Depreciation and Amortization Expense
— Depreciation and amortization expense increased in 2011
compared to 2010, primarily as a result of our acquisition of Atlantic Energy.
Other income — affiliates
— Other income — affiliates results for 2010 reflect a $3.0 million payment
received in the second quarter from Spectra Energy, a supplier for our Wholesale Propane Logistics segment,
related to an amendment of a supply agreement to shorten the term of the agreement by two years.
Propane Sales Volume
— Propane sales volumes increased in 2011 compared to 2010, primarily as a
result of our acquisition of Atlantic Energy. 2010 results reflect a planned outage related to our Providence
terminal inspection.
Year Ended December 31, 2010 vs. Year Ended December 31, 2009
Total Operating Revenues
— Total operating revenues increased in 2010 compared to 2009, primarily as a
result of the following:
• $111.7 million increase attributable to higher propane prices, which impact both sales and purchases;
and
• $35.4 million increase attributable to our acquisition of Atlantic Energy in July 2010.
This increase was partially offset by:
• $20.5 million decrease attributable to a planned outage related to our Providence terminal inspection and
reduced demand as a result of an early spring and warmer weather;
• $1.5 million decrease due to commodity derivative activity.
Purchases of Propane
— Purchases of propane increased in 2010 compared to 2009 as a result of higher
propane prices, which impact both sales and purchases, and our acquisition of Atlantic Energy in July 2010,
partially offset by decreased propane sales volumes.
Segment Gross Margin
— Segment gross margin decreased in 2010 compared to 2009. 2010 results reflect
a planned outage related to our Providence terminal inspection and reduced demand as a result of an early
spring and warmer weather, partially offset by our acquisition of Atlantic Energy in July 2010. 2009 results
reflect a late winter, increased spot sales volumes and significantly higher per unit margins, approximately $6.0
million of which was attributable to the sale of inventory that was written down at the end of the fourth quarter
of 2008.
Operating and Maintenance Expense
— Operating and maintenance expense increased in 2010 compared
to 2009, primarily as a result of our acquisition of Atlantic Energy.
Depreciation and Amortization Expense
— Depreciation and amortization expense increased in 2010
compared to 2009, primarily as a result of our acquisition of Atlantic Energy.
Other income — affiliates
— Other income — affiliates increased due to a $3.0 million payment received
in the second quarter of 2010 from Spectra Energy, related to an amendment of a supply agreement to shorten
the term of the agreement by two years.
Propane Sales Volume
— Propane sales volumes were stable in 2010 compared to 2009. 2010 results
reflect increased volumes due to our acquisition of Atlantic Energy, offset by a planned outage related to our
Providence terminal inspection and reduced demand as a result of an early spring and warmer weather. 2009
results reflect a late winter and increased spot sales volume.
Liquidity and Capital Resources
We expect our sources of liquidity to include:
• cash generated from operations;
• cash distributions from our unconsolidated affiliates;
• borrowings under our revolving credit facility;
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