Exhibit 99.1
Financial results for the nine months ended April 30, 2015 (unaudited)
Ferrellgas Partners, L.P.’s consolidated financial statements for the nine months ended April 30, 2015 are not yet available to be filed with the SEC. Our current expectations with respect to our unaudited results for this period are based upon management estimates. The preliminary estimates presented below are subject to the completion of our financial closing procedures. Accordingly, these estimates may change and those changes may be material. You should not place undue reliance on these estimates. For additional information regarding the various risks and uncertainties inherent in estimates of this type, see “Forward-looking statements” elsewhere in this prospectus supplement. We do not expect to file our consolidated financial statements and related notes as of and for the nine months ended April 30, 2015 with the SEC until our next quarterly report on Form 10-Q.
The preliminary estimates have been prepared by, and are the responsibility of, our management and have not been reviewed or audited or subject to any other procedures by our independent registered public accounting firm. Accordingly, our independent registered public accounting firm does not express an opinion or any other form of assurance with respect to these preliminary estimates.
We are providing the following preliminary estimates of our financial results and operating metrics for the nine months ended April 30, 2015:
|
| Nine months ended |
| ||||
|
| April 30, |
| ||||
(in thousands, except per unit data) |
| 2015 |
| 2014 |
| ||
Revenues: |
|
|
|
|
| ||
Propane and other gas liquids sales |
| $ | 1,400,895 |
| $ | 1,796,786 |
|
Other |
| 240,984 |
| 210,044 |
| ||
Total revenues |
| 1,641,879 |
| 2,006,830 |
| ||
Cost of product sold: |
|
|
|
|
| ||
Propane and other gas liquids sales |
| 849,190 |
| 1,232,516 |
| ||
Other |
| 153,736 |
| 131,443 |
| ||
Gross profit |
| 638,953 |
| 642,871 |
| ||
Operating expense |
| 316,913 |
| 333,632 |
| ||
Depreciation and amortization expense |
| 70,576 |
| 61,771 |
| ||
General and administrative expense |
| 29,701 |
| 35,070 |
| ||
Equipment lease expense |
| 17,674 |
| 12,978 |
| ||
Non-cash employee stock ownership plan compensation charge |
| 16,728 |
| 10,389 |
| ||
Non-cash stock-based compensation charge (a) |
| 19,701 |
| 16,182 |
| ||
Loss on disposal of assets |
| 4,578 |
| 3,426 |
| ||
Operating income |
| 163,082 |
| 169,423 |
| ||
Interest expense |
| (71,797 | ) | (64,372 | ) | ||
Loss on extinguishment of debt |
| — |
| (21,202 | ) | ||
Other income (expense), net |
| (415 | ) | 498 |
| ||
Earnings before income taxes |
| 90,870 |
| 84,347 |
| ||
Income tax expense |
| 1,448 |
| 2,391 |
| ||
Net earnings |
| 89,422 |
| 81,956 |
| ||
Net earnings attributable to noncontrolling interest (b) |
| 1,027 |
| 950 |
| ||
Net earnings attributable to Ferrellgas Partners, L.P. |
| 88,395 |
| 81,006 |
| ||
Less: General partner’s interest in net earnings |
| 884 |
| 810 |
| ||
Common unitholders’ interest in net earnings |
| $ | 87,511 |
| $ | 80,196 |
|
Earnings Per Unit: |
|
|
|
|
| ||
Basic and diluted net earnings per common unitholders’ interest |
| $ | 1.06 |
| $ | 1.01 |
|
Weighted average common units outstanding |
| 82,536.1 |
| 79,127.1 |
| ||
Supplemental Data and Reconciliation of Non-GAAP Items:
|
| Nine months ended |
| ||||
|
| April 30, |
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(in thousands, except per unit data) |
| 2015 |
| 2014 |
| ||
Net earnings attributable to Ferrellgas Partners, L.P. |
| $ | 88,395 |
| $ | 81,006 |
|
Income tax expense |
| 1,448 |
| 2,391 |
| ||
Interest expense |
| 71,797 |
| 64,372 |
| ||
Depreciation and amortization expense |
| 70,576 |
| 61,771 |
| ||
EBITDA |
| 232,216 |
| 209,540 |
| ||
Loss on extinguishment of debt |
| — |
| 21,202 |
| ||
Non-cash employee stock ownership plan compensation charge |
| 16,728 |
| 10,389 |
| ||
Non-cash stock-based compensation charge (a) |
| 19,701 |
| 16,182 |
| ||
Loss on disposal of assets |
| 4,578 |
| 3,426 |
| ||
Other income (expense), net |
| 415 |
| (498 | ) | ||
Change in fair value of contingent consideration (included in operating expense) |
| (6,300 | ) | — |
| ||
Litigation accrual and related legal fees associated with a class action lawsuit (included in operating expense) |
| 806 |
| 1,422 |
| ||
Unrealized (non-cash) gain on changes in fair value of non-hedged derivatives |
| (1,609 | ) | — |
| ||
Net earnings attributable to noncontrolling interest (b) |
| 1,027 |
| 950 |
| ||
Adjusted EBITDA (c) |
| 267,562 |
| 262,613 |
| ||
Net cash interest expense (d) |
| (68,599 | ) | (61,507 | ) | ||
Maintenance capital expenditures (e) |
| (14,863 | ) | (13,345 | ) | ||
Cash paid for taxes |
| (333 | ) | (403 | ) | ||
Proceeds from asset sales |
| 4,060 |
| 3,267 |
| ||
Distributable cash flow to equity investors (f) |
| 187,827 |
| 190,625 |
| ||
Distributable cash flow attributable to general partner and non-controlling interest |
| 3,757 |
| 3,813 |
| ||
Distributable cash flow attributable to common unitholders |
| 184,070 |
| 186,812 |
| ||
Less: Distributions paid to common unitholders |
| 124,074 |
| 118,702 |
| ||
Distributable cash flow excess/(shortage) |
| $ | 59,996 |
| $ | 68,110 |
|
Propane gallons sales |
|
|
|
|
| ||
Retail - Sales to End Users |
| 518,726 |
| 558,142 |
| ||
Wholesale - Sales to Resellers |
| 211,068 |
| 233,664 |
| ||
Total propane gallons sales |
| 729,794 |
| 791,806 |
| ||
Midstream operations (barrels processed) |
| 13,234 |
| — |
| ||
(a) Non-cash stock-based compensation charges consist of the following:
|
| Nine months ended |
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|
| April 30, |
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|
| 2015 |
| 2014 |
| ||
Operating expense |
| $ | 4,233 |
| $ | 3,503 |
|
General and administrative expense |
| 15,468 |
| 12,679 |
| ||
Total |
| $ | 19,701 |
| $ | 16,182 |
|
(b) Amounts allocated to the general partner for its 1.0101% interest in the operating partnership, Ferrellgas, L.P.
(c) Adjusted EBITDA is calculated as net earnings attributable to Ferrellgas Partners, L.P., income tax expense, interest expense, depreciation and amortization expense, loss on extinguishment of debt, non-cash employee stock ownership plan compensation charge, non-cash stock-based compensation charge, loss on disposal of assets, other income (expense), net, change in fair value of contingent consideration, litigation accrual and related legal fees associated with a class action lawsuit and unrealized (non-cash) gain on changes in fair value of non-hedged derivatives and net earnings attributable to non-controlling interest. Management believes the presentation of this measure is relevant and useful, because it allows investors to view the partnership’s performance in a manner similar to the method management uses, adjusted for items management believes makes it easier to compare its results with other companies that have different financing and capital structures. This method of calculating Adjusted EBITDA may not be consistent with that of other companies and should be viewed in conjunction with measurements that are computed in accordance with GAAP.
(d) Net cash interest expense is the sum of interest expense less non-cash interest expense and other income (expense), net. This amount includes interest expense related to the accounts receivable securitization facility.
(e) Maintenance capital expenditures include capitalized expenditures for betterment and replacement of property, plant and equipment.
(f) Management considers distributable cash flow to equity investors a meaningful non-GAAP measure of the partnership’s ability to declare and pay quarterly distributions to equity investors. Distributable cash flow to
equity investors, as management defines it, may not be comparable to distributable cash flow to equity investors or similarly titled measurements used by other corporations and partnerships. Items added into our calculation of distributable cash flow to equity investors that will not occur on a continuing basis may have associated cash payments. Distributable cash flow to equity investors may not be consistent with that of other companies and should be viewed in conjunction with measurements that are computed in accordance with GAAP.