<PAGE> 1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________ to __________
Commission file number 1-13692
Commission file number 33-92734-01
AMERIGAS PARTNERS, L.P.
AMERIGAS FINANCE CORP.
(Exact name of registrants as specified in their charters)
Delaware 23-2787918
Delaware 23-2800532
(State or other jurisdiction of (I.R.S.Employer
incorporation or organization) Identification No.)
460 North Gulph Road, King of Prussia, PA
(Address of principal executive offices)
19406
(Zip Code)
(610) 337-7000
(Registrants' telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
-- --
At July 31, 1998, the registrants had units and shares of common stock
outstanding as follows:
<TABLE>
<S> <C>
AmeriGas Partners, L.P. - 22,105,993 Common Units
19,782,146 Subordinated Units
AmeriGas Finance Corp. - 100 shares
</TABLE>
<PAGE> 2
AMERIGAS PARTNERS, L.P.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGES
-----
<S> <C>
PART I FINANCIAL INFORMATION
Item 1. Financial Statements
AmeriGas Partners, L.P.
Condensed Consolidated Balance Sheets as of June 30, 1998,
September 30, 1997 and June 30, 1997 1
Condensed Consolidated Statements of Operations for the three,
nine and twelve months ended June 30, 1998 and 1997 2
Condensed Consolidated Statements of Cash Flows for the nine
and twelve months ended June 30, 1998 and 1997 3
Condensed Consolidated Statement of Partners' Capital for the
nine months ended June 30, 1998 4
Notes to Condensed Consolidated Financial Statements 5 - 8
AmeriGas Finance Corp.
Balance Sheets as of June 30, 1998 and September 30, 1997 9
Note to Balance Sheets 10
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 11 - 19
PART II OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 19
Signatures 20
</TABLE>
<PAGE> 3
AMERIGAS PARTNERS, L.P. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
(Thousands of dollars)
<TABLE>
<CAPTION>
June 30, September 30, June 30,
1998 1997 1997
---------- ------------ --------
<S> <C> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 7,462 $ 4,069 $ 21,206
Accounts receivable (less allowances for doubtful accounts
of $8,774, $7,875, and $7,783, respectively) 59,327 78,341 82,781
Inventories 55,305 64,933 61,121
Prepaid expenses and other current assets 11,222 35,748 7,544
---------- ---------- ----------
Total current assets 133,316 183,091 172,652
Property, plant and equipment (less accumulated depreciation and
amortization of $192,913, $167,385, and $159,408, respectively) 442,751 444,677 445,330
Intangible assets (less accumulated amortization of $135,335,
$116,557, and $110,324, respectively) 634,991 677,116 676,989
Other assets 13,096 13,777 13,776
---------- ---------- ----------
Total assets $1,224,154 $1,318,661 $1,308,747
========== ========== ==========
LIABILITIES AND PARTNERS' CAPITAL
Current liabilities:
Current maturities of long-term debt $ 6,160 $ 6,420 $ 11,787
Bank loans 11,000 28,000 --
Accounts payable - trade 30,453 50,055 33,133
Accounts payable - related parties 3,939 4,533 5,539
Other current liabilities 70,523 91,861 64,583
---------- ---------- ----------
Total current liabilities 122,075 180,869 115,042
Long-term debt 693,896 684,308 684,966
Other noncurrent liabilities 49,631 50,904 53,024
Commitments and contingencies
Minority interest 4,638 5,043 5,604
Partners' capital 353,914 397,537 450,111
---------- ---------- ----------
Total liabilities and partners' capital $1,224,154 $1,318,661 $1,308,747
========== ========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
-1-
<PAGE> 4
AMERIGAS PARTNERS, L.P. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(Thousands of dollars, except per unit)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended Twelve Months Ended
June 30, June 30, June 30,
-------------------------- ------------------------- -------------------------
1998 1997 1998 1997 1998 1997
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Revenues:
Propane $ 140,363 $ 159,796 $ 705,540 $ 844,292 $ 855,448 $ 1,001,787
Other 17,843 17,870 61,771 64,639 80,757 84,253
----------- ----------- ----------- ----------- ----------- -----------
158,206 177,666 767,311 908,931 936,205 1,086,040
----------- ----------- ----------- ----------- ----------- -----------
Costs and expenses:
Cost of sales - propane 63,014 82,346 352,984 482,080 434,863 573,754
Cost of sales - other 6,695 7,062 26,683 27,849 35,247 37,646
Operating and administrative
expenses 74,829 73,967 241,269 238,656 319,005 320,843
Depreciation and amortization 15,830 15,351 47,081 46,365 62,720 61,861
Miscellaneous income, net (1,510) (1,653) (3,476) (10,105) (4,687) (11,273)
----------- ----------- ----------- ----------- ----------- -----------
158,858 177,073 664,541 784,845 847,148 982,831
----------- ----------- ----------- ----------- ----------- -----------
Operating income (loss) (652) 593 102,770 124,086 89,057 103,209
Interest expense (16,234) (15,995) (50,048) (49,602) (66,104) (65,443)
----------- ----------- ----------- ----------- ----------- -----------
Income (loss) before income taxes (16,886) (15,402) 52,722 74,484 22,953 37,766
Income tax (expense) benefit 199 122 72 (349) 241 (316)
Minority interest 142 128 (612) (828) (339) (484)
----------- ----------- ----------- ----------- ----------- -----------
Net income (loss) $ (16,545) $ (15,152) $ 52,182 $ 73,307 $ 22,855 $ 36,966
=========== =========== =========== =========== =========== ===========
General partner's interest in
net income (loss) $ (165) $ (152) $ 522 $ 733 $ 229 $ 370
=========== =========== =========== =========== =========== ===========
Limited partners' interest in
net income (loss) $ (16,380) $ (15,000) $ 51,660 $ 72,574 $ 22,626 $ 36,596
=========== =========== =========== =========== =========== ===========
Income (loss) per
limited partner unit $ (0.39) $ (0.36) $ 1.23 $ 1.74 $ 0.54 $ 0.87
=========== =========== =========== =========== =========== ===========
Average limited partner units
outstanding (thousands) 41,888 41,842 41,885 41,784 41,875 41,771
=========== =========== =========== =========== =========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
-2-
<PAGE> 5
AMERIGAS PARTNERS, L.P. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(Thousands of dollars)
<TABLE>
<CAPTION>
Nine Months Ended Twelve Months Ended
June 30, June 30,
-------------------------- --------------------------
1998 1997 1998 1997
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 52,182 $ 73,307 $ 22,855 $ 36,966
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 47,081 46,365 62,720 61,861
Other, net (960) 1,127 1,852 (2,593)
--------- --------- --------- ---------
98,303 120,799 87,427 96,234
Net change in:
Accounts receivable 14,997 (1,039) 17,547 (9,818)
Inventories and prepaid propane purchases 31,625 22,218 6,297 4,787
Accounts payable (20,669) (10,815) (4,753) 2,301
Other current assets and liabilities (16,813) (20,161) 89 2,271
--------- --------- --------- ---------
Net cash provided by operating activities 107,443 111,002 106,607 95,775
--------- --------- --------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Expenditures for property, plant and equipment (22,026) (16,708) (29,788) (20,566)
Proceeds from disposals of assets 3,261 9,217 4,657 10,699
Acquisitions of businesses, net of cash acquired (6,871) (4,543) (13,955) (23,299)
--------- --------- --------- ---------
Net cash used by investing activities (25,636) (12,034) (39,086) (33,166)
--------- --------- --------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Distributions (69,788) (69,614) (93,035) (92,797)
Minority interest activity (751) (736) (1,039) (1,024)
Increase (decrease) in bank loans (17,000) (15,000) 4,000 --
Issuance of long-term debt 13,000 8,131 13,000 31,132
Repayment of long-term debt (3,887) (2,691) (4,203) (3,110)
Capital contribution from General Partner 12 26 12 26
--------- --------- --------- ---------
Net cash used by financing activities (78,414) (79,884) (81,265) (65,773)
--------- --------- --------- ---------
Cash and cash equivalents increase (decrease) $ 3,393 $ 19,084 $ (13,744) $ (3,164)
========= ========= ========= =========
CASH AND CASH EQUIVALENTS:
End of period $ 7,462 $ 21,206 $ 7,462 $ 21,206
Beginning of period 4,069 2,122 21,206 24,370
--------- --------- --------- ---------
Increase (decrease) $ 3,393 $ 19,084 $ (13,744) $ (3,164)
========= ========= ========= =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
-3-
<PAGE> 6
AMERIGAS PARTNERS, L.P. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF PARTNERS' CAPITAL
(unaudited)
(Thousands, except unit data)
<TABLE>
<CAPTION>
Number of units Total
--------------------------- General partners'
Common Subordinated Common Subordinated partner capital
---------- ------------ --------- ------------ ------- ---------
<S> <C> <C> <C> <C> <C> <C>
BALANCE SEPTEMBER 30, 1997 22,060,407 19,782,146 $ 208,253 $ 185,310 $ 3,974 $ 397,537
Net income 27,263 24,397 522 52,182
Distributions (36,461) (32,629) (698) (69,788)
Issuance of Common Units in
connection with acquisition 45,586 1,198 1,198
Adjustments to net assets
contributed (14,172) (12,783) (272) (27,227)
Cash contribution by
General Partner 6 5 1 12
---------- ---------- --------- --------- ------- ---------
BALANCE JUNE 30, 1998 22,105,993 19,782,146 $ 186,087 $ 164,300 $ 3,527 $ 353,914
========== ========== ========= ========= ======= =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
-4-
<PAGE> 7
AMERIGAS PARTNERS, L.P.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
(Thousands of dollars, except per unit)
1. BASIS OF PRESENTATION
AmeriGas Partners, L.P. (AmeriGas Partners), through its subsidiary
AmeriGas Propane, L.P. (the "Operating Partnership"), is the largest
retail propane distributor in the United States. The Operating Partnership
serves residential, commercial, industrial, motor fuel and agricultural
customers from locations in 45 states, including Alaska and Hawaii.
AmeriGas Partners and the Operating Partnership are Delaware limited
partnerships. AmeriGas Propane, Inc. (the "General Partner") serves as the
general partner of AmeriGas Partners and the Operating Partnership. The
General Partner holds a 1% general partner interest in AmeriGas Partners
and a 1.01% general partner interest in the Operating Partnership. In
addition, the General Partner and its wholly owned subsidiary Petrolane
Incorporated (Petrolane) own an effective 56.6% limited partner interest
in the Operating Partnership.
The condensed consolidated financial statements include the accounts of
AmeriGas Partners, the Operating Partnership and their subsidiaries,
collectively referred to herein as the Partnership. The General Partner's
1.01% interest in the Operating Partnership is accounted for in the
condensed consolidated financial statements as a minority interest.
Certain prior-period balances have been reclassified to conform with the
current period presentation.
The accompanying condensed consolidated financial statements are unaudited
and have been prepared in accordance with the rules and regulations of the
U.S. Securities and Exchange Commission. They include all adjustments
which the Partnership considers necessary for a fair statement of the
results for the interim periods presented. Such adjustments consisted only
of normal recurring items unless otherwise disclosed. These financial
statements should be read in conjunction with the financial statements and
notes thereto included in the Partnership's Report on Form 10-K for the
year ended September 30, 1997. Weather significantly impacts demand for
propane and profitability because many customers use propane for heating
purposes. Due to the seasonal nature of the Partnership's propane
business, the results of operations for interim periods are not
necessarily indicative of the results to be expected for a full year.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities,
the disclosure of contingent assets and liabilities
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<PAGE> 8
AMERIGAS PARTNERS, L.P.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(unaudited)
(Thousands of dollars, except per unit)
at the date of the financial statements, and revenues and expenses during
the reporting period. Actual results could differ from these estimates.
2. DISTRIBUTIONS OF AVAILABLE CASH
Distributions of 55 cents per limited partner unit (the "Minimum Quarterly
Distribution" or "MQD") for the quarters ended September 30, 1997,
December 31, 1997 and March 31, 1998 were paid on November 18, 1997,
February 18, 1998 and May 18, 1998, respectively, on all Common and
Subordinated units. On July 27, 1998, the Partnership declared the MQD on
all Common and Subordinated units for the quarter ended June 30, 1998,
payable August 18, 1998 to holders of record on August 10, 1998.
3. RELATED PARTY TRANSACTIONS
In accordance with the Amended and Restated Agreement of Limited
Partnership of AmeriGas Partners, the General Partner is entitled to
reimbursement of all direct and indirect expenses incurred or payments it
makes on behalf of the Partnership, and all other necessary or appropriate
expenses allocable to the Partnership or otherwise reasonably incurred by
the General Partner in connection with the Partnership's business. These
costs totaled $45,954, $140,804 and $185,686 during the three, nine and
twelve months ended June 30, 1998, respectively, and $41,716, $132,328 and
$173,620 during the three, nine and twelve months ended June 30, 1997,
respectively. In addition, UGI Corporation (UGI) provides certain
financial and administrative services to the General Partner. UGI bills
the General Partner for these direct and indirect corporate expenses, and
the General Partner is reimbursed by the Partnership for these expenses.
Such corporate expenses totaled $1,229, $4,276 and $6,215 during the
three, nine and twelve months ended June 30, 1998, respectively, and
$1,343, $4,618 and $5,901 during the three, nine and twelve months ended
June 30, 1997, respectively.
4. UNUSUAL ITEMS
In June 1998, management of the General Partner revised its estimate of
the tax basis of certain assets contributed to the Partnership in
conjunction with the Partnership's formation on April 19, 1995. The change
in estimate resulted in an adjustment to the net assets contributed to the
Partnership as follows: (1) a $17,945 decrease in goodwill; (2) a $9,561
decrease in excess reorganization value; (3) a $27,227 decrease in
partners' capital; and (4) a $279 decrease in minority interest.
-6-
<PAGE> 9
AMERIGAS PARTNERS, L.P.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(unaudited)
(Thousands of dollars, except per unit)
5. COMMITMENTS AND CONTINGENCIES
The Partnership has succeeded to the lease guarantee obligations of
Petrolane, a predecessor company of the Partnership, relating to
Petrolane's divestiture of nonpropane operations prior to its 1989
acquisition by QFB Partners. These leases are currently estimated to
aggregate approximately $57,000. The leases expire through 2010, and some
of them are currently in default. The Partnership has succeeded to the
indemnity agreement of Petrolane by which Texas Eastern Corporation (Texas
Eastern), a prior owner of Petrolane, agreed to indemnify Petrolane
against any liabilities arising out of the conduct of businesses that do
not relate to, and are not a part of, the propane business, including
lease guarantees. To date, Texas Eastern has directly satisfied defaulted
lease obligations without the Partnership having to honor its guarantee.
The Partnership believes the probability that it will be required to
directly satisfy such lease obligations is remote.
In addition, the Partnership has succeeded to Petrolane's agreement to
indemnify Shell Petroleum N.V. (Shell) for various scheduled claims that
were pending against Tropigas de Puerto Rico (Tropigas). This
indemnification agreement had been entered into by Petrolane in
conjunction with Petrolane's sale of the international operations of
Tropigas to Shell in 1989. The Partnership also succeeded to Petrolane's
right to seek indemnity on these claims first from International Controls
Corp., which sold Tropigas to Petrolane, and then from Texas Eastern. To
date, neither the Partnership nor Petrolane has paid any sums under this
indemnity, but several claims by Shell, including claims related to
certain antitrust actions aggregating at least $68,000, remain pending.
The Partnership has identified environmental contamination at several of
its properties. The Partnership's policy is to accrue environmental
investigation and cleanup costs when it is probable that a liability
exists and the amount or range of amounts can be reasonably estimated.
However, in many circumstances future expenditures cannot be reasonably
quantified because of a number of factors, including various costs
associated with potential remedial alternatives, the unknown number of
other potentially responsible parties involved and their ability to
contribute to the costs of investigation and remediation, and changing
environmental laws and regulations. The Partnership intends to pursue
recovery of any incurred costs through all appropriate means, although
such recovery cannot be assured.
In addition to these environmental matters, there are various other
pending claims and legal actions arising out of the normal conduct of the
Partnership's business. The final results of environmental and other
matters cannot be predicted with certainty. However, it is reasonably
possible that some of them could be resolved unfavorably to the
Partnership.
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<PAGE> 10
AMERIGAS PARTNERS, L.P.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(unaudited)
(Thousands of dollars, except per unit)
Management believes, after consultation with counsel, that damages or
settlements, if any, recovered by the plaintiffs in such claims or actions
will not have a material adverse effect on the Partnership's financial
position but could be material to operating results and cash flows in
future periods depending on the nature and timing of future developments
with respect to these matters and the amounts of future operating results
and cash flows.
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<PAGE> 11
AMERIGAS FINANCE CORP.
(a wholly owned subsidiary of AmeriGas Partners, L.P.)
BALANCE SHEETS
(unaudited)
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<CAPTION>
June 30, September 30,
1998 1997
------ ------
<S> <C> <C>
ASSETS
Cash $1,000 $1,000
------ ------
Total assets $1,000 $1,000
====== ======
STOCKHOLDER'S EQUITY
Common stock, $.01 par value; 100 shares authorized,
issued and outstanding $ 1 $ 1
Additional paid-in capital 999 999
------ ------
Total stockholder's equity $1,000 $1,000
====== ======
</TABLE>
The accompanying note is an integral part of these financial statements.
-9-
<PAGE> 12
AMERIGAS FINANCE CORP.
(A WHOLLY OWNED SUBSIDIARY OF AMERIGAS PARTNERS, L.P.)
NOTE TO BALANCE SHEETS
AmeriGas Finance Corp. (AmeriGas Finance), a Delaware corporation, was formed on
March 13, 1995 and is a wholly owned subsidiary of AmeriGas Partners, L.P.
(AmeriGas Partners). AmeriGas Partners was formed on November 2, 1994 as a
Delaware limited partnership. AmeriGas Partners was formed to acquire and
operate the propane businesses and assets of AmeriGas Propane, Inc., a Delaware
corporation (AmeriGas Propane), AmeriGas Propane-2, Inc. (AGP-2) and Petrolane
Incorporated (Petrolane) through AmeriGas Propane, L.P. (the "Operating
Partnership"). AmeriGas Partners holds a 98.99% limited partner interest in the
Operating Partnership and AmeriGas Propane, Inc., a Pennsylvania corporation and
the general partner of AmeriGas Partners (the "General Partner"), holds a 1.01%
general partner interest. On April 19, 1995, (i) pursuant to a Merger and
Contribution Agreement dated as of April 19, 1995, AmeriGas Propane and certain
of its operating subsidiaries and AGP-2 merged into the Operating Partnership
(the "Formation Merger"), and (ii) pursuant to a Conveyance and Contribution
Agreement dated as of April 19, 1995, Petrolane conveyed substantially all of
its assets and liabilities to the Operating Partnership (the "Petrolane
Conveyance"). As a result of the Formation Merger and the Petrolane Conveyance,
the General Partner and Petrolane received limited partner interests in the
Operating Partnership and the Operating Partnership owns substantially all of
the assets and assumed substantially all of the liabilities of AmeriGas Propane,
AGP-2 and Petrolane. AmeriGas Propane conveyed its limited partner interest in
the Operating Partnership to AmeriGas Partners in exchange for 2,922,235 Common
Units and 13,350,146 Subordinated Units of AmeriGas Partners and Petrolane
conveyed its limited partner interest in the Operating Partnership to AmeriGas
Partners in exchange for 1,407,911 Common Units and 6,432,000 Subordinated Units
of AmeriGas Partners. Both Common and Subordinated units represent limited
partner interests in AmeriGas Partners.
On April 19, 1995, AmeriGas Partners issued $100,000,000 face value of 10.125%
Senior Notes due April 2007. AmeriGas Finance serves as a co-obligor of these
notes.
AmeriGas Partners owns all 100 shares of AmeriGas Finance Common Stock
outstanding.
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<PAGE> 13
AMERIGAS PARTNERS, L.P.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
ANALYSIS OF RESULTS OF OPERATIONS
The following analyses compare the Partnership's results of operations for the
three months ended June 30, 1998 (1998 three-month period) with the three months
ended June 30, 1997 (1997 three-month period); the nine months ended June 30,
1998 (1998 nine-month period) with the nine months ended June 30, 1997 (1997
nine-month period); and the twelve months ended June 30, 1998 (1998 twelve-month
period) with the twelve months ended June 30, 1997 (1997 twelve-month period).
AmeriGas Finance Corp. has nominal assets and does not conduct any operations.
Accordingly, a discussion of the results of operations and financial condition
and liquidity of AmeriGas Finance Corp. is not presented.
1998 THREE-MONTH PERIOD COMPARED WITH 1997 THREE-MONTH PERIOD
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------
Increase
Three Months Ended June 30, 1998 1997 (Decrease)
- --------------------------- ---- ---- ----------------------
(Millions of dollars)
<S> <C> <C> <C> <C>
Gallons sold (millions):
Retail 135.9 145.4 (9.5) (6.5)%
Wholesale 29.2 34.5 (5.3) (15.4)%
-------- -------- -------
165.1 179.9 (14.8) (8.2)%
======== ======== =======
Revenues:
Retail propane $ 128.2 $ 143.3 $ (15.1) (10.5)%
Wholesale propane 12.1 16.5 (4.4) (26.7)%
Other 17.9 17.9 -- --
-------- -------- -------
$ 158.2 $ 177.7 $ (19.5) (11.0)%
======== ======== =======
Total margin $ 88.5 $ 88.3 $ .2 .2%
EBITDA (a) $ 15.2 $ 15.9 $ (.7) (4.4)%
Operating income (loss) $ (.7) $ .6 $ (1.3) N.M.
- ---------------------------------------------------------------------------------
</TABLE>
(a) EBITDA (earnings before interest expense, income taxes, depreciation and
amortization) should not be considered as an alternative to net income (as
an indicator of operating performance) or as an alternative to cash flow
(as a measure of liquidity or ability to service debt obligations) and is
not a measure of performance or financial condition under generally
accepted accounting principles.
N.M. - Not meaningful.
Retail volumes of propane sold during the 1998 three-month period decreased due
in large part to warmer weather in April and May 1998. Based upon degree day
information provided by the
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<PAGE> 14
AMERIGAS PARTNERS, L.P.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)
National Oceanic and Atmospheric Administration (NOAA) for 335 airports in the
continental U.S., weather during the 1998 three-month period was approximately
8% warmer than normal and 21% warmer than the same period of 1997. Wholesale
volumes of propane sold were lower in the 1998 three-month period also due to
the warmer weather and lower purchases by independent retailers.
Total revenues from retail propane sales decreased $15.1 million during the 1998
three-month period reflecting (1) a $9.4 million decrease as a result of the
lower volumes sold and (2) a $5.7 million decrease as a result of lower average
retail propane selling prices. The lower average retail propane selling prices
reflect lower 1998 three-month period propane product costs. Wholesale propane
revenues decreased $4.4 million due to the previously mentioned lower wholesale
volumes sold as well as lower average wholesale propane selling prices.
Notwithstanding the lower propane volumes sold, total margin increased $.2
million in the 1998 three-month period. Retail unit margins were higher in 1998
as the Partnership benefitted from lower industry-wide propane product costs.
The decrease in wholesale volumes did not have a material impact on the change
in total margin because wholesale unit margins are typically very small.
The decrease in EBITDA during the 1998 three-month period principally resulted
from higher operating expenses. Operating expenses in the 1998 three-month
period include net benefits of $2.2 million comprising (1) $2.0 million from
lower required accruals for property taxes, (2) $1.7 million from lower required
accruals for environmental matters and (3) a $1.5 million increase in accrued
disability benefits. Excluding these items, operating and administrative
expenses increased $3.1 million principally reflecting higher expenses
associated with Partnership acquisitions and new business development
activities.
Interest expense was $16.2 million during the 1998 three-month period compared
with $16.0 million during the 1997 three-month period. The increase in interest
expense reflects higher average borrowings under the Partnership's Revolving
Credit and Acquisition facilities.
-12-
<PAGE> 15
AMERIGAS PARTNERS, L.P.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)
1998 NINE-MONTH PERIOD COMPARED WITH 1997 NINE-MONTH PERIOD
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------
Nine Months Ended June 30, 1998 1997 Decrease
- -------------------------- ---- ----- ---------------
(Millions of dollars)
<S> <C> <C> <C> <C>
Gallons sold (millions):
Retail 650.2 664.7 (14.5) (2.2)%
Wholesale 172.7 176.6 (3.9) (2.2)%
------ ------ -----
822.9 841.3 (18.4) (2.2)%
===== ===== ====
Revenues:
Retail propane $ 628.8 $737.7 $(108.9) (14.8)%
Wholesale propane 76.8 106.6 (29.8) (28.0)%
Other 61.7 64.6 (2.9) (4.5)%
------- ------ -------
$ 767.3 $908.9 $(141.6) (15.6)%
======= ====== =======
Total margin $ 387.6 $399.0 $ (11.4) (2.9)%
EBITDA (a) $ 149.9 $170.5 $ (20.6) (12.1)%
Operating income $ 102.8 $124.1 $ (21.3) (17.2)%
- ----------------------------------------------------------------------------
</TABLE>
(a) EBITDA (earnings before interest expense, income taxes, depreciation and
amortization) should not be considered as an alternative to net income (as
an indicator of operating performance) or as an alternative to cash flow
(as a measure of liquidity or ability to service debt obligations) and is
not a measure of performance or financial condition under generally
accepted accounting principles.
Retail volumes of propane sold were slightly lower during the 1998 nine-month
period. Based upon degree day information provided by NOAA for 335 airports in
the continental U.S., weather during the peak heating-season months November
1997 through March 1998 was 9% warmer than normal and 5% warmer than the prior
year. In particular, the period comprising January and February 1998 was the
warmest in more than 100 years.
Total revenues from retail propane sales decreased $108.9 million during the
1998 nine-month period reflecting (1) a $92.8 million decrease as a result of
lower average retail propane selling prices and (2) a $16.1 million decrease as
a result of the lower retail volumes sold. The decrease in wholesale propane
revenues is due principally to lower 1998 nine-month period selling prices. The
lower average retail and wholesale selling prices resulted from significantly
lower propane product costs. The decline in other revenues reflects in large
part lower terminal and storage revenues and lower appliance sales revenues.
-13-
<PAGE> 16
AMERIGAS PARTNERS, L.P.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)
Total margin declined $11.4 million in the 1998 nine-month period principally
reflecting the impact of lower retail volumes sold. Although average retail
propane unit margins for the 1998 nine-month period were comparable with the
prior-year period, the Partnership recorded significantly lower retail unit
margins early in the 1998 nine-month period (compared to the same period of the
prior year) and higher retail unit margins later in the period. Retail unit
margins early in the prior-year period were higher due to fuel supply and
pricing strategies that were especially effective during the unique market
conditions (characterized by a rapid increase in propane spot-market prices)
that existed at the time. Retail unit margins in the later part of the 1998
nine-month period benefitted from significantly lower propane product costs.
The decrease in operating income and EBITDA during the 1998 nine-month period
principally reflects (1) the decrease in total margin, (2) lower miscellaneous
income and (3) slightly higher operating expenses. Miscellaneous income in the
prior-year nine-month period includes (1) $4.7 million of income from the sale
of the Partnership's 50% interest in Atlantic Energy, Inc. (Atlantic Energy),
(2) higher customer finance charges and (3) higher interest income on short-term
investments. Operating expenses in the 1998 nine-month period include net
benefits of $2.2 million comprising (1) $2.0 million from lower required
accruals for property taxes, (2) $1.7 million from lower required accruals for
environmental matters and (3) a $1.5 million increase in accrued disability
benefits. Excluding these items, operating and administrative expenses of the
Partnership increased $4.8 million principally reflecting higher expenses
associated with acquisitions and new business development activities.
Interest expense was $50.0 million during the 1998 nine-month period compared
with $49.6 million in the prior-year period reflecting increased interest
expense on the Partnership's Acquisition Facility from higher amounts
outstanding.
-14-
<PAGE> 17
AMERIGAS PARTNERS, L.P.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)
1998 TWELVE-MONTH PERIOD COMPARED WITH 1997 TWELVE-MONTH PERIOD
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------
Twelve Months Ended June 30, 1998 1997 Decrease
- ---------------------------- ------- -------- -----------------
(Millions of dollars)
<S> <C> <C> <C> <C>
Gallons sold (millions):
Retail 792.9 814.0 (21.1) (2.6)%
Wholesale 214.7 225.4 (10.7) (4.7)%
------- ------- ----
1,007.6 1,039.4 (31.8) (3.1)%
======= ======= ====
Revenues:
Retail propane $ 759.3 $ 871.6 $(112.3) (12.9)%
Wholesale propane 96.2 130.2 (34.0) (26.1)%
Other 80.7 84.2 (3.5) (4.2)%
------- -------- -------
$ 936.2 $1,086.0 $(149.8) (13.8)%
======= ======== =======
Total margin $ 466.1 $ 474.6 $ (8.5) (1.8)%
EBITDA (a) $ 151.8 $ 165.1 $ (13.3) (8.1)%
Operating income $ 89.1 $ 103.2 $ (14.1) (13.7)%
- -----------------------------------------------------------------------------
</TABLE>
(a) EBITDA (earnings before interest expense, income taxes, depreciation and
amortization) should not be considered as an alternative to net income (as
an indicator of operating performance) or as an alternative to cash flow
(as a measure of liquidity or ability to service debt obligations) and is
not a measure of performance or financial condition under generally
accepted accounting principles.
Retail and wholesale volumes of propane sold decreased in the 1998 twelve-month
period principally reflecting the effects of warmer heating season temperatures.
Based upon degree day information provided by NOAA for 335 airports in the
continental U.S., weather during the peak heating season months of November 1997
through March 1998 averaged 9% warmer than normal and 5% warmer than the prior
year. In particular, the period comprising January and February 1998 was the
warmest in more than 100 years.
Total revenues from retail propane sales declined $112.3 million reflecting (1)
an $89.7 million decrease as a result of lower average retail propane selling
prices and (2) a $22.6 million decrease as a result of the lower retail volumes
sold. The decrease in wholesale propane revenues reflects (1) a $27.8 million
decrease as a result of lower average selling prices and (2) a $6.2 million
decrease as a result of the lower volumes. The higher selling prices in the
prior-year period were a result of significantly higher propane spot-market
prices.
Total margin in the 1998 twelve-month period was lower than the prior-year
period reflecting the
-15-
<PAGE> 18
AMERIGAS PARTNERS, L.P.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)
impact of the lower propane volumes sold. Total margin from other sales and
services during the 1998 twelve-month period was slightly lower than in the
prior-year period.
EBITDA and operating income declined during the 1998 twelve-month period as a
result of (1) the previously mentioned lower total margin and (2) lower
miscellaneous income. Miscellaneous income in the 1997 twelve-month period
includes $4.7 million of income from the sale of the Partnership's 50% interest
in Atlantic Energy. Miscellaneous income in the prior-year period also includes
higher interest income and income from sales of fixed assets. Operating expenses
were slightly lower during the 1998 twelve-month period principally as a result
of (1) lower required self-insurance reserves and costs associated with general
and automobile liability and workers' compensation and (2) lower required
accruals for environmental and property tax matters. These decreases were
partially offset by higher expenses associated with Partnership acquisitions and
new business development activities.
Interest expense was $66.1 million in the twelve months ended June 30, 1998
compared with $65.4 million in the prior-year period. The increase reflects
higher interest expense on the Partnership's Revolving Credit and Acquisition
facilities principally due to larger amounts outstanding.
FINANCIAL CONDITION AND LIQUIDITY
FINANCIAL CONDITION
The Partnership's debt outstanding at June 30, 1998 totaled $711.1 million
compared with $718.7 million at September 30, 1997. The decrease reflects a $17
million decrease in borrowings under the Revolving Credit Facility and a $3.7
million decrease in other long-term debt partially offset by the issuance of $13
million under the Acquisition Facility. The Partnership's debt outstanding at
June 30, 1997 totaled $696.8 million. At June 30, 1998 there was $11 million
outstanding under the Revolving Credit Facility. At June 30, 1997 there were no
amounts outstanding under the Revolving Credit Facility.
In June 1998, management of the General Partner revised its estimate of the tax
basis of certain assets contributed to the Partnership in conjunction with the
Partnership's formation on April 19, 1995. The change in estimate resulted in an
adjustment to the net assets contributed to the Partnership as follows: (1) a
$17,945 decrease in goodwill; (2) a $9,561 decrease in excess reorganization
value; (3) a $27,227 reduction in partner's capital; and (4) a $279 decrease in
minority interest.
During the nine months ended June 30, 1998, the Partnership declared and paid
the MQD of 55 cents on all units for the quarters ended September 30, 1997,
December 31, 1997 and March 31, 1998. The MQD for the quarter ended June 30,
1998 will be paid on August 18, 1998 to holders of record on August 10, 1998 of
all Common and Subordinated units.
-16-
<PAGE> 19
AMERIGAS PARTNERS, L.P.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)
The ability of the Partnership to continue to pay the full MQD on all of its
units will depend upon a number of factors including the level of Partnership
earnings, the cash needs of the Partnership's operations (including cash needed
for maintenance and growth capital), and the Partnership's ability to finance
externally such cash needs. The Partnership's EBITDA during the 1998 nine-month
period was $20.6 million lower than during the 1997 nine-month period. Given the
level of EBITDA to date, it is unlikely the Partnership will be able to fund
solely from cash generated from operations during fiscal 1998 payment of the
full distribution on its Subordinated Units for the remainder of calendar year
1998. While the Partnership expects to have sufficient borrowing capacity to
fund all of its cash needs (including amounts for growth capital and the full
distribution on the Subordinated Units) during this period, no assurance can be
given that the General Partner will elect to utilize such borrowing capacity to
fund the full distribution on the Subordinated Units. The Partnership expects to
generate sufficient cash from operations during fiscal 1998 to continue to fund
the full distribution on the Common Units.
CASH FLOWS
Cash and cash equivalents totaled $7.5 million at June 30, 1998 compared with
$4.1 million at September 30, 1997 and $21.2 million at June 30, 1997. Due to
the seasonal nature of the propane business, cash flows from operating
activities are generally strongest during the second and third fiscal quarters
of the Partnership when customers pay for propane purchased during the heating
season and are typically at their lowest levels during the first and fourth
fiscal quarters. Accordingly, cash flows from operations during the nine months
ended June 30, 1998 are not necessarily indicative of cash flows to be expected
for a full year.
OPERATING ACTIVITIES. Cash provided by operating activities was $107.4 million
during the nine months ended June 30, 1998 compared with $111.0 million in the
comparable prior-year period. Cash flow from operations before changes in
working capital was $98.3 million in the nine months ended June 30, 1998
compared with $120.8 million during the nine months ended June 30, 1997
reflecting the decrease in the Partnership's operating results. Changes in
operating working capital during the nine months ended June 30, 1998 provided
$9.1 million of operating cash flow principally from a $15.0 million decrease in
accounts receivable and a $31.6 million seasonal decrease in inventories and
prepaid propane purchases partially offset by a $20.7 million decrease in
accounts payable and a $16.8 million decrease in other net current liabilities.
During the nine months ended June 30, 1997, changes in operating working capital
required $9.8 million of operating cash flow.
INVESTING ACTIVITIES. Cash expenditures for property, plant and equipment
totaled $22.0 million (including maintenance capital expenditures of $7.0
million) during the nine months ended June 30, 1998 compared with $16.7 million
(including maintenance capital expenditures of $5.3 million) in the prior-year
period. Proceeds from disposals of assets totaled $3.3 million during the nine
months ended June 30, 1998 compared with $9.2 million during the nine months
ended June 30, 1997. Proceeds in the prior-year period included those from the
sale of Atlantic Energy. During the nine months ended June 30, 1998, the
Partnership acquired several propane businesses for an aggregate $6.9 million in
-17-
<PAGE> 20
AMERIGAS PARTNERS, L.P.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)
cash. In conjunction with one acquisition, the Partnership issued 45,586 Common
Units to the General Partner having a fair value of $1.2 million. During the
nine months ended June 30, 1997, the Partnership made acquisition-related cash
payments of $4.5 million.
FINANCING ACTIVITIES. During the nine-month periods ended June 30, 1998 and
1997, AmeriGas Partners declared and paid the MQD on all Common and Subordinated
units and the general partner interest. In addition, during each of the
nine-month periods ended June 30, 1998 and 1997, the Operating Partnership
distributed $.8 million and $.7 million, respectively, for the General Partner's
1.01% interest in the Operating Partnership. During the nine months ended June
30, 1998 and 1997, the Partnership had net repayments under its working capital
facilities of $17 million and $15 million, respectively. The Partnership
borrowed $13 million under its Acquisition Facility during the nine months ended
June 30, 1998. During the prior-year nine-month period, the Partnership borrowed
$7 million under the Acquisition Facility. During the nine months ended June 30,
1998, the Partnership made long-term debt repayments of $3.9 million (including
the repayment of $1.2 million of debt assumed in conjunction with an
acquisition) compared with $2.7 million in the prior-year period.
YEAR 2000 MATTERS
The Partnership, in conjunction with outside consultants, has conducted a
detailed assessment of its critical computer-based systems in order to evaluate
its Year 2000 ("Y2K") exposure. The Y2K issue is a result of computer programs
being written using two digits (rather than four) to identify and process a year
in a date field. Computer programs having date sensitive software may recognize
date fields using "00" as the year 1900 rather than the year 2000, resulting in
miscalculations and possible computer-based system failures. The Partnership has
also identified and is contacting major vendors on which it depends for products
or services in order to assess their Y2K compliance readiness and, if necessary,
to develop appropriate contingency plans.
The Partnership has a number of information system improvement initiatives under
way which include the installation of integrated financial system software that
is Y2K compliant. In addition, the Partnership, in conjunction with consultants,
has begun modifying its computer-based systems that are not currently Y2K
compliant. The Partnership anticipates that its critical computer-based systems
will be Y2K compliant by March 31, 1999.
The Partnership does not expect the costs to modify its computer-based systems,
which will be expensed as incurred, will have a material effect on the
Partnership's results of operations or cash flows. However, in the event that
the Partnership or its major suppliers experience disruptions due to Y2K issues,
the Partnership's operations could be adversely affected.
-18-
<PAGE> 21
AMERIGAS PARTNERS, L.P.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)
ACCOUNTING PRINCIPLES NOT YET ADOPTED
In June 1998, the Financial Accounting Standards Boards (FASB) issued SFAS No.
133, "Accounting for Derivative Instruments and Hedging Activities" (SFAS 133).
SFAS 133 establishes accounting and reporting standards for derivative
instruments, including certain derivative instruments embedded in other
contracts, and for hedging activities. It requires that an entity recognize all
derivatives as either assets or liabilities and measure the instruments at fair
value. The accounting for changes in fair value of a derivative depends upon the
intended use of such derivative. The Partnership expects to adopt the provisions
of SFAS 133 in fiscal 2000.
The Partnership utilizes derivative commodity instruments, including futures
contracts, price swap agreements and option contracts, to manage market risk
associated with a portion of its anticipated propane supply requirements. The
Partnership's price risk management policy does not permit speculative trading
of derivative instruments. To the extent such derivative instruments qualify and
are designated as hedges of forecasted transactions, changes in the fair value
will generally be reported as a component of other comprehensive income and
reclassified into earnings when the forecasted transaction affects earnings. To
the extent such derivative qualifies as a hedge of a firm commitment, any gain
or loss would generally be recognized in earnings together with the offsetting
gain or loss on the hedged item.
The impact of the adoption of SFAS 133 on the Partnership's financial condition
and results of operations will depend upon a number of factors including the
extent to which the Partnership uses derivative instruments and the designation
and effectiveness of such derivatives as hedging market risk.
PART II OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) List of Exhibits:
10 Amendment No. 1 to AmeriGas Propane, Inc. Executive Employee
Severance Pay Plan
27.1 Financial Data Schedule of AmeriGas Partners, L.P.
27.2 Financial Data Schedule of AmeriGas Finance Corp.
(b) No Current Report on Form 8-K was filed by either AmeriGas Partners,
L.P. or AmeriGas Finance Corp. during the fiscal quarter ended June
30, 1998.
-19-
<PAGE> 22
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrants have duly caused this report to be signed on their behalf by the
undersigned thereunto duly authorized.
AmeriGas Partners, L.P.
--------------------------------------
(Registrant)
By: AmeriGas Propane, Inc.,
as General Partner
Date: August 12, 1998 By: Martha B. Lindsay
--------------- ---------------------------------
Martha B. Lindsay
Vice President - Finance
and Chief Financial Officer
By: Richard R.Eynon
---------------------------------
Richard R. Eynon
Controller and Chief Accounting Officer
AmeriGas Finance Corp.
---------------------------------------
(Registrant)
Date: August 12, 1998 By: Martha B. Lindsay
--------------- ---------------------------------
Martha B. Lindsay
Vice President - Finance
and Chief Financial Officer
By: Richard R. Eynon
--------------------------------------
Richard R. Eynon
Controller and Chief Accounting Officer
-20-
<PAGE> 23
AMERIGAS PARTNERS, L.P.
EXHIBIT INDEX
10 Amendment No. 1 to AmeriGas Propane, Inc. Executive Employee Severance
Pay Plan
27.1 Financial Data Schedule of AmeriGas Partners, L.P.
27.2 Financial Data Schedule of AmeriGas Finance Corp.
<PAGE> 1
Exhibit 10
AMENDMENT NO. 1
TO
AMERIGAS PROPANE, INC. EXECUTIVE EMPLOYEE SEVERANCE PAY PLAN
This Amendment No. 1, dated as of April 30, 1998, amends that certain
AmeriGas Propane, Inc. Executive Employee Severance Pay Plan ("the Plan") dated
as of January 27, 1997.
BACKGROUND
AmeriGas Propane, Inc. has approved a change in the minimum benefit
payable under the Plan. The purpose of this Amendment is to make that change in
the Plan.
NOW THEREFORE, the Plan is amended as follows:
Section 1. Amendment and Restatement. The last sentence of Section 4.01
of the Plan is hereby amended and restated in its entirety as follows:
Notwithstanding the foregoing language, the minimum
payment pursuant to this Plan shall not be less than six (6)
months of base salary at the level in effect on the beginning
of the quarter immediately preceding the Employment
Termination Date, without regard for target bonus, for
Participants in employment grades 36 and 37, and one (1)
year's base salary in effect on the beginning of the quarter
immediately preceding the Employment Termination Date, without
regard for target bonus, for Participants in employment grades
38 and higher.
Section 2. Effect of Amendment. All other terms and conditions of the
Plan shall remain unaffected by this Amendment No. 1 and are ratified and
confirmed.
Section 3. Definitions. Capitalized terms used in this Amendment No. 1,
but not defined shall have the meanings ascribed to those terms in the Plan.
-1-
<PAGE> 2
IN WITNESS WHEREOF, and as evidence of the adoption of this Amendment,
an appropriate officer of the Company has caused this Amendment to be executed
as of April 30, 1998.
Attest: AMERIGAS PROPANE, INC.
By: /s/ Robert H. Knauss By: /s/ Diane L. Carter
------------------------------ ----------------------------------
Robert H. Knauss Diane L. Carter
Secretary Vice President - Human Resources
-2-
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONDENSED CONSOLIDATED BALANCE SHEET AND STATEMENT OF OPERATIONS OF AMERIGAS
PARTNERS, L.P. AND SUBSIDIARIES AS OF AND FOR THE NINE MONTHS ENDED JUNE 30,
1998 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS
INCLUDED IN AMERIGAS PARTNERS' QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTER
ENDED JUNE 30, 1998.
</LEGEND>
<CIK> 0000932628
<NAME> AMERIGAS PARTNERS, L.P.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> OCT-01-1997
<PERIOD-END> JUN-30-1998
<CASH> 7,462
<SECURITIES> 0
<RECEIVABLES> 68,101
<ALLOWANCES> 8,774
<INVENTORY> 55,305
<CURRENT-ASSETS> 133,316
<PP&E> 635,664
<DEPRECIATION> 192,913
<TOTAL-ASSETS> 1,224,154
<CURRENT-LIABILITIES> 122,075
<BONDS> 693,896
0
0
<COMMON> 0
<OTHER-SE> 353,914
<TOTAL-LIABILITY-AND-EQUITY> 1,224,154
<SALES> 767,311
<TOTAL-REVENUES> 767,311
<CGS> 379,667
<TOTAL-COSTS> 379,667
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 4,585
<INTEREST-EXPENSE> 50,048
<INCOME-PRETAX> 52,722
<INCOME-TAX> (72)
<INCOME-CONTINUING> 52,182
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 52,182
<EPS-PRIMARY> $1.23
<EPS-DILUTED> $1.23
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE
SHEET OF AMERIGAS FINANCE CORP. AS OF JUNE 30, 1998 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH BALANCE SHEET INCLUDED IN AMERIGAS PARTNERS'
QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 1998.
</LEGEND>
<CIK> 0000945792
<NAME> AMERIGAS FINANCE CORP.
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> OCT-01-1997
<PERIOD-END> JUN-30-1998
<CASH> 1,000
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,000
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,000
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 1
<OTHER-SE> 999
<TOTAL-LIABILITY-AND-EQUITY> 1,000
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 0
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
