"Market conditions have shown some improvement year-over-year, but challenges remain. U.S. demand growth is modest, refining capacity continues to be added around the world and product inventories [image-nocss] are high," said Lynn L. Elsenhans, Sunoco's chairman and CEO. "While it is clear we continue to face headwinds and have also experienced some recent operational reliability issues that must be addressed, we are pleased to have made progress during the quarter toward our strategic goals of growing our retail network and separating our coke business."
Commenting on what the company accomplished last year and the outlook for 2011, Elsenhans said, "Overall, Sunoco made excellent progress during 2010. We finished the year with $1.5 billion in cash, achieved growth in our retail and logistics businesses and improved the competitiveness of our refineries. We also made significant progress in preparing to separate our coke business, a step designed to unlock shareholder value and maximize the future success of both Sunoco and SunCoke Energy."
She added, "Looking ahead to 2011, we will continue to execute a strategy that positions Sunoco to become the premier provider of transportation fuels in its markets. This strategy includes pursuing growth in retail and logistics, where potential returns are highest, while continuing to run our manufacturing facilities efficiently, reliably and safely."
Refining & Supply had a loss from continuing operations of $8 million in fourth-quarter 2010 versus a loss of $135 million in fourth-quarter 2009. The improved results were primarily due to higher realized margins and lower expenses, partially offset by lower production volumes.
Retail Marketing earned $3 million in the current quarter versus $21 million in fourth-quarter 2009. The decrease in earnings was largely due to lower average retail gasoline and distillate margins, which were impacted by the increase in crude prices during the quarter, partially offset by higher sales volumes.
Philadelphia-based Sunoco is a leading transportation fuel provider, with operations located primarily in the East Coast and Midwest regions of the United States. The company operates more than 4,900 branded retail locations that market transportation fuels and convenience store merchandise in 23 states. The retail network is principally supplied by Sunoco-owned refineries with a combined crude oil processing capacity of 675,000 barrels per day. Sunoco is also the general partner and has a 31% interest in Sunoco Logistics Partners LP, a publicly traded master limited partnership that owns and operates 7,600 miles of refined product and crude oil pipelines and approximately 40 active product terminals. Many of Sunoco Logistics' pipelines and terminals and storage facilities are integrated with Sunoco's retail network and refineries.
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