Q2 2022 Ferrellgas Partners LP Earnings Call

March 11, 2022

Ladies and gentlemen, thank you for standing by and welcome to the fiscal 2022 Q2 earnings Conference call I would now like to hand, the conference over to your speaker today Tim.

Sir.

You may begin.

Thank you Angel.

Welcome to our second quarter fiscal 2022 earnings call. My name is Kim Lee <unk>, Chief operating officer of shale gas.

Before we go over the financial results for the quarter I would like to discuss a few key points relating to our performance over the last few months.

First I want to say, how privileged Diane to work with all of the employee owners a forecast.

Many touch points I have with them on a daily basis, I see firsthand the amazing commitment and hard work that each put in every single day to make this company better.

Second our successful performance this last quarter, despite experiencing warmer temperatures in December is directly correlated to the amazing execution by our team of over 4500 employees across the country.

We believe in investing in our people and the result.

I believe they speak for themselves we have continued to build upon our strategic initiatives.

And leverage our successful restructuring from almost a year ago now to perform at this level.

I will now turn the floor over to our controller Wendel Clark.

Over the financial results for the quarter Wendell.

Thank you Tia Maria and welcome to our second quarter 2022 earnings call.

Thank you all for joining us.

I'd like to remind all of you that some of the statements made during this call.

May be considered forward looking and.

And the various risk uncertainties and other factors could cause actual performance to differ materially from anticipated performance.

These factors are discussed in our Form 10-K filed last year and other documents filed from time to time with the Securities and Exchange Commission. Additionally.

Additionally, we note that the purpose of this call is to discuss the results of operations for the second fiscal quarter.

Ended January 31 2022.

For the second quarter of 2022, the company deliver $23 million higher operating income.

And almost 18% increase versus the same period last year.

Overall gallon performance and the company's strategic initiatives.

<unk> to an increase in the second physical quarter gross profit of $18 9 million or 7% higher than the prior year period.

Operating expenses as a percentage of total revenue or approximately 2% lower than the prior year period.

Margin per gallon for the quarter increased by 10.

Or 10% higher than the prior year period.

The company continued to realize cost savings through better utilization of assets is it redeployed existing tanks to locations with higher usage.

Which in turn alleviated the need to purchase additional tanks at the current higher market prices.

The savings on providing more propane at east delivery was partially offset by overtime costs.

For the second fiscal quarter. The company reported net earnings attributable to federal gas partners LP or <unk>.

$108 4 million.

Compared to $63 3 million in the prior year period.

An increase of $45 1 million or 71%.

Adjusted EBITDA.

non-GAAP measure increased by $10 5 million or 7% to $151 4 million in the second physical quarter compared to $140 9 million in the prior year period.

I will now turn it over to Tim Maria to go over some of the operational and company highlights for the last quarter.

Thank you Wendell.

Ferro gas continues to increase at Blue Rhino home delivery service, which now extends to include the long Island market. This makes the 13th market and 11 different states to offer the very convenient feature just another way that <unk> continue to fuel life simply join.

This past quarter. The company also announced an expansion of its partnership with operation Bbq relief.

Organization, which has served nearly 10 million meals in the United States to communities impacted by natural disasters.

The company's nationwide footprint really allows it to help the victims and first responders throughout the United States by supplying operation Bbq relief with necessary propane to fuel its industrial sized smokers. In addition to blue Rhino tank.

The company also recognized over 280 employees across the country with the Ferrell gas Clean Award the Flame Award initiative, it's a peer to peer recognition program that celebrates employee achievement on the areas of customer service.

Safety innovation and leadership.

The Blue Rhino tank exchange brand apparel back also announced a partnership with the International Rhino Foundation, It's a global Wildlife Conservation organization.

To raise awareness of Rhino conservation efforts around the world.

Part of the initiative Blue Rhino will draw attention to conservation efforts.

<unk> Big marketing program and tanks sold at retail locations across the country.

In an effort to provide some additional transparency we are going to address a few questions that we've received over the last few days.

One question that we received was really around.

An update on our plan to take that.

Lastly kick out the clock speed is it was great.

The answer we have is ultimately that we have a long term financial plan, which includes the repayment of the unit.

We continue to.

To really analyze the best solutions in support of our strong capital structure.

The next question, we received is around our outlook for further M&A.

Current economic environment continues to be very suitable for those interested in selling and we are strategic about acquisition, our focus will be on opportunities that leverage our network footprint.

Our high performing operations teams and that create economies of scale.

Another question, we received was regarding the rapid increase in propane pricing and how that might impact our working capital.

As a reminder, about 70% of our volume allows for past repricing. The other 30% is what we call our platinum program, which allows customers to lock in on their price.

One of the best in the business.

And while there is some timing impacts there is nothing material to have any meaningful impact on our overall cash position.

Those three questions really summarize most of the questions received I'm going to turn the call back over to the moderator now, but before I do that.

Want to remind everyone as mentioned in our announcement for this call any additional questions may be submitted via our Investor relations email inbox at Investor Relations at <unk> Dot Com I want to thank you very much for your interest in <unk> and at this time I will turn it back over to you Angie.

At this time there are no questions.

Thank you then I think we can you can go ahead and close our call Angie.

Thank you for participating in today's conference call. You May now disconnect your lines at this time.

Thank you.

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Ladies and gentlemen, thank you for standing by and welcome to the fiscal 2022 Q2 earnings Conference call I would now like to hand, the conference over to your speaker today.

Tim Reeves RTG you may begin.

Thank you Angie.

Welcome to our second quarter fiscal 2022 earnings call.

My name is Kim <unk>, Chief operating officer of Ferro gas.

Before we go over the financial results for the quarter I would like to discuss a few key points relating to our performance over the last few months.

First I want to say, how privilege Diane to work with all the employee owners or fill gaps.

Through the many touch points I have with them on a daily basis.

Firsthand the amazing commitment and hard work that each put in every single day to make this company better.

We believe in investing in our people and the results I believe they speak for themselves. We have continued to build upon our strategic initiatives and leverage our successful restructuring from almost a year ago now to perform at this level.

I will now turn the floor over to our controller Wendell Park to go over the financial results for the quarter Wendell.

Okay.

Thank you Tia Maria and welcome to our second quarter 2022 earnings call.

Thank you all for joining us.

I'd like to remind all of you that some of the statements made during this call.

May be considered forward looking.

And the various risk uncertainties and other factors could cause actual performance to differ materially from anticipated performance.

These factors are discussed in our Form 10-K filed last year and other documents filed from time to time with.

With the Securities and Exchange Commission.

Additionally, we note that the purpose of this call is to discuss the results of operations for the second fiscal quarter.

Ended January 31 2022.

For the second quarter of 2022.

The company delivered $23 million higher operating income.

And almost 18% increase versus the same period last year.

Overall gallon performance and the company's strategic initiatives.

Contributed to an increase in the second physical quarter gross profit of $18 9 million or 7% higher than the prior year period.

Operating expenses as a percentage of total revenue for approximately 2% lower than the <unk>.

Prior year period.

Margin per gallon for the quarter increased by 10 four.

Or 10% higher than the prior year period.

The company continued to realize cost savings through better utilization of assets is it redeploy existing tanks to locations with higher usage.

Which in turn alleviated the need to purchase the digital tanks at the current higher market prices.

The savings on providing more propane at east delivery was partially offset by overtime costs.

For the second fiscal quarter. The company reported net earnings attributable to favorable gas partners LP of $108 4 million.

Compared to $63 3 million in the prior year period.

The increase of $45 1 million or 71%.

Adjusted EBITDA.

non-GAAP measure increased by $10 5 million or 7% to $151 4 million in the second fiscal quarter compared to $140 9 million in the prior year period.

I will now turn it over to <unk> to go over some of the operational and company highlights for the last quarter.

Thank you Wendell.

<unk> continues to increase its blue Rhino home delivery service, which now extends to include the long island market. This mix the 13th market and 11 different states to offer the very convenient feature.

Just another way that Ferrell gas continue to fuel life simply.

During this past quarter. The company also announced an expansion of its partnership with operation Bbq relief and organization, which has served nearly 10 million meals in the United States to communities impacted by natural disasters. The companies nationwide footprint really allows it to help victims in first.

Founders throughout the United States by supply and operation Bbq relief with necessary propane to fuel its industrial sized smokers. In addition to blue Rhino tank.

The company also recognized over 280 employees across the country with the barrel gas claim award. The Flame Award initiative is a peer to peer recognition program that celebrates employee achievement on the areas of customer service.

Safety innovation and leadership.

The Blue Rhino tank exchange brand apparel back also announced a partnership with the International Rhino Foundation is a global Wildlife Conservation organization.

To raise awareness of Rhino conservation efforts around the world as part of the.

Initiative Blue Rhino will draw attention to conservation efforts.

<unk> Big marketing program and tanks sold at retail locations across the country.

And an effort to provide some additional transparency we are going to address a few questions that we've received over the last few days.

One question that we received was really around an update on our plan to take.

The class B kick off the clock speed as it was great.

The answer we have is ultimately that we have a long term financial plan, which includes the repayment of the unit.

We continue to.

To really analyze the best solutions in support of our strong capital structure.

The next question, we received is around our outlook for further M&A.

Our high performing operations teams and that create economies of scale.

Another question, we received was regarding the rapid increase in propane pricing and how that might impact our working capital.

As a reminder, about 70% of our volume allows for past repricing. The other 30% is what we call our platinum program, which allows customers to lock in on their price.

One of the best in the business.

And while there is some timing impacts there is nothing material to have any meaningful impact on our overall cash position.

Those three questions really summarize most of the questions received I'm going to turn the call back over to the moderator now, but before I do that.

Once you remind everyone as mentioned in our announcement for this call any additional questions may be submitted via our Investor relations email inbox at Investor Relations at <unk> Dot Com I want to thank you very much for your interest in <unk> and at this time I will turn it back over to you Angie at this time there are no questions. Thank you.

And I think we can you can go ahead and close our call Angie.

Thank you for participating in today's conference call. You May now disconnect your lines at this time.

Q2 2022 Ferrellgas Partners LP Earnings Call

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