TSX: SPF.UN
CALGARY, Jan. 9 /CNW/ - Superior Plus Income Fund (the "Fund") announced today the commencement of a Distribution Reinvestment Plan and an Optional Unit Purchase Plan (the "DRIP"). Proceeds of the DRIP will be used to fund growth capital projects for its existing Canadian based businesses.
Grant Billing, Chairman and Chief Executive Officer of Superior Plus, said: "The DRIP will provide our unitholders with the opportunity to reinvest their cash distributions in the future growth of the business at a 5% discount to the market price of the trust units. The proceeds of the DRIP will assist Superior Plus in funding accretive organic growth opportunities. Operating performance of our businesses continues to meet expectations with annual distributable cash flow per trust unit anticipated in the $1.60 to $1.80 range for 2007, assuming no acquisitions or expansions of the existing businesses. With the completion of the sale of JW Aluminum, our businesses can now focus on their unique opportunities to expand and generate value growth for our unitholders going forward. The recent change in tax rules by the Federal Government is expected to have little impact on our growth strategy, as our capital requirements are within the new guidelines and our threshold returns for growth capital projects are well in excess of our cost of capital and more than sufficient to account for the tax changes."
Under the terms of the DRIP, eligible unitholders of the Fund (the "Unitholders") may elect to automatically reinvest their regular monthly distributions in additional trust units (the "Units") of the Fund, without incurring any commissions, service charges or brokerage fees. Unitholders who elect to reinvest cash distributions under the DRIP will receive Units at a price (the "Average Market Price") equal to the average closing price of the Units on the Toronto Stock Exchange for the five day trading period ending on the business day immediately prior to the distribution payment date. The price of the Units purchased with reinvested distributions will be 95% of the Average Market Price.
Unitholders who participate in the DRIP may also elect to purchase additional Units by way of cash payment, without incurring any commissions, service charges or brokerage fees. Units purchased by way of additional cash payment will be purchased at the Average Market Price, without discount.
Units may be purchased under the DRIP commencing with the January 2007 cash distribution payable on February 15, 2007 to Unitholders of record on January 31, 2007. Units purchased through the DRIP will be issued directly from the Fund's treasury.
Registered Unitholders may enroll in the distribution reinvestment component of the Plan by completing an Authorization Form and submitting the completed form to Computershare Trust Company at the address set out in the DRIP. In addition, registered Unitholders may enroll in the optional unit purchase component of the Plan by completing an Optional Cash Payment/Participant Declaration form and submitting the completed form to Computershare Trust Company at the address set out in the DRIP. Beneficial Unitholders are encouraged to contact their broker or other intermediary for enrollment information. The DRIP is subject to certain limitations and restrictions and interested parties are encouraged to review the full text of the DRIP. The DRIP and the enrollment forms are available on the Fund's website at www.superiorplus.com.
About the Fund
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Superior Plus Income Fund is a diversified business trust. The Fund holds 100% of Superior Plus LP, a limited partnership formed between Superior Plus Inc., as general partner and the Fund as limited partner. Superior Plus has four Canadian based operating divisions: Superior Propane is Canada's largest distributor of propane, related products and services; ERCO Worldwide is a leading supplier of chemicals and technology to the pulp and paper industries, a regional Midwest supplier of chloralkali products and the third largest producer of potassium products in North America; Winroc is the seventh largest distributor of walls and ceilings construction products in North America; and Superior Energy Management provides fixed price natural gas supply services in Ontario and Quebec.
The Fund's trust units and convertible debentures trade on the Toronto Stock Exchange as follows:
Trading Symbol Security Issued and Outstanding ------------------------------------------------------------------------- SPF.un Trust Units 85.5 million SPF.db 8% Debentures, Series 1 $ 8.1 million principal amount SPF.db.a 8% Debentures, Series 2 $ 59.0 million principal amount SPF.db.b 5.75% Debentures $174.9 million principal amount SPF.db.c 5.85% Debentures $ 75.0 million principal amount -------------------------------------------------------------------------
Forward Looking Statements: Except for the historical and present factual information, certain statements contained herein are forward-looking. Such forward-looking statements are not guarantees of future performance and involve a number of known and unknown risks and uncertainties which may cause the actual results of the Superior Plus Income Fund (the "Fund") or its wholly owned partnership, Superior Plus LP ("Superior") in future periods to differ materially from any projections expressed or implied by such forward-looking statements and therefore should not be unduly relied upon. Any forward-looking statements are made as of the date hereof and neither the Fund nor Superior undertakes any obligation to publicly update or revise such statements to reflect new information, subsequent events or otherwise.
Distributable Cash Flow and Other Non-GAAP Measures:
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Distributable cash flow of the Fund available for distribution to Unitholders is equal to cash generated from operations before natural gas customer acquisition costs and changes in working capital, less amortization of natural gas customer acquisition costs and maintenance capital expenditures. Maintenance capital expenditures are equal to capital expenditures incurred to maintain the capacity of Superior's operations and are deducted from the calculation of distributable cash flow. Acquisitions and other capital expenditures incurred to expand the capacity of Superior's operations or to increase its profitability ("growth capital"), are excluded from the calculation of distributable cash flow. Distributable cash flow is the main performance measure used by management and investors to evaluate the performance of the Fund and its businesses. Readers are cautioned that distributable cash flow is not a defined performance measure under Canadian generally accepted accounting principles ("GAAP"), and that distributable cash flow cannot be assured. The Fund's calculation of distributable cash flow, maintenance capital and growth capital may differ from similar calculations used by comparable entities. Operating distributable cash flow is distributable cash flow before corporate and interest expenses. It is also a non-GAAP measure and is used by management to assess the performance of the operating divisions. EBITDA represents earnings before interest, taxes, depreciation and amortization calculated on a 12 month trailing basis giving pro forma effect to acquisitions and divestitures and is used by Superior to calculate its debt covenants and other credit information. Superior's calculation of EBITDA may differ from similar calculations used by comparable entities.