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PRESS RELEASE: Paid content from Globe Newswire
Press release content from Globe Newswire. The AP news staff was not involved in its creation.

Icahn Enterprises L.P. Reports Fourth Quarter and Full Year 2018 Financial Results

February 28, 2019

-- Full year 2018 net income attributable to Icahn Enterprises of $1.5 billion, or $11.46 per depositary unit

-- Board approves increase in quarterly distribution to $2.00 per depositary unit (an increase from $7.00 to $8.00 in the annualized distribution)

-- Statement by Carl Icahn

NEW YORK, Feb. 28, 2019 (GLOBE NEWSWIRE) -- Icahn Enterprises L.P. (NASDAQ:IEP) is reporting for the year ended December 31, 2018, revenues of $11.8 billion and net income attributable to Icahn Enterprises of $1.5 billion, or $11.46 per depositary unit, including a loss of $213 million from continuing operations, or $1.16 per depositary unit. For the year ended December 31, 2017, revenues were $12.6 billion and net income attributable to Icahn Enterprises was $2.4 billion, or $14.80 per depositary unit, including $2.3 billion from continuing operations, or $13.84 per depositary unit. For the year ended December 31, 2018, Adjusted EBITDA attributable to Icahn Enterprises was $561 million compared to $642 million for the year ended December 31, 2017. For the year ended December 31, 2018, Adjusted EBIT attributable to Icahn Enterprises was $264 million compared to $323 million for the year ended December 31, 2017.

For the fourth quarter of 2018, revenues were $2.8 billion and net income attributable to Icahn Enterprises was $935 million, or $8.03 per depositary unit, including a loss of $434 million from continuing operations, or $2.28 per depositary unit. For the three months ended December 31, 2017, revenues were $2.5 billion and net income attributable to Icahn Enterprises was $298 million, or $1.76 per depositary unit, including $279 million from continuing operations, or $1.65 per depositary unit. For the three months ended December 31, 2018, Adjusted EBITDA attributable to Icahn Enterprises was a loss of $104 million compared to a loss of $96 million for the three months ended December 31, 2017. For the three months ended December 31, 2018, Adjusted EBIT attributable to Icahn Enterprises was a loss of $176 million compared to a loss of $177 million for the three months ended December 31, 2017.

For the year ended December 31, 2018, indicative net asset value increased to $8.2 billion compared to $7.9 billion as of December 31, 2017.

Statement by Carl Icahn

Carl Icahn, the Chairman of the Board of Icahn Enterprises stated:

“Both 2018 and 2017 were banner years for Icahn Enterprises. The major contribution to our success resulted from the sale of a number of our companies with combined values in excess of $13 billion. These transactions exemplify our general modus operandi at Icahn Enterprises, by which we seek to acquire undervalued assets, nurture, guide and improve their condition and operations, and ultimately develop them into more valuable businesses, which greatly enhances value for all shareholders. A summary of the 2018 transactions is below.

“In April, we entered into an agreement to sell our indirect wholly owned subsidiary Federal-Mogul LLC to Tenneco Inc. for $5.4 billion, comprised of $800 million in cash and 29.5 million shares of Tenneco common stock. This transaction closed in October. In connection with the sale, Tenneco announced its intention to separate the combined businesses into two independent, publicly traded companies through a tax-free spin-off to its stockholders that will establish an aftermarket & ride performance company and a powertrain technology company. We acquired majority control of Federal-Mogul in 2008 when we saw an out-of-favor market opportunity for a great company. During that time, we built one of the leading global suppliers of automotive products. I am very proud of the business we built at Federal-Mogul and see tremendous value in the business combination and separation into two companies.

“Also in April, our majority-owned subsidiary, Tropicana Entertainment Inc. entered into an agreement to sell its real estate to Gaming and Leisure Properties, Inc. and to merge its gaming and hotel operations into Eldorado Resorts, Inc., for aggregate consideration of approximately $1.85 billion. This transaction also closed in October. We first acquired an interest in Tropicana in 2008. Tropicana was bankrupt and desperately needed new leadership. At that time, we identified this undervalued asset as being a perfect situation to deploy our modus operandi. By hiring a great CEO and a great management team, and by reinvesting every single penny of profits back into the company, we turned Tropicana into a great casino company.

“In October, our majority-owned subsidiary, American Railcar Industries, Inc. entered into an agreement to merge with a wholly-owned subsidiary of ITE Rail Fund L.P. in a transaction valued at approximately $1.75 billion (including ARI’s net indebtedness). This transaction closed in December. We first acquired an interest in American Railcar Industries in 2010. Following that time, we deployed our activist modus operandi and guided the company towards growth and increased profitability, enhancing value for all IEP unitholders.”

Distribution

Icahn Enterprises has a long history of endeavoring to return capital to its unitholders by declaring and paying significant and consistent annual distributions. As a reminder –

Icahn Enterprises estimated annual distribution of $8.00 per depositary unit for fiscal year 2019

Icahn Enterprises declared annual distributions of $7.00 per depositary unit for fiscal year 2018

Icahn Enterprises declared annual distributions of $6.00 per depositary unit for fiscal year 2017

Icahn Enterprises declared annual distributions of $6.00 per depositary unit for fiscal year 2016

Icahn Enterprises declared annual distributions of $6.00 per depositary unit for fiscal year 2015

Icahn Enterprises declared annual distributions of $6.00 per depositary unit for fiscal year 2014

Most recently, on February 26, 2019, the Board of Directors of the general partner of Icahn Enterprises declared a quarterly distribution in the amount of $2.00 per depositary unit ($8.00 per unit annualized) which will be paid on or about April 17, 2019 to depositary unitholders of record at the close of business on March 11, 2019. Depositary unitholders will have until April 8, 2019 to make an election to receive either cash or additional depositary units; if a holder does not make an election, it will automatically be deemed to have elected to receive the dividend in cash. Depositary unitholders who elect to receive additional depositary units will receive units valued at the volume weighted average trading price of the units on NASDAQ during the 5 consecutive trading days ending April 15, 2019. No fractional depositary units will be issued pursuant to the distribution payment. Icahn Enterprises will make a cash payment in lieu of issuing fractional depositary units to any holders electing to receive depositary units. Any holders that would only be eligible to receive a fraction of a depositary unit based on the above calculation will receive a cash payment.

Icahn Enterprises L.P., a master limited partnership, is a diversified holding company engaged in eight primary business segments: Investment, Energy, Automotive, Food Packaging, Metals, Real Estate, Home Fashion and Mining.

Caution Concerning Forward-Looking Statements

Results for any interim period are not necessarily indicative of results for any full fiscal period. This release may contain 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. Actual events, results and outcomes may differ materially from our expectations due to a variety of known and unknown risks, uncertainties and other factors, including 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 ability to continue to conduct our activities in a manner so as to not be deemed an investment company under the Investment Company Act of 1940, as amended; 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; risks related to our automotive activities, including exposure to adverse conditions in the automotive industry; 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 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.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS(In millions, except per unit amounts)

Three Months Ended Year Ended December December 31, 31, 2018 2017 2018 2017 --------- --------- ---------- --------- Revenues: (Unaudited) Net sales $ 2,578 $ 2,385 $ 10,576 $ 9,306 Other revenues from operations 156 183 647 743 Net gain from investment activities (6 ) (300 ) 322 302 Interest and dividend income 50 34 148 127 Gain on disposition of assets, net 19 194 84 2,163 Other income (loss), net 5 (14 ) — (22 ) ------- - ------- - -------- - ------- - 2,802 2,482 11,777 12,619 ------- - ------- - -------- - ------- - Expenses: Cost of goods sold 2,202 2,250 8,947 8,258 Other expenses from operations 132 119 529 518 Selling, general and administrative 374 351 1,386 1,269 Restructuring 1 1 21 4 Impairment 89 11 92 87 Interest expense 133 146 524 655 ------- - ------- - -------- - ------- - 2,931 2,878 11,499 10,791 ------- - ------- - -------- - ------- - (Loss) income from continuing operations before (129 ) (396 ) 278 1,828 income tax (expense) benefit Income tax (expense) benefit (65 ) 534 4 529 ------- - ------- - -------- - ------- - (Loss) income from continuing operations (194 ) 138 282 2,357 Income from discontinued operations 1,376 59 1,764 234 ------- - ------- - -------- - ------- - Net income 1,182 197 2,046 2,591 ------- - ------- - -------- - ------- - Less: net income (loss) attributable to non- 247 (101 ) 539 161 controlling interests ------- - ------- - -------- - ------- - Net income attributable to Icahn Enterprises $ 935 $ 298 $ 1,507 $ 2,430 - ----- - - ----- - - ------ - - ----- - Net income (loss) attributable to Icahn Enterprises from: Continuing operations $ (434 ) $ 279 $ (213 ) $ 2,273 Discontinued operations 1,369 19 1,720 157 ------- - ------- - -------- - ------- - $ 935 $ 298 $ 1,507 $ 2,430 - ----- - - ----- - - ------ - - ----- - Net income (loss) attributable to Icahn Enterprises allocable to: Limited partners $ 1,502 $ 292 $ 2,063 $ 2,382 General partner (567 ) 6 (556 ) 48 ------- - ------- - -------- - ------- - $ 935 $ 298 $ 1,507 $ 2,430 - ----- - - ----- - - ------ - - ----- - Basic and diluted income (loss) per LP unit: Continuing operations $ (2.28 ) $ 1.65 $ (1.16 ) $ 13.84 Discontinued operations 10.31 0.11 12.62 0.96 $ 8.03 $ 1.76 $ 11.46 $ 14.80 - ----- - - ----- - - ------ - - ----- - Basic and diluted weighted average LP units 187 166 180 161 outstanding ------- - ------- - -------- - ------- - Cash distributions declared per LP unit $ 1.75 $ 1.50 $ 7.00 $ 6.00 - ----- - - ----- - - ------ - - ----- -

CONDENSED CONSOLIDATED BALANCE SHEETS(In millions)

December 31, 2018 2017 ---------- ---------- ASSETS (Unaudited) Cash and cash equivalents $ 2,656 $ 1,164 Cash held at consolidated affiliated partnerships and restricted cash 2,682 747 Investments 8,337 10,015 Due from brokers 664 506 Accounts receivable, net 474 473 Inventories, net 1,779 1,730 Property, plant and equipment, net 4,703 5,186 Goodwill 247 327 Intangible assets, net 501 544 Assets held for sale 333 10,263 Other assets 1,020 846 -------- - -------- - Total Assets $ 23,396 $ 31,801 - ------ - - ------ - LIABILITIES AND EQUITY Accounts payable $ 832 $ 980 Accrued expenses and other liabilities 900 984 Deferred tax liability 676 732 Unrealized loss on derivative contracts 36 1,275 Securities sold, not yet purchased, at fair value 468 1,023 Due to brokers 141 1,057 Liabilities held for sale 112 7,010 Debt 7,326 7,372 -------- - -------- - Total liabilities 10,491 20,433 -------- - -------- - Equity: Limited partners 7,319 5,341 General partner (790 ) (235 ) -------- - -------- - Equity attributable to Icahn Enterprises 6,529 5,106 Equity attributable to non-controlling interests 6,376 6,262 -------- - -------- - Total equity 12,905 11,368 Total Liabilities and Equity $ 23,396 $ 31,801 - ------ - - ------ -

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 from continuing operations before interest expense, income tax (benefit) expense and depreciation and amortization. EBIT represents earnings from continuing operations 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 and Adjusted EBITDA 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, certain gains/losses on disposition of assets, certain share based compensation, discontinued operations, gains/losses on extinguishment of debt, major scheduled turnaround expenses 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 depositary 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, 2018 2017 --------- --------- Market-valued Subsidiaries: (Unaudited) Holding Company interest in Funds (1) $ 5,066 $ 3,052 CVR Energy (2) 2,455 2,651 CVR Refining - direct holding (2) 60 95 American Railcar Industries (2) — 494 Tenneco Inc.(2) 806 — Total market-valued subsidiaries $ 8,387 $ 6,293 Other Subsidiaries: Tropicana (3) $ — $ 1,439 Viskase (4) 147 173 Federal-Mogul (5) — 1,690 Real Estate Holdings (1) 465 846 PSC Metals (1) 177 182 WestPoint Home (1) 133 144 ARL (6) — 18 Ferrous Resources (7) 423 138 Icahn Automotive Group (1) 1,747 1,728 Total - other subsidiaries $ 3,092 $ 6,359 Add: Holding Company cash and cash equivalents (8) 1,834 526 Less: Holding Company debt (8) (5,505 ) (5,507 ) Add: Other Holding Company net assets (8) 344 189 Indicative Net Asset Value $ 8,152 $ 7,860 - ----- - - ----- -

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, expressed 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) Represents equity attributable to us as of each respective date.(2) Based on closing share price on each date (or if such date was not a trading day, the immediately preceding trading day) and the number of shares owned by the Holding Company as of each respective date.(3) December 31, 2017 based on market comparables due to lack of material trading volume, valued at 9.0x Adjusted EBITDA for the twelve months ended December 31, 2017.(4) Amounts based on market comparables due to lack of material trading volume, valued at 9.0x Adjusted EBITDA for the twelve months ended December 31, 2018 and 2017.(5) December 31, 2017 represents the value of the company based on IEP’s tender offer during Q1 2017.(6) December 31, 2017 represents the option purchase price of the remaining cars not sold in the initial ARL sale, plus working capital as of that date.(7) December 31, 2018 represents the estimated proceeds based on the sale agreement signed during December 2018. December 31, 2017 represents equity attributable to us as of that date.(8) Holding Company’s balance as of each respective date.

($ in millions) Three Months Ended Year Ended December December 31, 31, 2018 2017 2018 2017 -------- -------- --------- --------- Consolidated Adjusted EBITDA: (Unaudited) Net (loss) income from continuing operations $ (194 ) $ 138 $ 282 $ 2,357 Interest expense, net 124 146 511 650 Income tax expense (benefit) 65 (534 ) (4 ) (529 ) Depreciation and amortization 111 120 447 474 ------ - ------ - ------- - ------- - Consolidated EBITDA $ 106 $ (130 ) $ 1,236 $ 2,952 - ---- - - ---- - - ----- - - ----- - Impairment of assets 89 11 92 87 Restructuring costs — 1 16 4 Non-Service cost U.S. based pensions — 1 6 4 Major scheduled turnaround expense 2 43 10 83 Gain on disposition of assets (20 ) (195 ) (90 ) (2,166 ) Net loss on extinguishment of debt — 12 — 12 Tax settlements — — — (38 ) Other 22 23 53 62 Consolidated Adjusted EBITDA $ 199 $ (234 ) $ 1,323 $ 1,000 - ---- - - ---- - - ----- - - ----- - IEP Adjusted EBITDA: Net (loss) income from continuing operations $ (434 ) $ 279 $ (213 ) $ 2,273 attributable to Icahn Enterprises Interest expense, net 102 110 419 472 Income tax expense (benefit) 67 (444 ) (14 ) (435 ) Depreciation and amortization 72 81 297 319 EBITDA attributable to IEP $ (193 ) $ 26 $ 489 $ 2,629 - ---- - - ---- - - ----- - - ----- - Impairment of assets 89 11 92 87 Restructuring costs — 1 14 3 Non-Service cost U.S. based pensions — 1 4 3 Major scheduled turnaround expense 1 25 5 49 Gain on disposition of assets (20 ) (195 ) (91 ) (2,166 ) Net loss on extinguishment of debt — 12 — 12 Tax settlements — — — (38 ) Other 19 23 48 63 Adjusted EBITDA attributable to IEP $ (104 ) $ (96 ) $ 561 $ 642 - ---- - - ---- - - ----- - - ----- -

($ in millions) Three Months Ended Year Ended December December 31, 31, 2018 2017 2018 2017 -------- -------- -------- --------- Consolidated Adjusted EBIT: (Unaudited) Net (loss) income from continuing operations $ (194 ) $ 138 $ 282 $ 2,357 Interest expense, net 124 146 511 650 Income tax expense (benefit) 65 (534 ) (4 ) (529 ) ------ - ------ - ------ - ------- - Consolidated EBIT $ (5 ) $ (250 ) $ 789 $ 2,478 - ---- - - ---- - - ---- - - ----- - Impairment of assets 89 11 92 87 Restructuring costs — 1 16 4 Non-Service cost U.S. based pensions — 1 6 4 Major scheduled turnaround expense 2 43 10 83 Gain on disposition of assets (20 ) (195 ) (90 ) (2,166 ) Net loss on extinguishment of debt — 12 — 12 Tax settlements — — — (38 ) Other 22 23 53 62 ------ - ------ - ------ - ------- - Consolidated Adjusted EBIT $ 88 $ (354 ) $ 876 $ 526 - ---- - - ---- - - ---- - - ----- - IEP Adjusted EBIT: Net (loss) income from continuing operations $ (434 ) $ 279 $ (213 ) $ 2,273 attributable to Icahn Enterprises Interest expense, net 102 110 419 472 Income tax expense (benefit) 67 (444 ) (14 ) (435 ) ------ - ------ - ------ - ------- - EBIT attributable to IEP $ (265 ) $ (55 ) $ 192 $ 2,310 - ---- - - ---- - - ---- - - ----- - Impairment of assets 89 11 92 87 Restructuring costs — 1 14 3 Non-Service cost U.S. based pensions — 1 4 3 Major scheduled turnaround expense 1 25 5 49 Gain on disposition of assets (20 ) (195 ) (91 ) (2,166 ) Net loss on extinguishment of debt — 12 — 12 Tax settlements — — — (38 ) Other 19 23 48 63 ------ - ------ - ------ - ------- - Adjusted EBIT attributable to IEP $ (176 ) $ (177 ) $ 264 $ 323 - ---- - - ---- - - ---- - - ----- -

Investor Contacts:SungHwan Cho, Chief Financial OfficerPeter Reck, Chief Accounting Officer(212) 702-4300

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