Guarantor Subsidiaries | Guarantor Subsidiaries Certain of the Company’s 100% owned, domestic subsidiaries (the “Guarantor Subsidiaries”) fully and unconditionally guarantee, on a joint and several basis, certain of the outstanding indebtedness of the Company, including the 6.00% senior notes due 2023 and the 5.625% senior notes due 2027. The following consolidating schedules present financial information on a consolidated basis in conformity with the SEC’s Regulation S-X Rule 3-10(d): CONSOLIDATING BALANCE SHEET (unaudited) (Thousands of dollars) June 30, 2017 Assets Parent Company Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations Consolidated Current assets Cash and cash equivalents — 197,090 5 — — 197,095 Accounts receivable—trade, less allowance for doubtful accounts of $1,921 in 2017 — 164,372 — — — 164,372 Inventories, at lower of cost or market — 179,044 — — — 179,044 Prepaid expenses and other current assets — 25,230 3 — — 25,233 Total current assets — 565,736 8 — — 565,744 Property, plant and equipment, at cost less accumulated depreciation and amortization of $818,409 in 2017 — 1,612,436 798 — — 1,613,234 Investments in subsidiaries 2,030,647 144,911 — — (2,175,558 ) — Other assets — 44,208 — — — 44,208 Total assets 2,030,647 2,367,291 806 — (2,175,558 ) 2,223,186 Liabilities and Stockholders' Equity Current liabilities Current maturities of long-term debt — 14,958 — — — 14,958 Inter-company accounts payable 689,653 (484,066 ) (51,249 ) (154,338 ) — — Trade accounts payable and accrued liabilities — 394,303 — — — 394,303 Total current liabilities 689,653 (74,805 ) (51,249 ) (154,338 ) — 409,261 Long-term debt, including capitalized lease obligations — 869,086 — — — 869,086 Deferred income taxes — 217,670 — — 217,670 Asset retirement obligations — 26,978 — — — 26,978 Deferred credits and other liabilities — 19,550 — — — 19,550 Total liabilities 689,653 1,058,479 (51,249 ) (154,338 ) — 1,542,545 Stockholders' Equity Preferred Stock, par $0.01 (authorized 20,000,000 shares, none outstanding) — — — — — — Common Stock, par $0.01 (authorized 200,000,000 shares, 46,767,164 shares issued at June 30, 2017) 468 1 60 — (61 ) 468 Treasury Stock (10,715,229 shares held at June 30, 2017 ) (667,522 ) — — — — (667,522 ) Additional paid in capital (APIC) 1,206,240 568,482 52,004 87,543 (1,368,382 ) 545,887 Retained earnings 801,808 740,329 (9 ) 66,795 (807,115 ) 801,808 Total stockholders' equity 1,340,994 1,308,812 52,055 154,338 (2,175,558 ) 680,641 Total liabilities and stockholders' equity 2,030,647 2,367,291 806 — (2,175,558 ) 2,223,186 CONSOLIDATING BALANCE SHEET (Thousands of dollars) December 31, 2016 Assets Parent Company Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations Consolidated Current assets Cash and cash equivalents $ — $ 153,813 $ — $ — $ — $ 153,813 Accounts receivable—trade, less allowance for doubtful accounts of $1,891 in 2016 — 183,519 — — — 183,519 Inventories, at lower of cost or market — 153,351 — — — 153,351 Prepaid expenses and other current assets — 24,871 — — — 24,871 Total current assets — 515,554 — — — 515,554 Property, plant and equipment, at cost less accumulated depreciation and amortization of $780,426 in 2016 — 1,532,655 — — — 1,532,655 Investments in subsidiaries 1,978,110 144,917 — — (2,123,027 ) — Other assets — 40,531 — — — 40,531 Total assets $ 1,978,110 $ 2,233,657 $ — $ — $ (2,123,027 ) $ 2,088,740 Liabilities and Stockholders' Equity Current liabilities Current maturities of long-term debt $ — $ 40,596 $ — $ — $ — $ 40,596 Inter-company accounts payable 623,316 (416,914 ) (52,064 ) (154,338 ) — — Trade accounts payable and accrued liabilities — 473,370 — — — 473,370 Income taxes payable — 591 3 — — 594 Total current liabilities 623,316 97,643 (52,061 ) (154,338 ) — 514,560 Long-term debt, including capitalized lease obligations — 629,622 — — — 629,622 Deferred income taxes — 204,656 — — — 204,656 Asset retirement obligations — 26,200 — — — 26,200 Deferred credits and other liabilities — 16,626 — — — 16,626 Total liabilities 623,316 974,747 (52,061 ) (154,338 ) — 1,391,664 Stockholders' Equity Preferred Stock, par $0.01 (authorized 20,000,000 shares, none outstanding) — — — — — — Common Stock, par $0.01 (authorized 200,000,000 shares, 46,767,164 shares issued at December 31, 2016) 468 1 60 — (61 ) 468 Treasury Stock (9,831,196 shares held at December 31, 2016) (608,001 ) — — — — (608,001 ) Additional paid in capital (APIC) 1,213,056 571,117 52,004 87,543 (1,368,382 ) 555,338 Retained earnings 749,271 687,792 (3 ) 66,795 (754,584 ) 749,271 Total stockholders' equity 1,354,794 1,258,910 52,061 154,338 (2,123,027 ) 697,076 Total liabilities and stockholders' equity $ 1,978,110 $ 2,233,657 $ — $ — $ (2,123,027 ) $ 2,088,740 CONSOLIDATING INCOME STATEMENT (unaudited) (Thousands of dollars) Three Months Ended June 30, 2017 Operating Revenues Parent Company Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations Consolidated Petroleum product sales — 2,567,719 — — — 2,567,719 Merchandise sales — 605,698 — — — 605,698 Other operating revenues — 37,641 2 — — 37,643 Total operating revenues — 3,211,058 2 — — 3,211,060 Operating Expenses Petroleum product cost of goods sold — 2,413,175 — — — 2,413,175 Merchandise cost of goods sold — 507,979 — — — 507,979 Station and other operating expenses — 129,432 1 — — 129,433 Depreciation and amortization — 27,507 6 — — 27,513 Selling, general and administrative — 31,347 — — — 31,347 Accretion of asset retirement obligations — 446 — — — 446 Total operating expenses — 3,109,886 7 — — 3,109,893 Gain (loss) on sale of assets — 130 — — — 130 Income (loss) from operations — 101,302 (5 ) — — 101,297 Other income (expense) Interest income — 318 — — — 318 Interest expense — (11,644 ) — — — (11,644 ) Other nonoperating income — 3 — — — 3 Total other income (expense) — (11,323 ) — — — (11,323 ) Income (loss) before income taxes — 89,979 (5 ) — — 89,974 Income tax expense — 34,411 — — — 34,411 Income (loss) — 55,568 (5 ) — — 55,563 Equity earnings in affiliates, net of tax (55,563 ) — — — 55,563 — Net Income (Loss) (55,563 ) 55,568 (5 ) — 55,563 55,563 CONSOLIDATING INCOME STATEMENT (unaudited) (Thousands of dollars) Three Months Ended June 30, 2016 Operating Revenues Parent Company Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations Consolidated Petroleum product sales $ — $ 2,371,735 $ — $ — $ — $ 2,371,735 Merchandise sales — 589,457 — — — 589,457 Other operating revenues — 44,570 — — — 44,570 Total operating revenues $ — $ 3,005,762 $ — $ — $ — $ 3,005,762 Operating Expenses Petroleum product cost of goods sold — 2,242,936 — — — 2,242,936 Merchandise cost of goods sold — 496,801 — — — 496,801 Station and other operating expenses — 125,145 — — — 125,145 Depreciation and amortization — 23,685 — — — 23,685 Selling, general and administrative — 32,320 — — — 32,320 Accretion of asset retirement obligations — 412 — — — 412 Total operating expenses — 2,921,299 — — — 2,921,299 Gain (loss) on sale of assets $ — $ (490 ) $ — $ — $ — $ (490 ) Income from operations $ — $ 83,973 $ — $ — $ — $ 83,973 Other income (expense) Interest income — 250 — — — 250 Interest expense — (10,210 ) — — — (10,210 ) Other nonoperating income — 85 — — — 85 Total other income (expense) $ — $ (9,875 ) $ — $ — $ — $ (9,875 ) Income before income taxes — 74,098 — — — 74,098 Income tax expense — 27,788 — — — 27,788 Income — 46,310 — — — 46,310 Equity earnings in affiliates, net of tax 46,310 — — — (46,310 ) — Net Income (Loss) $ 46,310 $ 46,310 $ — $ — $ (46,310 ) $ 46,310 CONSOLIDATING INCOME STATEMENT (unaudited) (Thousands of dollars) Six Months Ended June 30, 2017 Operating Revenues Parent Company Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations Consolidated Petroleum product sales — 4,969,973 — — — 4,969,973 Merchandise sales — 1,171,488 — — — 1,171,488 Other operating revenues — 69,215 2 — — 69,217 Total operating revenues — 6,210,676 2 — — 6,210,678 Operating Expenses Petroleum product cost of goods sold — 4,742,508 — — — 4,742,508 Merchandise cost of goods sold — 984,940 — — — 984,940 Station and other operating expenses — 254,176 1 — — 254,177 Depreciation and amortization — 54,519 6 — — 54,525 Selling, general and administrative — 69,592 1 — — 69,593 Accretion of asset retirement obligations — 888 — — — 888 Total operating expenses — 6,106,623 8 — — 6,106,631 Gain (loss) on sale of assets — (3,368 ) — — — (3,368 ) Income (loss) from operations — 100,685 (6 ) — — 100,679 Other income (expense) Interest income — 365 — — — 365 Interest expense — (21,142 ) — — — (21,142 ) Other nonoperating income — 235 — — — 235 Total other income (expense) — (20,542 ) — — — (20,542 ) Income (loss) before income taxes — 80,143 (6 ) — — 80,137 Income tax expense — 27,600 — — — 27,600 Income (loss) — 52,543 (6 ) — — 52,537 Equity earnings in affiliates, net of tax 52,537 (6 ) — — (52,531 ) — Net Income (Loss) 52,537 52,537 (6 ) — (52,531 ) 52,537 CONSOLIDATING INCOME STATEMENT (unaudited) (Thousands of dollars) Six Months Ended June 30, 2016 Operating Revenues Parent Company Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations Consolidated Petroleum product sales $ — $ 4,260,019 $ — $ — $ — $ 4,260,019 Merchandise sales — 1,151,194 — — — 1,151,194 Other operating revenues — 84,811 — — — 84,811 Total operating revenues $ — $ 5,496,024 $ — $ — $ — $ 5,496,024 Operating Expenses Petroleum product cost of goods sold — 4,026,065 — — — 4,026,065 Merchandise cost of goods sold — 972,603 — — — 972,603 Station and other operating expenses — 241,919 — — — 241,919 Depreciation and amortization — 47,171 — — — 47,171 Selling, general and administrative — 63,822 1 — — 63,823 Accretion of asset retirement obligations — 825 — — — 825 Total operating expenses — 5,352,405 1 — — 5,352,406 Gain (loss) on sale of assets $ — $ 88,975 $ — $ — $ — $ 88,975 Income from operations $ — $ 232,594 $ (1 ) $ — $ — $ 232,593 Other income (expense) Interest income — 330 — — — 330 Interest expense — (19,598 ) — — — (19,598 ) Other nonoperating income — 118 — — — 118 Total other income (expense) $ — $ (19,150 ) $ — $ — $ — $ (19,150 ) Income before income taxes — 213,444 (1 ) — — 213,443 Income tax expense (benefit) — 81,259 — — — 81,259 Income — 132,185 (1 ) — — 132,184 Equity earnings in affiliates, net of tax 132,184 (1 ) — — (132,183 ) — Net Income (Loss) $ 132,184 $ 132,184 $ (1 ) $ — $ (132,183 ) $ 132,184 CONSOLIDATING STATEMENT OF CASH FLOW (unaudited) (Thousands of dollars) Six Months Ended June 30, 2017 Operating Activities Parent Company Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations Consolidated Net income (loss) $ 52,537 $ 52,537 $ (6 ) $ — $ (52,531 ) $ 52,537 Adjustments to reconcile net income (loss) to net cash provided by (required by) operating activities Depreciation and amortization — 54,519 6 — — 54,525 Deferred and noncurrent income tax charges (credits) — 13,014 — — — 13,014 Accretion of asset retirement obligations — 888 — — — 888 (Gain) loss on sale of assets — 3,368 — — — 3,368 Net increase in noncash operating working capital — (84,715 ) (3 ) — — (84,718 ) Equity in earnings of affiliates (52,537 ) 6 — — 52,531 — Other operating activities - net — 828 — — — 828 Net cash provided by (required by) operating activities — 40,445 (3 ) — — 40,442 Investing Activities Property additions — (133,346 ) (804 ) — — (134,150 ) Proceeds from sale of assets — 715 — — — 715 Changes in restricted cash — — — — — — Other investing activities - net — (4,143 ) — — — (4,143 ) Net cash required by investing activities — (136,774 ) (804 ) — — (137,578 ) Financing Activities Purchase of treasury stock (66,337 ) — — — — (66,337 ) Borrowings of debt — 338,750 — — — 338,750 Repayments of debt — (125,901 ) — — — (125,901 ) Debt issuance costs — (935 ) — — — (935 ) Amounts related to share-based compensation — (5,159 ) — — — (5,159 ) Net distributions to parent 66,337 (67,149 ) 812 — — — Net cash provided by financing activities — 139,606 812 — — 140,418 Net increase in cash and cash equivalents — 43,277 5 — — 43,282 Cash and cash equivalents at January 1 — 153,813 — — — 153,813 Cash and cash equivalents at June 30 $ — $ 197,090 $ 5 $ — $ — $ 197,095 CONSOLIDATING STATEMENT OF CASH FLOW (unaudited) (Thousands of dollars) Six Months Ended June 30, 2016 Operating Activities Parent Company Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations Consolidated Net income (loss) $ 132,184 $ 132,184 $ (1 ) $ — $ (132,183 ) $ 132,184 Adjustments to reconcile net income (loss) to net cash provided by (required by)operating activities Depreciation and amortization — 47,171 — — — 47,171 Deferred and noncurrent income tax charges (credits) — 14,605 — — — 14,605 Accretion of asset retirement obligations — 825 — — — 825 Pretax (gains) losses from sale of assets — (88,975 ) — — — (88,975 ) Net decrease in noncash operating working capital — 57,427 — — — 57,427 Equity in earnings of affiliates (132,184 ) 1 — — 132,183 — Other operating activities - net — 5,365 — — — 5,365 Net cash provided by (required by) operating activities — 168,603 (1 ) — — 168,602 Investing Activities Property additions — (116,569 ) — — — (116,569 ) Proceeds from sale of assets — 86,298 — — — 86,298 Changes in restricted cash — 13,429 — — — 13,429 Other investing activities - net — (15,138 ) — — — (15,138 ) Net cash required by investing activities — (31,980 ) — — — (31,980 ) Financing Activities Purchase of treasury stock (167,105 ) — — — — (167,105 ) Borrowings of debt — 200,000 — — — 200,000 Repayments of debt — (10,165 ) — — — (10,165 ) Debt issuance costs — (3,240 ) — — — (3,240 ) Amounts related to share-based compensation — (4,237 ) — — — (4,237 ) Net distributions to parent 167,105 (167,106 ) 1 — — — Net cash provided by financing activities — 15,252 1 — — 15,253 Net increase in cash and cash equivalents — 151,875 — — — 151,875 Cash and cash equivalents at January 1 — 102,335 — — — 102,335 Cash and cash equivalents at June 30 $ — $ 254,210 $ — $ — $ — $ 254,210 CONSOLIDATING STATEMENT OF CHANGES IN EQUITY (unaudited) (Thousands of dollars) Six Months Ended June 30, 2017 Statement of Stockholders' Equity Parent Company Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations Consolidated Common Stock Balance as of December 31, 2016 $ 468 $ 1 $ 60 $ — $ (61 ) $ 468 Issuance of common stock — — — — — — Balance as of June 30, 2017 $ 468 $ 1 $ 60 $ — $ (61 ) $ 468 Treasury Stock Balance as of December 31, 2016 $ (608,001 ) $ — $ — $ — $ — $ (608,001 ) Issuance of common stock 6,816 — — — — 6,816 Repurchase of common stock (66,337 ) — — — — (66,337 ) Balance as of June 30, 2017 $ (667,522 ) $ — $ — $ — $ — $ (667,522 ) APIC Balance as of December 31, 2016 $ 1,213,056 $ 571,117 $ 52,004 $ 87,543 $ (1,368,382 ) $ 555,338 Issuance of common stock (6,816 ) — — — — (6,816 ) Amounts related to share-based compensation — (5,159 ) — — — (5,159 ) Share-based compensation expense — 2,524 — — — 2,524 Balance as of June 30, 2017 $ 1,206,240 $ 568,482 $ 52,004 $ 87,543 $ (1,368,382 ) $ 545,887 Retained Earnings Balance as of December 31, 2016 $ 749,271 $ 687,792 $ (3 ) $ 66,795 $ (754,584 ) $ 749,271 Net income (loss) 52,537 52,537 (6 ) — (52,531 ) 52,537 Balance as of June 30, 2017 $ 801,808 $ 740,329 $ (9 ) $ 66,795 $ (807,115 ) $ 801,808 CONSOLIDATING STATEMENT OF CHANGES IN EQUITY (unaudited) (Thousands of dollars) Six Months Ended June 30, 2016 Statement of Stockholders' Equity Parent Company Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations Consolidated Common Stock Balance as of December 31, 2015 $ 468 $ 1 $ 60 $ — $ (61 ) $ 468 Issuance of common stock — — — — — — Balance as of June 30, 2016 $ 468 $ 1 $ 60 $ — $ (61 ) $ 468 Treasury Stock Balance as of December 31, 2015 $ (294,139 ) $ — $ — $ — $ — $ (294,139 ) Issuance of common stock 6,748 — — — — 6,748 Repurchase of common stock (167,105 ) — — — — (167,105 ) Balance as of June 30, 2016 $ (454,496 ) $ — $ — $ — $ — $ (454,496 ) APIC Balance as of December 31, 2015 $ 1,222,465 $ 564,554 $ 52,004 $ 87,543 $ (1,368,384 ) $ 558,182 Issuance of common stock (6,748 ) — — — — (6,748 ) Amounts related to share-based compensation — (4,237 ) — — — (4,237 ) Share-based compensation expense — 4,780 — — — 4,780 Balance as of June 30, 2016 $ 1,215,717 $ 565,097 $ 52,004 $ 87,543 $ (1,368,384 ) $ 551,977 Retained Earnings Balance as of December 31, 2015 $ 527,779 $ 466,300 $ (2 ) $ 66,795 $ (533,093 ) $ 527,779 Net income (loss) 132,184 132,184 (1 ) — (132,183 ) 132,184 Balance as of June 30, 2016 $ 659,963 $ 598,484 $ (3 ) $ 66,795 $ (665,276 ) $ 659,963 |