By a News Reporter-Staff News Editor at News of Science -- AmeriGas Propane, Inc., general partner of AmeriGas Partners, L.P. (NYSE: APU), reported a seasonal net loss attributable to AmeriGas Partners for the third quarter of fiscal 2014 ended June 30, 2014 of $37.8 million compared to a seasonal net loss of $34.6 million for the third quarter of fiscal 2013. The Partnership's adjusted earnings before interest expense, income taxes, depreciation and amortization (Adjusted EBITDA) decreased to $55.1 million for the third quarter of 2014 compared to $69.0 million for the same period last year.
For the three months ended June 30, 2014, retail propane volumes sold were 215.6 million gallons compared with retail propane volumes of 224.7 million gallons in the prior-year period. Weather for the quarter was 9.3% warmer than normal and 9.7% warmer than in the prior-year period, according to the National Oceanic and Atmospheric Administration (NOAA).
Jerry E. Sheridan, chief executive officer of AmeriGas, said, "Our results for the quarter were in line with our expectations given the warmer weather. As we had previously stated, last year's third quarter results were unusually favorable due to cold spring weather that followed a relatively warm winter. We continue to make significant progress with our growth initiatives. Our National Accounts program experienced a solid quarter with volume up 11%. AmeriGas Cylinder Exchange, our nationwide cylinder exchange program, delivered volume growth of 4% during the third quarter. We continue to make good progress in expanding our exchange program, with more than 1,000 new distribution locations added this year."
Sheridan continued, "Given our results thus far and our current assessment of business conditions for the remainder of the fiscal year, we continue to anticipate Adjusted EBITDA for fiscal 2014 to be in the range of $660 million to $675 million. We are pleased with the strong performance of the business thus far. Our year to date Adjusted EBITDA of $617 million is just about equal to our Adjusted EBITDA for all of last year. At the low end of our guidance levels, Adjusted EBITDA would be up 7% from last year and would have nearly doubled from just three years ago."
Revenues for the quarter increased to $613.2 million from $581.7 million in the prior-year period, reflecting higher average selling prices, largely due to higher propane product costs, but partially offset by lower retail volumes sold. The average wholesale cost of propane at Mont Belvieu, Texas, for the current quarter was approximately 16% higher than the average cost in the same period last year. Total margin decreased $6.4 million principally reflecting lower retail propane total margin of $3.4 million and a $2.8 million loss on unsettled commodity derivative instruments. The lower retail propane margin is principally due to the decrease in volumes sold partially offset by modestly higher average retail propane unit margins.
Operating and administrative expenses in the prior-year period included $9.9 million of transition expenses associated with the integration of Heritage Propane. Excluding the effects of this expense, operating and administrative expenses increased $10.5 million during the 2014 period principally reflecting higher payroll and benefits, general insurance, equipment repair and maintenance and advertising expenses. Operating income decreased $2.2 million principally reflecting the decrease in margin offset by lower depreciation expense.
Keywords for this news article include: Alkanes, Propane, AmeriGas Partners L.P..
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