SOURCE: Parkland Fuel Corporation

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March 04, 2015 17:30 ET

Parkland Fuel Corporation Reports Record Fourth Quarter 2014 Results

Parkland Achieves $183 Million of Adjusted EBITDA in First Full Year Without Refiner's Margin Contribution;

Announces a Two Cent Increase to its Annual Dividend to $1.08 per Common Share

RED DEER, AB--(Marketwired - March 04, 2015) - Parkland Fuel Corporation ("Parkland" or the "Corporation") (TSX: PKI), Canada's largest independent marketer of fuel and petroleum products, today announced the financial and operating results for the three and twelve months ended December 31, 2014. All financial figures are expressed in Canadian dollars.

"In 2011 we rolled out the Parkland Penny Plan which was a plan to offset the financial contribution from the expiring refiner's margin contract by executing on a strategy to grow the business, expand our supply advantage, and operate effectively. I am excited by what we accomplished in 2014 and the great progress that the team has made toward delivering the Penny Plan," said Bob Espey, President and Chief Executive Officer of Parkland. "In particular, I am pleased with the underlying EBITDA growth across all divisions, the performance of acquisitions to date, and the anticipated addition of the Pioneer brand and business to Parkland. Parkland's strong performance has enabled us to increase Parkland's annual dividend by two cents per common share."

2014 Highlights

Grow

  • Added 1.2 billion litres of fuel volume and $23.7 million of Adjusted EBITDA(1) through the acquisition of SPF Energy Inc. which closed on January 8, 2014;
  • Added 12 Chevron-branded service stations in Northern British Columbia in 2014 and announced the acquisition of an additional 11 Chevron-branded services in British Columbia subsequent to year-end;
  • Announced the acquisition of Pioneer Energy for $378 million which is expected to add 2.2 billion litres of fuel volume and $55 million of Adjusted EBITDA(1) annually upon closing; and
  • Delivered strong organic growth in the retail and wholesale, supply, and trading divisions excluding the impact of the refiner's margin contract.

Supply

  • Delivered strong results in the wholesale, supply, and trading division which contributed $64 million of Adjusted EBITDA(1) without the benefit of the refiner's margin contract; and
  • Continued to grow assets and infrastructure (e.g., rail cars and storage) to help expand and buttress this core capability.

Operate

  • Reduced operating costs ("Opex") and marketing, general and administrative costs ("MG&A") on a cents per litre basis by 4.2% and 10.7%, respectively, as a result of continued focus on cost controls and improved operating leverage; and
  • Remained committed to distributing excess cash to shareholders and returned $85.9 million in dividends to shareholders in 2014.

Common Share Dividend Increase

The annualized common share dividend will increase 1.9%, or two cents per share, from $1.06 to $1.08 effective with Parkland's monthly dividend payable on April 15, 2015 to shareholders of record at the close of business on March 20, 2015.

Financial Summary    
  Three months ended  Year ended  
(in millions of Canadian dollars, except per share amounts) December 31,  December 31,  
  2014  2013  2014  2013  
Sales and operating revenues 1,739.0  1,598.9  7,527.6  5,663.4  
Adjusted gross profit(1) 141.5  141.9  540.8  500.0  
Net earnings 10.2  22.0  49.9  92.0  
 Per share - basic 0.13  0.31  0.66  1.31  
 Per share - diluted(2) 0.13  0.30  0.66  1.26  
Adjusted EBITDA(1) 51.1  50.6  183.2  207.4  
Dividends 26.9  18.6  85.9  72.9  
 Dividends declared per share 0.26  0.26  1.05  1.04  
Distributable cash flow(3) 23.1  26.1  107.0  136.5  
 Per share - outstanding 0.28  0.36  1.30  1.90  
Dividend to distributable cash flow payout ratio(4) 117 %71 %80 %53 %
Total assets       1,531.8  1,255.2  
Total Funded Debt(1)       245.5  259.8  
Shares Outstanding (thousands of shares)       82,114  71,795  
   
Operating Summary             
  Three months ended  Year ended  
(in millions of Canadian dollars, except per share amounts) December 31,  December 31,  
  2014  2013  2014  2013  
Fuel volume (millions of litres) 2,328  1,917  8,855  6,659  
Fuel product adjusted gross profit(1)- cents per litre:             
 Retail fuel 5.37  4.63  5.00  4.73  
 Commercial fuel 11.63  10.18  10.47  9.93  
 SPF Energy 3.72  -  3.22  -  
Operating costs - cents per litre 2.58  3.15  2.74  2.86  
Marketing, general and administrative - cents per litre 1.65  1.80  1.50  1.68  
  1. Non-GAAP financial measures. See the Non-GAAP Financial Measures, Reconciliations, and Advisories section of the MD&A for period ended December 31, 2014 for the reconciliation.
  2. Dilutive earnings (loss) per share can be impacted by an antidilutive impact of conversion of the debenture. Quarterly diluted earnings (loss) per share may therefore not accumulate to the same per share value as the year-to-date calculation.
  3. Refer to Distributable Cash Flow section of the MD&A for the period ended December 31, 2014 for the reconciliation.
  4. Calculated by dividing dividends by distributable cash flow.

MD&A and Financial Statements

Management's Discussion and Analysis, the audited Consolidated Financial Statements, and the Notes to the Consolidated Financial Statements for the three and twelve months ended December 31, 2014, are available online at www.parkland.ca.

Conference Call Information
Parkland Fuel Corporation will host a webcast and conference call at 6:30 a.m. MST (8:30 a.m. EST) on Thursday, March 5, 2014 to discuss the results for the three and twelve months ended December 31, 2014.

Please log into the webcast slide presentation 10 minutes before the start time at:

http://www.gowebcasting.com/6337

To access the conference call by telephone dial toll free 1-800-355-4959. Callers from the Toronto area should use (416) 340-8527. Please connect approximately 10 minutes prior to the beginning of the call.

The webcast will be available for replay two hours after the conference call ends. It will remain available at the link above for one year.

Financial Statements and Management's Discussion and Analysis will also be posted to www.parkland.ca and SEDAR immediately after the results are released by newswire.

Forward Looking Information
Certain information included herein is forward-looking. Forward-looking statements include, without limitation, statements regarding Parkland's expectation of its future financial position, business and growth strategies, including the manner in which such strategies will be implemented, budgets, projected costs, sources of growth, capital expenditures, financial results, taxes, future acquisitions and the efficiencies to be derived therefrom, effectiveness of internal controls, sources of funding for growth capital expenditures, anticipated dividends and the amount thereof, if any, to be declared by Parkland Fuel Corporation, and plans and objectives of or involving Parkland. Many of these statements can be identified by looking for words such as "believe", "expects", "expected", "will", "intends", "projects", "projected", "anticipates", "estimates", "continues", or similar words and include, but are not limited to, statements regarding the accretive effects of acquisitions and the anticipated benefits of acquisitions. Parkland believes the expectations reflected in such forward-looking statements are reasonable but no assurance can be given that these expectations will prove to be correct and such forward- looking statements should not be unduly relied upon. Forward-looking statements are not guarantees of future performance and involve a number of risks and uncertainties some of which are described in Parkland's annual information form and other continuous disclosure documents. Such forward-looking statements necessarily involve known and unknown risks and uncertainties and other factors, which may cause Parkland's actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. Such factors include, but are not limited to: failure to obtain necessary regulatory or other third party consents and approvals; the failure to achieve the anticipated benefits of acquisitions; failure to meet financial, operational and strategic objectives and plans; general economic; market and business conditions; industry capacity; competitive action by other companies; refining and marketing margins; the ability of suppliers to meet commitments; actions by governmental authorities including increases in taxes; changes in environmental and other regulations; and other factors, many of which are beyond the control of Parkland. Any forward-looking statements are made as of the date hereof and Parkland does not undertake any obligation, except as required under applicable law, to publicly update or revise such statements to reflect new information, subsequent or otherwise.

About Parkland Fuel Corporation"
Parkland Fuel Corporation is Canada's largest independent marketer of fuel and petroleum products. We deliver gasoline, diesel, propane, lubricants, heating oil and other high quality petroleum products to motorists, businesses, households and wholesale customers in Canada and the United States. Our mission is to be the partner of choice for our customers and suppliers, and we do this by building lasting relationships through outstanding service, reliability, safety and professionalism.

We are unique in our ability to provide customers with dependable access to fuel and petroleum products, utilizing a portfolio of supply relationships, storage infrastructure and third-party rail and highway carriers to rapidly respond to supply disruptions in order to protect our customers.

To sign up for Parkland new alerts please go to http://bit.ly/PKI-Alert or visit www.parkland.ca.

Contact Information

  • For investor inquiries, please contact:
    Scott Stickland
    Investor Relations
    403-567-2590
    Email contactFor media inquiries, please contact:
    Elizabeth Wilcox
    403-567-2578
    Email contact