OVERLAND PARK, Kan., Nov. 22, 2016 (GLOBE NEWSWIRE) -- Ferrellgas Partners, L.P. (NYSE:FGP) (“Ferrellgas” or the “Company”) today announced the declaration of its first quarter cash distribution of $0.10 ($0.40 annualized rate) per partnership common unit. The distribution is payable on December 15, 2016 to common unitholders of record as of December 8, 2016.
The distribution covers the period from August 1, 2016, to October 31, 2016, the Company’s first quarter of fiscal 2017.
If this distribution level is maintained throughout fiscal 2017, compared to the previous distribution level of $0.5125 per quarter ($2.05 annualized), it will provide approximately $160 million of internally generated capital on an annualized basis to provide increased liquidity, reduce leverage and strengthen the Company’s balance sheet. The Board of Directors will continue to monitor and evaluate the distribution level each quarter.
As previously disclosed the Company has experienced headwinds in our midstream business primarily due to the loss of our largest customer as well as general market conditions. We have also experienced a significantly warmer than normal start to the winter propane season. As a result, the Board of Directors believes it is prudent to strengthen our balance sheet by reducing indebtedness and operating expenses.
“We are confident these actions support the long-term interests of our unitholders, employees, and other stakeholders,” said James E. Ferrell, Chairman and interim President and Chief Executive Officer. “There are encouraging signs throughout all business segments. We are focused on organic customer growth and asset utilization in an effort to improve cash flow that will in turn contribute to the improvement of our leverage ratios.”
Ferrellgas Partners, L.P., through its operating partnership, Ferrellgas, L.P., and subsidiaries, serves propane customers in all 50 states, the District of Columbia, and Puerto Rico, and provides midstream services to major energy companies in the United States. Ferrellgas employees indirectly own 22.8 million common units of the partnership, through an employee stock ownership plan. Ferrellgas Partners, L.P. filed a Form 10-K with the Securities and Exchange Commission on September 28, 2016. Investors can request a hard copy of this filing free of charge and obtain more information about the partnership online at www.ferrellgas.com.
Forward Looking Statements
Statements in this release concerning expectations for the future are forward-looking statements. These statements often use words such as “anticipate,” “believe,” “intend,” “plan,” “projection,” “forecast,” “strategy,” “position,” “continue,” “estimate,” “expect,” “may,” “will,” or the negative of those terms or other variations of them or comparable terminology. Forward-looking statements, include, but are not limited to: Ferrellgas’ debt reduction plans, statements about Ferrellgas’ distributions, the anticipated impact of the distribution rate on Ferrellgas’ business and the anticipated impact of Ferrellgas’ actions on its balance sheet and liquidity position. While Ferrellgas believes that the assumptions concerning future events are reasonable, it cautions that there are inherent difficulties in predicting certain important factors that could impact the future performance or results of its business. Among the factors that could cause results to differ materially from those indicated by such forward-looking statements are: risks related to Ferrellgas’ ability to generate sufficient cash flow to pay distributions, to make payments on its debt obligations and to execute its business plan; Ferrellgas’ ability to access funds on acceptable terms, if at all, because of the terms and conditions governing its indebtedness or otherwise; local, regional and national economic conditions and the impact they may have on Ferrellgas and its customers; the effect of weather conditions on the demand for propane; the prices of wholesale propane, motor fuel and crude oil; disruptions to the supply of propane; the termination or non-renewal of certain arrangements or agreements; adverse changes in our relationships with our national propane customers; the financial condition of Ferrellgas’ customers; and the failure of any customer to perform its contractual obligations. 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 Form 10-K of Ferrellgas Partners, L.P., Ferrellgas Partners Finance Corp., Ferrellgas, L.P., and Ferrellgas Finance Corp. for the fiscal year ended July 31, 2016 and in other documents filed from time to time by these entities with the Securities and Exchange Commission. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. All forward-looking statements in this press release are qualified in their entirety by these cautionary statements. Except as required by law, Ferrellgas undertakes no obligation and does not intend to update or revise any forward-looking statements, whether as a result of new information, future results or otherwise.
Source:Ferrellgas Partners, L.P.