Parkland Reports First Quarter Financial Results



    
    First Quarter 2009 Performance Highlights:

    -   Record Q1 fuel sales volumes of 673 million litres, up 29% from
        523 million litres the prior year, driven by strategic acquisitions.
    -   Q1 EBITDA of $32.3 million, up 87% from $17.2 million in 2008 and a
        record for any Q1.
    -   Q1 2009 net earnings of $19.8 million, up 94% from $10.2 million in
        2008.
    -   Distribution payout ratio of 59% for Q1 2009 compared to 96% in 2008.
    

    RED DEER, AB, April 28 /CNW/ - Parkland Income Fund (TSX: PKI.UN) today
announced its business performance for the first quarter of 2009. Fuel volumes
achieved record levels for the quarter and earnings before interest, taxes,
depreciation and amortization (EBITDA) for Q1 2009 was higher than the same
period a year earlier and was the highest Q1 on record and the second best
quarter in Parkland's history.

    President and CEO Mike Chorlton commented "In the face of considerable
economic challenges, Parkland recorded one of the most successful quarters in
its history, an accomplishment we attribute to a sharp strategic and
operational focus, the continued diversification of our business by brand,
fuel type and geography, and the strength of over 1,150 Parkland employees
from B.C. to Ontario."

    "In the first quarter of 2009, record sales volume and strong margins
drove profit significantly higher relative to the first quarter of 2008. At
the same time, our retail unit performed exceptionally well and our commercial
business remained strong despite the challenging economic environment.
Refiners' margins for gasoline were exceptionally strong for a winter quarter
and were significantly higher than in the prior year. During this period of
economic uncertainty, Parkland will remain focused on driving operational
efficiency, continuing to build our business as the right opportunities arise
and maintain monthly distributions," said Mr. Chorlton.

    Distributable cash exceeded cash distributions in the first quarter. The
distribution payout ratio was 59% compared to 96% in 2008. We have maintained
our monthly distribution rate of $0.105 per unit.

    Outlook

    Retail fuel volumes in our market area have shown same-store sales growth
to date in 2009 despite the overall weakness in the economy. Commercial fuel
sales volumes have reflected the weakness in the diesel and propane markets
which have been impaired by the decline in the forestry, trucking and oil and
gas drilling industries.

    Assuming normal weather conditions, the agricultural input season is
forecast to be strong as farmers curtailed fertilizer use when prices peaked
last fall and are expected to buy heavily this spring.

    Refiners' margins for gasoline have declined after reaching a peak in
February but remain positive. Refiners' margins for diesel currently are weak,
posting levels seen only twice in the past ten years for this season of the
year.

    Fuel Volumes

    Fuel volumes were strong with total sales of 673 million litres in the
quarter ended March 31, 2009, an increase of 29% from 523 million litres for
the same period in 2008. The increase resulted primarily from the acquisitions
completed over the past year. The propane portion of these volumes was down 6%
but margins were higher, resulting in good financial returns.

    Retail fuel volumes in company-controlled stations were 5% higher than
the prior year. Volume in other retail categories ranged from flat to slightly
positive year over year. We attribute this to strong marketing programs in
company-operated sites and our predominance of non-urban locations.

    Gross Profit

    Sales revenues were lower than the prior year as underlying crude oil
prices were lower. Cost of sales declined more than sales leaving higher
profit margins on a per litre basis. In addition to the retail margins for
gasoline and diesel, we participate in the refiners' margins for a significant
portion of our supply volumes. In the first quarter this participation yielded
earnings approximately $10.8 million higher than the comparative period in
2008.

    Although higher Q1 2009 sales volumes of fertilizer and lubes contributed
to a 24 percent increase in commercial sales over Q1 2008, profit margins for
these product lines decreased. 2008 profit margins for fertilizer sales were
unusually high relative to prior years while Q1 2009 showed more historical
levels.

    Our inventory of fuel volumes on hand is subject to revaluation as
underlying crude oil prices rise and fall. In the first quarter of 2009 it
resulted in an increase in earnings of $4.6 million compared to an increase of
$4.0 million in 2008.

    Our operating and direct costs were $27.3 million in the first quarter
compared to $23.4 million for the same period in 2008. The increase is
primarily a result of additional business operations acquired over the course
of 2008.

    Our marketing, general and administrative expenses were $12.3 million in
the first quarter compared to $12.3 million for the same period in 2008.

    A comparison of EBITDA for the first quarter of 2009 with the first
quarter of 2008 is available online at
http://files.newswire.ca/714/Waterfall_chart_Q1_09.pdf.

    Capital Resources

    We are seeking to expand our banking syndicate and increase our senior
secured credit facility, including operating line, letters of credit and
capital facility, to an expected total amount of $265 million from $169
million. We have received commitments for this amount subject to final
documentation. This is expected to provide sufficient funding for our 2009
growth capital program and allow for potential acquisitions.

    
    Consolidated Highlights

    Financial Results
    -------------------------------------------------------------------------
    (in millions of Canadian        Three months  Three months
     dollars except per Unit               ended         ended
     amounts)                           March 31,     March 31,
                                            2009          2008        Change

    Fuel volume (millions of litres)         673           523           29%
    Net sales and operating revenues       455.1         482.9           -6%
    Gross profit                            72.0          53.0           36%
    Gross margin                             16%           11%
    Operating and direct costs              27.3          23.4           17%
    Marketing, general and administrative   12.3          12.3
    Income before income taxes              22.5           9.6          136%
    Income tax (recovery) expense            2.7          -0.6
    Net earnings                            19.8          10.2           94%
    EBITDA(1)                               32.3          17.2           87%
    Earnings per Unit - basic              $0.40         $0.20
    Earnings per Unit - diluted            $0.40         $0.20

    Distributable cash flow(2)              26.8          16.5           62%
    Distributions                           15.7          15.8
    Distribution payout ratio                59%           96%
    -------------------------------------------------------------------------

    (1) EBITDA, which is not a financial measure under Generally Accepted
        Accounting Principles (GAAP), refers to Earnings Before Interest on
        Long-Term Debt, Income Tax Expense, Amortization, Refinery
        Remediation Accrual, Accretion Expense and (Gain) Loss on Disposal of
        Property, Plant and Equipment. It can be calculated from the GAAP
        amounts included in the Fund's financial statements. Management
        believes that EBITDA is a relevant measure to users of its financial
        information as it provides an indication of pre-tax earnings
        available to distribute to debt and equity holders. The Fund's
        definition of EBITDA may not be consistent with other providers of
        financial information and therefore may not be comparable.
    (2) Please see Distributable Cash Flow reconciliation table in the MD&A.

    The MD&A as well as the complete audited Consolidated Financial Statements
and Notes to Consolidated Financial Statements for the first quarter ended
March 31, 2009 are available online at
http://files.newswire.ca/714/Parkland_MD&A_FS.pdf.

    Fund Description
    ----------------
    

    Parkland Income Fund currently operates retail and wholesale fuels and
convenience store businesses under its Fas Gas Plus, Fas Gas, Race Trac Fuels
and Short Stop Food Stores brands and through independent branded dealers, and
transports fuel and other products through its Distribution division. With
approximately 623 locations, Parkland has developed a strong market niche in
Canadian non-urban markets focused in the West and Ontario. The Fund supplies
propane, bulk fuel, heating oil, lubricants, industrial fluids, agricultural
inputs and associated services to commercial and industrial customers in
Alberta, British Columbia and the Yukon Territory under the Neufeld, United
Petroleum and Great Northern Oil brands. Additionally, Parkland operates the
Bowden refinery near Red Deer, Alberta as a storage and contract-processing
site.

    Parkland is focused on creating and delivering value for its unitholders
through the continuous refinement of its site portfolio, increasing revenue
diversification through growth in non-fuel revenues and active supply chain
management.

    The Fund's units trade on the Toronto Stock Exchange (TSX) under the
symbol PKI.UN. For more information, visit www.parkland.ca.

    Certain information included herein is forward-looking. Forward-looking
statements include, without limitation, statements regarding the future
financial position, business strategy, budgets, projected costs, capital
expenditures, financial results, taxes and plans and objectives of or
involving Parkland. Many of these statements can be identified by looking for
words such as "believe", "expects", "expected", "will", "intends", "projects",
"projected", "anticipates", "estimates", "continues", or similar words and
include but are not limited to, statements regarding the accretive effects of
the acquisition and the anticipated benefits of the acquisition. Parkland
believes the expectations reflected in such forward-looking statements are
reasonable but no assurance can be given that these expectations will prove to
be correct and such forward-looking statements should not be unduly relied
upon. Forward-looking statements are not guarantees of future performance and
involve a number of risks and uncertainties some of which are described in the
Fund's annual report, annual information form and other continuous disclosure
documents. Such forward-looking statements necessarily involve known and
unknown risks and uncertainties and other factors, which may cause the Fund's
actual performance and financial results in future periods to differ
materially from any projections of future performance or results expressed or
implied by such forward-looking statements. Such factors include, but are not
limited to: general economic, market and business conditions; industry
capacity; competitive action by other companies; refining and marketing
margins; the ability of suppliers to meet commitments; actions by governmental
authorities including increases in taxes; changes in environmental and other
regulations; and other factors, many of which are beyond the control of
Parkland. Any forward-looking statements are made as of the date hereof and
the Fund does not undertake any obligation, except as required under
applicable law, to publicly update or revise such statements to reflect new
information, subsequent or otherwise.

    
    Conference Call
    ---------------
    Parkland will hold a conference call for Analysts, Brokers and Investors
to discuss first quarter results as follows:

    Wednesday, April 29, 2009, 9:00 a.m. (11:00 a.m. Eastern Time)
    Direct: 416-644-3417
    Toll-free: 800-733-7560
    Passcode: 21304119 followed by the pound sign

    The replay will be available as follows:

        From Wednesday, April 29, 2009, 9:00 a.m. (11:00 a.m. Eastern Time)
        To Wednesday, May 13, 2009 at 9:59 p.m. (11:59 p.m. Eastern Time)
        Direct: 416-640-1917
        Toll-free: 877-289-8525
        Passcode: 21304119 followed by the pound sign

    Webcast
    -------
    http://www.newswire.ca/en/webcast/viewEvent.cgi?eventID=2635380
    





For further information:

For further information: Red Deer: Mike W. Chorlton, President and CEO,
(403) 357-6400; John G. Schroeder, Vice President and CFO, (403) 357-6400; If
you prefer to receive Company news releases via e-mail, please request at
corpinfo@parkland.ca.

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Parkland Fuel Corporation

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