Ferrellgas Partners (FGPR) 8 Mar 192019 Q2 Earnings call transcript

Good morning. My name is Sepania [ph] and I will be your conference operator today. At this time, I would like to welcome everyone to the Second Quarter Fiscal 2019 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. now turn would to call I Mr. Instructions] like the to over [Operator Chief Officer. Ruisinger, Financial Bill Interim Sir, begin you may your conference.

joining Thank second you, for quarter our us. XXXX earnings and call. Thank welcome to you

Form anticipated made Exchange discussed to get we of and some with differ may XX-Q various and started, to considered like risks, in other from during Before cause remind Securities uncertainties actual call the this filed performance Commission. performance. and I'd documents you are from all that forward-looking our These that factors be statements other factors materially could time-to-time and

As the results quarter our million, release consolidated from million. sales completed the that $XXX.X XXXX, compared from XX-Q second was detailed over $X.X since XX,XXX Trailing eclipsed EBITDA the at added XX year's retail in million non-strategic for Blue included XXX,XXX stands over last go-forward new now reported EBITDA year's locations. $XXX.X $XXX.X selling asset time and filed was Rhino for Form for fiscal new quarter adjusted customer the EBITDA adjusted Highlights to an during XXXX. in year million first adjusted quarter. morning, of since $XXX.X earnings last of mark months the business up Exclusive XXXX this increase last were customers million, million. We $XXX.X last

quarter a announced third with this just acquisitions accretive two week. added also We last

were XXXX colder consistent a year. for million weather retail quarter Retail was the to a of for despite in million affecting to $XXX.X despite gross or million $XXX.X was previously exclusive second was cents the than fiscal XXXX. capacity gross result related For customer only expenses This well from and million X% with pressures XX,XXX sales gallons of million margin as operating customer sales future prior X.X Operating This gallons quarter prior were million business. due fiscal to effects increase operating additional primarily year was of higher service the related per effects continue customers with one of up the assets were were to reseller to in noted. in margins gallon service a prior second approximately gallons the that $XXX.X to sold X million assets the million year, our sold XXXX. expenses This growth in wholesale gallon XXX.X compared X% gallons. by of of increase the year nearly point sold platform year exclusive provide X.X% offset however was in Total new expenses quarter, in XXX Propane to increase in expand profit by trucks, a ago. resources the for three associated the to as total prior drivers than the growth $XXX.X of approximately competitive higher growth. reduction the negatively

related million. XXXX the $XX.X capacity available $XX.X primarily our our $XX.X January liquidity $XXX.X in held the increase million we the to prior increase borrowing January of XX, in rates XXXX, general LIBOR facility. XXXX. compared increased in of million at the effects trend expenses new the At of working associated provides general with of year, cash rates. is legal due upward expense million credit quarter to primarily facility, expense under which Interest includes of and revolving recent associated to capital was $XX.X and total effects of higher million $XXX.X This XX, had exclusive second assets The million to The quarter compared in million For for $XX.X with the fees. is administrative was administrative prior sold year. fiscal XXXX

to compared capital new the propane maintenance This million $XX.X the would capital purchase utilize Our expenditures to the to was million leased. $X.X quarter in cash attributed expenditures year. delivery Growth have quarter were compared the that to a for for increase excess to prior prior in year. $X decision $X.X vehicles second primarily were million historically million been

at the of the As February, momentum we we look at continued built January. end

setting Moving saw year's could third XX% to million weeks in this quarter performance February. Jim February what That's At the we built of be momentum of quarter, The with propane. strong the first call the I'll his comments. generate gallons than stage over two over carried of third month for quarter. the continued backlog into into last sales a the March first of over that into time, XX significant more the for turn

Good morning.

we core continue not seen in to years. yielded however, the for this share, all strategy propane its business part We markets strongholds. only at of for our business strengthened future. long our our success. and at adding customers tanks the on We're results, in focus as the in investing has and position growing are adding entering levels not Ferrellgas but of long new term and owners while employee to term sustained Most as setting company build accomplishing importantly, market foundation this momentum density We're

of of and seeing locations this acquisitions quarter. as allow plants five us are it's of protection would Alabama also positive to distributors today's new been. culture maximize the ever business. and The return We independent California and as in recent is business tank productive we in yet on as volumes this grew Ferrellgas number The the exchange selling record the again

working people innovative excellence. together operational Our promote well are ways in to

We tools, fret collaborate making best we provide the most head, importantly, what and knowledge the industry We make with We mistakes, about are best our proactive, for in people the not not the to business. work confidence don't the reactive. do right decisions. our and We and behind. is from

talk about me moment Now debt. our a let

partners with supporters. our We continue flexibility us working liquidity and great business. with a working our facilities our provide the to to that and enjoy capital be happy manage We relationship

process financial advisors the the We we in on that continue to related the in assist engaging that leverage will resolve options options to to work are evaluating of leverage situation. however,

heating We generating the as future. our the of for and and have the have on cash business investing growing through season plenty we winter flow. perform we're liquidity, Have been been focused business we

Our for do in not least over a whole mature MLP not the at did of XXXX. and year code mature June bonds

Our direction which progress goal in continue over be I is heading. with we to not position reduce our us the aggressively future. industry the to a to last we've are and the leverage to two that proud could in with the the made allow more the that will company consolidate years us for level

people Our are empowered.

finding and and we and good feel improve our future. build We are about constantly to ways searching business, very for the new

Now, for I’ll questions. back to turn call the our moderator

from [Operator Instructions] question Hamid Your comes first line with JPMorgan. of Tarek the

Good morning.

Good morning.

on of volume do in, side think progress you side. market is program, back what in of just, earlier seventh amount months? share your you enormous an made that taking Can it in sort you’re of market you as inning in share of about guys sort the the sort of the you You or are think inning

it's put not say, I'd Well innings. -- could I'm sure it I in

long to a continue. term it's think, that we process plan I

have made. We

strides we there's that's term to lot industry efficiency. two build and like we'll that the really the significant and to feel made reap you We've start past a But as right. consolidation and build, more goal. whole know but build long years, benefits in You're over the continues and this

about and talked into just your sort total leverage you as And sense us be of wanting give the maybe target of Ferrellgas to actual leverage future? level a enough. reduce the is to what's leverage, the what Fair right running

opinion. Well we have that's an --

that I those has to else cards opinion. everybody cash an make flow but right a go opinion, now. up an goal multiple And want We have is lowest the You out for. going We're lay can that number, for here. we go the don't of our can to

in you of to I How do weigh the guess, a you ability outcomes going versus pay think fair any ask you're about distribution those two about? leverage? forward is to solution it how thinking sort do

you Don't you to happen. forget you the recovery happen, you an Once leverage without begin currency, to public will have equity ESOP. of first. Well And to is a get owned don't to distribution have have XX% don't the by that, an equity? that, get solution

we about, way What we the always unless cannot We distribution. has It decreased? to that are increase about have do ask value to be have ESOP concerned going employees the me occasionally.

are not We're It So is debt. This ESOP. finally debt a there's and restore company, equity worried worry, problem. the using about an are women's conclusion this then but making I'm by that massive restructuring. a shouldn't. general chicken to lower distribution. get partner, is I still We're debt, getting an it's restore, this and our -- and restructuring. egg can your about word on an we first We -- has we a on about owned that partner can debt it's you unusual We're partnership. is When you lowering happen. focused general worried event first forget worried we're focused

Understood. sort in I appreciate my Thanks of not wanting negotiate too to for taking questions. public. much

Sure. Thanks Tarek.

your And next Brownlow from line of the Raymond question comes with Instructions] Ben James. [Operator

wanted bucket I expense a and the new -- that around purchased I related, to lease should the some clarity forward? year-over-year. delivery shifting the the how morning. you but And just to impact leases, think wanted away was are Good going CapEx. maintenance entire trucks know we about from equipment

well bucket. as Yes, We some as quarter so entire quarter. did previous the that's lease trucks this not well the as

year an We of But cash be exact cash vehicles buy probably so would have vehicles. and on a you leased purchased use cash. things mix how essentially available than So of mix it lease. forward. you rather this do know purchase then that number lease, it's continue how what you forward. of go and the some of rest when going impact give I But we're shows to couldn't know we'll we'll that a managing see versus you and

you're million of And with a still million kind XX to Great. maintenance comfortable CapEx. XX

ahead. Excuse XX Go to… me,

that say Those number trucks the set that in be I'd XX, know trucks. good that aside you purchase to purchase Yes, if addition would was XX. you

And as then going any we that forward, would purchase in addition be well. trucks

Okay.

of this thinking for give maintenance you So ballpark us where can year? you're CapEx a

to I'd expect. vehicles. original would as XXX plus the is if what would in with XX or line we be Well estimate. purchased say probably be to in that XXX probably buy minus Like total, CapEx I adding said, in that trucks going continue with somewhere just I total range, the to be But

they when on it depends arrive. of Some

as like have program. period not week, year next a buy So are it's It's going on something two, ongoing you things an decided to of though time. we've just replacement three and

come the the side a recovering trucks are of no just truck out, have on It's we trucks. so other from business And buying and things. we maintenance years several of

now higher So will than settled. a this we do get little we truck we have spend once

get to to guess think I know flow return beat basically trying the to just to dust, where the I'm the And lease not going we -- about through. just to is Okay. expense just when

you do bring that future and some growth expense trucks think return think just time, will there? and retirement in business that kind remain. growth? lease additional the for know will expenses down over that So lease the you offset you of Where of know support you'll expense the will lease you the They'll those of see sort

say the only my grow to can truck It's hold be know, you and hard drive guess will many incrementally can would continue driver we to But one that [ph] exactly one gallons because out. gallons, Bobtail to model add as it business we have vehicles you truck. how add so as know we

therefore to grow lease we see going it's So, going to the whether to you're organically business, see continue and more expense. you're through or more vehicles, as acquisition,

you generally reduce that going it down. increase we to would, on age have just would -- as I generally we growing, would as the going expense, if we're a to continue I fleet, see expense and on not releasing, would to But of we're would speaking, correlation that's lease in it say know maintenance. but I reduced execute repair go the So, the lease

goes me a rating us about debt lease think give talking much Restructuring credit Let restructuring means, it. about expense down. a a you gives our better different better debt. We're rating, credit

the The interest it’s worse are money Our finance. better credit rating, rate form rating, going both would less be. more your burn to your The expensive down, a it's going on the to interest goes be. credit of expensive

our have go So interests we trucks lease and both expense might able be our and to buy more down. --

that like don't So, look today, forget eventually. do going to not we we're

volumes? on -- through for mentioned the and the me, mid-single rate fair Thanks me great. that. based strong, kind at digit Okay, growth a just year-over-year. ballpark more February I'm just on you looking from like Is being seems what seeing it that And one of of a you you're know data, walking

You percentage digit said mid-single growth. growth

yeah. growth, Percentage

a still There's left that play -- That right. lot feels to out.

to there's directionally You exactly know so there's look -- started March, But maps play out how still of well. off amount the The certainly to a stands. correct. still fair half into March you that's is good that second know know

guys. Okay, Thanks great.

Ben. Thanks

Is that all we have?

There are no further questions.

time your today. for Thanks Okay.

This concludes today's call. conference

You now may disconnect.