AmeriGas Propane, Inc., general partner of AmeriGas Partners, L.P. (NYSE: APU), announced that it expects to declare a distribution increase of 5% at its next regularly scheduled board of directors meeting in April. Jerry E. Sheridan, chief executive officer of AmeriGas, said, “When we announced the Heritage Propane acquisition last fall, we stated our belief that the transaction would enhance our ability to meet our long-standing goal of 5% annual distribution increases. We are pleased to be able to once again tangibly demonstrate the benefits of the transaction by announcing our intention to increase the distribution in April.” AmeriGas had previously increased its partnership distribution by 3% following the closing of the acquisition in January.
AmeriGas also issued estimated earnings guidance for its second fiscal quarter ending March 31, 2012 and its full fiscal year ending September 30, 2012 as well as estimated guidance for its upcoming 2013 fiscal year. Results for the quarter ending March 31, 2012 and the fiscal year ending September 30, 2012 include the results of Heritage Propane from the mid-January acquisition date through the end of the quarter or fiscal year, respectively.
For the quarter ending March 31, 2012, AmeriGas estimates Adjusted EBITDA, defined as earnings before interest expense, income taxes, depreciation and amortization, losses on extinguishment of debt and Heritage Propane acquisition and transition expenses, in the range of $225 million to $235 million. Using the midpoint of this range, AmeriGas estimates that net income for the quarter will be approximately $105 million. The forecasted results for the quarter include the effects of decreases in volumes sold resulting primarily from the unusually warm weather experienced during the two months ended February 29, 2012 (16% warmer than normal and 20% warmer than last year) according to degree day statistics compiled by the National Oceanic and Atmospheric Administration. Adjusted EBITDA excludes the impact of approximately $10 million in Heritage Propane acquisition and transition expenses an approximate $15 million loss on extinguishment of debt expected to be incurred during the quarter.
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