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News2019-02-27T18:24:31-04:00
Suburban Propane Partners, L.P. Announces Third Quarter Results And Increases Quarterly Distribution to $0.5875 Per Common Unit

WHIPPANY, N.J., July 24 /PRNewswire-FirstCall/ -- Suburban Propane Partners, L.P. (NYSE: SPH), a marketer of propane gas and related products and services nationwide, today announced its results for the third quarter ended June 28, 2003. The Partnership also announced the seventh increase in its quarterly distribution from $0.5750 to $0.5875 per Common Unit -- $2.35 per Common Unit annualized. The increased distribution will be payable on August 12, 2003, to Common Unitholders of record as of August 5, 2003.

Consistent with the seasonal nature of the propane industry, the Partnership typically experiences a net loss in the third quarter. For the third quarter of fiscal 2003, Suburban's net loss was $11.9 million, or $0.47 per Common Unit, compared to a net loss of $11.0 million, or $0.44 per Common Unit, for the third quarter of fiscal 2002. Earnings before interest, taxes, depreciation and amortization ("EBITDA") amounted to $3.2 million in the third quarter of fiscal 2003, compared to $4.5 million for the prior year period.

Retail gallons sold increased 2.9 million gallons, or 3.3%, to 89.6 million gallons in the fiscal 2003 third quarter, compared to 86.7 million gallons in the prior year period. The increase in retail volumes is primarily attributable to cooler temperatures that extended well into the spring, particularly in the Northeast and Mid-Atlantic regions of the country.

Revenues increased $8.6 million, or 6.3%, to $146.2 million for the three months ended June 28, 2003, compared to $137.6 million in the prior year quarter. The increase in revenues is primarily the result of an increase in average selling prices in line with the significant increase in product costs compared to the prior year quarter, coupled with the aforementioned increase in retail sales volumes.

Combined operating and general and administrative expenses of $69.7 million increased $1.1 million, or 1.6%, compared to the prior year quarter of $68.6 million. Operating expenses in the fiscal 2003 third quarter included a $0.1 million unrealized gain attributable to the mark to market on derivative instruments ("FAS 133"), compared to a $1.0 million unrealized loss in the prior year quarter attributable to FAS 133. Offsetting the impact of FAS 133, combined operating and general and administrative expenses increased $2.2 million compared to the prior year quarter. The increase was primarily attributable to higher bad debt expense and vehicle costs (primarily fuel costs) reflecting increased business activity throughout the fiscal 2003 winter heating season, a higher commodity price environment and general economic conditions, as well as higher pension and insurance costs.

In announcing these results, President and Chief Executive Officer Mark A. Alexander said, "In addition to achieving solid results for the quarter, we took additional steps to further strengthen our balance sheet with the successful completion of our follow-on equity offering of approximately 2.6 million Common Units. We used the net proceeds from the offering of $72.4 million, in combination with our strong cash flow from operations, to pay down debt of approximately $88.5 million in a conscious effort to reduce our leverage. With these accomplishments, we are also pleased to announce yet another increase in our quarterly distribution, our seventh increase in four years. This history of steady distribution increases is proof of our commitment to providing continued value and growth opportunities to our Unitholders."

Suburban Propane Partners, L.P. is a publicly traded Master Limited Partnership listed on the New York Stock Exchange. Headquartered in Whippany, New Jersey, Suburban has been in the customer service business since 1928. The Partnership serves approximately 750,000 residential, commercial, industrial and agricultural customers through more than 320 customer service centers in 40 states.

                 Suburban Propane Partners, L.P. and Subsidiaries
                      Consolidated Statements of Operations
       For the Three and Nine Months Ended June 28, 2003 and June 29, 2002
                     (in thousands, except per unit amounts)
                                   (unaudited)

                                      Three Months Ended   Nine Months Ended
                                       June 28,  June 29,  June 28,  June 29,
                                         2003      2002      2003      2002

    Revenues
      Propane                          $126,144 $115,571 $577,006 $482,166
      Other (a)                          20,027    22,064    69,069    73,220
                                        146,171   137,635   646,075   555,386

    Costs and expenses
      Cost of products sold              73,325    64,444   314,213   241,033
      Operating                          61,193    60,589   190,211   177,996
      General and administrative          8,534     8,053    27,704    23,369
      Depreciation and amortization       6,717     7,048    20,490    21,379
      Gain on sale of storage facility        -         -         -    (6,768)
                                        149,769   140,134   552,618   457,009

    (Loss) / income before interest
     expense and provision for
     income taxes                        (3,598)   (2,499)   93,457    98,377
    Interest expense, net                 8,480     8,339    26,212    26,373

    (Loss) / income before provision
     for income taxes                   (12,078)  (10,838)   67,245    72,004
    (Benefit) / provision for income
     taxes                                  (64)      190       103       518
    (Loss) / income from continuing
     operations                         (12,014)  (11,028)   67,142    71,486
    Discontinued operations:
      Gain on sale of customer service
       centers                               79         -     2,483         -

    Net (loss) / income                $(11,935) $(11,028)  $69,625 $71,486

    General Partner's interest in net
     (loss) / income                      $(320)    $(281)   $1,755 $1,482
    Limited Partners' interest in net
     (loss) / income                   $(11,615) $(10,747)  $67,870 $70,004

    (Loss) / income from continuing
     operations per unit - basic         $(0.47)   $(0.44)    $2.65 $2.84
    Net (loss) / income per unit -
     basic                               $(0.47)   $(0.44)    $2.74 $2.84
    Weighted average number of units
     outstanding - basic                 24,918    24,631    24,727    24,631

    (Loss) / income from continuing
     operations per unit - diluted       $(0.47)   $(0.44)    $2.64 $2.84
    Net (loss) / income per unit -
     diluted                             $(0.47)   $(0.44)    $2.74 $2.84
    Weighted average number of units
     outstanding - diluted               24,918    24,631    24,793    24,665

    Supplemental Information:
    EBITDA (b)                           $3,198 $4,549 $116,430 $119,756
    Retail gallons sold                  89,600    86,730   412,490   379,309

    (a) Other revenues principally represent amounts generated from the sales
        of appliances, parts and related services.

    (b) EBITDA represents income before deducting interest expense, income
        taxes, depreciation and amortization.  Our management uses EBITDA as a
        measure of liquidity and we are including it because we believe that
        it provides our investors and industry analysts with additional
        information to evaluate our ability to meet our debt service
        obligations and to pay our quarterly distributions to holders of our
        common units.  Moreover, our senior note agreements and our revolving
        credit agreement require us to use EBITDA in calculating our leverage
        and interest coverage ratios.  EBITDA is not a recognized term under
        generally accepted accounting principles ("GAAP") and should not be
        considered as an alternative to net income or net cash provided by
        operating activities determined in accordance with GAAP.  Because
        EBITDA, as determined by us, excludes some, but not all, items that
        affect net income, it may not be comparable to EBITDA or similarly
        titled measures used by other companies.  The following table sets
        forth (i) our calculation of EBITDA and (ii) a reconciliation of
        EBITDA, as so calculated, to our net cash provided by operating
        activities:

                                        Three Months Ended  Nine Months Ended
                                         June 28,  June 29,  June 28, June 29,
                                           2003      2002     2003     2002

    Net (loss) / income                  $(11,935) $(11,028) $69,625 $71,486
    Add:
      (Benefit) / provision for income
       taxes                                  (64)      190      103      518
      Interest expense, net                 8,480     8,339   26,212   26,373
      Depreciation and amortization         6,717     7,048   20,490   21,379
    EBITDA                                  3,198     4,549  116,430  119,756
    Add / (subtract):
      Benefit / (provision) for income
       taxes                                   64      (190)    (103)    (518)
      Interest expense, net                (8,480)   (8,339) (26,212) (26,373)
      (Gain) / loss on disposal of
       property, plant and equipment,
       net                                   (166)       63     (486)    (213)
      Gain on sale of customer service
       centers                                (79)        -   (2,483)       -
      Gain on sale of storage facility          -         -        -   (6,768)
      Changes in working capital and
       other assets and liabilities        51,020    33,823  (18,223) (19,856)
    Net cash provided by operating
     activities                           $45,557 $29,906 $68,923 $66,028 
SOURCE  Suburban Propane Partners, L.P.
    -0-                             07/24/2003
    /CONTACT:  Robert M. Plante, Vice President - Finance, Suburban Propane
Partners, L.P., +1-973-503-9252/
    /Company News On-Call:  http://www.prnewswire.com/comp/112074.html/
    /Web site:  http://suburbanpropane.com/
    (SPH)

CO:  Suburban Propane Partners, L.P.
ST:  New Jersey
IN:  OIL
SU:  ERN DIV

MW 
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6184 07/24/2003 07:27 EDT http://www.prnewswire.com