Automobile

Sunoco LP Announces Third Quarter 2022 Financial and Operating Results

November 1, 2022

340

Reports third quarter outcomes together with internet earnings of $83 million, Adjusted EBITDA⁽¹⁾of $276 million and Distributable Cash Flow, as adjusted⁽¹⁾ of $196 million
Executes a definitive settlement to accumulate Peerless Oil & Chemicals, Inc., a number one terminal operator and refined product logistics business in Puerto Rico
Increases full-year 2022 Adjusted EBITDA⁽¹⁾⁽²⁾steerage to $845 to $865 million

DALLAS, Nov. 1, 2022 /PRNewswire/ — Sunoco LP (NYSE: SUN) (“SUN” or the “Partnership”) immediately reported monetary and working outcomes for the three-month interval ended September 30, 2022.

Financial and Operational Highlights

For the three months ended September 30, 2022, internet earnings was $83 million versus $104 million within the third quarter of 2021.

Adjusted EBITDA⁽¹⁾ for the quarter was $276 million in contrast with $198 million within the third quarter of 2021. The enhance in Adjusted EBITDA⁽¹⁾displays increased reported gasoline margins and the affect of current acquisitions.

Distributable Cash Flow, as adjusted⁽¹⁾, for the quarter was $196 million, in comparison with $146 million a yr in the past.

The Partnership offered roughly 2.0 billion gallons of gasoline within the third quarter of 2022, up roughly 1% from the third quarter of 2021. Fuel margin for all gallons offered was 13.9 cents per gallon for the quarter in comparison with 11.3 cents per gallon a yr in the past.

Distribution and Coverage

On October 25, 2022, the Board of Directors of SUN’s normal companion declared a distribution for the third quarter of 2022 of $0.8255 per unit, or $3.3020 per unit on an annualized foundation. The distribution will probably be paid on November 18, 2022 to widespread unitholders of document on November 4, 2022. SUN’s present quarter money protection was 2.2 occasions and trailing twelve months protection was 1.8 occasions.

Liquidity and Leverage

At September 30, 2022, SUN had $704 million of borrowings towards its revolving credit score facility and different long-term debt of $2.7 billion. The Partnership maintained liquidity of roughly $789 million on the finish of the quarter below its $1.5 billion revolving credit score facility. SUN’s leverage ratio of internet debt to Adjusted EBITDA⁽¹⁾, calculated in accordance with its credit score facility, was 3.7 occasions on the finish of the third quarter.

Capital Spending

SUN’s whole capital expenditures for the third quarter had been $42 million, which included $31 million for progress capital and $11 million for upkeep capital. For the full-year 2022, SUN expects progress capital expenditures of roughly $150 million and upkeep capital expenditures of roughly $50 million.

Peerless Oil & Chemicals, Inc. Acquisition

On October 28, 2022 the Partnership executed a definitive settlement to accumulate Peerless Oil & Chemicals, Inc. (“Peerless”) for $70 million, topic to customary working capital changes. Peerless is a longtime terminal operator that distributes gasoline merchandise to over 100 areas inside Puerto Rico and all through the Caribbean. The Partnership expects the acquisition to be instantly accretive to unitholders. The transaction is predicted to shut within the fourth quarter, topic to customary closing situations, and will probably be funded utilizing quantities accessible below SUN’s revolving credit score facility.

SUN’s section outcomes and different supplementary knowledge are offered after the monetary tables beneath.

(1)

Adjusted EBITDA and Distributable Cash Flow, as adjusted, are non-GAAP monetary measures of efficiency which have limitations and shouldn’t be thought-about as an alternative choice to internet earnings. Please seek advice from the dialogue and tables below “Reconciliations of Non-GAAP Measures” later on this information launch for a dialogue of our use of Adjusted EBITDA and Distributable Cash Flow, as adjusted, and a reconciliation to internet earnings.

(2)

A reconciliation of non-GAAP ahead trying info to corresponding GAAP measures can’t be offered with out unreasonable efforts as a result of inherent problem in quantifying sure quantities because of a wide range of components, together with the unpredictability of commodity worth actions and future prices or reversals exterior the traditional course of business which can be important.

Earnings Conference Call

Sunoco LP administration will maintain a convention name on Tuesday, November 1, 2022, at 9:00 a.m. Central time (10:00 a.m. Eastern time) to debate outcomes and current developments. To take part, dial 877-407-6184 (toll free) or 201-389-0877 roughly 10 minutes earlier than the scheduled begin time and ask for the Sunoco LP convention name. The name can even be accessible reside and for later replay through webcast within the Investor Relations part of Sunoco’s web site at www.SunocoLP.com below Webcasts and Presentations.

Sunoco LP (NYSE: SUN) is a grasp restricted partnership with core operations that embrace the distribution of motor gasoline to roughly 10,000 comfort shops, impartial sellers, industrial clients and distributors positioned in additional than 40 U.S. states and territories in addition to refined product transportation and terminalling property. SUN’s normal companion is owned by Energy Transfer LP (NYSE: ET).

Forward-Looking Statements

This information launch might embrace sure statements regarding expectations for the long run which are forward-looking statements as outlined by federal regulation. Such forward-looking statements are topic to a wide range of recognized and unknown dangers, uncertainties, and different components which are troublesome to foretell and a lot of that are past administration’s management. An in depth listing of things that may have an effect on future outcomes are mentioned within the Partnership’s Annual Report on Form 10-Ok and different paperwork filed occasionally with the Securities and Exchange Commission. In addition to the dangers and uncertainties beforehand disclosed, the Partnership has additionally been, or might sooner or later be, impacted by new or heightened dangers associated to the COVID-19 pandemic and the current instability in commodity costs, and we can not predict the size and final affect of these dangers. The Partnership undertakes no obligation to replace or revise any forward-looking assertion to mirror new info or occasions.

The info contained on this press launch is on the market on our web site at www.SunocoLP.com

Contacts
Investors:
Scott Grischow, Treasurer, Vice President – Investor Relations and Mergers & Acquisitions
(214) 840-5660, [email protected]

James Heckler, Director – Investor Relations and Corporate Finance
(214) 840-5415, [email protected]

Media:
Alexis Daniel, Manager – Communications
(214) 981-0739, [email protected]

– Financial Schedules Follow –

SUNOCO LP CONSOLIDATED BALANCE SHEETS (Dollars in hundreds of thousands) (unaudited)

	September 30, 2022	December 31, 2021
Assets
Current property:
Cash and money equivalents	$ 196	$ 25
Accounts receivable, internet	730	526
Receivables from associates	10	12
Inventories, internet	776	534
Other present property	151	95
Total present property	1,863	1,192

Property and tools	2,675	2,581
Accumulated depreciation	(1,007)	(914)
Property and tools, internet	1,668	1,667
Other property:
Finance lease right-of-use property, internet	9	9
Operating lease right-of-use property, internet	514	517
Goodwill	1,588	1,568

Intangible property	990	902
Accumulated amortization	(396)	(360)
Intangible property, internet	594	542
Other noncurrent property	209	188
Investment in unconsolidated affiliate	129	132
Total property	$ 6,574	$ 5,815
Liabilities and fairness
Current liabilities:
Accounts payable	$ 868	$ 515
Accounts payable to associates	110	59
Accrued bills and different present liabilities	326	291
Operating lease present liabilities	19	19
Current maturities of long-term debt	—	6
Total present liabilities	1,323	890
Operating lease noncurrent liabilities	519	521
Revolving line of credit score	704	581
Long-term debt, internet	2,670	2,668
Advances from associates	117	126
Deferred tax legal responsibility	151	114
Other noncurrent liabilities	112	104
Total liabilities	5,596	5,004
Commitments and contingencies
Equity:
Limited companions:
Common unitholders (83,763,300 items issued and excellent as of September 30, 2022 and 83,670,950 items issued and excellent as of December 31, 2021)	978	811
Class C unitholders – held by subsidiaries (16,410,780 items issued and excellent as of September 30, 2022 and December 31, 2021)	—	—
Total fairness	978	811
Total liabilities and fairness	$ 6,574	$ 5,815

SUNOCO LP CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Dollars in hundreds of thousands, besides per unit knowledge) (unaudited)

	Three Months Ended September 30,		Nine Months Ended September 30,
	2022	2021	2022	2021
Revenues:
Motor gasoline gross sales	$ 6,468	$ 4,666	$ 19,423	$ 12,321
Non motor gasoline gross sales	90	79	282	218
Lease earnings	36	34	106	103
Total revenues	6,594	4,779	19,811	12,642
Cost of gross sales and working bills:
Cost of gross sales	6,261	4,472	18,703	11,631
General and administrative	29	28	86	79
Other working	86	70	250	192
Lease expense	16	15	47	44
Gain on disposal of property	(3)	(4)	(8)	(12)
Depreciation, amortization and accretion	55	45	151	135
Total price of gross sales and working bills	6,444	4,626	19,229	12,069
Operating earnings	150	153	582	573
Other earnings (expense):
Interest expense, internet	(49)	(40)	(135)	(124)
Equity in earnings of unconsolidated affiliate	1	1	3	3
Loss on extinguishment of debt	—	—	—	(7)
Income earlier than earnings taxes	102	114	450	445
Income tax expense	19	10	30	21
Net earnings and complete earnings	$ 83	$ 104	$ 420	$ 424

Net earnings per widespread unit:
Basic	$ 0.76	$ 1.01	$ 4.32	$ 4.38
Diluted	$ 0.75	$ 1.00	$ 4.27	$ 4.33

Weighted common widespread items excellent:
Basic	83,763,064	83,352,123	83,728,153	83,348,540
Diluted	84,831,037	84,549,277	84,769,526	84,364,321

Cash distributions per widespread unit	$ 0.8255	$ 0.8255	$ 2.4765	$ 2.4765

Key Operating Metrics

The following info is meant to offer traders with an affordable foundation for assessing our historic operations, however mustn’t function the one standards for predicting our future efficiency.

The key working metrics by section and accompanying footnotes set forth beneath are offered for the three months ended September 30, 2022 and 2021 and have been derived from our historic consolidated monetary statements.

	Three Months Ended September 30,
	2022			2021
	Fuel Distribution and Marketing	All Other	Total	Fuel Distribution and Marketing	All Other	Total
	*({dollars} and gallons in hundreds of thousands, besides gross revenue per gallon)*
Revenues:
Motor gasoline gross sales	$ 6,270	$ 198	$ 6,468	$ 4,499	$ 167	$ 4,666
Non motor gasoline gross sales	29	61	90	21	58	79
Lease earnings	35	1	36	33	1	34
Total revenues	$ 6,334	$ 260	$ 6,594	$ 4,553	$ 226	$ 4,779
Cost of Sales:
Motor gasoline gross sales	$ 6,062	$ 170	$ 6,232	$ 4,283	$ 152	$ 4,435
Non motor gasoline gross sales	2	27	29	9	28	37
Lease	—	—	—	—	—	—
Total price of gross sales	$ 6,064	$ 197	$ 6,261	$ 4,292	$ 180	$ 4,472
Net earnings and complete earnings			$ 83			$ 104
Adjusted EBITDA (1)	$ 250	$ 26	$ 276	$ 186	$ 12	$ 198
Operating Data:
Total motor gasoline gallons offered			1,986			1,971
Motor gasoline gross revenue cents per gallon (2)			13.9 ¢			11.3 ¢

The following desk presents a reconciliation of Adjusted EBITDA to internet earnings and Adjusted EBITDA to Distributable Cash Flow, as adjusted, for the three months ended September 30, 2022 and 2021:

	Three Months Ended September 30,
	2022	2021
	*(in hundreds of thousands)*
Segment Adjusted EBITDA
Fuel distribution and advertising	$ 250	$ 186
All different	26	12
Consolidated Adjusted EBITDA	276	198
Depreciation, amortization and accretion	(55)	(45)
Interest expense, internet	(49)	(40)
Non-cash unit-based compensation expense	(4)	(5)
Gain on disposal of property	3	4
Unrealized loss on commodity derivatives	(23)	(2)
Inventory changes	(40)	9
Equity in earnings of unconsolidated affiliate	1	1
Adjusted EBITDA associated to unconsolidated affiliate	(2)	(3)
Other non-cash changes	(5)	(3)
Income tax expense	(19)	(10)
Net earnings and complete earnings	$ 83	$ 104

Adjusted EBITDA (1)	$ 276	$ 198
Adjusted EBITDA associated to unconsolidated affiliate	(2)	(3)
Distributable money circulate from unconsolidated affiliate	2	3
Cash curiosity expense	(46)	(39)
Current earnings tax expense	(24)	(4)
Maintenance capital expenditures	(11)	(10)
Distributable Cash Flow	195	145
Transaction-related bills	1	1
Distributable Cash Flow, as adjusted (1)	$ 196	$ 146

Distributions to Partners:
Limited Partners	$ 69	$ 69
General Partners	18	18
Total distributions to be paid to companions	$ 87	$ 87
Common Units excellent – finish of interval	83.8	83.4
Distribution protection ratio (3)	2.24x	1.68x


(1) Adjusted EBITDA is outlined as earnings earlier than internet curiosity expense, earnings taxes, depreciation, amortization and accretion expense, allotted non-cash compensation expense, unrealized positive factors and losses on commodity derivatives and stock changes, and sure different working bills mirrored in internet earnings that we don’t imagine are indicative of ongoing core operations, equivalent to acquire or loss on disposal of property and non-cash impairment prices. We outline Distributable Cash Flow, as adjusted, as Adjusted EBITDA much less money curiosity expense, together with the accrual of curiosity expense associated to our long-term debt which is paid on a semi-annual foundation, present earnings tax expense, upkeep capital expenditures and different non-cash changes.
We imagine Adjusted EBITDA and Distributable Cash Flow, as adjusted, are helpful to traders in evaluating our working efficiency as a result of:
Adjusted EBITDA is used as a efficiency measure below our revolving credit score facility;
securities analysts and different events use such metrics as measures of monetary efficiency, capability to make distributions to our unitholders and debt service capabilities;
our administration makes use of them for inside planning functions, together with elements of our consolidated working funds, and capital expenditures; and
Distributable Cash Flow, as adjusted, gives helpful info to traders as it’s a broadly accepted monetary indicator utilized by traders to check partnership efficiency, and because it gives traders an enhanced perspective of the working efficiency of our property and the money our business is producing.
Adjusted EBITDA and Distributable Cash Flow, as adjusted, should not acknowledged phrases below GAAP and don’t purport to be options to internet earnings (loss) as measures of working efficiency or to money flows from working actions as a measure of liquidity. Adjusted EBITDA and Distributable Cash Flow, as adjusted, have limitations as analytical instruments, and one mustn’t contemplate them in isolation or as substitutes for evaluation of our outcomes as reported below GAAP. Some of those limitations embrace:
they don’t mirror our whole money expenditures, or future necessities for capital expenditures or contractual commitments;SUN
they don’t mirror adjustments in, or money necessities for, working capital;
they don’t mirror curiosity expense or the money necessities essential to service curiosity or principal funds on our revolving credit score facility or senior notes;
though depreciation and amortization are non-cash prices, the property being depreciated and amortized will usually have to get replaced sooner or later, and Adjusted EBITDA doesn’t mirror money necessities for such replacements; and
as not all corporations use equivalent calculations, our presentation of Adjusted EBITDA and Distributable Cash Flow, as adjusted, will not be akin to equally titled measures of different corporations.
Adjusted EBITDA displays quantities for the unconsolidated affiliate based mostly on the identical recognition and measurement strategies used to document fairness in earnings of unconsolidated affiliate. Adjusted EBITDA associated to unconsolidated affiliate excludes the identical objects with respect to the unconsolidated affiliate as these excluded from the calculation of Adjusted EBITDA, equivalent to curiosity, taxes, depreciation, depletion, amortization and different non-cash objects. Although these quantities are excluded from Adjusted EBITDA associated to unconsolidated affiliate, such exclusion shouldn’t be understood to suggest that we have now management over the operations and ensuing revenues and bills of such affiliate. We don’t management our unconsolidated affiliate; due to this fact, we don’t management the earnings or money flows of such affiliate. The use of Adjusted EBITDA or Adjusted EBITDA associated to unconsolidated affiliate as an analytical software needs to be restricted accordingly. Inventory changes which are excluded from the calculation of Adjusted EBITDA characterize adjustments in decrease of price or market reserves on the Partnership’s stock. These quantities are unrealized valuation changes utilized to gasoline volumes remaining in stock on the finish of the interval.
(2) Excludes the affect of stock changes per the definition of Adjusted EBITDA.
(3) The distribution protection ratio for a interval is calculated because the non-GAAP measure of Distributable Cash Flow, as adjusted, divided by distributions anticipated to be paid to companions of Sunoco LP in respect of such a interval.

SOURCE Sunoco LP

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