A. Davin D'Ambrosio – Vice President and Treasurer Michael J. Dunn, Jr. – President and Chief Executive Officer Michael A. Stivala – Chief Financial Officer Michael A. Kuglin – Vice President, Finance and Chief Accounting Officer.

Sharon Lui – Wells Fargo Securities Darren Horowitz – Raymond James.

Ladies and gentlemen, thank you for standing by. Welcome to the Suburban Propane's Second Quarter 2014 Financial Results Conference call. At this time, all participants are in a listen-only mode. Later we will conduct a question-and-answer session. Instructions will be given at that time.

(Operator instructions) As a reminder, this conference is being recorded. This conference call contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 as amended, relating to the Partnership’s future business expectations and predictions and financial condition and results of operation.

These forward-looking statements involve certain risks and uncertainties.

The Partnership has listed some of the important factors that could cause actual results to differ materially from those discussed in such forward-looking statements, which are referred to as cautionary statements in its earnings press release, which can be viewed on the company's website.

All subsequent written and oral forward-looking statements attributable to the Partnership or persons acting on its behalf are expressly qualified in their entirety by such cautionary statements. I would now like to turn the conference over to your host, Mr. Davin D’Ambrosio. Please go ahead..

Thank you and good morning everyone. Welcome to Suburban’s fiscal 2014 second quarter results earnings conference call. I’m Davin D’Ambrosio, Vice President and Treasurer at Suburban. Joining me this morning is Mike Dunn, Chief Executive Officer; Mike Stivala, our President; Mark Wienberg, our Chief Operating Officer; and Mike A.

Kuglin, Vice President of Finance and Chief Accounting Officer. The purpose of today’s call is to review our second quarter financial results along with our current outlook for the business including an update on the status of our integration efforts with regards to the Inergy Propane acquisition that was completed on August 1, 2012.

As usual, once we’ve concluded our prepared remarks, we will open the session to questions. Before getting started, I would like to reemphasize what the operator has just explained about forward-looking statements.

Additional information about factors that could cause actual results to differ materially from those discussed in forward-looking statements is contained in the Partnership’s SEC filings, including its Form 10-K for the fiscal year ended September 28, 2013 and its Form 10-Q for the period ended March 29, 2014, which will be filed by the end of business today.

Copies of these filings may be obtained by contacting the Partnership or the SEC. Certain non-GAAP measures will be discussed on this call. We have provided a description of those measures as well as a discussion of why we believe this information to be useful in our Form 8-K, which was furnished to the SEC this morning.

The Form 8-K can be accessed through a link on our website at www.suburbanpropane.com. At this time, I like to turn the call over to Mike Dunn for some opening remarks.

Mike?.

Thank you Davin, and thanks everyone for joining us this morning. Coming off of a winter season that had no shortage of challenges, we are very pleased with our operating results for the second quarter of fiscal 2014. Adjusted EBITDA of $206.3 million, an increase of $15.6 million, or 8% compared to the prior year.

The quarter was characterized by sustained colder than normal temperatures in the East and Midwest regions of the country. The harsh winter storms in several areas have industrywide supply and logistics issues, which not only present challenges in terms of secure and adequate supplies, but also resulted in a dramatic rise in wholesale propane costs.

One might describe these challenges as a perfect storm of sorts. Nonetheless, our employees were geared up to handle the operating challenges and in some cases took extraordinary measures to ensure the comfort and safety of our customer base. This improvement in year-over-year performance is a testament to the hard work and dedication.

In a moment, I will comment on our outlook for the remainder of the fiscal year, along with providing an update on our integration efforts. However at this point, I would like to turn the call over to Mike Stivala to discuss our second quarter results in more detail.

Mike?.

Thanks Mike and good morning everyone. As I discussed our second quarter results, I am excluding the impact of $300,000 unrealized non-cash gain applicable to FAS 133 accounting that compares to an unrealized loss of 2.6 million in the prior year’s second quarter.

Adjusted EBITDA, which also excludes integration-related costs of $2.2 million in the fiscal 2014 second quarter and $2.7 million in the prior year second quarter totaled $206.3 million. That is an increase of $15.6 million compared to the prior year’s second quarter of $190.7 million.

Net income totaled $149.5 million or $2.47 per common unit for the second quarter of fiscal 2014 compared to net income of $129.5 million or $2.26 per common unit reported in the prior year’s second quarter.

Retail propane gallons sold in the second quarter of fiscal 2014 increased 3.4 million gallons or 1.6% to 213.7 million gallons from 210.3 million gallons in the prior year second quarter. Sales of fuel oil and other refined fuels decreased 600,000 gallons to 22.6 million gallons compared to 23.2 million gallons in the prior year’s second quarter.

For the quarter, average temperatures across all of our service territories were 9% colder than normal and 11% colder than the prior year second quarter.

While the East and Midwest regions of the country had sustained colder than normal temperatures, our service territories in the West experienced unseasonably warm temperatures throughout the quarter. In fact, average temperatures in our Western service areas were 16% warmer than normal and 17% warmer than the prior year second quarter.

In regions where the weather was colder than normal, our sales volumes responded, increasing approximately 7% compared to the prior year second quarter.

However, even in those areas the supply and logistic issues that plagued the entire industry throughout much of the quarter, coupled with the dramatic rise in wholesale propane costs drove customer conservation, which weighed on volumes for the quarter.

In the commodity markets, average posted prices for propane for the second quarter of fiscal 2014 were 51.1% higher than the prior year second quarter that is basis Mont Belvieu, Texas, and, at other supply points, posted prices increased at an even greater pace.

In fact, at Conway, Kansas, posted prices soared to an all-time high of nearly $5 per gallon in late January. The dramatic increase in posted propane prices resulted from the well-publicized supply and logistics issues that started late in the first quarter and continued throughout most of the second quarter of fiscal 2014.

The propane industry experienced tightness in supply in several parts of the country, particularly in the Midwest as a result of a number of factors, including lower [pad 2] inventories entering the heating season arising from record crop drying demand in the fall.

Pipeline disruptions due to refinery maintenance and pipeline reversals, which affected the flow of propane, higher export activity and constraints on rail and transport truck delivery infrastructure, which couldn’t fully compensate for the lost pipeline capacity.

Nonetheless, in addition to our normal planning at the beginning of the heating season, our product supply group took some extraordinary steps to secure adequate supplies to enable us to keep up with customer demand.

However, given the steps we took to transport products into the areas that experienced the worst supply constraints, transportation costs were significantly higher than is typical. While average (inaudible) since we have exited the heating season, they still remain somewhat elevated in comparison to historical norms.

Current average propane posted prices are about 12% higher compared to this time last year. Total gross margins of $356.3 million for the second quarter of fiscal 2014 were $22.2 million of 6.6% higher than the prior year second quarter of $334.1 million, primarily from higher volumes, as well as slightly higher unit margins.

Combined operating and G&A expenses of $152.2 million was $6.1 million or 4.2% higher than the prior year second quarter, primarily due to higher over time and vehicle expenses, both attributable to increased business activities, as well as harsh weather conditions.

Additionally, higher variable compensation associated with higher earnings drove the increase.

As for bad debts, obviously given the dramatic increase in wholesale propane costs that drove retail prices higher, coupled with the increased customer demand due to sustained cold weather in several parts of the country, our receivable balance at the end of the second quarter of fiscal 2014 is significantly higher than previous years.

However, with our disciplined approach towards managing our receivables and maintaining good communication with our customer base, our overall bad debt expense as a percentage of revenues and our ageing profile have remained relatively consistent with historical levels.

Net interest expense of $21.2 million for the second quarter of fiscal 2014 was $3.1 million lower than the prior year second quarter, and that is a direct result of the repayment in August 2013 of 157.3 million of our 7.375% senior notes that are due 2021.

Total capital spending for the quarter was $5 million, which included $2.8 million of maintenance capital.

Turning to our balance sheet, while we have now moved through our historically high period of seasonal working capital needs, the significant increase in commodity prices and strong customer demand this winter did require us to draw $55 million from our bank revolver, which we have since repaid in April with internally generated cash.

Our liquidity position remained strong with approximately $250 million of capacity under the revolver, and we ended the quarter with $68.8 million of cash on hand.

We have more than ample liquidity to fund our increased working capital requirements, and incremental capital expenditures associated with our integration efforts, which are currently under way.

Finally, with the continued improvement in adjusted EBITDA, which through the first six months of fiscal 2014 was reported at $324 million, an improvement of nearly $16 million over the comparable prior year period, our key financial metrics continued to strengthen compared to where we ended fiscal 2012, which was just after our purchase of Inergy Propane.

We continue to maintain our focus on strengthening the balance sheet, and positioning ourselves for further growth opportunities. Over to you Mike..

Thanks Mike. As announced in our April 24 press release, our board of supervisors declared a quarterly distribution of $0.8750 per Common Unit, which equates to an annualized rate of $3.50 per Common Unit. This quarterly distribution will be paid on May 13 to our Unitholders of record as of May 6.

Looking ahead, as we have exited the heating season, our attention has once again turned to ramping up the execution of our detailed integration plans. Last month we resumed executing on our system conversion and physical blending plans to fully integrate our field operations.

By the end of this fiscal year, we expect to be substantially completed with our system conversion activities, and be functioning on one common system platform for all field operations. Throughout the remainder of the fiscal year and into the new fiscal year we will continue to fine tune our combined operating platform.

We remain comfortable with our stated synergy target of $50 million over the first three years following the acquisition.

In closing, I would like to again acknowledge the tireless efforts of all of our dedicated employees and continuing to remain focused on providing exceptional customer service to our customer base, particularly in the face of one of the harshest and most challenging heating seasons that we have faced in a long time.

And as always, we appreciate your support and attention this morning and would now like to open the call up for questions.

Stacy?.

(Operator instructions) And our first question we will go to Sharon Lui with Wells Fargo. Please go ahead..

Hi, good morning guys..

Good morning Sharon..

Hello Sharon..

Just wondering if you have been able to quantify the amount of maybe higher transportation costs related to I guess the challenges that you guys faced that is likely non-recurring in nature?.

I would say Sharon it is really tough to actually get you around the actual dollar effect.

I can tell you that there were moments in the middle of the supply and logistics crisis that the country was facing in January, February timeframe where our transportation costs increased probably double and that sometimes tripled typical unit delivery costs than you would otherwise expect to see at that time of the year.

But it wasn’t – it was a pretty tight period of time limited to mid-January into mid- February. But it certainly was a challenge..

Okay. And I guess in terms of the fuel oil sales, which was down slightly despite the colder weather in the Northeast.

Can you maybe just provide some color on the relatively weak demand for that product?.

If you look at the two quarters combined you will see that the volumes were reasonably flat. So I just think it is a matter of when people decide to pick. I mean, one of the things that became abundantly clear Sharon was as we entered into March and some of the weather issues subsided, people experienced fatigue with respect to price and volume.

Pocketbooks got stretched far greater than they had in the past years based on their needs to heat their homes and so forth and so on. So from a customer base perspective, customer base reasonably intact, so there really isn’t any fundamental issue outside of timing..

And just to add to that Sharon, the differences that you are seeing is mostly in the non-fuel oil, the non-heating oil side of the business, okay. So, to Mike’s point, when you look at the heating oil it was relatively flat year-over-year, particularly when you take the whole heating season into consideration..

Okay. That is helpful..

Sharon, can I go backwards, maybe I shouldn’t do this, but were you satisfied with the transportation? When you were talking about transportation, were you talking specifically about moving the commodity from the supply point to a distribution center?.

Yeah.

I am just trying to figure out, you know, excluding those types of, you know, unusual cost like what the margins could have been?.

Well, I mean the reality of it is I mean the margin situation between the cost of the transportation to get it from A to B and the rapid change in prices, you can’t really put a number or quantify it.

However, I can tell you that we did a good job in managing the higher prices as well as managing our customer base so that there wasn’t a extraordinary amount of sticker shock and distrust in us.

From a transportation perspective, we probably used more trucks than we would have normally have versus rail, and again, to Mike’s point that is really, really very, very, very difficult to quantify..

Okay, all right.

And I would guess you had touched on receivables, given I guess where we are in the year, are you pretty much comfortable with the amount of uncollectibles relative to historical levels?.

Hi, Sharon. I mentioned it in our remarks. If you look at our ageing profile and frankly our ageing is remarkably, you know, relative to historical levels comparable, and albeit the dollar numbers are higher because obviously you went through our winter weather revenue dollars are higher because of the increase in wholesale prices.

But when you look at our collection efforts, which really reflects on the ageing profile we are doing a heck of a job with that.

So, right now it doesn’t concern us, but certainly to Mike’s point earlier on the heating oil, the answer that he gave certainly the customer is feeling the pinch of this year’s heating season in their budgets, and they are very mindful of paying attention to their budgets and they are looking to us to help them manage their heating needs, and I think we have good options for them in the form of different plans that will help them get through the winter heating season and as well as get through this period of bringing those receivables down..

Great. Thank you..

Thank you..

Thank you. We have a question from Darren Horowitz with Raymond James. Please go ahead..

Hi guys. Good morning..

Good morning Darren..

Hi Darren..

Mike, wanted to go back to your prepared commentary around elevated wholesale propane cost and you know, that being part of a function of both Mid-Continent and Gulf Coast inventories.

I’m just thinking, you know, obviously you are in kind of the transition period, but let us just look at where inventories are today, the expectation that the propane market is going to be pretty tight at least for the intermediate timeframe, if wholesale costs remain elevated, how much of a challenge do you think that is going to have on the ability to expand retail margins into next heating season?.

I think it is going to be difficult to expand retail margins in any business today. I just think that the, you know, again I’m answering your question in general terms. I don’t think that the economy and/or the mentality of the American purchaser today understands the relative changing cost and is unwilling to pay for it.

I mean, you know, you have got higher commodity costs, you have got higher benefit costs, you have got a political group that is trying to push for higher minimum wage cost, but yet, nobody wants to pay for these things. You have got already embedded regulatory cost.

So looking at the commodity here that is part of our concern, so are some of the other issues, you know, around the overall cost structure. .

And then, if I could switching gears over to some previous comments that you guys had made with regard to acquisition activity and obviously more recently we have seen one of your larger competitors diversify their operations with a Midstream water disposal acquisition.

I know you have talked in the past about considering acquisitions maybe outside, you know, the retail wholesale propane fairway, and I am just wondering, you know, what your thoughts are on the current opportunity set, what you are seeing out there – has there been any shift and maybe what you might be looking at, what you might not be looking at and just a general update on overall multiples would be helpful?.

We spend a lot of time on outside propane potential opportunities. As far as the multiple thing is concerned, I mean you know probably better than I that a lot of these drop downs are trading at significantly lower multiples than the non-drop down acquisitions, and the non-drop down multiples 12, 13, 14 times just don't work mathematically.

But we are looking and (inaudible) they did a nice acquisition and it was interesting how it was reported. But that is for another day. But, you know, they did take that step outside, and they were quick to follow it up with a, you know, reasonably small acquisition in propane in California, which consumed a lot of headline.

But as far as we're concerned, was I being sarcastic? As far as we are concerned we continue to pursue to try to get our arms around where we think, okay the viable spots will be for either ancillary businesses and/or, you know, general common known mid-stream type opportunities.

So we are working pretty hard at it Darren and I am pretty confident that we will accomplish something, you know, in due time..

Well, we wish you the best of luck. Thanks Mike..

Thank you..

Thank you. (Operator instructions) And there are no questions. Thank you. Please continue..

Well, again I want to thank everyone for joining us today, and we look forward to speaking with you again in August. Thank you, Stacy..

Thank you. Ladies and gentlemen, this conference will be available for replay after 11 o'clock AM today running through May 9 till midnight. You may access the AT&T replay system at any time by dialing 1-800-475-6701 and when prompted, enter the access code of 325141. Those numbers again 1-800-475-6701, access code 325141.

That does conclude your conference for today. Thank you for your participation and for using AT&T executive teleconference. You may now disconnect..