AmeriGas Propane, Inc., general partner of AmeriGas Partners, L.P. (NYSE:APU), reported GAAP net income attributable to AmeriGas Partners for the year ended September 30, 2016 of $207.0 million, compared to net income attributable to AmeriGas Partners of $211.2 million for the year ended September 30, 2015. On an adjusted basis, the Partnership reported net income attributable to AmeriGas Partners of $190.5 million for the year compared with $258.6 million in the prior year. Adjusted net income attributable to AmeriGas Partners excludes the impact of unrealized gains and losses on commodity derivative instruments and losses from the early extinguishments of debt. A reconciliation of adjusted net income to GAAP net income is set forth at the end of this release.
The Partnership’s adjusted earnings before interest expense, income taxes, depreciation and amortization (Adjusted EBITDA) was $543.0 million for the year compared with $619.2 million in the prior year. Retail volumes sold for the year decreased 10% to 1.07 billion gallons from 1.18 billion gallons in the prior year. The decrease in retail gallons sold reflects temperatures that were 15% warmer than normal and 12.5% warmer than the prior year.
Jerry E. Sheridan, president and chief executive officer of AmeriGas, said, “This year was a challenge due to significantly warmer weather than the prior year but our team navigated this challenge well. Our unit margins increased and our operating expenses were contained as we initiated our warm weather plan early in the heating season. We advanced our growth strategy through the completion of six acquisitions during the year and increased the number of National Accounts and Cylinder Exchange locations.
“In addition, we were pleased to have increased our distribution for the 12th consecutive year. Looking forward, we are eager to continue making progress on our growth initiatives as well as deploying our technology across our national footprint to drive operational efficiency and improve the customer experience.”
The Partnership announced earnings guidance for fiscal 2017 last month. For the year ending September 30, 2017, it expects to report adjusted EBITDA of $660 million to $700 million, assuming normal weather and excluding mark-to-market gains and losses on commodity derivative instruments. Because we are unable to predict certain potentially material items affecting net income on a GAAP basis, principally mark-to-market gains and losses on commodity derivative instruments, we cannot reconcile 2017 Adjusted EBITDA, a non-GAAP measure, to net income attribute to AmeriGas Partners, L.P., the most directly comparable GAAP measure, in reliance on the “unreasonable efforts” exception set forth in SEC rules. Adjustments that management can reasonably estimate are provided below.
AmeriGas is the nation’s largest retail propane marketer, serving approximately two million customers in all 50 states from approximately 2,000 distribution locations. UGI Corporation, through subsidiaries, is the sole General Partner and owns 26% of the Partnership and the public owns the remaining 74%.
AmeriGas Partners, L.P. will hold a live Internet Audio Webcast of its conference call to discuss fiscal 2016 earnings and other current activities at 9:00 AM ET on Thursday, November 10, 2016. Interested parties may listen to the audio webcast both live and in replay on the Internet at http://investors.amerigas.com/investor-relations/events-presentations or at the company website http://www.amerigas.comunder Investor Relations. A telephonic replay will be available from 12:00 PM ET on November 10 through 11:59 PM on November 16. The replay may be accessed at (855) 859-2056, and internationally at 1-404-537-3406, conference ID 13777143.
Comprehensive information about AmeriGas is available on the Internet at http://www.amerigas.com