EX-99 2 w23476exv99.txt PRESS RELEASE OF AMERIGAS PARTNERS, L.P. DATED JULY 26, 2006 [AMERIGAS PARTNERS, L.P. LOGO] NEWS PARTNERS, L.P. BOX 965, VALLEY FORGE, PA 19482 (610) 337-7000 Contact: 610-337-1000 For Immediate Release: Robert W. Krick, ext. 3645 July 26, 2006 Brenda A. Blake, ext. 3202 AMERIGAS PARTNERS REPORTS THIRD QUARTER RESULTS, AFFIRMS 2006 GUIDANCE VALLEY FORGE, Pa., July 26 - AmeriGas Propane, Inc., general partner of AmeriGas Partners, L.P. (NYSE: APU), reported a seasonal net loss for the third fiscal quarter ended June 30, 2006 of $14.8 million compared to a loss of $17.7 million, excluding a loss on the early extinguishment of debt, in the same period last year. Including the loss on the early extinguishment of debt of $33.6 million, the prior year third quarter net loss was $51.3 million. Average diluted units outstanding were 4.2% higher for the recent quarter principally as a result of a common unit offering in September 2005. The Partnership's earnings before interest expense, income taxes, depreciation and amortization (EBITDA) were $20.7 million for the third fiscal quarter of 2006 compared to EBITDA of $19.9 million, excluding the loss on extinguishment of debt of $33.6 million (adjusted EBITDA), a year ago. EBITDA in the 2005 fiscal third quarter, including the loss on extinguishment of debt, was a loss of $13.7 million. Eugene V. N. Bissell, chief executive officer of AmeriGas, said, "Our retail volumes declined 10.8 million gallons to 171.1 million gallons this quarter due to warmer weather and price-induced customer conservation. Weather for the quarter was 21.9% warmer than normal compared to weather that was 4.9% warmer than normal in the prior-year period, according to the National Oceanic and Atmospheric Administration (NOAA). Despite the lower volumes, we continue to expect to earn adjusted EBITDA in the range of $245 million to $255 million for the fiscal year ending September 30, 2006." Revenues for the quarter were $379.1 million versus $349.5 million a year ago due to higher retail selling prices partially offset by lower sales volumes due to warmer weather and customer conservation. Operating and administrative expenses increased $3.8 million during the quarter due to higher vehicle fuel and lease costs, higher employee compensation and benefits expense and increased bad debt expense partially offset by a favorable net adjustment in reserves for general insurance, mainly reflecting continued improvement in claims history. -MORE- AMERIGAS PARTNERS REPORTS THIRD QUARTER RESULTS, PAGE 2 AFFIRMS 2006 GUIDANCE AmeriGas Partners is the nation's largest retail propane marketer, serving nearly 1.3 million customers from approximately 650 locations in 46 states. UGI Corporation (NYSE:UGI), through subsidiaries, owns 44% of the Partnership and individual unitholders own the remaining 56%. AmeriGas Partners, L. P. will host its third quarter FY 2006 earnings conference call on Wednesday, July 26, 2006, 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 1-888-203-1112, passcode 4258637 (International replay 719-457-0820, passcode 4258637) through midnight Friday, July 28, 2006. The financial table appended to this news release can be viewed directly at HTTP://WWW.SHAREHOLDER.COM/UGI/APU/3Q06FINANCIALTABLE.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. 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, price volatility and availability of propane, increased customer conservation measures, the capacity to transport propane to our market areas and political, economic and regulatory conditions in the U. S. and abroad. 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-10 ### 7/26/06 AMERIGAS PARTNERS, L.P. AND SUBSIDIARIES REPORT OF EARNINGS (Thousands, except per unit and where otherwise indicated) (Unaudited)
Three Months Ended Nine Months Ended Twelve Months Ended June 30, June 30, June 30, ------------------------- ------------------------- ------------------------- 2006 2005 2006 2005 (a) 2006 2005 (a) ----------- ----------- ----------- ----------- ----------- ----------- Revenues: Propane $ 338,047 $ 315,992 $ 1,604,821 $ 1,497,120 $ 1,927,360 $ 1,776,907 Other 41,062 33,477 122,642 106,833 159,406 139,931 ----------- ----------- ----------- ----------- ----------- ----------- 379,109 349,469 1,727,463 1,603,953 2,086,766 1,916,838 ----------- ----------- ----------- ----------- ----------- ----------- Costs and expenses: Cost of sales - propane 215,900 194,744 1,041,719 946,794 1,256,733 1,118,582 Cost of sales - other 18,456 14,231 47,738 43,083 62,853 56,817 Operating and administrative expenses 128,469 124,698 403,502 392,411 529,218 512,201 Depreciation 16,729 16,889 50,485 51,824 66,769 71,729 Amortization 1,111 1,332 3,524 4,145 4,896 5,413 Other (income), net (4,429) (4,070) (13,368) (21,526) (17,623) (22,321) ----------- ----------- ----------- ----------- ----------- ----------- 376,236 347,824 1,533,600 1,416,731 1,902,846 1,742,421 ----------- ----------- ----------- ----------- ----------- ----------- Operating income 2,873 1,645 193,863 187,222 183,920 174,417 Loss on extinguishment of debt -- (33,602) (17,079) (33,602) (17,079) (33,602) Interest expense (17,820) (19,722) (56,167) (60,958) (75,109) (81,315) ----------- ----------- ----------- ----------- ----------- ----------- Income (loss) before income taxes (14,947) (51,679) 120,617 92,662 91,732 59,500 Income tax benefit (expense) 105 324 (2) (1,809) 293 (1,687) Minority interests 5 79 (1,680) (1,616) (1,482) (1,389) ----------- ----------- ----------- ----------- ----------- ----------- Net income (loss) $ (14,837) $ (51,276) $ 118,935 $ 89,237 $ 90,543 $ 56,424 =========== =========== =========== =========== =========== =========== General partner's interest in net income (loss) (b) $ (148) $ (513) $ 3,134 $ 892 $ 905 $ 564 =========== =========== =========== =========== =========== =========== Limited partners' interest in net income (loss) (b) $ (14,689) $ (50,763) $ 115,801 $ 88,345 $ 89,638 $ 55,860 =========== =========== =========== =========== =========== =========== Net income (loss) per limited partner unit (b) Basic $ (0.26) $ (0.93) $ 2.04 $ 1.62 $ 1.59 $ 1.03 =========== =========== =========== =========== =========== =========== Diluted $ (0.26) $ (0.93) $ 2.04 $ 1.62 $ 1.59 $ 1.02 =========== =========== =========== =========== =========== =========== Average limited partner units outstanding: Basic 56,797 54,493 56,797 54,487 56,330 54,484 =========== =========== =========== =========== =========== =========== Diluted 56,797 54,493 56,833 54,541 56,370 54,544 =========== =========== =========== =========== =========== =========== SUPPLEMENTAL INFORMATION: Retail gallons sold (millions) 171.1 181.9 804.4 857.5 981.8 1,033.0 EBITDA (c) (d) $ 20,718 $ (13,657) $ 229,113 $ 207,973 $ 237,024 $ 216,568 Distributable cash (c) (1,529) (3,751) 173,061 165,098 158,288 145,357 Capital expenditures: Maintenance capital expenditures 4,427 3,974 16,964 15,519 20,706 23,498 Growth capital expenditures 11,642 11,095 34,706 34,619 43,443 43,684
(a) Net income for the nine and twelve months ended June 30, 2005 includes a gain of $7,107 recognized in connection with the Partnership's sale of its 50% ownership interest in Atlantic Energy, Inc. (b) In accordance with Emerging Issues Task Force Issue No. 03-6, "Participating Securities and the Two-Class Method under FASB Statement No. 128" ("EITF 03-6") the Partnership calculates 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 net income per diluted limited partner unit was $(0.03) for the nine months ended June 30, 2006. There was no dilutive effect of EITF 03-6 for the three months ended June 30, 2006 or for the three or nine months ended June 30, 2005. Because EITF 03-6 does not currently impact the calculation of Partnership net income per limited partner unit on an annual basis, annual net income per limited partner unit is not equal to the sum of net income per limited partner unit for each of the Partnership's quarterly periods. (c) 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. 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. (continued) 1 AMERIGAS PARTNERS, L.P. AND SUBSIDIARIES REPORT OF EARNINGS (Thousands, except per unit and where otherwise indicated) (Unaudited) (continued) Management defines distributable cash as EBITDA less interest expense and maintenance capital expenditures and excluding losses on extinguishments of debt in connection with a refinancing. 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 quarterly distributions. 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 Nine Months Ended Twelve Months Ended June 30, June 30, June 30, ------------------------ ------------------------ ------------------------ 2006 2005 2006 2005 2006 2005 --------- --------- --------- --------- --------- --------- Net income $ (14,837) $ (51,276) $ 118,935 $ 89,237 $ 90,543 $ 56,424 Income tax (benefit) expense (105) (324) 2 1,809 (293) 1,687 Interest expense 17,820 19,722 56,167 60,958 75,109 81,315 Depreciation 16,729 16,889 50,485 51,824 66,769 71,729 Amortization 1,111 1,332 3,524 4,145 4,896 5,413 --------- --------- --------- --------- --------- --------- EBITDA 20,718 (13,657) 229,113 207,973 237,024 216,568 Interest expense (17,820) (19,722) (56,167) (60,958) (75,109) (81,315) Maintenance capital expenditures (4,427) (3,974) (16,964) (15,519) (20,706) (23,498) Loss on extinguishment of debt -- 33,602 17,079 33,602 17,079 33,602 --------- --------- --------- --------- --------- --------- Distributable cash $ (1,529) $ (3,751) $ 173,061 $ 165,098 $ 158,288 $ 145,357 ========= ========= ========= ========= ========= =========
(d) The following table includes a reconciliation of forecasted net income to forecasted adjusted EBITDA (EBITDA excluding the loss on extinguishment of debt) for the fiscal year ending September 30, 2006:
Forecast Fiscal Year Ending September 30, 2006 ------------- Net income (estimate) $ 86,000 Income Tax expense (estimate) -- Interest expense (estimate) 74,000 Depreciation (estimate) 68,000 Amortization (estimate) 5,000 Loss on early extinguishment of debt (estimate) 17,000 -------- Adjusted EBITDA (estimate) $250,000 ========
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