Business Context and Reporting Period
Company: Suburban Propane Partners, L.P.
Filing Type: Form 8-K (Current Report)
Date of Report: August 4, 2011
Reporting Period: Fiscal 2011 Third Quarter
This filing serves to announce the issuance of a press release detailing the company's financial results for the third quarter of fiscal 2011. The registrant operates in the retail propane, fuel oil, natural gas, and electricity sectors.
Key Financial Metrics
The filing text does not provide specific numerical values for revenue, profit, cash flow, margins, debt, or liquidity. Instead, it defines the non-GAAP measures used in the accompanying press release (Exhibit 99.1) to assess performance:
- EBITDA: Earnings before interest, income taxes, depreciation, and amortization.
- Adjusted EBITDA: EBITDA, net income, and net income per Common Unit, excluding unrealized (non-cash) gains/losses from mark-to-market activity on derivative instruments and loss on debt extinguishment.
- Gross Margins: Defined as revenues less cost of products sold (excluding depreciation and amortization).
These metrics are utilized to evaluate liquidity, debt service obligations, quarterly distribution capabilities, and executive incentive compensation.
Material Changes
The filing text does not contain specific data regarding material changes in financial position or results of operations compared to the prior comparable period. It references a press release (Exhibit 99.1) where such year-over-year comparisons and reconciliations of Adjusted EBITDA to net cash provided by operating activities are presented.
Guidance, Outlook, and Risks
Management Commentary: Management emphasizes that profitability in their business segments is largely dependent on the difference between retail sales prices and product costs. Consequently, they utilize gross margins to help investors understand the impact of commodity prices on profitability.
Usage of Non-GAAP Measures: The company states that Adjusted EBITDA is a required component for calculating leverage and interest coverage ratios under their revolving credit agreement.
Risks and Contingencies: The filing does not explicitly list new risks or contingencies, though it notes the reliance on commodity price spreads for profitability.
Investor Verification Checklist
- Review Exhibit 99.1 (Press Release) for specific numerical results for Fiscal 2011 Q3, as the 8-K text only defines the metrics.
- Verify the reconciliation of Adjusted EBITDA to net cash provided by operating activities to understand the impact of non-cash items.
- Assess the impact of commodity price fluctuations on gross margins as described in the press release.
- Confirm compliance with revolving credit agreement covenants regarding leverage and interest coverage ratios based on Adjusted EBITDA.