EX-99.3 3 exhibit991.txt EARNINGS RELEASE AND FINANCIAL STATEMENTS Exhibit 99.3 For immediate release Contact: Ryan VanWinkle, Investor Relations, 816-792-7998 Scott Brockelmeyer, Media Relations, 816-792-7837 Ferrellgas Partners, L.P. Reports First Quarter Results Liberty, MO (November 24, 2003)--Ferrellgas Partners, L.P. (NYSE: FGP), one of the nation's largest retail marketers of propane, today reported earnings for the first quarter of fiscal year 2004. The first quarter covers the three-month period ended October 31, 2003. Retail propane sales volume for the first quarter was 176 million gallons, a 2 percent increase, as compared to 172 million gallons sold in the first quarter of fiscal year 2003. This increase in sales volume was primarily the result of acquisitions, partially offset by the lack of sustained cold temperatures this fall which helps to initiate the winter heating season. First quarter gross profit and operating expense were $96.2 million and $72.5 million, respectively, as compared to $92.6 million and $68.4 million recognized in the first quarter of fiscal year 2003, again primarily the result of this quarter's increased retail sales volume. General and administrative expense for the quarter was $6.9 million, essentially unchanged in comparison to the first quarter of fiscal year 2003. Equipment lease expense for the quarter decreased 25 percent to $4.5 million, from $6.0 million, primarily reflecting the Partnership's fiscal year 2003 refinancing of certain operating lease obligations. - more - Ferrellgas Page 2 of 2 The resulting Adjusted EBITDA for the quarter was $12.3 million, as compared to $11.3 million in the first quarter of fiscal year 2003. The Partnership historically experiences a seasonal loss during its first quarter, as sales volumes typically represent less than 20 percent of annual gallon sales, causing fixed costs to exceed off-season cash flow. The first quarter seasonal net loss was $18.6 million, as compared to the prior year's first quarter net loss of $25.0 million, and was consistent with the Partnership's expectations. "Our first quarter's performance is a good start to fiscal 2004 and continues our history of consistent, stable earnings," said James E. Ferrell, Chairman, President and Chief Executive Officer. "This performance comes on the heels of three consecutive fiscal years in which we achieved record or near-record earnings, which should give investors confidence that we know how to effectively manage our business." Ferrellgas Partners, L.P., through its operating partnership, Ferrellgas, L.P., currently serves more than one million customers in 45 states. Ferrellgas employees indirectly own more than 17 million common units of the Partnership through an employee stock ownership plan. Statements in this release concerning expectations for the future are forward-looking statements. A variety of known and unknown risks, uncertainties and other factors could cause results, performance and expectations to differ materially from anticipated results, performance and expectations. These risks, uncertainties and other factors are discussed in the Partnership's Form 10-K for the fiscal year ended July 31, 2003 and other documents filed from time to time by the Partnership with the Securities and Exchange Commission. ### FERRELLGAS PARTNERS, L.P. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands, except unit data) (unaudited) ASSETS October 31, 2003 July 31, 2003 ----------------------------------------------------------------------------- ------------------ ------------------ Current assets: Cash and cash equivalents $ 12,351 $ 11,154 Accounts and notes receivable, net 63,495 56,742 Inventories 103,232 69,077 Prepaid expenses and other current assets 10,893 8,306 ------------------ ------------------ Total current assets 189,971 145,279 Property, plant and equipment, net 683,581 684,917 Goodwill 124,190 124,190 Intangible assets, net 96,743 98,157 Other assets 9,420 8,853 ------------------ ------------------ Total assets $ 1,103,905 $ 1,061,396 ================== ================== LIABILITIES AND PARTNERS' CAPITAL ----------------------------------------------------------------------------- Current liabilities: Accounts payable $ 119,389 $ 59,454 Other current liabilities (a) 74,838 89,687 Short-term borrowings 21,800 - ------------------- ------------------- Total current liabilities 216,027 149,141 Long-term debt (a) 900,807 888,226 Other liabilities 19,607 18,747 Contingencies and commitments - - Minority interest 2,036 2,363 Partners' capital: Senior unitholder (1,994,146 units outstanding at both October 2003 and July 2003 - liquidation preference $79,766 at both October 2003 and July 2003) 79,766 79,766 Common unitholders (37,707,434 and 37,673,455 units outstanding at October 2003 and July 2003, respectively) (52,381) (15,602) General partner unitholder (401,026 and 400,683 units outstanding at October 2003 and July 2003, respectively) (59,670) (59,277) Accumulated other comprehensive loss (2,287) (1,968) ------------------- ------------------- Total partners' capital (34,572) 2,919 ------------------- ------------------- Total liabilities and partners' capital $ 1,103,905 $ 1,061,396 =================== =================== (a) The principal difference between the Ferrellgas Partners, L.P. balance sheet and that of Ferrellgas, L.P., is $218 million of 8 3/4% notes and a $10 million short-term note payable, which are liabilities of Ferrellgas Partners, L.P. and not of Ferrellgas, L.P.
FERRELLGAS PARTNERS, L.P. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EARNINGS FOR THE THREE MONTHS ENDED OCTOBER 31, 2003 AND 2002 (in thousands, except per unit data) (unaudited) Three months ended October 31 ----------------------------- 2003 2002 ------------ ------------ Revenues: Propane and other gas liquids sales $ 232,054 $ 194,900 Other 23,360 21,414 ------------ ------------ Total revenues 255,414 216,314 Cost of product sold 159,249 123,672 ------------ ------------ Gross profit 96,165 92,642 Operating expense 72,479 68,428 Depreciation and amortization expense 11,195 9,895 General and administrative expense 6,891 6,902 Equipment lease expense 4,511 5,992 Employee stock ownership plan compensation charge 1,784 1,395 Loss on disposal of assets and other 1,626 671 ------------ ------------ Operating loss (2,321) (641) Interest expense (16,794) (14,696) Interest income 331 62 Early extinguishment of debt expense (a) - (7,052) ------------ ------------ Loss before minority interest and cumulative effect of change in accounting principle (18,784) (22,327) Minority interest (b) (138) (115) ------------ ------------ Loss before cumulative effect of change in accounting principle (18,646) (22,212) Cumulative effect of change in accounting principle, net of minority interest of $28 (c) - (2,754) ------------ ------------ Net loss (18,646) (24,966) Distribution to senior unitholder 1,994 2,782 Net loss available to general partner (206) (277) ------------ ------------ Net loss available to common unitholders $ (20,434) $ (27,471) ============ ============ Basic loss per common unit: Loss before cumulative effect of change in accounting principle (d) $ (0.54) $ (0.69) Net loss available to common unitholders $ (0.54) $ (0.76) Weighted average common units outstanding 37,704.7 36,088.1 Supplemental Data and Reconciliation of Non-GAAP Item: Three months ended October 31 ----------------------------- 2003 2002 ------------ ------------ Retail gallons 175,572 172,026 ============ ============ Net loss $ (18,646) $ (24,966) Interest expense 16,794 14,696 Depreciation and amortization expense 11,195 9,895 Interest income (331) (62) ------------ ------------ EBITDA $ 9,012 $ (437) Employee stock ownership plan compensation charge 1,784 1,395 Loss on disposal of assets and other 1,626 671 Minority interest (b) (138) (115) Early extinguishment of debt expense (a) - 7,052 Cumulative effect of change in accounting principle (c) - 2,754 ------------ ------------ Adjusted EBITDA (e) $ 12,284 $ 11,320 ============ ============ (a) Expenses related to the refinancing of the $160 million Ferrellgas Partners, L.P. senior secured debt in September 2002. (b) Amounts allocated to the general partner for its 1.0101% interest in the operating partnership, Ferrellgas, L.P. (c) Amount related to recognition of liabilities for future retirements of underground storage facilities, as required by SFAS No. 143. (d) Amount calculated as 99% of the earnings (loss) before cumulative effect of change in accounting principle less distribution to senior unitholder; the result then divided by the weighted average common units outstanding. (e) Management considers Adjusted EBITDA to be a chief measurement of the partnership's overall economic performance and return on invested capital. Adjusted EBITDA is calculated as earnings before interest, income taxes, depreciation and amortization, employee stock ownership compensation charge, loss from disposal of assets and other, minority interest, early extinguishment of debt expense, cumulative effect of change in accounting principle and other non-cash and non-operating charges. 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 are unusual or non-recurring, and makes it easier to compare its results with other companies that have different financing and capital structures. In addition, management believes this measure is consistent with the manner in which the partnership's lenders and investors measure its overall performance and liquidity, including its ability to pay quarterly equity distributions, service its long-term debt and other fixed obligations and to fund its capital expenditures and working capital requirements. 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.