FGP better hope that Renaissance contributes the 30 million that they are predicting. The common holders are somewhat shielded by the fact that FerrellGas Corp's (the GP of MLP) LP units are now subordinated to the common LP units, which conveniently makes up the shortfall that FGP has been operating under (distribution coverage of only 70%) which essentially means they are short 30 million or so...so, yes, for the commons, the distribution should be steady. If Renaissance is as good as they market it up to be, then the coverage ratio ought to climb to at least 1.0x and perhaps higher. That sadly, only puts them back where they needed to be all along. How is it that FGP has not managed to raise the distribution at all, while other operators such as Inergy have managed to increase the distribution by leaps and bounds?
With the sale of some assets, I think we can now relax for a few quarters about a possible dividend cut. Smith Barney also just relaxed about the possibility of a dividend cut. I am buying here. We only need a cold winter to show what a good cash flow this company can produce.
According to what I`ve been reading,they don`t have full cash flow to handle distribution as it is,but I don`t think they cut dist.at least for a while as they`ve been doing-I`m a little sceptical about buying at this price though.that`s just me.
Re: "Another company with cash flow problems[ ARC] just cut their dividend." I couldn't find this information about ARC cutting DIV, where did you come up with this? If you could provide a link or someother information this would help, Thanks.......