{"id":379478,"date":"2020-11-12T07:33:36","date_gmt":"2020-11-12T12:33:36","guid":{"rendered":"http:\/\/www.marketnewsdesk.com\/?p=379478"},"modified":"2020-11-12T07:33:36","modified_gmt":"2020-11-12T12:33:36","slug":"suburban-propane-partners-l-p-announces-full-year-and-fourth-quarter-results","status":"publish","type":"post","link":"https:\/\/www.marketnewsdesk.com\/index.php\/suburban-propane-partners-l-p-announces-full-year-and-fourth-quarter-results\/","title":{"rendered":"Suburban Propane Partners, L.P. Announces Full Year and Fourth Quarter Results"},"content":{"rendered":"
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PR Newswire<\/p>\n<\/p><\/div>\n

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\n WHIPPANY, N.J.<\/span>, Nov. 12, 2020<\/span> \/PRNewswire\/ —\u00a0Suburban Propane Partners, L.P. (NYSE: SPH), a nationwide distributor of propane, fuel oil and related products and services, as well as a marketer of natural gas and electricity, today announced earnings for its full year and fourth quarter ended September 26, 2020<\/span>. <\/p>\n

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\n \"Suburban
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\n Fiscal Year 2020 Results
<\/b>Net income for fiscal 2020 was $60.8 million<\/span>, or $0.98<\/span> per Common Unit, compared to $68.6 million<\/span>, or $1.11<\/span> per Common Unit, in fiscal 2019. <\/p>\n

Net income and EBITDA (as defined and reconciled below) for fiscal 2020 included a $1.1 million<\/span> pension settlement charge and a $0.1 million<\/span> loss on debt extinguishment.\u00a0 Excluding the effects of the foregoing items and unrealized non-cash mark-to-market adjustments on derivative instruments in both years, Adjusted EBITDA (as defined and reconciled below) amounted to $253.7 million<\/span> for fiscal 2020, compared to $275.0 million<\/span> in the prior year. <\/p>\n

In announcing these results, President and Chief Executive Officer Michael A. Stivala<\/span> said, “In the face of one of the most challenging operating environments, resulting from near record warm temperatures in the heart of the heating season followed by the unprecedented health and economic crisis from COVID-19, fiscal 2020 was a very successful year for Suburban Propane.\u00a0 Despite the headwinds, we made significant strides in advancing our strategic growth and our Three Pillars corporate initiatives. Specifically, in furtherance of our Commitment to Excellence pillar, we took decisive action to adapt our business model and modify our operating protocols in order to help protect the health and safety of our employees, while ensuring seamless delivery of our essential services to the customers and communities we serve.\u00a0 Through our SuburbanCares pillar, we partnered with a number of major regional food service brands to provide support to frontline health care workers in multiple locations throughout our operating territory.” <\/p>\n

Mr. Stivala continued, “In our Go Green<\/span> pillar, we made advancements in our efforts to advocate for the clean burning attributes of propane, while also making strategic investments in new technologies that can contribute to lowering greenhouse gas emissions.\u00a0 In line with our strategic growth initiatives, in September 2020<\/span> we acquired a 39% equity interest in Oberon Fuels, a development-stage producer of a low-carbon transportation fuel which, when blended with propane can significantly reduce its carbon intensity.\u00a0 To further support our efforts to invest in innovative solutions to pave the way to zero-carbon emissions, we also entered into a large supply agreement to acquire renewable propane, produced entirely from renewal sources, such as waste fats and oils, to help meet customer demand for renewable energy solutions.”<\/p>\n

Concluding his remarks, Mr. Stivala said, “We are extremely proud of our accomplishments in the face of unprecedented challenges.\u00a0 We remained focused on navigating the business through the crisis, ended fiscal year 2020 with the strongest second half performance in our history and invested excess cash flows in a balanced way to reduce debt and fund strategic growth.\u00a0 We continue to position the business for long-term sustainable growth.” <\/p>\n

Retail propane gallons sold in fiscal 2020 of 402.9 million gallons decreased 5.6% compared to the prior year, primarily due to warmer than normal weather conditions during the most critical months for heat-related demand.\u00a0 While average temperatures (as measured by heating degree days) across all of the Partnership’s service territories for fiscal 2020 were 10% warmer than normal and 4% warmer than the prior year, average temperatures during the peak demand months of December through February were 14% warmer than normal — on par with the warmest temperatures on record.<\/p>\n

Revenues for fiscal 2020 of $1,107.9 million<\/span> decreased 12.6% compared to the prior year, primarily due to lower retail selling prices associated with lower wholesale costs, coupled with lower propane volumes sold.<\/p>\n

Cost of products sold for fiscal 2020 of $383.0 million<\/span> decreased 26.6% compared to the prior year, primarily due to lower wholesale costs and lower volumes sold.\u00a0 Average propane prices (basis Mont Belvieu, Texas<\/span>) decreased 27.9% compared to the prior year.\u00a0 Cost of products sold for fiscal 2020 included a $0.4 million<\/span> unrealized non-cash loss attributable to the mark-to-market adjustment for derivative instruments used in risk management activities, compared to an $8.0 million<\/span> unrealized non-cash loss in fiscal 2019.\u00a0 These unrealized items are excluded from Adjusted EBITDA for both periods in the table below.<\/p>\n

Combined operating and general and administrative expenses of $467.9 million<\/span> for fiscal 2020 decreased 1.3% compared to the prior year, primarily due to lower volume-related variable operating costs and lower variable compensation, partially offset by an increase in accruals for self-insured liabilities and other legal matters.\u00a0\u00a0\u00a0 <\/p>\n

During fiscal 2020, the Partnership utilized cash flows from operating activities to repay $18.9 million<\/span> of debt, and to fund two acquisitions of well-run propane operations for an aggregate purchase price of $23.4 million<\/span>, along with purchasing a 39% equity interest in Oberon Fuels, supporting the Partnership’s “Go Green<\/span>“<\/i> initiatives.\u00a0 As a result of the debt repayment, outstanding borrowings under the revolving credit facility were reduced to $94.6 million<\/span> at the end of fiscal 2020, and the Consolidated Leverage Ratio as of September 26, 2020<\/span> was 4.64x.\u00a0\u00a0\u00a0 <\/p>\n

\n Fourth Quarter 2020 Results
<\/b>Consistent with the seasonal nature of the propane business, the Partnership typically reports a net loss for its fiscal fourth quarter.\u00a0 Net loss for the fourth quarter of fiscal 2020 was $41.2 million<\/span>, or $0.66<\/span> per Common Unit, a 19.3% improvement compared to the fourth quarter of fiscal 2019.\u00a0 Excluding the effects of a $0.2 million<\/span> pension settlement charge in the fourth quarter of fiscal 2020 and unrealized non-cash mark-to-market adjustments on derivative instruments used in risk management activities in both fiscal fourth quarters, Adjusted EBITDA for the fourth quarter of fiscal 2020 increased to $5.5 million<\/span>, reflecting an improvement of $6.8 million<\/span> compared to a loss of $1.3 million<\/span> in the fourth quarter of fiscal 2019. Retail propane gallons sold of 61.2 million gallons in the fourth quarter of fiscal 2020 decreased 3.8% compared to the prior year fourth quarter.\u00a0\u00a0 <\/p>\n

As previously announced on October 22, 2020<\/span>, the Partnership’s Board of Supervisors declared a quarterly distribution of $0.30<\/span> per Common Unit for the three months ended September 26<\/span>, 2020.\u00a0 On an annualized basis, this distribution rate equates to $1.20<\/span> per Common Unit. The distribution was paid on November 10, 2020<\/span> to Common Unitholders of record as of November 3, 2020<\/span>. <\/p>\n

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\n About Suburban Propane Partners, L.P.
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\n <\/b>Suburban Propane Partners, L.P. is a publicly-traded master limited partnership listed on the New York Stock Exchange. Headquartered in Whippany, New Jersey<\/span>, Suburban has been in the customer service business since 1928.\u00a0 The Partnership serves the energy needs of approximately 1.0 million residential, commercial, industrial and agricultural customers through approximately 700 locations in 41 states.<\/p>\n

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\n Forward-Looking Statements
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\n This press release contains certain forward-looking statements relating to future business expectations and financial condition and results of operations of the Partnership, based on management’s current good faith expectations and beliefs concerning future developments.\u00a0 These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those discussed or implied in such forward-looking statements, including the following:<\/i>\n <\/p>\n