8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_________________

FORM 8-K

_________________

CURRENT REPORT

Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  February 3, 2021

_______________________________

STAR GROUP, L.P.

(Exact name of registrant as specified in its charter)

_______________________________

Delaware	001-14129	06-1437793
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

9 West Broad Street, Suite 310

Stamford, CT 06902

(Address of Principal Executive Offices) (Zip Code)

(203) 328-7310

(Registrant's telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

_______________________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Units	SGU	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02. Results of Operations and Financial Condition.

On February 3, 2021, Star Group, L.P., a Delaware partnership, issued a press release announcing its financial results for the fiscal first quarter ended December 31, 2020. A copy of the press release is furnished within this report as Exhibit 99.1.

The information in this report is being furnished and is not deemed as "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and shall not be deemed incorporated by reference in any filings under the Securities Act of 1933, as amended, unless specifically stated so therein.

Item 7.01. Regulation FD Disclosure.

Item 9.01. Financial Statements and Exhibits.

Exhibit 99.1	A copy of the Star Group, L.P. Press Release dated February 3, 2021.
Exhibit 104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	STAR GROUP, L.P.
	By: Kestrel Heat, LLC (General Partner)
Date: February 3, 2021	By:	/s/ Richard F. Ambury
		Richard F. Ambury
		Chief Financial Officer Principal Financial Officer

EX-99.1

EXHIBIT 99.1

Star Group, L.P. Reports Fiscal 2021 First Quarter Results

STAMFORD, Conn., Feb. 03, 2021 (GLOBE NEWSWIRE) -- Star Group, L.P. (the "Company" or "Star") (NYSE:SGU), a home energy distributor and services provider, today announced financial results for the fiscal 2021 first quarter ended December 31, 2020.

Three Months Ended December 31, 2020 Compared to the Three Months Ended December 31, 2019
For the fiscal 2021 first quarter, Star reported a 26.6 percent decrease in total revenue to $373.3 million compared with $508.9 million in the prior-year period, reflecting a decline in selling prices in response to lower wholesale product costs and a decrease in total volume sold.

The volume of home heating oil and propane sold during the fiscal 2021 first quarter decreased by 17.6 million gallons, or 16.4 percent, to 89.5 million gallons due to the impact of warmer weather, net customer attrition, and other factors. Temperatures in Star's geographic areas of operation for the fiscal 2021 first quarter were 13.5 percent warmer than during the fiscal 2020 first quarter and 15.5 percent warmer than normal, as reported by the National Oceanic and Atmospheric Administration.

Star’s net income rose by $10.1 million in the quarter, to $37.9 million, primarily due to a favorable change in the fair value of derivative instruments of $11.0 million, and lower depreciation and amortization expense of $1.1 million, partially offset by an increase in income tax expense of $3.0 million. 

First quarter Adjusted EBITDA improved by $0.3 million, to $45.3 million, as the impact of higher per gallon home heating oil and propane margins, $16.3 million of lower operating expenses (including a $7.0 million favorable change in the impact from the Company’s weather hedge), and a $1.1 million improvement in net service and installation profitability more than offset the impact from a decrease in volume of home heating oil and propane sold. As of December 31, 2020, Star recorded a benefit of $4.0 million under its weather hedging contract, reducing delivery and branch expense. The final benefit (if any) for fiscal 2021 may be lower or higher depending on the accumulation of actual heating degree-days recorded in the period January 1, 2021 through March 31, 2021. Temperatures recorded for January 2021 were warmer than normal.

“We began fiscal 2021 well positioned even in the face of a pandemic,” said Jeff Woosnam, Star Group’s President and Chief Executive Officer. “While the impact from COVID-19 on the heating season has been muted, our performance reflects 13.5 percent warmer weather within our footprint – dampening demand for home heating oil and propane. However, we maintained our focus on cost discipline and customer service while acquiring two propane dealers in late December that will add, in aggregate, roughly 7 million gallons of product annually. We also repurchased 2.6 million common units during the quarter as part of our ongoing unit repurchase plan. As we navigate through the remainder of fiscal 2021, we are confident in our ability to continue providing the best possible customer experience and strong bottom line results during the quarters to come.”

EBITDA and Adjusted EBITDA (Non-GAAP Financial Measures)
EBITDA (Earnings from continuing operations before net interest expense, income taxes, depreciation and amortization) and Adjusted EBITDA (Earnings from continuing operations before net interest expense, income taxes, depreciation and amortization, (increase) decrease in the fair value of derivatives, other income (loss), net, multiemployer pension plan withdrawal charge, gain or loss on debt redemption, goodwill impairment, and other non-cash and non-operating charges) are non-GAAP financial measures that are used as supplemental financial measures by management and external users of the Company’s financial statements, such as investors, commercial banks and research analysts, to assess Star’s position with regard to the following:

• compliance with certain financial covenants included in our debt agreements;
• financial performance without regard to financing methods, capital structure, income taxes or historical cost basis;
• operating performance and return on invested capital compared to those of other companies in the retail distribution of refined petroleum products, without regard to financing methods and capital structure;
• ability to generate cash sufficient to pay interest on our indebtedness and to make distributions to our partners; and
• the viability of acquisitions and capital expenditure projects and the overall rates of return of alternative investment opportunities.
  

The method of calculating Adjusted EBITDA may not be consistent with that of other companies, and EBITDA and Adjusted EBITDA both have limitations as analytical tools and so should not be viewed in isolation but in conjunction with measurements that are computed in accordance with GAAP. Some of the limitations of EBITDA and Adjusted EBITDA are as follows:

• EBITDA and Adjusted EBITDA do not reflect cash used for capital expenditures;
• although depreciation and amortization are non-cash charges, the assets being depreciated or amortized often will have to be replaced and EBITDA and Adjusted EBITDA do not reflect the cash requirements for such replacements;
• EBITDA and Adjusted EBITDA do not reflect changes in, or cash requirements for, working capital;
• EBITDA and Adjusted EBITDA do not reflect the cash necessary to make payments of interest or principal on indebtedness; and
• EBITDA and Adjusted EBITDA do not reflect the cash required to pay taxes.
  

REMINDER:
Members of Star's management team will host a webcast and conference call at 11:00 a.m. Eastern Time tomorrow, February 4, 2021. The webcast will be accessible on the company’s website, at www.stargrouplp.com, and the telephone number for the conference call is 877-327-7688 (or 412-317-5112 for international callers).

About Star Group, L.P.
Star Group, L.P. is a full service provider specializing in the sale of home heating products and services to residential and commercial customers to heat their homes and buildings. The Company also sells and services heating and air conditioning equipment to its home heating oil and propane customers and, to a lesser extent, provides these offerings to customers outside of its home heating oil and propane customer base. In certain of Star's marketing areas, the Company provides plumbing services, primarily to its home heating oil and propane customer base. Star also sells diesel, gasoline and home heating oil on a delivery only basis. We believe Star is the nation's largest retail distributor of home heating oil based upon sales volume. Including its propane locations, Star serves customers in the more northern and eastern states within the Northeast and Mid-Atlantic U.S. regions. Additional information is available by obtaining the Company's SEC filings at www.sec.gov and by visiting Star's website at www.stargrouplp.com, where unit holders may request a hard copy of Star’s complete audited financial statements free of charge.

Forward Looking Information
This news release includes "forward-looking statements" which represent the Company’s expectations or beliefs concerning future events that involve risks and uncertainties, including those associated with the severity and duration of the novel coronavirus, or COVID-19, pandemic, the pandemic’s impact on the U.S. and global economies, the timing, scope and effectiveness of federal, state and local governmental responses to the pandemic, the effect of weather conditions on our financial performance; the price and supply of the products that we sell; the consumption patterns of our customers; our ability to obtain satisfactory gross profit margins; our ability to obtain new customers and retain existing customers; our ability to make strategic acquisitions; the impact of litigation; our ability to contract for our current and future supply needs; natural gas conversions; future union relations and the outcome of current and future union negotiations; the impact of current and future governmental regulations, including climate change, environmental, health and safety regulations; the ability to attract and retain employees; customer creditworthiness; counterparty creditworthiness; marketing plans; potential cyber-attacks; general economic conditions and new technology. All statements other than statements of historical facts included in this news release are forward-looking statements. Without limiting the foregoing, the words "believe," "anticipate," "plan," "expect," "seek," "estimate" and similar expressions are intended to identify forward-looking statements. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct and actual results may differ materially from those projected as a result of certain risks and uncertainties. These risks and uncertainties include, but are not limited to, those set forth under the heading "Risk Factors" and "Business Strategy" in our Annual Report on Form 10-K (the "Form 10-K") for the fiscal year ended September 30, 2020. Important factors that could cause actual results to differ materially from the Company’s expectations ("Cautionary Statements") are disclosed in this news release and in the Company’s Form 10-K and our Quarterly Reports on Form 10-Q. Currently, one of the most significant factors, however, is the potential adverse effect of the pandemic of the novel coronavirus, or COVID-19, on the financial condition, results of operations, cash flows and performance of the Company and its customers and counterparties and the global economy and financial markets. The extent to which COVID-19 impacts us and our customers will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic, the actions taken to contain the pandemic or mitigate its impact, and the direct and indirect economic effects of the pandemic and containment measures, among others. All subsequent written and oral forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by the Cautionary Statements. Unless otherwise required by law, the Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise after the date of this news release.

(financials follow)

STAR GROUP, L.P. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS

	December 31,			September 30,
		2020			2020
(in thousands)	(unaudited)
ASSETS
Current assets
Cash and cash equivalents	$	18,847		$	56,911
Receivables, net of allowance of $5,185 and $6,121, respectively		147,011			83,594
Inventories		56,902			50,256
Fair asset value of derivative instruments		5,197			—
Prepaid expenses and other current assets		38,478			29,554
Assets held for sale		—			6,030
Total current assets		266,435			226,345
Property and equipment, net		98,332			93,495
Operating lease right-of-use assets		100,222			99,776
Goodwill		255,425			240,327
Intangibles, net		103,440			90,293
Restricted cash		250			250
Captive insurance collateral		69,988			69,787
Deferred charges and other assets, net		19,322			18,343
Total assets	$	913,414		$	838,616
LIABILITIES AND PARTNERS' CAPITAL
Current liabilities
Accounts payable	$	41,924		$	30,827
Liabilities held for sale		—			1,265
Revolving credit facility borrowings		59,341			—
Fair liability value of derivative instruments		—			11,437
Current maturities of long-term debt		13,000			13,000
Current portion of operating lease liabilities		19,200			19,139
Accrued expenses and other current liabilities		133,713			127,286
Unearned service contract revenue		68,063			58,430
Customer credit balances		74,626			83,471
Total current liabilities		409,867			344,855
Long-term debt		106,606			109,805
Long-term operating lease liabilities		86,419			85,908
Deferred tax liabilities, net		20,908			17,227
Other long-term liabilities		26,998			25,001
Partners' capital
Common unitholders		279,873			273,283
General partner		(2,447	)		(2,506	)
Accumulated other comprehensive loss, net of taxes		(14,810	)		(14,957	)
Total partners' capital		262,616			255,820
Total liabilities and partners' capital	$	913,414		$	838,616

STAR GROUP, L.P. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

	Three Months Ended December 31,
(in thousands, except per unit data - unaudited)		2020			2019
Sales:
Product	$	300,332		$	432,688
Installations and services		72,988			76,257
Total sales		373,320			508,945
Cost and expenses:
Cost of product		172,147			287,673
Cost of installations and services		69,303			73,669
(Increase) decrease in the fair value of derivative instruments		(17,395	)		(6,417	)
Delivery and branch expenses		80,687			96,726
Depreciation and amortization expenses		7,957			9,050
General and administrative expenses		6,241			6,506
Finance charge income		(406	)		(713	)
Operating income		54,786			42,451
Interest expense, net		(1,851	)		(2,679	)
Amortization of debt issuance costs		(247	)		(235	)
Income before income taxes		52,688			39,537
Income tax expense		14,828			11,782
Net income	$	37,860		$	27,755
General Partner's interest in net income		296			192
Limited Partners' interest in net income	$	37,564		$	27,563
Per unit data (Basic and Diluted):
Net income available to limited partners	$	0.89		$	0.58
Dilutive impact of theoretical distribution of earnings		0.15			0.09
Basic and diluted income per Limited Partner Unit:	$	0.74		$	0.49
Weighted average number of Limited Partner units outstanding (Basic and Diluted)		42,246			47,266

SUPPLEMENTAL INFORMATION
STAR GROUP, L.P. AND SUBSIDIARIES

RECONCILIATION OF EBITDA AND ADJUSTED EBITDA
(Unaudited)

	Three Months Ended December 31,
(in thousands)		2020			2019
Net income	$	37,860		$	27,755
Plus:
Income tax expense		14,828			11,782
Amortization of debt issuance costs		247			235
Interest expense, net		1,851			2,679
Depreciation and amortization		7,957			9,050
EBITDA		62,743			51,501
(Increase) / decrease in the fair value of derivative instruments		(17,395	)		(6,417	)
Adjusted EBITDA		45,348			45,084
Add / (subtract)
Income tax expense		(14,828	)		(11,782	)
Interest expense, net		(1,851	)		(2,679	)
(Recovery) provision for losses on accounts receivable		(476	)		1,010
Decrease in accounts receivables		(62,989	)		(85,745	)
Decrease in inventories		(7,177	)		(15,427	)
Increase in customer credit balances		(8,987	)		(15,898	)
Change in deferred taxes		3,601			1,336
Change in other operating assets and liabilities		20,358			32,510
Net cash used in operating activities	$	(27,001	)	$	(51,591	)
Net cash used in investing activities	$	(35,903	)	$	(7,663	)
Net cash provided by financing activities	$	24,840		$	68,897
Home heating oil and propane gallons sold		89,500			107,100
Other petroleum products		37,700			41,400
Total all products		127,200			148,500

 Source: Star Group, L.P.

CONTACT:
Star Group, L.P.	Chris Witty
Investor Relations	Darrow Associates
203/328-7310	646/438-9385 or cwitty@darrowir.com

XML

Cover	Feb. 03, 2021
Document Type	8-K
Amendment Flag	false
Document Period End Date	Feb. 03, 2021
Entity File Number	001-14129
Entity Registrant Name	STAR GROUP, L.P.
Entity Central Index Key	0001002590
Entity Tax Identification Number	06-1437793
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	9 West Broad Street, Suite 310
Entity Address, City or Town	Stamford
Entity Address, State or Province	CT
Entity Address, Postal Zip Code	06902
City Area Code	203
Local Phone Number	328-7310
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Units
Trading Symbol	SGU
Security Exchange Name	NYSE
Entity Emerging Growth Company	false