Net income was $29 million for 2023’s first quarter at Global Partners LP, compared with net income of $30.5 million in the same period of 2022, as the Waltham, Massachusetts-based company posted results it said were in line with expectations.
“The global team executed well in the first quarter,” Eric Slifka, the partnership’s president and CEO, said during the company’s first-quarter earnings call May 5. “Continued momentum in our gasoline distribution and station operations segment helped to more than offset the effects of warmer-than-normal temperatures on our winter-sensitive products.”
Global Partners owns about 1,700 locations across the Northeast and Mid-Atlantic, of which 353 are company owned. Brands include Alltown Fresh, Honey Farms and XtraMart, among others.
“Our performance underscores the strength of our diversified business model, which focuses on creating value for unit holders and delivering quality products and superior service to our customers and guests across our network of liquid energy terminals and convenience markets,” Slifka said.
- Global Partners is No. 24 on CSP’s 2023 Top 40 update to the 2022 Top 202 ranking of U.S. c-store chains by number of company-owned retail outlets.
Total sales were $4 billion in first-quarter 2023 compared with $4.5 billion in the same period of 2022, the company said. Wholesale segment sales were $2.5 billion in first-quarter 2023 compared with $2.8 billion a year ago. Commercial segment sales were $257.9 million in first-quarter 2023 compared with $330 million in 2022’s first quarter.
In addition:
- Wholesale segment product margin was $53.1 million in first-quarter 2023 compared with $47.1 million a year ago. The increase was primarily driven by more favorable conditions in gasoline and gasoline blend stocks, which more than offset less favorable market conditions in distillates and other oils, Global Partners said.
- Commercial segment product margin was $8.13 million in first-quarter of 2023, compared to $8.14 million in first-quarter 2022.
Other financial highlights:
- Earnings before interest, taxes, depreciation and amortization (EBITDA) was $78.1 million in first-quarter 2023 compared with $79.8 million a year ago.
- Adjusted EBITDA was $76 million in first-quarter 2023 versus $74.9 million a year ago.
- Distributable cash flow (DCF) was $46.3 million in first-quarter 2023 compared with $49.9 million in the same period of 2022.
- EBITDA, adjusted EBITDA and DCF include a net gain on sale and disposition of assets of $2.1 million and $4.9 million for the three months ended March 31, 2023, and 2022, respectively.
- Gross profit in first-quarter 2023 was $222.1 million compared with $206.2 million in the same period of 2022.
- Combined product margin, which is gross profit adjusted for depreciation allocated to cost of sales, was $244.8 million in first-quarter 2023 compared with $228.2 million in the same period of 2022.
The product margin in the gasoline distribution and station operations segment product margin was $183.5 million in the first quarter of 2023 compared with $173 million in the same period of 2022. Product margin from gasoline distribution increased to $120.8 million from $114.9 million in the year-earlier period, primarily due to higher fuel margins (cents per gallon) and an increase in volume sold due to acquisitions completed in 2022, Global Partners said.
Product margin from station operations increased to $62.7 million from $58.1 million in first-quarter 2022, primarily due to increased convenience store sales in part because of the 2022 acquisitions.
Total volume was 1.4 billion gallons in first-quarter 2023 compared with 1.5 billion gallons in the same period of 2022. Wholesale segment volume was 928.6 million gallons in first-quarter 2023 compared with 976.8 million gallons in the same period of 2022.
“Through organic initiatives and strategic transactions, we continue to advance our leadership role in the energy distribution network,” Slifka said.
In March, Global Partners LP and Exxon Mobil Corp. said they will acquire 64 Houston-area convenience and fueling facilities from Landmark Group. The companies expect to complete the transaction in second-quarter 2023.
“We are excited about the opportunity to expand our footprint into the fast-growing Texas market and look forward to operating these sites on behalf of the joint venture,” Slifka said.