Suburban Propane(US:SPH)2021-11-11 17:19Financial Data and Key Metrics Changes - Fiscal year 2021 saw adjusted EBITDA increase by $22 million or nearly 9% from $253.7 million to $275.7 million [8][17] - Net income for fiscal 2021 was $101.9 million or $1.62 per common unit, compared to $62.3 million or $1 per common unit in the prior year [16] - Distributable cash flow increased by more than $26 million or 16%, ending fiscal 2021 with a distribution coverage ratio of 2.55x [9] Business Line Data and Key Metrics Changes - Propane volumes sold increased by more than 4%, with retail propane gallons sold reaching 419.8 million gallons, a 4.2% increase from the prior year [7][17] - Propane unit margins increased by about $0.02 per gallon or 1.2% compared to the prior year due to effective margin management [20] Market Data and Key Metrics Changes - Average wholesale propane prices for the year were $0.88 per gallon, which was 98% higher than the prior year [19] - Wholesale prices have continued to rise in early fiscal 2022, with current prices ranging between $1.35 and $1.45 per gallon [19][29] Company Strategy and Development Direction - The company completed an acquisition of a propane business in North Carolina and is investing in renewable energy technologies, particularly renewable DME [10][32] - The strategic focus includes building a renewable energy platform and supporting sustainability goals [11][31] Management's Comments on Operating Environment and Future Outlook - Management noted strong customer demand driven by economic activity and easing COVID-19 restrictions, contributing to increased propane volumes [7] - The outlook for the upcoming winter indicates cooler than average temperatures, which may affect propane demand [30] Other Important Information - The company repaid nearly $88 million of revolver borrowings during the fiscal year, improving its consolidated leverage ratio to 3.96x [26] - The company is committed to hiring military veterans through its Heroes Hired Here Program [6][12] Q&A Session Summary Question: Capital allocation and potential distribution increases - Management indicated that discussions on distribution increases will depend on achieving the 3.5 times leverage target and strategic opportunities in renewable energy [36][37] Question: Strategic initiatives related to Oberon - Management confirmed ongoing investments in Oberon to support renewable DME production and is evaluating additional renewable energy technologies [38][39] Question: Update on the Propane M&A market - Management noted that while the M&A market has seen increased multiples, they will remain disciplined in their acquisition strategy [41][42]