Contact: 610-337-1000 For Release: January 26, 2005
Robert W. Krick, Ext. 3141 Immediate
AMERIGAS PARTNERS REPORTS FIRST QUARTER RESULTS
VALLEY FORGE, Pa., January 26 - AmeriGas Propane, Inc., general partner of
AmeriGas Partners, L.P. (NYSE: APU), reported net income for the Partnership's
first fiscal quarter ended December 31, 2004 of $44.3 million or $0.77 per
diluted limited partner unit, compared to $43.1 million, or $0.77 per diluted
limited partner unit, in the same period last year. The results for the quarter
include a gain of $7.1 million, or $0.13 per diluted unit, on the
previously-reported sale of AmeriGas' 50% interest in Atlantic Energy, Inc.,
owner of a propane import terminal in Virginia. Average diluted units
outstanding were 4% higher for the recent quarter principally as a result of a
common unit offering in May 2004.
Earnings before interest expense, income taxes, depreciation and amortization
(EBITDA) were $86.4 million, including the $9.1 million pretax gain on the sale
of Atlantic Energy, in the first fiscal quarter of 2005 compared to $84.6
million a year ago. For the three months ended December 31, 2004, retail volumes
sold declined to 296.8 million gallons from 304.5 million gallons sold in the
prior-year period. Weather was 8.0% warmer than normal during the recent quarter
compared to weather that was 7.4% warmer than normal in the prior-year period,
according to the National Oceanic and Atmospheric Administration.
Eugene V. N. Bissell, chief executive officer of AmeriGas, said, "The lower
retail sales volumes and higher operating expenses we experienced this quarter
reflect the dual challenges of significantly warmer weather and continued high
propane product costs. The average cost per gallon during the quarter at Mt.
Belvieu, Texas, one of our major propane supply points, rose 47% over the prior
year."
Revenues for the quarter were $556.2 million versus $460.2 million a year ago,
principally reflecting higher propane product prices. Operating and
administrative expenses rose during the quarter mainly reflecting the impact of
higher vehicle costs associated with increased fuel prices and lease expenses,
higher employee compensation costs and higher general insurance expenses.
AmeriGas Partners is the nation's largest retail propane marketer, serving
nearly 1.3 million customers from over 650 locations in 46 states. UGI
Corporation (NYSE: UGI), through subsidiaries, owns 46% of the Partnership and
individual unitholders own the remaining 54%.
-- MORE --
AMERIGAS PARTNERS REPORTS FIRST QUARTER RESULTS PAGE 2
AmeriGas Partners, L. P. will host its first quarter FY 2005 earnings conference
call on Wednesday, January 26, 2005, at 4:00 PM ET. Interested parties may
listen to a live audio broadcast of the conference call at
http://www.shareholder.com/ugi/medialist.cfm. A telephonic replay of the call
can be accessed approximately one hour after the completion of the call at
888/203-1112, passcode 7435500 (International replay 719/457-0820,
passcode 7435500) through February 1, 2005.
The financial tables appended to this news release can be viewed directly at
HTTP://WWW.SHAREHOLDER.COM/UGI/APU/1Q05/FINANCIALTABLE.PDF.
This press release contains certain forward-looking statements which 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. Among them are adverse
weather conditions, product cost volatility and availability of propane, the
capacity to transport propane to our market areas and regional economic
conditions. You should read the Partnership's Annual Report on Form 10-K for a
more extensive list of factors that could affect results. The Partnership
undertakes no obligation to release revisions to its forward-looking statements
to reflect events or circumstances occurring after today.
Comprehensive information about AmeriGas is available on the Internet at
WWW.AMERIGAS.COM.
AP-02 ### 1/26/05
AMERIGAS PARTNERS, L.P. AND SUBSIDIARIES
REPORT OF EARNINGS
(Thousands, except per unit and where otherwise indicated)
(Unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
2004(a) 2003 2004(a) 2003
----------- ----------- ----------- -----------
Revenues:
Propane $ 517,451 $ 423,261 $ 1,733,890 $ 1,515,245
Other 38,765 36,937 138,028 128,346
----------- ----------- ----------- -----------
556,216 460,198 1,871,918 1,643,591
----------- ----------- ----------- -----------
Costs and expenses:
Cost of sales - propane 335,309 239,122 1,068,489 867,711
Cost of sales - other 15,835 15,381 57,391 53,761
Operating and administrative expenses (b) 130,619 123,763 507,929 491,251
Depreciation 17,922 18,337 75,053 72,286
Amortization 1,396 1,318 5,222 4,503
Other (income), net (12,549) (3,282) (21,011) (11,056)
----------- ----------- ----------- -----------
488,532 394,639 1,693,073 1,478,456
----------- ----------- ----------- -----------
Operating income 67,684 65,559 178,845 165,135
Loss on extinguishment of debt -- -- -- (3,023)
Interest expense (20,503) (21,135) (82,543) (85,631)
----------- ----------- ----------- -----------
Income before income taxes 47,181 44,424 96,302 76,481
Income tax expense (2,315) (707) (1,877) (1,035)
Minority interests (575) (568) (1,429) (1,251)
----------- ----------- ----------- -----------
Net income $ 44,291 $ 43,149 $ 92,996 $ 74,195
=========== =========== =========== ===========
General partner's interest in net income (c) $ 2,493 $ 2,538 $ 930 $ 742
=========== =========== =========== ===========
Limited partners' interest in net income (c) $ 41,798 $ 40,611 $ 92,066 $ 73,453
=========== =========== =========== ===========
Net income per limited partner unit (c):
Basic $ 0.77 $ 0.78 $ 1.72 $ 1.44
=========== =========== =========== ===========
Diluted $ 0.77 $ 0.77 $ 1.71 $ 1.44
=========== =========== =========== ===========
Average limited partner units outstanding:
Basic 54,477 52,348 53,632 51,002
=========== =========== =========== ===========
Diluted 54,552 52,442 53,702 51,085
=========== =========== =========== ===========
SUPPLEMENTAL INFORMATION:
Retail gallons sold (millions) 296.8 304.5 1,051.4 1,055.2
EBITDA (d) $ 86,427 $ 84,646 $ 257,691 $ 237,650
Distributable cash (d) 59,405 57,389 151,647 129,643
Capital expenditures:
Maintenance capital expenditures 6,519 6,122 23,501 22,376
Growth capital expenditures 14,617 8,291 44,877 29,905
(a) Net income and net income per limited partner unit for the three- and
twelve-month periods ended December 31, 2004 include a gain of $7,107 and
$0.13, respectively, recognized in connection with the Partnership's sale
of its 50% ownership interest in Atlantic Energy, Inc.
(b) Included in operating and administrative expenses during the twelve-month
period ended December 31, 2003 are $3,756 of costs associated with the
management realignment announced in June 2003.
(c) Effective April 2004, the Partnership adopted Emerging Issues Task Force
Issue No. 03-6, "Participating Securities and the Two-Class Method under
FASB Statement No. 128" ("EITF 03-6"), which results in the calculation of
net income per limited partner unit for each period according to
distributions declared and participation rights in undistributed earnings,
as if all of the earnings for the period had been distributed. In periods
with undistributed earnings above certain levels, the calculation according
to the two-class method results in an increased allocation of undistributed
earnings per unit to the general partner and a dilution of the earnings per
unit for the limited partners. The dilutive effect of EITF 03-6 on basic
and diluted net income per limited partner unit was $(0.03) and $(0.04) for
the three months ended December 31, 2004 and 2003, respectively.
(continued)
AMERIGAS PARTNERS, L.P. AND SUBSIDIARIES
REPORT OF EARNINGS
(Thousands, except per unit and where otherwise indicated)
(Unaudited)
(continued)
(d) EBITDA (earnings before interest expense, income taxes, depreciation and
amortization) should not be considered as an alternative to net income (as
an indicator of operating performance) or as an alternative to cash flow
(as a measure of liquidity or ability to service debt obligations) and is
not a measure of performance or financial condition under accounting
principles generally accepted in the United States ("GAAP"). Management
believes EBITDA is a meaningful non-GAAP financial measure used by
investors to compare the Partnership's operating performance with other
companies within the propane industry and to evaluate our ability to meet
loan covenants.
Management defines distributable cash as EBITDA less interest expense and
maintenance capital expenditures. Maintenance capital expenditures are
defined in the Partnership Agreement as expenditures made to maintain the
operating capacity of the Partnership's existing capital assets. Management
believes distributable cash is a meaningful non-GAAP measure for evaluating
the Partnership's ability to declare and pay the Minimum Quarterly
Distribution pursuant to the terms of the Partnership Agreement. The
Partnership's definition of distributable cash may be different from that
used by other entities.
The following table includes reconciliations of net income to EBITDA and
distributable cash for all periods presented:
Three Months Ended Twelve Months Ended
December 31, December 31,
2004 2003 2004 2003
--------- --------- --------- ---------
Net income $ 44,291 $ 43,149 $ 92,996 $ 74,195
Income tax expense 2,315 707 1,877 1,035
Interest expense 20,503 21,135 82,543 85,631
Depreciation 17,922 18,337 75,053 72,286
Amortization 1,396 1,318 5,222 4,503
--------- --------- --------- ---------
EBITDA 86,427 84,646 257,691 237,650
Interest expense (20,503) (21,135) (82,543) (85,631)
Maintenance capital expenditures (6,519) (6,122) (23,501) (22,376)
--------- --------- --------- ---------
Distributable cash $ 59,405 $ 57,389 $ 151,647 $ 129,643
========= ========= ========= =========