AmeriGas Partners Reports Fiscal 2016 First Quarter Earnings
AmeriGas Propane, Inc., general partner of AmeriGas Partners, L.P.
(NYSE: APU), reported adjusted net income attributable to AmeriGas
Partners for the quarter ended December 31, 2015 of $86.5 million,
compared to adjusted net income of $97.3 million for the quarter ended
December 31, 2014. Adjusted net income attributable to AmeriGas Partners
eliminates the impact of mark-to-market changes in commodity derivative
instruments not associated with current period transactions. Most of the
mark-to-market adjustments relate to our normal business practice of
hedging fixed-price commitments to our customers. On a GAAP basis,
including the impact of such mark-to-market changes, AmeriGas Partners
reported net income of $81.0 million for the quarter ended December 31,
2015, compared to a loss of $39.6 million in the prior year.
The Partnership’s adjusted earnings before interest expense, income
taxes, depreciation and amortization (Adjusted EBITDA) was $177.7
million for the first fiscal quarter compared with $188.5 million in the
prior year. Retail volumes sold for the quarter decreased 13.3% to 295.1
million gallons from 340.2 million gallons in the prior year. The
decrease in retail gallons sold reflects temperatures that were 16.8%
warmer than the prior year according to the National Oceanic and
Atmospheric Administration (NOAA).
Jerry E. Sheridan, president and chief executive officer of AmeriGas,
said, “Although this was a challenging quarter with weather that was
approximately 20% warmer than normal and nearly 17% warmer than the
prior year, we were pleased to deliver adjusted EBITDA that was only 6%
below the prior year. This performance was made possible through a focus
on operational efficiency and cost containment, as operating expenses
decreased nearly $16 million from last year’s quarter. We were pleased
to see continued moderation in propane commodity costs, which were 45%
lower than the prior-year period. Lower propane prices are good for our
customers as they benefit from lower bills, and good for our business as
we face lower working capital needs and collection-related expenses.
Overall, the business remains strong, with a healthy balance sheet and
ability to fund our growth initiatives without accessing the capital
markets.”
Sheridan continued, “We also continued to make solid progress on each of
our growth initiatives. We completed three acquisitions in the quarter
which, collectively, are expected to add approximately the same amount
of volume as the nine acquisitions we completed in the entire prior
fiscal year. Our National Accounts program added 21 new customer
contracts and our Cylinder Exchange program secured customers that will
add 2,500 new locations this fiscal year. Due to the importance of the
second fiscal quarter to full year results, we intend to update our
guidance for the 2016 fiscal year following the completion of our second
fiscal quarter on March 31, 2016.”
About AmeriGas
AmeriGas is the nation’s largest retail propane marketer, serving
approximately two million customers in all 50 states from approximately
2,000 distribution locations. UGI Corporation, through subsidiaries, is
the sole General Partner and owns 26% of the Partnership and the public
owns the remaining 74%.
AmeriGas Partners, L.P. will hold a live Internet Audio Webcast of
its conference call to discuss fiscal 2016 first quarter earnings and
other current activities at 9:00 AM ET on Tuesday, February 2, 2016.
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
12:00 PM ET on February 2 through 11:59 PM on February 9. The replay may
be accessed at (855) 859-2056, and internationally at 1-404-537-3406,
conference ID 13051514.
Comprehensive information about AmeriGas is available on the Internet at http://www.amerigas.com.
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, political, economic and regulatory conditions in the
U.S. and abroad, and our ability to successfully integrate acquisitions
and achieve anticipated synergies. The Partnership undertakes no
obligation to release revisions to its forward-looking statements to
reflect events or circumstances occurring after today.
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AMERIGAS PARTNERS, L.P. AND SUBSIDIARIES
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REPORT OF EARNINGS
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(Thousands, except per unit and where otherwise indicated)
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(Unaudited)
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Three Months Ended
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Twelve Months Ended
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December 31,
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December 31,
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2015
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2014
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2015
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2014
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Revenues:
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Propane
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$
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573,904
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$
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812,735
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$
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2,373,570
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$
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3,283,301
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Other
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70,194
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76,057
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267,058
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272,600
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644,098
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888,792
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2,640,628
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3,555,901
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Costs and expenses:
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Cost of sales - propane
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227,922
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578,541
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950,548
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2,050,685
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Cost of sales - other
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20,867
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22,040
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85,465
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83,763
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Operating and administrative expenses
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230,889
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246,651
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937,521
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973,066
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Depreciation
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38,606
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38,682
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152,128
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151,199
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Amortization
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10,600
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10,686
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42,590
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43,062
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Other operating income, net
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(8,907
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(10,148
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(30,114
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(31,154
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519,977
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886,452
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2,138,138
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3,270,621
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Operating income (loss)
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124,121
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2,340
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502,490
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285,280
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Interest expense
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(41,025
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(41,034
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(162,833
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(165,025
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Income (loss) before income taxes
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83,096
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(38,694
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339,657
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120,255
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Income tax expense
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(910
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(870
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(2,938
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(2,050
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Net income (loss) including noncontrolling interest
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82,186
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(39,564
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)
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336,719
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118,205
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Deduct net income attributable to noncontrolling interest
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(1,213
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(7
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(4,964
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(2,781
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Net income (loss) attributable to AmeriGas Partners, L.P.
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$
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80,973
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$
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(39,571
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$
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331,755
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$
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115,424
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General partner's interest in net income (loss) attributable to
AmeriGas Partners, L.P.
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$
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9,455
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$
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6,137
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$
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35,787
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$
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26,146
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Limited partners' interest in net income (loss) attributable to
AmeriGas Partners, L.P.
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$
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71,518
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$
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(45,708
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$
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295,968
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$
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89,278
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Income (loss) per limited partner unit (a)
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Basic
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$
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0.77
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$
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(0.49
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$
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3.16
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$
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0.95
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Diluted
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$
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0.77
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$
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(0.49
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$
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3.16
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$
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0.95
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Average limited partner units outstanding:
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Basic
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92,922
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92,893
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92,916
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92,887
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Diluted
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93,004
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92,893
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92,983
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92,953
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SUPPLEMENTAL INFORMATION:
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Retail gallons sold (millions)
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295.1
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340.2
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1,139.2
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1,241.7
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Wholesale gallons sold (millions)
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14.9
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14.2
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55.1
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70.1
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Total margin (b)
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$
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395,309
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$
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288,211
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$
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1,604,615
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$
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1,421,453
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Adjusted total margin (c)
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$
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400,942
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$
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426,441
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$
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1,519,859
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$
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1,569,178
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EBITDA (c)
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$
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172,114
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$
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51,701
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$
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692,244
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$
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476,760
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Adjusted EBITDA (c)
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$
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177,690
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$
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188,535
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$
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608,344
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$
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622,993
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Adjusted net income attributable to AmeriGas Partners, L.P. (c)
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$
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86,549
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$
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97,263
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$
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247,855
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$
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261,657
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Expenditures for property, plant and equipment:
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Maintenance capital expenditures
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$
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12,915
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$
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17,013
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$
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53,717
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$
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73,562
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Growth capital expenditures
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$
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15,059
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$
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13,417
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$
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45,836
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$
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47,533
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(a)
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Income (loss) 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, 2015.
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(b)
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Total margin represents total revenues less cost of sales — propane
and cost of sales — other.
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(c)
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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.,
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.
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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 years. Management also uses Adjusted EBITDA to
assess the Partnership’s profitability because its parent, UGI
Corporation, uses the Partnership’s EBITDA, as adjusted to exclude
gains and losses on commodity derivative instruments not
associated with current-period transactions, to assess the
profitability of the Partnership which is one of UGI Corporation’s
industry segments. UGI Corporation discloses the Partnership’s
EBITDA, as so adjusted, in its disclosure about industry segments
as the profitability measure for its domestic propane segment.
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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.
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The following tables include 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 for all the
periods presented:
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Three Months Ended
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Twelve Months Ended
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December 31,
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December 31,
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2015
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2014
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2015
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2014
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Adjusted total margin:
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Total revenues
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$
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644,098
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$
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888,792
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$
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2,640,628
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$
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3,555,901
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Cost of sales - propane
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(227,922
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)
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(578,541
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)
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(950,548
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(2,050,685
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Cost of sales - other
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(20,867
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(22,040
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(85,465
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(83,763
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Total margin
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395,309
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288,211
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1,604,615
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1,421,453
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Add net losses (subtract net gains) on commodity derivative
instruments not associated with current-period transactions
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5,633
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138,230
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(84,756
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)
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147,725
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Adjusted total margin
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$
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400,942
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$
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426,441
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$
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1,519,859
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$
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1,569,178
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Adjusted net income attributable to AmeriGas Partners, L.P.:
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Net income (loss) attributable to AmeriGas Partners, L.P.
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$
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80,973
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$
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(39,571
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)
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$
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331,755
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$
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115,424
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Add net losses (subtract net gains) on commodity derivative
instruments not associated with current-period transactions
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5,633
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138,230
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(84,756
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)
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147,725
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Noncontrolling interest in net gains (losses) on commodity
derivative instruments not associated with current-period
transactions
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(57
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)
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(1,396
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)
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856
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(1,492
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)
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Adjusted net income attributable to AmeriGas Partners, L.P.
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$
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86,549
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$
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97,263
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$
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247,855
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$
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261,657
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Three Months Ended
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Twelve Months Ended
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December 31,
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December 31,
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2015
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2014
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2015
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2014
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EBITDA and Adjusted EBITDA:
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|
|
|
|
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Net income (loss) attributable to AmeriGas Partners, L.P.
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$
|
80,973
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|
$
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(39,571
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)
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|
|
$
|
331,755
|
|
|
$
|
115,424
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|
Income tax expense
|
|
|
|
910
|
|
|
|
870
|
|
|
|
|
2,938
|
|
|
|
2,050
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|
Interest expense
|
|
|
|
41,025
|
|
|
|
41,034
|
|
|
|
|
162,833
|
|
|
|
165,025
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|
Depreciation
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|
|
|
38,606
|
|
|
|
38,682
|
|
|
|
|
152,128
|
|
|
|
151,199
|
|
Amortization
|
|
|
|
10,600
|
|
|
|
10,686
|
|
|
|
|
42,590
|
|
|
|
43,062
|
|
EBITDA
|
|
|
|
172,114
|
|
|
|
51,701
|
|
|
|
|
692,244
|
|
|
|
476,760
|
|
Add net losses (subtract net gains) on commodity derivative
instruments not associated with current-period transactions
|
|
|
|
5,633
|
|
|
|
138,230
|
|
|
|
|
(84,756
|
)
|
|
|
147,725
|
|
|
|
|
|
|
|
|
|
|
|
|
Noncontrolling interest in net gains (losses) on commodity
derivative instruments not associated with current-period
transactions
|
|
|
|
(57
|
)
|
|
|
(1,396
|
)
|
|
|
|
856
|
|
|
|
(1,492
|
)
|
Adjusted EBITDA
|
|
|
$
|
177,690
|
|
|
$
|
188,535
|
|
|
|
$
|
608,344
|
|
|
$
|
622,993
|
|
|
|
|
|
|
|
|
|
|
|
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20160201006400/en/ Copyright Business Wire 2016
Source: Business Wire
(February 1, 2016 - 6:15 PM EST)
News by QuoteMedia
www.quotemedia.com
|