Regency Energy Partners LP (RGP) Misses Q4 EPS by 5c, Revenues Beat

July 22, 2020 4:26 PM EDT
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Regency Energy Partners LP (NASDAQ: RGP) reported Q4 EPS of $0.13, $0.05 worse than the analyst estimate of $0.18. Revenue for the quarter came in at $178.6 million versus the consensus estimate of $158.28 million.

Fourth Quarter Fiscal 2020 Highlights:

  • Revenue of $178.6 million compared to $182.1 million in prior year quarter, or down 2.0%
  • Gross profit of $72.2 million compared to $73.0 million in prior year quarter
  • Gross margin improved 30 basis points to 40.4% compared to prior year quarter
  • SG&A of $62.0 million including $5 million of restructuring costs, compared to $56.9 million in the prior year quarter
  • Net income of $4.1 million compared to $9.4 million in prior year quarter
  • Diluted earnings per common share of $0.13 compared to $0.29 in prior year quarter, reflecting an $0.11 per diluted share impact from the restructuring costs
  • Adjusted EBITDA increased to $18.6 million from $17.5 million in prior year quarter
  • Operating cash flow of $28.0 million compared to $30.1 million in prior year quarter
  • Available financial liquidity of $126.3 million as of May 30, 2020
  • Cash dividend declared of $0.14 per share

Management Commentary

“Despite the global pandemic, we held fairly steady in Q4 – expanding our Adjusted EBITDA margin to above 10% – and I am very proud of the resilience and tenacity shown by our people,” said Kate Duchene, chief executive officer. “This pandemic is accelerating changes in how work will get done and by whom – changes we have anticipated and built our business around. Virtual delivery is here to stay and the need for business agility is on the rise, and already impacting workforce design strategies in clients from healthcare to technology. The addition of Veracity to RGP’s tool kit rounds out our ability to deliver digital transformation projects, especially focused on improved employee experience and digital workflows.

As we shared in April, we completed a restructuring of headcount and real estate in North America before the pandemic hit, which better prepared us to operate in the current environment. We had initially planned to complete our strategic review of the European business in the fourth quarter of fiscal 2020, but the lockdowns caused by the pandemic created delays in our timeline. We are actively conducting the review now and expect to be ready to report further on our plan after the first quarter of fiscal 2021.”

Ms. Duchene concluded, “Until we have further visibility into the full impact of the pandemic on the global economy, we will remain focused on the health of our balance sheet and liquidity. We will make prudent decisions to reinvest in the business to drive key growth initiatives in core markets and the expansion of our digital capabilities. We are confident the actions we are taking in this challenging environment will enhance our agility and our positioning to create long-term shareholder value.”

For earnings history and earnings-related data on Regency Energy Partners LP (RGP) click here.

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