Icahn Enterprises L.P. Reports Fourth Quarter and Record Full Year 2013 Financial Results

Icahn Enterprises L.P. Reports Fourth Quarter and Record Full Year 2013 Financial Results    *Record 2013 Net Income Attributable to Icahn Enterprises of $1.0 billion,     or $9.07 per LP unit (An increase of 144% vs prior year)   *Record 2013 Adjusted EBITDA attributable to Icahn Enterprises of $1.9     billion   *Board Approves Increase in Quarterly Distribution to $1.50 per depository     unit (An Increase from $5.00 to $6.00 in the Annual Distribution)  NEW YORK, March 3, 2014 (GLOBE NEWSWIRE) -- Icahn Enterprises L.P. (Nasdaq:IEP) is reporting full year 2013 revenues were $20.7 billion and net income attributable to Icahn Enterprises was $1.0 billion, or $9.07 per LP unit, an increase of 144% compared to the prior year. For the full year 2012, revenues were $15.8 billion and net income attributable to Icahn Enterprises was $396 million, or $3.72 per LP unit. Adjusted EBITDA attributable to Icahn Enterprises was $1.9 billion for the full year 2013 compared to $1.5 billion for the full year 2012. Adjusted EBIT attributable to Icahn Enterprises was $1.4 billion for the full year 2013 compared to $1.1 billion for the full year 2012.  For the fourth quarter of 2013, revenues were $4.9 billion and net income attributable to Icahn Enterprises was $222 million, or $1.90 per LP unit. For fourth quarter of 2012, revenues were $4.3 billion and net income attributable to Icahn Enterprises was $6 million, or $0.05 per LP unit. For the fourth quarter of 2013, Adjusted EBITDA attributable to Icahn Enterprises was $282 million compared to $331 million in the fourth quarter of 2012. For the fourth quarter of 2013, Adjusted EBIT attributable to Icahn Enterprises was $140 million compared to $200 million in the fourth quarter of 2012.  On February 25, 2014, the Board of Directors of the general partner of Icahn Enterprises declared a quarterly distribution in the amount of $1.50 per depositary unit increasing our annualized distribution from $5.00 to $6.00. The quarterly distribution is payable in either cash or additional depositary units, at the election of each depositary unit holder and will be paid on or about April 22, 2014 to depositary unit holders of record at the close of business on March 13, 2014.  Mr. Icahn stated, "I am pleased to report record earnings in 2013. The financial performance of Icahn Enterprises demonstrates the power of our activist strategy both in our investment funds and our operating companies. We are off to a strong start in 2014. As a result of our strong performance and positive outlook, we are happy to increase the distribution by 20%. I encourage you to read my letter to IEP shareholders for a more in-depth discussion regarding the advantages of shareholder activism at www.shareholderssquaretable.com or www.ielp.com."  Icahn Enterprises L.P. (Nasdaq:IEP), a master limited partnership, is a diversified holding company engaged in nine primary business segments: Investment, Automotive, Energy, Metals, Railcar, Gaming, Food Packaging, Real Estate and Home Fashion.  Caution Concerning Forward-Looking Statements  Results for any interim period are not necessarily indicative of results for any full fiscal period. This release contains certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, many of which are beyond our ability to control or predict. Forward-looking statements may be identified by words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," "will" or words of similar meaning and include, but are not limited to, statements about the expected future business and financial performance of Icahn Enterprises L.P. and its subsidiaries. Among these risks and uncertainties are risks related to economic downturns, substantial competition and rising operating costs; risks related to our investment activities, including the nature of the investments made by the private funds in which we invest, losses in the private funds and loss of key employees; risks related to our automotive activities, including exposure to adverse conditions in the automotive industry, and risks related to operations in foreign countries; risks related to our energy business, including the volatility and availability of crude oil, other feed stocks and refined products, unfavorable refining margin (crack spread), interrupted access to pipelines, significant fluctuations in nitrogen fertilizer demand in the agricultural industry and seasonality of results; risk related to our gaming operations, including reductions in discretionary spending due to a downturn in the local, regional or national economy, intense competition in the gaming industry from present and emerging internet online markets and extensive regulation; risks related to our railcar activities, including reliance upon a small number of customers that represent a large percentage of revenues and backlog, the health of and prospects for the overall railcar industry and the cyclical nature of the railcar manufacturing business; risks related to our food packaging activities, including competition from better capitalized competitors, inability of its suppliers to timely deliver raw materials, and the failure to effectively respond to industry changes in casings technology; risks related to our scrap metals activities, including potential environmental exposure; risks related to our real estate activities, including the extent of any tenant bankruptcies and insolvencies; risks related to our home fashion operations, including changes in the availability and price of raw materials, and changes in transportation costs and delivery times; and other risks and uncertainties detailed from time to time in our filings with the Securities and Exchange Commission. Past performance in our Investment segment is not necessarily indicative of future performance. We undertake no obligation to publicly update or review any forward-looking information, whether as a result of new information, future developments or otherwise.    CONSOLIDATED STATEMENTS OF OPERATIONS (In millions, except per unit amounts)                                                Three Months Ended December 31,                                               2013            2012 Revenues:                                      (Unaudited) Net sales                                     $ 4,533         $ 3,993 Other revenues from operations                242             211 Net gain from investment activities           143             67 Interest and dividend income                  68              34 Other loss, net                               (114)           (14)                                               4,872           4,291 Expenses:                                                      Cost of goods sold                            4,204           3,617 Other expenses from operations                122             115 Selling, general and administrative           358             337 Restructuring                                 28              10 Impairment                                    9               42 Interest expense                              138             149                                               4,859           4,270 Income before income tax benefit              13              21 Income tax benefit                            392             60 Net income                                    405             81 Less: net income attributable to               (183)           (75) non-controlling interests Net income attributable to Icahn Enterprises  $ 222           $ 6                                                               Net income attributable to Icahn Enterprises                   allocable to: Limited partners                              $ 218           $ 5 General partner                               4               1                                               $ 222           $ 6                                                               Basic income per LP unit                      $ 1.91          $ 0.05 Basic weighted average LP units outstanding   114             105                                                               Diluted income per LP unit                    $ 1.90          $ 0.05 Diluted weighted average LP units outstanding 115             105 Cash distributions declared per LP unit       $ 1.25          $ 0.10    CONSOLIDATED STATEMENTS OF OPERATIONS (In millions, except per unit amounts)                                                   Year Ended December 31,                                                  2013      2012      2011 Revenues:                                                            Net sales                                         $ 17,785 $ 14,574 $ 9,127 Other revenues from operations                   988       951       933 Net gain from investment activities              1,694     343       1,905 Interest and dividend income                     194       103       126 Other income (loss), net                         21        (175)     (72)                                                  20,682    15,796    12,019 Expenses:                                                            Cost of goods sold                               15,809    12,606    7,871 Other expenses from operations                   504       502       505 Selling, general and administrative              1,417     1,275     1,237 Restructuring                                    50        31        11 Impairment                                       16        129       71 Interest expense                                 560       572       490                                                  18,356    15,115    10,185 Income before income tax (expense) benefit       2,326     681       1,834 Income tax benefit (expense)                     118       81        (34) Net income                                       2,444     762       1,800 Less: net income attributable to non-controlling  (1,419)   (366)     (1,050) interests Net income attributable to Icahn Enterprises     $ 1,025   $ 396     $ 750                                                                     Net income attributable to Icahn Enterprises                         allocable to: Limited partners                                 $ 1,005   $ 379     $ 735 General partner                                  20        17        15                                                  $ 1,025   $ 396     $ 750                                                                     Basic income per LP unit                         $ 9.14    $ 3.72    $ 8.35 Basic weightedaverageLPunitsoutstanding      110       102       88                                                                     Diluted income per LP unit                       $ 9.07    $ 3.72    $ 8.15 Diluted weightedaverageLPunitsoutstanding    111       102       93 Cash distributions declared per LP unit          $ 4.50    $ 0.40    $ 0.55    CONSOLIDATED BALANCE SHEETS (In millions, except unit amounts)                                                            December 31,                                                           2013      2012 ASSETS                                                               Cash and cash equivalents                                                                                                      $ 3,262   $ 3,108 Cash held at consolidated affiliated partnerships and      396       963 restricted cash Investments                                               12,261    5,491 Accounts receivable, net                                  1,750     1,854 Due from brokers                                          35        567 Inventories, net                                          1,902     1,955 Property, plant and equipment, net                        8,077     7,661 Goodwill                                                  2,074     2,082 Intangible assets, net                                    1,113     1,206 Other assets                                              875       1,045 Total Assets                                               $ 31,745  $ 25,932 LIABILITIES AND EQUITY                                               Accounts payable                                                                                                               $ 1,353   $ 1,388 Accrued expenses and other liabilities                    2,196     1,499 Deferred tax liability                                    1,394     1,335 Securities sold, not yet purchased, at fair value         884       533 Due to brokers                                            2,203     — Post-employment benefit liability                         1,111     1,488 Debt                                                      9,295     9,873 Total liabilities                                         18,436    16,116                                                                     Commitments and contingencies                                                                                                            Equity:                                                              Limited partners: Depositary units: 115,900,309 and 104,850,813 units issued and outstanding at December 31,   6,308     4,913 2013 and 2012, respectively General partner                                           (216)     (244) Equity attributable to Icahn Enterprises                  6,092     4,669 Equity attributable to non-controlling interests          7,217     5,147 Total equity                                              13,309    9,816 Total Liabilities and Equity                               $ 31,745 $ 25,932  Use of Non-GAAP Financial Measures  The Company uses certain non-GAAP financial measures in evaluating its performance. These include non-GAAP EBITDA, Adjusted EBITDA, EBIT and Adjusted EBIT.EBITDA represents earnings before interest expense, income tax (benefit) expense and depreciation and amortization.EBIT represents earnings before interest expense and income tax (benefit) expense.We define Adjusted EBITDA and Adjusted EBIT as EBITDA and EBIT, respectively, excluding the effects of impairment, restructuring costs, certain pension plan expenses, OPEB curtailment gains, purchase accounting inventory adjustments, certain share-based compensation, discontinued operations, gains/losses on extinguishment of debt, major scheduled turnaround expenses, FIFO adjustments and unrealized gains/losses on energy segment derivatives and certain other non-operational charges.We present EBITDA, Adjusted EBITDA, EBIT and Adjusted EBIT on a consolidated basis and attributable to Icahn Enterprises net of the effect of non-controlling interests.We conduct substantially all of our operations through subsidiaries.The operating results of our subsidiaries may not be sufficient to make distributions to us.In addition, our subsidiaries are not obligated to make funds available to us for payment of our indebtedness, payment of distributions on our depositary units or otherwise, and distributions and intercompany transfers from our subsidiaries to us may be restricted by applicable law or covenants contained in debt agreements and other agreements to which these subsidiaries currently may be subject or into which they may enter into in the future.The terms of any borrowings of our subsidiaries or other entities in which we own equity may restrict dividends, distributions or loans to us.  We believe that providing EBITDA, Adjusted EBITDA, EBIT and Adjusted EBIT to investors has economic substance as these measures provide important supplemental information of our performance to investors and permits investors and management to evaluate the core operating performance of our business without regard to interest, taxes and depreciation and amortization and the effects of impairment, restructuring costs, certain pension plan expenses, OPEB curtailment gains, purchase accounting inventory adjustments, certain share-based compensation, discontinued operations, gains/losses on extinguishment of debt, major scheduled turnaround expenses, FIFO adjustments and unrealized gains/losses on energy segment derivatives and certain other non-operational charges.Additionally, we believe this information is frequently used by securities analysts, investors and other interested parties in the evaluation of companies that have issued debt.Management uses, and believes that investors benefit from referring to these non-GAAP financial measures in assessing our operating results, as well as in planning, forecasting and analyzing future periods.Adjusting earnings for these charges allows investors to evaluate our performance from period to period, as well as our peers, without the effects of certain items that may vary depending on accounting methods and the book value of assets.Additionally, EBITDA, Adjusted EBITDA, EBIT and Adjusted EBIT present meaningful measures of performance exclusive of our capital structure and the method by which assets were acquired and financed.  EBITDA, Adjusted EBITDA, EBIT and Adjusted EBIT have limitations as analytical tools, and you should not consider them in isolation, or as substitutes for analysis of our results as reported under generally accepted accounting principles in the United States, or U.S. GAAP.For example, EBITDA, Adjusted EBITDA, EBIT and Adjusted EBIT:    *do not reflect our cash expenditures, or future requirements for capital     expenditures, or contractual commitments;   *do not reflect changes in, or cash requirements for, our working capital     needs; and   *do not reflect the significant interest expense, or the cash requirements     necessary to service interest or principal payments on our debt.  Although depreciation and amortization are non-cash charges, the assets being depreciated or amortized often will have to be replaced in the future, and EBITDA and Adjusted EBITDA do not reflect any cash requirements for such replacements.Other companies in the industries in which we operate may calculate EBITDA, Adjusted EBITDA, EBIT and Adjusted EBIT differently than we do, limiting their usefulness as comparative measures.In addition, EBITDA, Adjusted EBITDA, EBIT and Adjusted EBIT do not reflect the impact of earnings or charges resulting from matters we consider not to be indicative of our ongoing operations.  EBITDA, Adjusted EBITDA, EBIT and Adjusted EBIT are not measurements of our financial performance under U.S. GAAP and should not be considered as alternatives to net income or any other performance measures derived in accordance with U.S. GAAP or as alternatives to cash flow from operating activities as a measure of our liquidity. Given these limitations, we rely primarily on our U.S. GAAP results and use EBITDA, Adjusted EBITDA, EBIT and Adjusted EBIT only as a supplemental measure of our financial performance.  Use of Indicative Net Asset Value Data  The Company uses indicative net asset value as an additional method for considering the value of the Company's assets, and we believe that this information can be helpful to investors.Please note, however, that the indicative net asset value does not represent the market price at which the units trade.Accordingly, data regarding indicative net asset value is of limited use and should not be considered in isolation.  The Company's depository units are not redeemable, which means that investors have no right or ability to obtain from the Company the indicative net asset value of units that they own.Units may be bought and sold on The NASDAQ Global Select Market at prevailing market prices.Those prices may be higher or lower than the indicative net asset value of the units as calculated by management.  See below for more information on how we calculate the Company's indicative net asset value.                                                            ($ in millions)                                                                                              December 31,                                                   2013    2012 Market-valued Subsidiaries:                        (unaudited)      Holding Company interest in Funds (1)             $ 3,696 $ 2,387 CVR Energy (2)                                    3,092   3,474 CVR Refining - direct holding (2)                 136     — Federal-Mogul (2)                                 2,383   615 American Railcar Industries (2)                   543     377 Total market-valued subsidiaries                  $ 9,850 $ 6,853                                                           Other Subsidiaries:                                        Tropicana (3)                                     $ 444   $ 512 Viskase (3)                                       290     268 Real Estate Holdings (4)                          711     763 PSC Metals (4)                                    273     338 WestPoint Home (4)                                191     256 AEP Leasing / ARL (5)                             754     60 Total - other subsidiaries                        $ 2,663 $ 2,196 Add:Holding Company cash and cash equivalents (6) 782     1,045 Less:Holding Company debt (6)                    (4,016) (4,082) Add:Other Holding Company net assets (7)         (147)   86 Indicative Net Asset Value                         $ 9,132 $ 6,098  Indicative net asset value does not purport to reflect a valuation of IEP.The calculated Indicative net asset value does not include any value for our Investment Segment other than the fair market value of our investment in the Investment Funds.A valuation is a subjective exercise and Indicative net asset value does not necessarily consider all elements or consider in the adequate proportion the elements that could affect the valuation of IEP.Investors may reasonably differ on what such elements are and their impact on IEP.No representation or assurance, express or implied is made as to the accuracy and correctness of indicative net asset value as of these dates or with respect to any future indicative or prospective results which may vary.  (1)Fair market value of Holding Company's interest in the Funds and Investment segment cash as of each respective date.  (2)Based on closing share price on each date and the number of shares owned by the Holding Company as of each respective date.  (3)Amounts based on market comparables due to lack of material trading volume.Tropicana valued at 8.0x Adjusted EBITDA for the twelve months ended December 31, 2012 and December 31, 2013. Viskase valued at 11.0x Adjusted EBITDA for the twelve months ended December 31, 2012 and 9.5x for the twelve months ended December 31, 2013.  (4)Represents equity attributable to us as of each respective date.  (5)December 31, 2012 represents book value of AEP Leasing. For December 31, 2013 ARL value assumes the present value of cash flows from leased railcars plus working capital.  (6)Holding Company's balance as of each respective date.  (7)Represents Holding Company net assets as of each respective date.                                                                                                                      ($ in millions)                         Three Months Ended Year Ended December                                         December 31,       31,                                        2013      2012     2013       2012 Consolidated Adjusted EBITDA:           (Unaudited) Net income                             $ 405    $ 81    $ 2,444   $ 762 Interest expense, net                  134       143      544        554 Income tax expense (benefit)           (392)     (60)     (118)      (81) Depreciation and amortization          184       174      708        607 Consolidated EBITDA                     $ 331     $ 338    $ 3,578    $ 1,842 Impairment of assets                   9         42       16         129 Restructuring costs                    28        10       50         31 Non-service cost U.S. based pensions    1         12       5          38 FIFO impact unfavorable (favorable)     62        23       (21)       71 Unrealized loss/(gain) on certain       126       (50)     (51)       68 derivatives OPEB curtailment gain                  —         —        (19)       (51) Major scheduled turnaround expense      —         94       —          107 Certain share-based compensation        7         10       28         34 expense Net loss on divestitures               3         —        60         — Net loss on extinguishment of debt     5         6        —          10 Other                                  (1)       25       25         39 Consolidated Adjusted EBITDA            $ 571     $ 510    $ 3,671    $ 2,318                                                                    IEP Adjusted EBITDA:                                                Net income attributable to IEP         $ 222    $ 6     $ 1,025   $ 396 Interest expense, net                  118       119      464        456 Income tax expense (benefit)           (381)     (68)     (170)      (128) Depreciation and amortization          142       131      485        434 EBITDA attributable to IEP              $ 101     $ 188    $ 1,804    $ 1,158 Impairment of assets                   7         38       14         106 Restructuring costs                    24        9        41         25 Non-service cost U.S. based pensions    —         9        4          29 FIFO impact unfavorable (favorable)     39        24       (15)       58 Unrealized loss/(gain) on certain       78        (39)     (43)       57 derivatives OPEB curtailment gain                  —         —        (15)       (40) Major scheduled turnaround expense      —         78       —          88 Certain share-based compensation        6         1        20         27 expense Net loss on divestitures               2         —        46         — Net loss on extinguishment of debt      3         5        —          7 Other                                  22        18       40         31 Adjusted EBITDA attributable to IEP     $ 282     $ 331    $ 1,896    $ 1,546                                                                                                                                        ($ in millions)                                                                                            Three Months Ended Year Ended December                                         December 31,       31,                                        2013       2012    2013       2012 Consolidated Adjusted EBIT:             (Unaudited) Net income                             $ 405     $ 81   $ 2,444   $ 762 Interest expense, net                  134        143     544        554 Income tax expense (benefit)           (392)      (60)    (118)      (81) Consolidated EBIT                       $ 147      $ 164   $ 2,870    $ 1,235 Impairment of assets                   9          42      16         129 Restructuring costs                    28         10      50         31 Non-service cost U.S. based pensions    1          12      5          38 FIFO impact unfavorable (favorable)     62         23      (21)       71 Unrealized loss/(gain) on certain       126        (50)    (51)       68 derivatives OPEB curtailment gain                  —          —       (19)       (51) Major scheduled turnaround expense      —          94      —          107 Certain share-based compensation        7          10      28         34 expense Net loss on divestitures               3          —       60         — Net loss on extinguishment of debt      5          6       —          10 Other                                  (1)        25      25         39 Consolidated Adjusted EBIT              $ 387      $ 336   $ 2,963    $ 1,711                                                                    IEP Adjusted EBIT:                                                  Net income attributable to IEP         $ 222     $ 6    $ 1,025   $ 396 Interest expense, net                  118        119     464        456 Income tax expense (benefit)           (381)      (68)    (170)      (128) EBIT attributable to IEP                $ (41)    $ 57    $ 1,319    $ 724 Impairment of assets                   7          38      14         106 Restructuring costs                    24         9       41         25 Non-service cost U.S. based pensions    —          9       4          29 FIFO impact unfavorable (favorable)     39         24      (15)       58 Unrealized loss/(gain) on certain       78         (39)    (43)       57 derivatives OPEB curtailment gain                  —          —       (15)       (40) Major scheduled turnaround expense      —          78      —          88 Certain share-based compensation        6          1       20         27 expense Net loss on divestitures               2          —       46         — Net loss on extinguishment of debt     3          5       —          7 Other                                  22         18      40         31 Adjusted EBIT attributable to IEP       $ 140      $ 200   $ 1,411    $ 1,112  CONTACT: Investor Contacts:          SungHwan Cho, Chief Financial Officer          Peter Reck, Chief Accounting Officer          (212) 702-4300  
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