Star Gas Partners L.P. (SGU, Financial) filed Annual Report for the period ended 2011-09-30.
Star Gas Partners L.p. has a market cap of $347.1 million; its shares were traded at around $5.15 with a P/E ratio of 12 and P/S ratio of 0.3. The dividend yield of Star Gas Partners L.p. stocks is 6%. Star Gas Partners L.p. had an annual average earning growth of 80.3% over the past 5 years.
For fiscal 2011, delivery and branch expenses increased $32.1 million, or 14.7%, to $250.8 million, compared to $218.6 million for fiscal 2010. Acquisitions accounted for $20.0 million of the higher delivery and branch expenses. In the base business, delivery and branch expenses increased by $12.0 million due to higher delivery expenses of $3.2 million associated with the increase in volume and the numerous snow storms experienced during fiscal 2011 along with an increase in bad debt expense and credit card fees of $5.3 million associated with the rise in sales. The Partnership has increased its reserve rate for doubtful accounts for fiscal 2011, compared to fiscal 2010, in response to an 11 day increase in the days sales outstanding, increased volume due to colder temperatures and higher selling prices. Insurance claims expense also rose by $3.3 million due to an increase in reserves for prior year claims and higher current year claim expense resulting from the extreme winter weather.
For fiscal 2010, product sales decreased $5.0 million, or 0.4%, to $1.028 billion, as compared to $1.033 billion for fiscal 2009, as an 11.0% increase in home heating oil and propane selling prices and an increase in sales of other petroleum products of $15.9 million (1.5% of total product sales) was reduced by a 11.7% decrease in home heating oil and propane volume. Selling prices rose largely due to an increase in wholesale product costs.
During fiscal 2011, cash provided by operating activities decreased by $5.0 million to $39.4 million, when compared to $44.4 million of cash provided by operating activities during fiscal 2010, as a favorable change in cash generated from operations of $14.3 million, the timing of cash receipts from budget customers of $7.5 million, increases in accruals for insurance, interest, profit sharing and accounts payable totaling $11.2 million and lower contributions to the Partnerships frozen pension plan of $9.9 million was reduced by a decline of $11.9 million in the cash benefit relating to the payment for hedging options, an increase in inventory of $11.2 million (largely due to an increase in price) and an increase in cash needs to fund accounts receivable of $27.0 million. In fiscal 2010, the Partnership structured its option purchases such that the cost of the option will be paid as it expired rather than at the time the hedge is entered into. The increase in accounts receivable can be attributed to an increase in volume due to acquisitions and colder temperatures, as well as an increase in selling prices. Days sales outstanding as of September 30, 2011 were 61 days as compared to 50 days at September 30, 2010 and 50 days at September 30, 2009. The impact of a colder third fiscal quarter coupled with an increase in wholesale product costs resulted in both budget and non-budget customers owing more at September 30, 2011 than at September 30, 2010.
During fiscal 2010, cash provided by operating activities declined by $34.1 million to $44.4 million, compared to $78.5 million for fiscal 2009 as favorable changes in cash used for inventory purchases of $15.7 million and option purchases of $12.2 million were more than offset by a decline in cash generated from operations of $17.9 million, increases in cash used to finance accounts receivable of $31.2 million and higher pension plan contributions of $11.2 million. During fiscal 2010, the Partnership bought 23.9 million fewer gallons of home heating oil for inventory than during fiscal 2009, which resulted in a favorable change in cash flows of $15.7 million. At the beginning of fiscal 2009, the Partnerships physical inventory of home heating oil was comparatively low because the Partnership did not prebuy physical inventory due to the relatively high cost at the time. The change in inventory was also impacted by price. During fiscal 2010, inventory costs increased by $0.42 per gallon compared to the prior period which experienced a reduction in inventory cost of $1.54 per gallon. In fiscal 2010, the Partnership structured its option purchases such that the cost of the option is paid as it expires rather than at the time the hedge is entered into. This favorably impacted cash in fiscal 2010. Cash flow from operations declined by $17.9 million largely due to the weather related decline in home heating oil volume and operating loss from acquisitions completed after the heating oil season. The Partnerships accounts receivable increased by $4.6 million during fiscal 2010 which compares to a decrease of $26.7 million in fiscal 2009. In fiscal 2010, home heating oil prices rose from the beginning of the year which drove a slight increase in accounts receivable as compared to fiscal 2009 when selling prices were much lower than the beginning of the fiscal year. Days sales outstanding were 50 days as of September 30, 2010 compared to 50 days as of September 30, 2009 and 57 days as of September 30, 2008. In addition, during fiscal 2010 the Partnership contributed $13.1 million into the frozen pension plan which exceeded the fiscal 2009 contribution of $1.9 million by $11.2 million.
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Star Gas Partners L.p. has a market cap of $347.1 million; its shares were traded at around $5.15 with a P/E ratio of 12 and P/S ratio of 0.3. The dividend yield of Star Gas Partners L.p. stocks is 6%. Star Gas Partners L.p. had an annual average earning growth of 80.3% over the past 5 years.
Highlight of Business Operations:
Installation costs increased by $4.0 million to $59.8 million, or 85.0% of installation sales, during fiscal 2011, versus $55.8 million, or 85.4% of installation sales during fiscal 2010, due to acquisitions ($4.6 million). Service expenses increased by $6.1 million to $119.8 million, or 93.5% of service sales, during fiscal 2011, from $113.7 million in fiscal 2010, or 95.5% of sales, due to acquisitions ($7.8 million). For fiscal 2011, we achieved a combined profit from service and installation of $18.9 million, compared to a combined profit of $14.9 million forFor fiscal 2011, delivery and branch expenses increased $32.1 million, or 14.7%, to $250.8 million, compared to $218.6 million for fiscal 2010. Acquisitions accounted for $20.0 million of the higher delivery and branch expenses. In the base business, delivery and branch expenses increased by $12.0 million due to higher delivery expenses of $3.2 million associated with the increase in volume and the numerous snow storms experienced during fiscal 2011 along with an increase in bad debt expense and credit card fees of $5.3 million associated with the rise in sales. The Partnership has increased its reserve rate for doubtful accounts for fiscal 2011, compared to fiscal 2010, in response to an 11 day increase in the days sales outstanding, increased volume due to colder temperatures and higher selling prices. Insurance claims expense also rose by $3.3 million due to an increase in reserves for prior year claims and higher current year claim expense resulting from the extreme winter weather.
For fiscal 2010, product sales decreased $5.0 million, or 0.4%, to $1.028 billion, as compared to $1.033 billion for fiscal 2009, as an 11.0% increase in home heating oil and propane selling prices and an increase in sales of other petroleum products of $15.9 million (1.5% of total product sales) was reduced by a 11.7% decrease in home heating oil and propane volume. Selling prices rose largely due to an increase in wholesale product costs.
During fiscal 2011, cash provided by operating activities decreased by $5.0 million to $39.4 million, when compared to $44.4 million of cash provided by operating activities during fiscal 2010, as a favorable change in cash generated from operations of $14.3 million, the timing of cash receipts from budget customers of $7.5 million, increases in accruals for insurance, interest, profit sharing and accounts payable totaling $11.2 million and lower contributions to the Partnerships frozen pension plan of $9.9 million was reduced by a decline of $11.9 million in the cash benefit relating to the payment for hedging options, an increase in inventory of $11.2 million (largely due to an increase in price) and an increase in cash needs to fund accounts receivable of $27.0 million. In fiscal 2010, the Partnership structured its option purchases such that the cost of the option will be paid as it expired rather than at the time the hedge is entered into. The increase in accounts receivable can be attributed to an increase in volume due to acquisitions and colder temperatures, as well as an increase in selling prices. Days sales outstanding as of September 30, 2011 were 61 days as compared to 50 days at September 30, 2010 and 50 days at September 30, 2009. The impact of a colder third fiscal quarter coupled with an increase in wholesale product costs resulted in both budget and non-budget customers owing more at September 30, 2011 than at September 30, 2010.
During fiscal 2010, cash provided by operating activities declined by $34.1 million to $44.4 million, compared to $78.5 million for fiscal 2009 as favorable changes in cash used for inventory purchases of $15.7 million and option purchases of $12.2 million were more than offset by a decline in cash generated from operations of $17.9 million, increases in cash used to finance accounts receivable of $31.2 million and higher pension plan contributions of $11.2 million. During fiscal 2010, the Partnership bought 23.9 million fewer gallons of home heating oil for inventory than during fiscal 2009, which resulted in a favorable change in cash flows of $15.7 million. At the beginning of fiscal 2009, the Partnerships physical inventory of home heating oil was comparatively low because the Partnership did not prebuy physical inventory due to the relatively high cost at the time. The change in inventory was also impacted by price. During fiscal 2010, inventory costs increased by $0.42 per gallon compared to the prior period which experienced a reduction in inventory cost of $1.54 per gallon. In fiscal 2010, the Partnership structured its option purchases such that the cost of the option is paid as it expires rather than at the time the hedge is entered into. This favorably impacted cash in fiscal 2010. Cash flow from operations declined by $17.9 million largely due to the weather related decline in home heating oil volume and operating loss from acquisitions completed after the heating oil season. The Partnerships accounts receivable increased by $4.6 million during fiscal 2010 which compares to a decrease of $26.7 million in fiscal 2009. In fiscal 2010, home heating oil prices rose from the beginning of the year which drove a slight increase in accounts receivable as compared to fiscal 2009 when selling prices were much lower than the beginning of the fiscal year. Days sales outstanding were 50 days as of September 30, 2010 compared to 50 days as of September 30, 2009 and 57 days as of September 30, 2008. In addition, during fiscal 2010 the Partnership contributed $13.1 million into the frozen pension plan which exceeded the fiscal 2009 contribution of $1.9 million by $11.2 million.
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