2015 RBC MLP CONFERENCE

Transcription

1 2015 RBC MLP CONFERENCE November 2015

2 FORWARD LOOKING STATEMENTS The following information contains, or may be deemed to contain, forward-looking statements. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. The future results of the partnership may vary from the results expressed in, or implied by, the following information, possibly to a material degree. The partnership assumes no obligation to update the information contained herein. For a discussion of some of the important factors that could cause the partnership s results to differ from those expressed in, or implied by, the following information, as well as a discussion of certain other risks, uncertainties and factors, please see the sections Item 1. Business - Risk Factors in the Form 10-K of Ferrellgas Partners, L.P., Ferrellgas Partners Finance Corp., Ferrellgas, L.P. and Ferrellgas Finance Corp. for the fiscal year ended July 31, No offer is being made hereby with respect to the high yield notes. The notes are being offered privately pursuant to and in compliance with exemptions from registration under the Securities Act. Accordingly, the notes are being offered only to Qualified Institutional Buyers in accordance with Rule 144A under the Securities Act and to non-u.s. persons outside the United States pursuant to Regulation S under the Securities Act. 2

3 INTRODUCTION

4 FERRELLGAS PARTNERS: TRANSFORMED ENERGY LOGISTICS MLP Propane Midstream A leading national provider of wholesale propane with extensive logistics capabilities and geographic diversity Second largest retail marketer of propane in the U.S. and a leading provider of propane by portable tank exchange Integrated midstream logistics provider operating in the following segments: Services Truck Transportation Rail Marine Terminaling Pipeline Storage Environmental Services Commodities Crude Water Ferrellgas Partnership Overview Founded in 1939 a trusted consumer brand to millions of Americans Limited partnership formed in 1994 NYSE: FGP ~4,000 Employees FGP Trading Summary (as of November 12, 2015) Units Price $20.03 Units Outstanding million Significant employee ownership Nearly 23% of the outstanding common units of Ferrellgas Partners and 100% of the general partner Market Cap Quarterly Distribution $2.0 billion $0.5125/$2.05 annualized Current Yield: 10.2% Leveraging our logistics expertise across multiple commodities and the entire lower 48 4

5 TRANSITION SUCCESS STORY: MIDSTREAM OFFERS TRANSFORMATIONAL GROWTH Propane offers a stable base business Bridger acquisition contributes towards achieving FGP s goal of growing the midstream operating segment to approximately one third of consolidated FGP EBITDA Adjusted EBITDA Growth Over Time $272.2 $288.1 $300.2 $410.0 (1) Diversification of existing asset base into new midstream operating segments FY13 FY14 FY15 FY16E Ferrellgas Business Mix Transformation (EBITDA) (1) Represents midpoint of guidance. 5 Creates larger platform from which to execute further identified growth initiatives Enhanced growth trajectory underpinned by Bridger s highlycontracted, fee-based cash flows Announced $0.05 annual distribution increase, the first in company history Propane 100% Business Mix as of January 2014 Propane Retail Wholesale Tank exchange Midstream 0% Business Mix Based on FY 16 Guidance Propane ~75% Propane Retail Wholesale Tank exchange Midstream ~25% Midstream Truck Transportation Rail Marine Terminaling Pipeline Storage Environmental Services

6 EXPANDED BLUE-CHIP CUSTOMER BASE Midstream Customers Wholesale Propane Customers 6

7 NATIONAL ENERGY LOGISTICS FOOTPRINT States with Bridger Operations Major U.S. Shale Plays Retail Distribution Locations Tank Exchange Distributors 7

8 LQA Yield FGP VALUE PROPOSITION 20% JPEP 16% NGL 12% 8% SPH OKS PAA WPT EEP SMLP WPZ ETP FGP GLP APU BPL TCP EPD ARCX BKEP HEP SEP GEL PBFX 4% 0% 0% 4% 8% 12% 16% 20% 2015E E Research Distribution Growth Expectations Potential for FGP unit price appreciation as growth is realized (1) FactSet estimates as of November 12,

9 PROPANE UPDATE

10 A TRUSTED PROVIDER OF PROPANE FOR AMERICA Fleet of over 1,450 bulk delivery trucks Fleet of 147 transport tractors and significant common carrier relationships Over 46,000 tank exchange selling locations and ~20 million annual transactions Own ~50 MM gallons of propane storage capacity at our distribution locations We have 51 service centers and 862 service units 10

11 11 NATIONWIDE PROPANE FOOTPRINT

12 A PROVEN INDUSTRY CONSOLIDATOR Proven acquirer and consolidator of more than 200 businesses since

13 MIDSTREAM OVERVIEW AND UPDATE

14 STRATEGIC PORTFOLIO OF ASSETS CONNECTING CRUDE OIL TO END MARKETS Bridger Crude Oil Value Chain Crude Oil Truck Rail Loading Terminal Rail Car Rail Unloading Terminal Barge Wellhead Refinery Crude Oil Truck Pipeline Loading Terminal Storage Tank Crude Oil Pipeline Bridger Owned/Leased Assets Truck Transportation Rail Marine Pipeline Terminals Pipeline One of the largest forhire crude oil carriers in the U.S. Over 555 trucks. Presence in most major crude producing regions across the U.S. 1,263 newbuild rail cars used to supply Bakken crude oil and East Coast refinery under long-term, take-or-pay agreement. Integrated loading capacity at various rail loading terminals in North Dakota. Agreement for exclusive use of unloading capacity at rail facility in Eddystone, PA. 118 MBbls capacity Jones Act vessel secured through Q Used to connect rail unloading facility with East Coast refinery. 19 strategically located terminals. Typical station has ~8 MBbls/d of capacity. 90 MBbls/d terminal connected to pipeline and rail with feebased, take-or-pay with super major. Five-year, fee-based logistics management agreement to transport crude on Pony Express. Owned 24 mile pipeline in Wyoming with 18 MBbls/d of throughput capacity. 14

15 COMPREHENSIVE CRUDE LOGISTICS FOOTPRINT Bridger Asset Map Bakken 63 Trucks 9 Pipeline Terminals 72.0 MBbls/d Terminal Capacity 65.0 MBbls/d Rail Loading Capacity MBbls Storage Capacity Legend Major U.S. Shale Plays States with Bridger Operations East Coast 80.0 MBbls/d Rail Unloading Capacity MBbls Storage Capacity MBbls Barge Capacity Rockies 56 Trucks 4 Pipeline Terminals MBbls/d Terminal Capacity 38.0 MBbls/d Pipeline Capacity MBbls Storage Capacity Permian Basin 316 Trucks 4 Pipeline Terminals 32.0 MBbls/d Terminal Capacity 11.6 MBbls Storage Capacity Gulf Coast 97 Trucks 2 Pipeline Terminals 16.0 MBbls/d Terminal Capacity 17.8 MBbls Storage Capacity Eagle Ford Shale 23 Trucks Total Existing Assets 555 Trucks 19 Pipeline Terminals MBbls/d Terminal Capacity 38.0 MBbls/d Pipeline Capacity MBbls/d Rail Transloading Capacity 1,044.8 MBbls Storage Capacity 1,263 Railcars MBbls Barge Capacity 15

16 SELECT CONTRACTUAL RELATIONSHIPS WITH KEY COUNTERPARTIES UNDERSCORE BRIDGER VALUE PROPOSITION 1 Rail 2 3 Trucking Terminals Customer Contract Long-Term Take-or-Pay Acreage Dedication Long-Term Take-or-Pay Agreement to transport 65 MBbls/d of Bakken crude to major East Coast Refinery Area of Mutual Interest covers ~86,000 square miles across the Permian Basin in West Texas and New Mexico Bridger-owned terminal constructed for Super Major with existing truck, rail and pipeline connectivity Details Integrated rail loading capacity at various rail loading facilities in North Dakota Contract utilizes 1,263 newbuild railcars Customer is largest oil producer in the Permian Basin Bridger has right of first call on moving customer s barrels by truck in Permian Basin Terminal facility has 90 MBbls/d of throughput capacity and 225 MBbls of storage capacity Located in the Rockies Right to exclusive use of rail and maritime facility in Eddystone, PA, with 80 MBbls/d of unloading capacity Note: Monroe Energy, LLC is a wholly owned subsidiary of Delta Air Lines, Inc. 16

17 FINANCIAL SUMMARY

18 FINANCIAL RECAP Gross Profit Gross profit for Fiscal 2015 was $800 million Operating expense Increased from the prior year, due to the gross profit associated with our newly acquired Midstream Crude Oil Logistics segment, and a full year of gross profit from our Midstream - Water solutions segment Operating expense was $432 million Adjusted EBITDA 3% favorable compared to Fiscal 2014 due to Company s ability to flex expenses down in the Propane and related equipment sales segment relative to gallons sold. The savings in this segment more than offset the additional operating expenses associated with the midstream operations the Company acquired. Adjusted EBITDA was $300.2 million Distributable Cash Flow Up from the record set at the end of Fiscal 2014 of $288.1 million We ve generated over $20 million of excess cash flow over the last 12 months to fund growth and acquisition spending Propane gallons sales and temperature % warmer / cooler than last year and than normal Weather was 8% warmer than the prior year and 4% warmer than normal. These temperatures are the biggest drivers of our gallon short fall which was 7% unfavorable to the prior year 18

19 FISCAL 2015 PERFORMANCE 12 months ended July 31, (in m illions except EPU) A ctual Prior Year Var. Gross Margin $ $ $ (11.1) Ot her Incom e (5.4) Ot her Income - Midst ream Gross Profit $ $ $ 8.6 Expenses: Personnel $ $ $ 6.3 Vehicle Leases (6.5) Ot her (3.5) Total Expenses $ $ $ 3.5 Tot al Expenses as a % of Gross Profit 62.5% 63.6% Adjusted EBITDA $ $ $ 12.0 Adjust ed EBITDA as a % of Gross Profit 37.5% 36.4% Net Earnings $ 30.1 $ 33.7 $ (3.6) D istributable Cash Flow $ $ $ (0.6) Propane Gallons Sold (67.7) W at er Volum es Processed

20 THREE CONSECUTIVE YEARS OF RECORD EBITDA PERFORMANCE ($mm) $ % 98% 96% 99% 96% 10 4% 96% 10 5% $ $ % $272.2 $288.1 $ % 85% $250.0 $221.9 $251.1 $ % $ $ % 55% $150.0 $ $ x 1.10 x 1.13x $1.0 9 $ x $ x 1.17x $ x 45% 35% $50.0 $ x $0.89 $ % 15% $0.0 FY0 8 FY0 9 FY10 FY11 FY12 FY13 FY14 FY15 Adjusted EBITDA DCF Coverage W holesale Cost (*) W eighted Degree Days as a % of normal 5% * The wholesale market price of propane at one of our major supply points - Mt. Belvieu, Texas 20

21 Ferrellgas, L.P. LONG-TERM DEBT MATURITY SCHEDULE Pro Forma Debt Maturity schedule ($mm) Principal Calendar Year Amount Senior Cred it Facility $60 0 ***** A R Securitization Facility 225 ***** % Senior Notes Due % Senior Notes Due % Senior Notes Due Ferrellgas Part ners, L.P % Senior Notes Due $ Total Debt $ 2,4 8 2 $ 18 2 $ 50 0 $ 4 75 $ 50 0 (1) as of July 31, 20 14, $193.3 w as outstand ing on the Senior Cred it Facility. Matures Octob er Existing RCF and A R Facilit y Existing Senior Unsecured Notes (2) as of July 31, 20 14, $91.0 w as outstand ing on the A R Securitization facility $50 0 $475 $50 0 $175 $260 $182 ***** Actual amount depends on loan balance outstanding in the future

22 CONCLUSION

23 23 KEY INVESTMENT TAKEAWAYS

24 Q&A