HOUSTON --Sunoco LP has announced that for the three months ended March 31, 2015, adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) totaled $43.7 million, compared to adjusted EBITDA in first-quarter 2014 of $15.7 million. Revenue was $1.1 billion, down 7.1% compared to $1.2 billion in the same period last year. The decline was the result of significantly lower retail and wholesale motor fuel prices, mostly offset by a 40% increase in gallons sold, the contribution of merchandise sales from the MACS and Aloha convenience stores and higher rental income.
Total gross profit was $87 million, compared to $22.1 million in first-quarter 2014. Key drivers of the increase were the MACS and Aloha acquisitions along with organic growth in gallons sold.
Net income attributable to partners was $17.1 million, compared to $10.1 million in first-quarter 2014.
On a weighted average basis, fuel margin for all gallons sold increased to 8.8 cents per gallon, compared to 4 cents per gallon a year earlier. Sales of retail gallons by MACS and Aloha—and a change in the wholesale fuel customer mix related to the MACS and Aloha acquisitions—drove most of the margin increase.
As of March 31, Sunoco LP operated 155 convenience stores and gas stations in Virginia, Hawaii, Tennessee, Maryland and Georgia.
Affiliate customers included 663 Stripes and Sac-N-Pac convenience stores operated by a subsidiary of its parent company, Energy Transfer Partners LP, as well as sales of motor fuel to ETP subsidiaries for resale under consignment arrangements at approximately 85 independently operated convenience stores.
Motor fuel gallons sold to affiliates during the first quarter increased 9.5% from a year ago to 304.3 million gallons. Sunoco LP realized 3 cents per gallon gross profit on these gallons, which totaled $9.1 million in the period versus $8.4 million in the same period a year ago.
Third-party customers included 731 independent dealers under long-term fuel supply agreements, 59 independently operated consignment locations and approximately 1,600 other commercial customers. Total gallons sold to third parties increased year-over-year by 50.8% to 234.7 million gallons. Gross profit on these gallons was $25.2 million, or 9.7 cents per gallon, compared to $8.8 million, or 5.7 cents per gallon, in the prior-year period.
Retail gallons sold by MACS and Aloha locations during the first quarter totaled 67.8 million gallons. Gross profit on these gallons was $21.2 million, or 31.9 cents per gallon. Merchandise sales from these locations totaled $47.5 million and contributed $12.7 million of gross profit.
The partnership announced on April 1 the acquisition of a 31.58% equity interest in Sunoco LLC, from an affiliate of ETP in a transaction valued at approximately $816 million. Sunoco LP paid $775 million in cash and issued to ETP 795,482 new Sunoco LP units valued at $40.8 million.
The partnership said it expects capital spending for the full-year 2015, excluding future acquisitions but including the additional capital spending related to its equity interest in Sunoco LLC, to include the purchase and leaseback of 30 to 40 new convenience stores that Stripes plans to build in 2015.
Click here for analysis of Sunoco LP’s quarterly performance. And click here for details of ETP's plans.
Sunoco LP is a master limited partnership (MLP) that primarily distributes motor fuel to convenience stores, independent dealers, commercial customers and distributors. It also operates more than 150 convenience stores and retail fuel sites. The company conducts its business through wholly owned subsidiaries, as well as through its 31.58% interest in Sunoco LLC, in partnership with an affiliate of its parent company, ETP. While primarily engaged in natural gas, natural gas liquids, crude oil and refined products transportation, ETP also operates a retail and fuel distribution business through its interest in Sunoco LLC, as well as wholly owned subsidiaries, Sunoco Inc. and Stripes LLC, which operate approximately 1,100 convenience stores and retail fuel sites.
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