DALLAS, Nov. 6, 2024
/PRNewswire/ -- Sunoco LP (NYSE: SUN) ("SUN" or the
"Partnership") today reported financial and operating results for
the quarter ended September 30,
2024.
Financial and Operational Highlights
Net income for the third quarter of 2024 was $2 million compared to net income of $272 million in the third quarter of 2023.
Adjusted EBITDA(1) for the third quarter of 2024 was
$456 million compared to $257 million in the third quarter of 2023.
Adjusted EBITDA(1) for the third quarter of 2024
includes approximately $14 million of
one-time transaction-related expenses(2).
Distributable Cash Flow, as adjusted(1), for the
third quarter of 2024 was $349
million compared to $181
million in the third quarter of 2023.
Adjusted EBITDA(1) for the Fuel Distribution segment
for the third quarter of 2024 was $253
million compared to $234
million in the third quarter of 2023. The segment sold
approximately 2.1 billion gallons of fuel in the third quarter of
2024, an increase of 1% from the third quarter of 2023. Fuel margin
for all gallons sold was 12.8 cents
per gallon for the third quarter of 2024 compared to 12.5 cents per gallon in the third quarter of
2023.
Adjusted EBITDA(1) for the Pipeline Systems segment
for the third quarter of 2024 was $136
million. Adjusted EBITDA(1) for the third quarter
of 2024 includes approximately $11
million of one-time transaction-related
expenses(2). The segment averaged throughput volumes of
approximately 1.2 million barrels per day in the third quarter of
2024.
Adjusted EBITDA(1) for the Terminals segment for
the third quarter of 2024 was $67
million. Adjusted EBITDA(1) for the third quarter
of 2024 includes approximately $3
million of one-time transaction-related
expenses(2). The segment averaged throughput volumes of
approximately 690 thousand barrels per day in the third quarter of
2024.
Distribution
On October 28, 2024, the Board of
Directors of SUN's general partner declared a distribution for the
third quarter of 2024 of $0.8756 per
unit, or $3.5024 per unit on an
annualized basis. The distribution will be paid on November 19, 2024, to common unitholders of
record on November 8, 2024.
Liquidity, Leverage and Credit
At September 30, 2024, SUN had
long-term debt of approximately $7.3
billion and approximately $1.4
billion of liquidity remaining on its $1.5 billion revolving credit facility. SUN's
leverage ratio of net debt to Adjusted EBITDA(1),
calculated in accordance with its credit facility, was 4.0 times at
the end of the third quarter.
Capital Spending
SUN's total capital expenditures in the third quarter of 2024
were $93 million, which included
$67 million of growth capital and
$26 million of maintenance
capital.
(1) Adjusted EBITDA and Distributable Cash
Flow, as adjusted, are non-GAAP financial measures of performance
that have limitations and should not be considered as a substitute
for net income. Please refer to the discussion and tables under
"Supplemental Information" later in this news release for a
discussion of our use of Adjusted EBITDA and Distributable Cash
Flow, as adjusted, and a reconciliation to net income.
(2) Transaction-related expenses include
certain one-time expenses incurred with acquisitions and
divestitures.
Earnings Conference Call
Sunoco LP management will hold a conference call on Wednesday, November 6, 2024, at 9:00 a.m. Central Time (10:00 a.m. Eastern Time) to discuss results and
recent developments. To participate, dial 877-407-6184 (toll free)
or 201-389-0877 approximately 10 minutes before the scheduled
start time and ask for the Sunoco LP conference call. The call will
also be accessible live and for later replay via webcast in the
Investor Relations section of Sunoco's website at www.sunocolp.com
under Webcasts and Presentations.
About Sunoco LP
Sunoco LP (NYSE: SUN) is a leading energy infrastructure and
fuel distribution master limited partnership operating in over 40
U.S. states, Puerto Rico,
Europe, and Mexico. The Partnership's midstream operations
include an extensive network of approximately 14,000 miles of
pipeline and over 100 terminals. This critical infrastructure
complements the Partnership's fuel distribution operations, which
serve approximately 7,400 Sunoco and partner branded locations and
additional independent dealers and commercial customers. SUN's
general partner is owned by Energy Transfer LP (NYSE: ET).
Forward-Looking Statements
This news release may include certain statements concerning
expectations for the future that are forward-looking statements as
defined by federal law. Such forward-looking statements are subject
to a variety of known and unknown risks, uncertainties, and other
factors that are difficult to predict and many of which are beyond
management's control. An extensive list of factors that can affect
future results are discussed in the Partnership's Annual Report on
Form 10-K and other documents filed from time to time with the
Securities and Exchange Commission. The Partnership undertakes no
obligation to update or revise any forward-looking statement to
reflect new information or events.
The information contained in this press release is available on
our website at www.sunocolp.com
Contacts
Investors:
Scott Grischow, Treasurer, Senior Vice President
– Finance
(214) 840-5660, scott.grischow@sunoco.com
Media:
Chris Cho,
Senior Manager – Communications
(469) 646-1647, chris.cho@sunoco.com
– Financial Schedules Follow –
|
SUNOCO
LP
CONSOLIDATED BALANCE SHEETS
(Dollars in
millions)
(unaudited)
|
|
|
September 30,
2024
|
|
December 31,
2023
|
|
ASSETS
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
$
116
|
|
$
29
|
|
Accounts receivable,
net
|
902
|
|
856
|
|
Accounts receivable
from affiliates
|
—
|
|
20
|
|
Inventories,
net
|
890
|
|
889
|
|
Other current
assets
|
157
|
|
133
|
|
Total current
assets
|
2,065
|
|
1,927
|
|
|
|
|
|
Property and
equipment
|
8,856
|
|
2,970
|
|
Accumulated
depreciation
|
(1,105)
|
|
(1,134)
|
|
Property and
equipment, net
|
7,751
|
|
1,836
|
|
Other
assets:
|
|
|
|
|
Operating lease
right-of-use assets, net
|
474
|
|
506
|
|
Goodwill
|
1,484
|
|
1,599
|
|
Intangible assets,
net
|
553
|
|
544
|
|
Other non-current
assets
|
396
|
|
290
|
|
Investment in
unconsolidated affiliates
|
1,399
|
|
124
|
|
Total
assets
|
$
14,122
|
|
$
6,826
|
|
LIABILITIES AND
EQUITY
|
|
Current
liabilities:
|
|
|
|
|
Accounts
payable
|
$
929
|
|
$
828
|
|
Accounts payable to
affiliates
|
222
|
|
170
|
|
Accrued expenses and
other current liabilities
|
515
|
|
353
|
|
Operating lease
current liabilities
|
32
|
|
22
|
|
Current maturities of
long-term debt
|
78
|
|
—
|
|
Total current
liabilities
|
1,776
|
|
1,373
|
|
|
|
|
|
Operating lease
non-current liabilities
|
482
|
|
511
|
|
Long-term debt,
net
|
7,259
|
|
3,580
|
|
Advances from
affiliates
|
86
|
|
102
|
|
Deferred tax
liabilities
|
166
|
|
166
|
|
Other non-current
liabilities
|
173
|
|
116
|
|
Total
liabilities
|
9,942
|
|
5,848
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
Equity:
|
|
|
|
|
Limited
partners:
|
|
|
|
|
Common unitholders
(136,001,589 units issued and outstanding as of
September 30, 2024 and
84,408,014 units issued and outstanding as of
December 31, 2023)
|
4,179
|
|
978
|
|
Class C unitholders -
held by subsidiaries
(16,410,780 units issued and outstanding as of
September 30, 2024 and
December 31, 2023)
|
—
|
|
—
|
|
Accumulated other
comprehensive income
|
1
|
|
—
|
|
Total
equity
|
4,180
|
|
978
|
|
Total liabilities and
equity
|
$
14,122
|
|
$
6,826
|
|
SUNOCO
LP
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
(Dollars in millions, except per unit data)
(unaudited)
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Revenues
|
$
5,751
|
|
$
6,320
|
|
$
17,424
|
|
$
17,427
|
|
|
|
|
|
|
|
|
|
Cost of Sales and
Operating Expenses:
|
|
|
|
|
|
|
|
|
Cost of
sales
|
5,327
|
|
5,793
|
|
15,951
|
|
16,211
|
|
Operating
expenses
|
151
|
|
93
|
|
373
|
|
262
|
|
General and
administrative
|
55
|
|
30
|
|
225
|
|
92
|
|
Lease
expense
|
18
|
|
18
|
|
53
|
|
51
|
|
Loss (gain) on
disposal of assets and impairment charges
|
(2)
|
|
4
|
|
52
|
|
(8)
|
|
Depreciation,
amortization and accretion
|
95
|
|
44
|
|
216
|
|
141
|
|
Total cost of sales
and operating expenses
|
5,644
|
|
5,982
|
|
16,870
|
|
16,749
|
|
Operating
Income
|
107
|
|
338
|
|
554
|
|
678
|
|
Other Income
(Expense):
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
(116)
|
|
(56)
|
|
(274)
|
|
(162)
|
|
Equity in earnings of
unconsolidated affiliates
|
31
|
|
1
|
|
35
|
|
4
|
|
Gain on West Texas
Sale
|
—
|
|
—
|
|
598
|
|
—
|
|
Loss on extinguishment
of debt
|
—
|
|
—
|
|
(2)
|
|
—
|
|
Other, net
|
(5)
|
|
—
|
|
(7)
|
|
7
|
|
Income Before Income
Taxes
|
17
|
|
283
|
|
904
|
|
527
|
|
Income tax
expense
|
15
|
|
11
|
|
171
|
|
27
|
|
Net Income
|
$
2
|
|
$
272
|
|
$
733
|
|
$
500
|
|
|
|
|
|
|
|
|
|
Net Income (Loss) per
Common Unit:
|
|
|
|
|
|
|
|
|
Basic
|
$
(0.26)
|
|
$
2.99
|
|
$
5.44
|
|
$
5.20
|
|
Diluted
|
$
(0.26)
|
|
$
2.95
|
|
$
5.40
|
|
$
5.14
|
|
|
|
|
|
|
|
|
|
Weighted Average Common
Units Outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
135,998,435
|
|
84,064,445
|
|
112,650,388
|
|
84,061,363
|
|
Diluted
|
136,844,312
|
|
85,132,733
|
|
113,466,864
|
|
85,037,289
|
|
|
|
|
|
|
|
|
|
Cash Distributions per
Unit
|
$
0.8756
|
|
$
0.8420
|
|
$
2.6268
|
|
$
2.5260
|
|
SUNOCO
LP
SUPPLEMENTAL INFORMATION
(Dollars and units in
millions)
(unaudited)
|
|
|
Three Months Ended
September 30,
|
|
2024
|
|
2023
|
|
Net
income
|
$
2
|
|
$
272
|
|
Depreciation,
amortization and accretion
|
95
|
|
44
|
|
Interest expense,
net
|
116
|
|
56
|
|
Non-cash unit-based
compensation expense
|
4
|
|
4
|
|
Loss (gain) on
disposal of assets and impairment charges
|
(2)
|
|
4
|
|
Unrealized (gains)
losses on commodity derivatives
|
1
|
|
(1)
|
|
Inventory valuation
adjustments
|
197
|
|
(141)
|
|
Equity in earnings of
unconsolidated affiliates
|
(31)
|
|
(1)
|
|
Adjusted EBITDA
related to unconsolidated affiliates
|
47
|
|
2
|
|
Other non-cash
adjustments
|
12
|
|
7
|
|
Income tax
expense
|
15
|
|
11
|
|
Adjusted EBITDA
(1)
|
456
|
|
257
|
|
Transaction-related
expenses
|
14
|
|
—
|
|
Adjusted
EBITDA(1), excluding
transaction-related expenses
|
$
470
|
|
$
257
|
|
|
|
|
|
Adjusted EBITDA
(1)
|
$
456
|
|
$
257
|
|
Adjusted EBITDA
related to unconsolidated affiliates
|
(47)
|
|
(2)
|
|
Distributable cash
flow from unconsolidated affiliates
|
45
|
|
2
|
|
Cash interest
expense
|
(112)
|
|
(54)
|
|
Current income tax
(expense) benefit
|
36
|
|
(8)
|
|
Transaction-related
income taxes
|
(17)
|
|
—
|
|
Maintenance capital
expenditures
|
(26)
|
|
(14)
|
|
Distributable Cash
Flow
|
335
|
|
181
|
|
Transaction-related
expenses
|
14
|
|
—
|
|
Distributable Cash
Flow, as adjusted (1)
|
$
349
|
|
$
181
|
|
|
|
|
|
Distributions to
Partners:
|
|
|
|
|
Limited
Partners
|
$
119
|
|
$
71
|
|
General
Partner
|
36
|
|
19
|
|
Total distributions to
be paid to partners
|
$
155
|
|
$
90
|
|
Common Units
outstanding - end of period
|
136.0
|
|
84.1
|
|
|
(1)
|
Adjusted EBITDA is
defined as earnings before net interest expense, income taxes,
depreciation, amortization and accretion expense, allocated
non-cash compensation expense, unrealized gains and losses on
commodity derivatives and inventory valuation adjustments, and
certain other operating expenses reflected in net income that we do
not believe are indicative of ongoing core operations, such as
gains or losses on disposal of assets and non-cash impairment
charges. We define Distributable Cash Flow as Adjusted EBITDA less
cash interest expense, including the accrual of interest expense
related to our long-term debt which is paid on a semi-annual basis,
current income tax expense, maintenance capital expenditures and
other non-cash adjustments. For Distributable Cash Flow, as
adjusted, certain transaction-related adjustments and non-recurring
expenses are excluded.
|
|
We believe Adjusted
EBITDA and Distributable Cash Flow, as adjusted, are useful to
investors in evaluating our operating performance
because:
|
|
•
|
Adjusted EBITDA is used
as a performance measure under our revolving credit
facility;
|
|
•
|
securities analysts and
other interested parties use such metrics as measures of financial
performance, ability to make distributions to our unitholders and
debt service capabilities;
|
|
•
|
our management uses
them for internal planning purposes, including aspects of our
consolidated operating budget, and capital expenditures;
and
|
|
•
|
Distributable Cash
Flow, as adjusted, provides useful information to investors as it
is a widely accepted financial indicator used by investors to
compare partnership performance, and as it provides investors an
enhanced perspective of the operating performance of our assets and
the cash our business is generating.
|
|
Adjusted EBITDA and
Distributable Cash Flow, as adjusted, are not recognized terms
under GAAP and do not purport to be alternatives to net income as
measures of operating performance or to cash flows from operating
activities as a measure of liquidity. Adjusted EBITDA and
Distributable Cash Flow, as adjusted, have limitations as
analytical tools, and one should not consider them in isolation or
as substitutes for analysis of our results as reported under GAAP.
Some of these limitations include:
|
|
•
|
they do not reflect our
total cash expenditures, or future requirements for capital
expenditures or contractual commitments;
|
|
•
|
they do not reflect
changes in, or cash requirements for, working capital;
|
|
•
|
they do not reflect
interest expense or the cash requirements necessary to service
interest or principal payments on our revolving credit facility or
senior notes;
|
|
•
|
although depreciation
and amortization are non-cash charges, the assets being depreciated
and amortized will often have to be replaced in the future, and
Adjusted EBITDA does not reflect cash requirements for such
replacements; and
|
|
•
|
as not all companies
use identical calculations, our presentation of Adjusted EBITDA and
Distributable Cash Flow, as adjusted, may not be comparable to
similarly titled measures of other companies.
|
|
Adjusted EBITDA
reflects amounts for the unconsolidated affiliates based on the
same recognition and measurement methods used to record equity in
earnings of unconsolidated affiliates. Adjusted EBITDA related to
unconsolidated affiliates excludes the same items with respect to
the unconsolidated affiliates as those excluded from the
calculation of Adjusted EBITDA, such as interest, taxes,
depreciation, depletion, amortization and other non-cash items.
Although these amounts are excluded from Adjusted EBITDA related to
unconsolidated affiliates, such exclusion should not be understood
to imply that we have control over the operations and resulting
revenues and expenses of such affiliates. We do not control our
unconsolidated affiliates; therefore, we do not control the
earnings or cash flows of such affiliates. The use of Adjusted
EBITDA or Adjusted EBITDA related to unconsolidated affiliates as
an analytical tool should be limited accordingly. Inventory
valuation adjustments that are excluded from the calculation of
Adjusted EBITDA represent changes in lower of cost or market
reserves on the Partnership's inventory. These amounts are
unrealized valuation adjustments applied to fuel volumes remaining
in inventory at the end of the period.
|
|
SUNOCO
LP
SUMMARY ANALYSIS OF QUARTERLY RESULTS BY
SEGMENT
(Tabular dollar amounts in millions)
(unaudited)
|
|
|
Three Months Ended
September 30,
|
|
2024
|
|
2023
|
|
Segment Adjusted
EBITDA:
|
|
|
|
|
Fuel
Distribution
|
$
253
|
|
$
234
|
|
Pipeline
Systems
|
136
|
|
2
|
|
Terminals
|
67
|
|
21
|
|
Adjusted
EBITDA
|
456
|
|
257
|
|
Transaction-related
expenses
|
14
|
|
—
|
|
Adjusted EBITDA,
excluding transaction-related expenses
|
$
470
|
|
$
257
|
The following analysis of segment operating results includes a
measure of segment profit. Segment profit is a non-GAAP financial
measure and is presented herein to assist in the analysis of
segment operating results and particularly to facilitate an
understanding of the impacts that changes in sales revenues have on
the segment performance measure of Segment Adjusted EBITDA. Segment
profit is similar to the GAAP measure of gross profit, except that
segment profit excludes charges for depreciation, depletion and
amortization. The most directly comparable measure to segment
profit is gross profit. The following table presents a
reconciliation of segment profit to gross profit.
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Fuel Distribution
segment profit
|
$
164
|
|
$
467
|
|
$
885
|
|
$
1,095
|
|
Pipeline Systems
segment profit
|
159
|
|
—
|
|
332
|
|
2
|
|
Terminals segment
profit
|
101
|
|
60
|
|
256
|
|
119
|
|
Total segment
profit
|
424
|
|
527
|
|
1,473
|
|
1,216
|
|
Depreciation,
amortization and accretion, excluding corporate and
other
|
93
|
|
44
|
|
213
|
|
141
|
|
Gross
profit
|
$
331
|
|
$
483
|
|
$
1,260
|
|
$
1,075
|
Fuel Distribution
|
Three Months Ended
September 30,
|
|
2024
|
|
2023
|
|
Motor fuel gallons
sold
|
2,138
|
|
2,118
|
|
Motor fuel profit cents
per gallon(1)
|
12.8 ¢
|
|
12.5 ¢
|
|
Fuel profit
|
$
96
|
|
$
388
|
|
Non-fuel
profit
|
39
|
|
40
|
|
Lease profit
|
29
|
|
39
|
|
Fuel Distribution
segment profit
|
$
164
|
|
$
467
|
|
Expenses
|
$
100
|
|
$
119
|
|
|
|
|
|
Segment Adjusted
EBITDA
|
$
253
|
|
$
234
|
|
Transaction-related
expenses
|
—
|
|
—
|
|
Segment Adjusted
EBITDA, excluding transaction-related expenses
|
$
253
|
|
$
234
|
|
|
(1) Excludes the impact of inventory
valuation adjustments consistent with the definition of Adjusted
EBITDA.
|
Volumes. For the three months ended September 30, 2024 compared to the same period
last year, volumes increased primarily due to growth from
investments and profit optimization strategies.
Segment Adjusted EBITDA. For the three months ended
September 30, 2024 compared to the
same period last year, Segment Adjusted EBITDA related to our Fuel
Distribution segment increased due to the net impact of the
following:
- an increase of $13 million
related to a 1% increase in gallons sold and an increase in profit
per gallon; and
- a decrease of $19 million in
expenses primarily due to the West Texas Sale in April 2024 and lower allocated overhead;
partially offset by
- a decrease of $10 million in
lease profit due to the West Texas Sale in April 2024.
Pipeline Systems
|
Three Months Ended
September 30,
|
|
2024
|
|
2023
|
|
Pipelines throughput
(barrels per day)
|
1,165
|
|
—
|
|
Pipeline Systems
segment profit
|
$
159
|
|
$
—
|
|
Expenses
|
$
72
|
|
$
—
|
|
|
|
|
|
Segment Adjusted
EBITDA
|
$
136
|
|
$
2
|
|
Transaction-related
expenses
|
11
|
|
—
|
|
Segment Adjusted
EBITDA, excluding transaction-related expenses
|
$
147
|
|
$
2
|
Volumes. For the three months ended September 30, 2024 compared to the same period
last year, volumes increased due to recently acquired assets.
Segment Adjusted EBITDA. For the three months ended
September 30, 2024 compared to the
same period last year, Segment Adjusted EBITDA related to our
Pipeline Systems segment increased due to the acquisition of NuStar
on May 3, 2024 and the formation of
the Permian joint venture on July 1,
2024.
Terminals
|
Three Months Ended
September 30,
|
|
2024
|
|
2023
|
|
Throughput (barrels per
day)
|
694
|
|
421
|
|
Terminal segment
profit
|
$
101
|
|
$
60
|
|
Expenses
|
$
52
|
|
$
22
|
|
|
|
|
|
Segment Adjusted
EBITDA
|
$
67
|
|
$
21
|
|
Transaction-related
expenses
|
3
|
|
—
|
|
Segment Adjusted
EBITDA, excluding transaction-related expenses
|
$
70
|
|
$
21
|
Volumes. For the three months ended September 30, 2024 compared to the same period
last year, volumes increased due to recently acquired assets.
Segment Adjusted EBITDA. For the three months ended
September 30, 2024 compared to the
same period last year, Segment Adjusted EBITDA related to our
Terminals segment increased primarily due to the recent
acquisitions of NuStar, Zenith European terminals and Zenith Energy
terminals located across the East Coast and Midwest.
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SOURCE Sunoco LP