Ferrellgas Partners Reports Solid Start To Fiscal Year

OVERLAND PARK, Kan., Dec. 6, 2013

The partnership reported Adjusted EBITDA of $26.4 million and Distributable Cash Flow of $3.0 million producing trailing 12 month distributable cash flow coverage of 1.08x on cash distributions paid to unitholders.  Revenues grew to $415.0 million, up 14% from $362.9 million in the prior-year quarter, reflecting both an increase in wholesale propane costs and sales volumes.

Gross profit rose 2% to a near record $142.9 million from $140.1 million a year earlier on increased sales volumes partially offset by lower retail margins adversely affected by the higher wholesale cost of propane that rose 20% over the year before.

President and Chief Executive Officer Steve Wambold commented, "Fiscal 2014 is off to a solid start with nationwide winter temperatures forecasted near normal levels this coming season.  Based on these weather forecasts, our first-quarter results and the strength of our underlying fundamentals, we project Adjusted EBITDA between $265 million and $275 million for fiscal 2014."

Propane sales grew 6% to 191.0 million gallons based upon increased wholesale and agricultural demand in the quarter.  Correspondingly, operating expense increased to $103.0 million, from $96.4 million the year before, each representing $0.54 per gallon sold.  General and administrative expense was $9.5 million, compared to $8.1 million in the year prior, each excluding nonrecurring litigation reserve and related legal fees that totaled $1.3 million and $0.7 million, respectively.  The partnership also expensed $0.3 million in the quarter associated with corporate development activities that ultimately did not result in a transaction.  The seasonal first-quarter loss was $25.1 million, or $0.31 per unit, compared to $17.8 million, or $0.22 per unit.

Wambold commented further, "We were very active in our acquisition efforts this quarter bidding on several growth opportunities; successfully acquiring KanGas Corporation, located in Basehor, KS during November.  We will continue to aggressively seek operations that strategically enhance our business operations, while maintaining our strict acquisition criteria."  Wambold concluded, "We further positioned ourselves for growth with the successful offering of $325 million 6.75% senior notes due 2022, which were used to refinance our existing $300 million 9.125% senior notes due 2017, and refinancing of our credit facility.  These transactions immediately increased our borrowing capacity more than $100 million while at the same time materially reducing interest expense going forward; we expect to save approximately $3.0 million in fiscal 2014 and approximately $5.0 million annually thereafter as a result of these transactions."

Ferrellgas Partners, L.P., through its operating partnership Ferrellgas L.P., serves customers in all 50 states, the District of Columbia and Puerto Rico.  Ferrellgas employees indirectly own more than 21 million common units of the partnership through an employee stock ownership plan.  More information about the partnership can be found online at www.ferrellgas.com.