
 
45,730

 
108,248

 
135,699

 
181,699

Income tax expense
 
(409
)
 
(2,378
)
 
(2,246
)
 
(3,575
)
Net income including noncontrolling interest
 
45,321

 
105,870

 
133,453

 
178,124

Deduct net income attributable to noncontrolling interest
 
(835
)
 
(1,449
)
 
(2,866
)
 
(3,598
)
Net income attributable to AmeriGas Partners, L.P.
 
$
44,486

 
$
104,421

 
$
130,587

 
$
174,526

General partner’s interest in net income attributable to AmeriGas Partners, L.P.
 
$
11,776

 
$
12,372

 
$
46,629

 
$
46,166

Limited partners’ interest in net income attributable to AmeriGas Partners, L.P.
 
$
32,710

 
$
92,049

 
$
83,958

 
$
128,360

Income per limited partner unit (a)
 
 
 
 
 
 
 
 
Basic
 
$
0.35

 
$
0.97

 
$
0.90

 
$
1.37

Diluted
 
$
0.35

 
$
0.97

 
$
0.90

 
$
1.37

Weighted average limited partner units outstanding:
 
 
 
 
 
 
 
 
Basic
 
93,055

 
93,016

 
93,028

 
93,006

Diluted
 
93,118

 
93,080

 
93,081

 
93,060

SUPPLEMENTAL INFORMATION:
 
 
 
 
 
 
 
 
Retail gallons sold (millions)
 
310.3

 
305.0

 
1,086.6

 
1,046.2

Wholesale gallons sold (millions)
 
21.9

 
17.0

 
67.2

 
52.5

Total margin (b)
 
$
363,212

 
$
421,951

 
$
1,462,047

 
$
1,461,395

Adjusted total margin (c)
 
$
441,714

 
$
421,200

 
$
1,528,827

 
$
1,455,313

EBITDA (c)
 
$
132,958

 
$
194,800

 
$
481,773

 
$
532,194

Adjusted EBITDA (c)
 
$
210,667

 
$
194,057

 
$
622,120

 
$
560,221

Adjusted net income attributable to AmeriGas Partners, L.P. (c)
 
$
122,195

 
$
103,678

 
$
270,934

 
$
202,553

Expenditures for property, plant and equipment:
 
 
 
 
 
 
 
 
Maintenance capital expenditures
 
$
16,198

 
$
10,105

 
$
59,029

 
$
46,760

Growth capital expenditures
 
$
14,814

 
$
13,480

 
$
49,659

 
$
48,608

(a)
Income per limited partner unit is computed in accordance with accounting guidance regarding the application of the two-class method for determining earnings per share as it relates to master limited partnerships. Refer to Note 2 to the consolidated financial statements included in the AmeriGas Partners, L.P. Annual Report on Form 10-K for the fiscal year ended September 30, 2018.
(b)
Total margin represents "Total revenues" less "Cost of sales — propane" and "Cost of sales — other."
(c)
The Partnership’s management uses certain non-GAAP financial measures, including adjusted total margin, EBITDA, Adjusted EBITDA, and adjusted net income attributable to AmeriGas Partners, L.P.




GAAP / NON-GAAP RECONCILIATION
(Thousands)
(Unaudited)
 
 
Three Months Ended
December 31,
 
Twelve Months Ended
December 31,
 
 
2018
 
2017
 
2018
 
2017
Adjusted total margin:
 
 
 
 
 
 
 
 
Total revenues
 
$
820,213

 
$
787,296

 
$
2,855,895

 
$
2,563,625

Cost of sales — propane
 
(435,415
)
 
(344,351
)
 
(1,306,680
)
 
(1,021,207
)
Cost of sales — other
 
(21,586
)
 
(20,994
)
 
(87,168
)
 
(81,023
)
Total margin
 
363,212

 
421,951

 
1,462,047

 
1,461,395

Add net losses (subtract net gains) on commodity derivative instruments not associated with current-period transactions
 
78,502

 
(751
)
 
66,780

 
(6,082
)
Adjusted total margin
 
$
441,714

 
$
421,200

 
$
1,528,827

 
$
1,455,313

 
 
 
 
 
 
 
 
 
Adjusted net income attributable to AmeriGas Partners, L.P.:
 
 
 
 
 
 
 
 
Net income attributable to AmeriGas Partners, L.P.
 
$
44,486

 
$
104,421

 
$
130,587

 
$
174,526

Add net losses (subtract net gains) on commodity derivative instruments not associated with current-period transactions
 
78,502

 
(751
)
 
66,780

 
(6,082
)
Impairment of Heritage tradenames and trademarks
 
—

 
—

 
75,000

 
—

Loss on extinguishments of debt
 
—

 
—

 
—

 
26,578

MGP environmental accrual
 
—

 
—

 
—

 
7,545

Noncontrolling interest in net (losses) gains on commodity derivative instruments not associated with current-period transactions, impairment of Heritage tradenames and trademarks and MGP environmental accrual
 
(793
)
 
8

 
(1,433
)
 
(14
)
Adjusted net income attributable to AmeriGas Partners, L.P.
 
$
122,195

 
$
103,678

 
$
270,934

 
$
202,553

EBITDA and Adjusted EBITDA:
 
 
 
 
 
 
 
 
Net income attributable to AmeriGas Partners, L.P.
 
$
44,486

 
$
104,421

 
$
130,587

 
$
174,526

Income tax expense
 
409

 
2,378

 
2,246

 
3,575

Interest expense
 
42,354

 
40,577

 
164,902

 
160,775

Depreciation and amortization
 
45,709

 
47,424

 
184,038

 
193,318

EBITDA
 
132,958

 
194,800

 
481,773

 
532,194

Add net losses (subtract net gains) on commodity derivative instruments not associated with current-period transactions
 
78,502

 
(751
)
 
66,780

 
(6,082
)
Impairment of Heritage tradenames and trademarks
 
—

 
—

 
75,000

 
—

Loss on extinguishments of debt
 
—

 
—

 
—

 
26,578

MGP environmental accrual
 
—

 
—

 
—

 
7,545

Noncontrolling interest in net (losses) gains on commodity derivative instruments not associated with current-period transactions, impairment of Heritage tradenames and trademarks and MGP environmental accrual
 
(793
)
 
8

 
(1,433
)
 
(14
)
Adjusted EBITDA
 
$
210,667

 
$
194,057

 
$
622,120

 
$
560,221



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Exhibit 99.1: Additional Exhibits
Exhibit 99.2: Additional Exhibits
Ticker: APU
CIK: 932628
Form Type: 8-K Corporate News
Accession Number: 0000932628-19-000003
Submitted to the SEC: Wed Feb 06 2019 8:58:52 AM EST
Accepted by the SEC: Wed Feb 06 2019
Period: Tuesday, February 5, 2019
Industry: Retail Stores
Events:
  1. Earnings Release
  2. Financial Exhibit
  3. Regulated Disclosure

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