Exhibit 99.1
| | |
 | | News Release |
Sunoco, Inc.
1818 Market Street, Suite 1500
Philadelphia, PA 19103
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For further information contact: | | For release: IMMEDIATELY |
| Thomas Golembeski (media) 215-977-6298 | | |
| Clare McGrory (investors) 215-977-6764 | | |
No. 12-11
SUNOCO REPORTS FIRST QUARTER 2011 RESULTS
PHILADELPHIA, May 5, 2011 — Sunoco, Inc. (NYSE: SUN) today reported a net loss attributable to Sunoco shareholders of $101 million ($0.84 per share diluted) for the first quarter of 2011 versus a net loss attributable to Sunoco shareholders of $63 million ($0.53 per share diluted) for the first quarter of 2010. Excluding special items, Sunoco had a loss of $122 million ($1.01 per share diluted) for the first quarter of 2011 versus first quarter 2010 income of $17 million ($0.14 per share diluted). Key first quarter details include:
| | • | | Retail and Logistics contributed pretax income of $43 million |
| | • | | SunCoke Energy earned pretax income of $9 million and acquired Harold Keene Coal Co., Inc. and its related assets, increasing the Company’s coal reserves |
| | • | | Refining and Supply reported a pretax loss of $138 million |
| | • | | Completed the sale of the Toledo refinery and related crude oil and refined product inventory |
| | • | | Special items include a $15 million pretax net gain from the sale of the Toledo refinery and related inventory to PBF and a $42 million pretax gain resulting from the reduction of crude oil and refined product inventories at the Toledo refinery prior to its sale |
“The sharp rise in crude oil prices created very challenging market conditions in the first quarter which, along with some significant operational reliability issues at two of our refineries, negatively impacted earnings. We have been aggressively focused on addressing the reliability issues,” said Lynn L. Elsenhans, Sunoco’s Chairman and Chief Executive Officer. “During the first quarter, we continued to make progress on growing our retail and logistics businesses and separating SunCoke Energy from Sunoco. We finished the quarter with approximately $1.5 billion in cash, which gives us strategic flexibility to further pursue our growth plans.”
Commenting on the coke business, Elsenhans said, “The recent filing of SunCoke’s registration statement with the Securities and Exchange Commission represents an important step in the separation process. We also have an
exceptional and experienced management team in place and we expect to complete the relocation of SunCoke’s corporate headquarters to the Chicago area in May. Establishing SunCoke as an independent company remains a priority.”
DETAILS OF FIRST QUARTER RESULTS
FUELS BUSINESS RESULTS
Refining and Supply
Refining and Supply had a pretax loss of $138 million in the current quarter versus a loss of $70 million in the first quarter of 2010. The $68 million decrease in results was primarily due to lower realized margins and production volumes. The overall crude utilization rate was 74 percent for the quarter, down from 85 percent in the fourth quarter of 2010. Production volumes were negatively affected by significant unplanned maintenance activities at the Philadelphia and Marcus Hook refineries during the first quarter of 2011.
Retail Marketing
Retail Marketing earned $12 million pretax in the current quarter versus $34 million in the first quarter of 2010. The decrease in earnings was primarily due to lower average retail gasoline margins largely driven by the inability to fully pass-through wholesale price increases caused by the run up in crude prices.
Logistics
Logistics earned $31 million pretax in the first quarter of 2011 versus $27 million in the first quarter of 2010. The improvement in results was primarily due to higher lease acquisition results and earnings attributable to recent acquisitions and organic growth projects.
Chemicals - Continuing Operations
Chemicals had a pretax loss of $9 million in the first quarter of 2011 versus income of $5 million in the first quarter of 2010. The decrease in results was primarily attributable to the unplanned refinery downtime at the Company’s Philadelphia refinery which limited supply of cumene to the Frankford phenol facility, raising feedstock costs and reducing production.
Chemicals - Discontinued Polypropylene Operations
Discontinued polypropylene operations, which were divested on March 31, 2010, had pretax income of $33 million in the first quarter of 2010.
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COKE BUSINESS RESULTS
Coke earned $9 million pretax in the first quarter of 2011 versus $51 million in the first quarter of 2010. The decrease in earnings was attributable to lower coke sales revenues as a result of the Jewell contract restructuring with ArcelorMittal in January 2011 and a $25 million decline in results at the Indiana Harbor cokemaking facility due to lower coal-to-coke yields, higher maintenance expenses and the recognition of a $13 million contract loss in connection with agreements to purchase coke from third-parties to cover the projected 2011 production shortfall.
OTHER
Corporate administrative expenses were $22 million pretax in the first quarter of 2011 versus $23 million in the first quarter of 2010.
Net financing expenses and other were $24 million pretax in the first quarter of 2011 compared to $28 million in the first quarter of 2010. The decrease was primarily driven by higher interest income and capitalized interest, partially offset by higher interest expense.
INCOME TAXES
Excluding the impact of special items, the effective tax rates on pretax income attributable to Sunoco, Inc. shareholders for the first quarter of 2011 and 2010 were 13 and 41 percent, respectively. The effective tax rates for each quarter were determined based upon the expected full year tax rates at the end of each quarter. The reduction in the effective rate in 2011 is largely attributable to the estimated impact of nonconventional fuel tax credits and higher coal depletion deductions combined with lower expected pretax earnings.
SPECIAL ITEMS
During the first quarter of 2011, Sunoco recognized a $15 million gain ($4 million after tax) related to the divestment of the Toledo refinery and related inventory; recognized a $42 million gain ($26 million after tax) resulting from the reduction of crude oil and refined product inventories at the Toledo refinery prior to its divestment; recorded a $6 million provision ($4 million after tax) primarily for pension settlement losses in connection with business improvement initiatives; and recorded a $5 million increase to deferred income taxes in part due to apportionment changes as a result of the sale of the Toledo refinery. The total net impact of special items during the first quarter of 2011 was a pretax gain of $51 million ($21 million after tax).
During the first quarter of 2010, Sunoco recorded a $169 million loss ($44 million after tax) related to the divestment of the discontinued polypropylene operations; recorded a $33 million provision ($20 million after tax) primarily related to contract losses in connection with excess barge capacity resulting from the permanent shutdown of the Eagle Point refinery during 2009; recorded a $12 million provision ($7 million after tax) primarily for pension settlement losses in connection with business improvement initiatives; and recorded a $9 million increase in deferred state income taxes attributable to the transfer of assets related to its continuing
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phenol chemicals operations to a different legal entity subsequent to the sale of the stock of the discontinued polypropylene business. The total net impact of special items during the first quarter of 2010 was a pretax loss of $214 million ($80 million after tax).
Sunoco is a leading transportation fuel provider, with operations located primarily in the East Coast and Midwest regions of the United States. The Company sells transportation fuels through more than 4,900 branded retail locations in 23 states. APlus convenience stores are operated by the Company or independent dealers in more than 600 retail locations. The retail network in the Northeast is principally supplied by Sunoco-owned refineries with a combined crude oil processing capacity of 505,000 barrels per day. Sunoco is also the General Partner and has a 31-percent interest in Sunoco Logistics Partners, L.P., a publicly traded master limited partnership which owns and operates 7,600 miles of refined product and crude oil pipelines and approximately 40 active product terminals. Through SunCoke Energy, Sunoco makes high-quality metallurgical-grade coke for major steel manufacturers. The Company’s facilities in the U.S. have the capacity to manufacture approximately 3.7 million tons of metallurgical-grade coke annually. Sunoco also is the operator of, and has an equity interest in, a 1.7 million tons-per-year cokemaking facility in Vitória, Brazil.
Anyone interested in obtaining further insights into the first quarter’s results can monitor the Company’s quarterly teleconference call, which is scheduled for 5:30 p.m. ET on May 5, 2011. It can be accessed through Sunoco’s website - www.SunocoInc.com. It is suggested that you visit the site prior to the teleconference to ensure that you have downloaded any necessary software.
Those statements made in this release that are not historical facts are forward-looking statements intended to be covered by the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements are based upon assumptions by the Company concerning future conditions, any or all of which ultimately may prove to be inaccurate, and upon the current knowledge, beliefs and expectations of Company management. These forward-looking statements are not guarantees of future performance. The reader should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company expressly disclaims any obligation to update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.
Forward-looking statements are inherently uncertain and involve significant known and unknown risks and uncertainties (many of which are beyond the control of the Company) that could cause actual results to differ materially from those discussed in this release.
Such risks and uncertainties include economic, business, competitive and/or regulatory factors affecting the Company’s business, as well as uncertainties related to the outcomes of pending or future litigation, legislation, or regulatory actions. Among such risks are: changes in crude oil or natural gas prices, refining, marketing and chemicals margins, or other market conditions affecting the oil and gas industry; higher-than-expected costs of, or delays in, planned development or completion of repair projects, capital projects, acquisitions, or dispositions;
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operational interruptions, unforeseen technical difficulties and/or changes in technical or operating conditions; general domestic and international economic and political conditions, wars and acts of terrorism or sabotage; the outcome of commercial negotiations; the actions of competitors or regulators; the competitiveness of alternate-energy sources or product substitutes; technological developments; liability resulting from pending or future litigation; significant investment or product changes and/or liability for remedial actions or assessments under existing or future environmental regulations; gains and losses related to the acquisition, disposition or impairment of assets; recapitalizations; access to, or significantly higher costs of, capital; the effects of changes in accounting rules applicable to the Company; and changes in tax, environmental and other laws and regulations applicable to the Company’s businesses. Unpredictable or unknown factors not discussed in this release also could have material adverse effects on forward-looking statements.
In accordance with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, the Company has included in its Annual Report on Form 10-K for the year ended December 31, 2010 and in its subsequent Form 10-Q and Form 8-K filings, cautionary language identifying other important factors (though not necessarily all such factors) that could cause future outcomes to differ materially from those set forth in the forward-looking statements. For more information concerning these factors, see the Company’s Securities and Exchange Commission filings, available on the Company’s website at www.SunocoInc.com.
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SUNOCO, INC.
2011 FIRST QUARTER FINANCIAL SUMMARY
(Millions of Dollars, Except Per-Share Amounts)
(Unaudited)
| | | | | | | | |
First Quarter | | 2011 | | | 2010 | |
Revenues | | $ | 10,638 | | | $ | 8,192 | |
| | |
Net loss | | $ | (80 | ) | | $ | (38 | ) |
Less: Net income attributable to noncontrolling interests | | | 21 | | | | 25 | |
| | | | | | | | |
Net loss attributable to Sunoco, Inc. shareholders | | $ | (101 | ) | | $ | (63 | ) |
| | | | | | | | |
| | |
Net loss attributable to Sunoco, Inc. shareholders per share of common stock: | | | | | | | | |
Basic | | $ | (0.84 | ) | | $ | (0.53 | ) |
Diluted* | | $ | (0.84 | ) | | $ | (0.53 | ) |
Weighted-average number of shares outstanding (in millions): | | | | | | | | |
Basic | | | 120.9 | | | | 118.8 | |
Diluted* | | | 120.9 | | | | 118.8 | |
| * | Since the assumed issuance of common stock incentive awards would not have been dilutive, the diluted per share amounts are equal to the basic per share amounts. |
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SUNOCO, INC.
EARNINGS PROFILE OF SUNOCO BUSINESSES
(Millions of Dollars, Except Per-Share Amounts)
(Unaudited)
| | | | | | | | | | | | |
| | | For the Three Months Ended | |
| | | March 31, | | | December 31, | |
| | | 2011 | | | 2010 | | | 2010 | |
Refining and Supply | | $ | (138 | ) | | $ | (70 | ) | | $ | (17 | ) |
Retail Marketing | | | 12 | | | | 34 | | | | 1 | |
Logistics | | | 31 | | | | 27 | | | | 35 | |
Chemicals: | | | | | | | | | | | | |
Continuing operations | | | (9 | ) | | | 5 | | | | 6 | |
Discontinued operations | | | — | | | | 33 | | | | — | |
Coke | | | 9 | | | | 51 | | | | 25 | |
Corporate and Other: | | | | | | | | | | | | |
Corporate expenses | | | (22 | ) | | | (23 | ) | | | (27 | ) |
Net financing expenses and other | | | (24 | ) | | | (28 | ) | | | (27 | ) |
| | | | | | | | | | | | |
Pretax income (loss) attributable to Sunoco, Inc. shareholders before special items | | | (141 | ) | | | 29 | | | | (4 | ) |
Income tax expense (benefit) attributable to Sunoco, Inc. shareholders | | | (19 | ) | | | 12 | | | | (17 | ) |
| | | | | | | | | | | | |
Income (loss) attributable to Sunoco, Inc. shareholders before special items | | | (122 | ) | | | 17 | | | | 13 | |
| | | | | | | | | | | | |
| | | |
Special items: | | | | | | | | | | | | |
Continuing operations | | | 51 | | | | (45 | ) | | | 123 | |
Discontinued operations | | | — | | | | (169 | ) | | | — | |
| | | | | | | | | | | | |
Pretax income (loss) from special items | | | 51 | | | | (214 | ) | | | 123 | |
Income tax expense (benefit) | | | 30 | | | | (134 | ) | | | 49 | |
| | | | | | | | | | | | |
Income (loss) from special items | | | 21 | | | | (80 | ) | | | 74 | |
| | | | | | | | | | | | |
| | | |
Net income (loss) attributable to Sunoco, Inc. shareholders | | $ | (101 | ) | | $ | (63 | ) | | $ | 87 | |
| | | | | | | | | | | | |
| | | |
Earnings (loss) per share of common stock (diluted): | | | | | | | | | | | | |
Income (loss) attributable to Sunoco, Inc. shareholders before special items | | $ | (1.01 | ) | | $ | 0.14 | | | $ | 0.11 | |
Income (loss) from special items | | | 0.17 | | | | (0.67 | ) | | | 0.61 | |
| | | | | | | | | | | | |
Net income (loss) attributable to Sunoco, Inc. shareholders | | $ | (0.84 | ) | | $ | (0.53 | ) | | $ | 0.72 | |
| | | | | | | | | | | | |
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SUNOCO, INC.
FINANCIAL AND OPERATING STATISTICS
(Unaudited)
| | | | | | | | | | | | |
| | | For the Three Months Ended | |
| | | March 31, | | | December 31, | |
| | | 2011 | | | 2010 | | | 2010 | |
REFINING AND SUPPLY | | | | | | | | | | | | |
Pretax Loss (Millions of Dollars) | | $ | (138 | ) | | $ | (70 | ) | | $ | (17 | ) |
Realized Wholesale Margin* (Per Barrel of Production Available for Sale) | | $ | 3.14 | | | $ | 4.08 | | | $ | 4.77 | |
Market Benchmark** (Per Barrel) | | $ | 6.71 | | | $ | 5.67 | | | $ | 6.11 | |
Crude Inputs as Percent of Crude Unit Rated Capacity*** | | | 74 | | | | 79 | | | | 85 | |
Throughputs (Thousands of Barrels Daily): | | | | | | | | | | | | |
Crude Oil | | | 459.7 | | | | 533.3 | | | | 571.8 | |
Other Feedstocks | | | 54.9 | | | | 58.9 | | | | 64.5 | |
| | | | | | | | | | | | |
Total Throughputs | | | 514.6 | | | | 592.2 | | | | 636.3 | |
| | | | | | | | | | | | |
Products Manufactured (Thousands of Barrels Daily): | | | | | | | | | | | | |
Gasoline | | | 265.4 | | | | 306.3 | | | | 339.9 | |
Middle Distillates | | | 183.6 | | | | 202.4 | | | | 225.1 | |
Residual Fuel | | | 23.7 | | | | 34.8 | | | | 28.7 | |
Petrochemicals | | | 16.3 | | | | 23.7 | | | | 23.3 | |
Other | | | 47.8 | | | | 51.8 | | | | 48.1 | |
| | | | | | | | | | | | |
Total Production | | | 536.8 | | | | 619.0 | | | | 665.1 | |
Less: Production Used as Fuel in Refinery Operations | | | 24.4 | | | | 28.5 | | | | 31.2 | |
| | | | | | | | | | | | |
Total Production Available for Sale | | | 512.4 | | | | 590.5 | | | | 633.9 | |
| | | | | | | | | | | | |
| * | Wholesale sales revenue less related cost of crude oil, other feedstocks, product purchases and terminalling and transportation divided by production available for sale. |
| ** | Represents a weighted-average refinery benchmark margin comprised of a 6-3-2-1 Value-Added Benchmark relating to the Northeast refining operations (80% weight) and a 4-3-1 Benchmark relating to the Toledo refinery (20% weight). For the three months ended March 31, 2011, the weighted-average refinery benchmark margin reflects only the 6-3-2-1 Value-Added Benchmark for the month of March as a result of the sale of the Toledo refinery on March 1, 2011. |
| *** | Reflects the impact of a 170 thousand barrels-per-day reduction in crude unit capacity resulting from the sale of the Toledo refinery effective March 1, 2011. |
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SUNOCO, INC.
FINANCIAL AND OPERATING STATISTICS
(Unaudited)
| | | | | | | | | | | | |
| | | For the Three Months Ended | |
| | | March 31, | | | December 31, | |
| | | 2011 | | | 2010 | | | 2010 | |
RETAIL MARKETING | | | | | | | | | | | | |
Pretax Income (Millions of Dollars) | | $ | 12 | | | $ | 34 | | | $ | 1 | |
Retail Margin* (Per Barrel): | | | | | | | | | | | | |
Gasoline | | $ | 2.90 | | | $ | 3.74 | | | $ | 2.79 | |
Middle Distillates | | $ | 2.97 | | | $ | 3.35 | | | $ | 2.37 | |
Sales (Thousands of Barrels Daily): | | | | | | | | | | | | |
Gasoline | | | 287.2 | | | | 271.4 | | | | 302.9 | |
Middle Distillates | | | 25.8 | | | | 24.2 | | | | 28.5 | |
| | | | | | | | | | | | |
| | | 313.0 | | | | 295.6 | | | | 331.4 | |
| | | | | | | | | | | | |
Total Retail Gasoline Outlets, End of Period | | | 4,926 | | | | 4,713 | | | | 4,921 | |
Gasoline and Diesel Throughput per Company-Owned Outlet (MGal/Site/Month) | | | 150 | | | | 147 | | | | 161 | |
Convenience Stores: | | | | | | | | | | | | |
Total Stores, End of Period | | | 603 | | | | 576 | | | | 602 | |
Merchandise Sales (M$/Store/Month) | | $ | 85 | | | $ | 87 | | | $ | 92 | |
Merchandise Margin (Company Operated) (% of Sales) | | | 27 | % | | | 26 | % | | | 27 | % |
| | | | | | | | | | | | |
| * | Retail sales price less related wholesale price and terminalling and transportation costs per barrel. The retail sales price is the weighted-average price received through the various branded marketing distribution channels. |
| | | | | | | | | | | | |
| | | For the Three Months Ended | |
| | | March 31, | | | December 31, | |
| | | 2011 | | | 2010 | | | 2010 | |
LOGISTICS | | | | | | | | | | | | |
Pretax Income (Millions of Dollars) | | $ | 31 | | | $ | 27 | | | $ | 35 | |
Pipeline and Terminal Throughputs (Thousands of Barrels Daily)* | | | | | | | | | | | | |
Unaffiliated Customers | | | 2,291 | | | | 1,738 | | | | 2,309 | |
Affiliated Customer | | | 1,175 | | | | 1,238 | | | | 1,385 | |
| | | | | | | | | | | | |
| | | 3,466 | | | | 2,976 | | | | 3,694 | |
| | | | | | | | | | | | |
| * | Excludes joint-venture operations which are not consolidated. |
| | | 3,466 | | | | 3,466 | | | | 3,466 | |
| | | For the Three Months Ended | |
| | | March 31, | | | December 31, | |
| | | 2011 | | | 2010* | | | 2010 | |
CHEMICALS | | | | | | | | | | | | |
Pretax Income (Loss) (Millions of Dollars) | | $ | (9) | | | $ | 5 | | | $ | 6 | |
Margin** (Cents per Pound) | | | 7.4 | | | | 9.9 | | | | 9.1 | |
Sales (Millions of Pounds) | | | 470 | | | | 449 | | | | 582 | |
| | | | | | | | | | | | |
| * | Consists of the phenol and related products operations but excludes amounts attributable to the polypropylene chemicals business, which was sold to Braskem S.A. on March 31, 2010. |
| ** | Wholesale sales revenue less cost of feedstocks, product purchases and related terminalling and transportation divided by sales volumes. |
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SUNOCO, INC.
FINANCIAL AND OPERATING STATISTICS
(Unaudited)
| | | | | | | | | | | | |
| | | For the Three Months Ended | |
| | | March 31, | | | December 31, | |
| | | 2011 | | | 2010 | | | 2010 | |
COKE | | | | | | | | | | | | |
Pretax Income (Millions of Dollars) | | $ | 9 | | | $ | 51 | | | $ | 25 | |
Coke Production (Thousands of Tons): | | | | | | | | | | | | |
United States | | | 861 | | | | 841 | | | | 916 | |
Brazil | | | 331 | | | | 413 | | | | 370 | |
| | | | | | | | | | | | |
| |
| | | For the Three Months Ended | |
| | | March 31, | | | December 31, | |
| | | 2011 | | | 2010 | | | 2010 | |
CAPITAL PROGRAM (Millions of Dollars) | | | | | | | | | | | | |
Refining and Supply | | $ | 36 | | | $ | 109 | | | $ | 52 | |
Retail Marketing | | | 18 | | | | 7 | | | | 68 | |
Logistics | | | 28 | | | | 27 | | | | 69 | |
Chemicals: | | | | | | | | | | | | |
Continuing operations | | | 5 | | | | 5 | | | | 5 | |
Discontinued operations | | | — | | | | 3 | | | | — | |
Coke* | | | 99 | | | | 10 | | | | 83 | |
| | | | | | | | | | | | |
| | $ | 186 | | | $ | 161 | | | $ | 277 | |
| | | | | | | | | | | | |
| * | Includes cash consideration of $36 million paid in the first quarter of 2011 related to the acquisition of a coal business. |
| | | | | | | | | | | | |
| | | For the Three Months Ended | |
| | | March 31, | | | December 31, | |
| | | 2011 | | | 2010* | | | 2010 | |
DEPRECIATION, DEPLETION AND AMORTIZATION (Millions of Dollars) | | | | | | | | | | | | |
Refining and Supply | | $ | 52 | | | $ | 62 | | | $ | 64 | |
Retail Marketing | | | 22 | | | | 20 | | | | 28 | |
Logistics | | | 18 | | | | 14 | | | | 20 | |
Chemicals | | | 7 | | | | 7 | | | | 6 | |
Coke | | | 13 | | | | 11 | | | | 12 | |
| | | | | | | | | | | | |
| | $ | 112 | | | $ | 114 | | | $ | 130 | |
| | | | | | | | | | | | |
| * | Excludes amounts attributable to the polypropylene chemicals business which was sold to Braskem S.A. on March 31, 2010 and, as a result, has been classified as discontinued operations in the Company’s consolidated statements of operations. |
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SUNOCO, INC.
EARNINGS PROFILE OF SUNOCO BUSINESSES
(Millions of Dollars, Except Per-Share Amounts)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | |
| | | 2010 | |
| | | 1st | | | 2nd | | | 3rd | | | 4th | | | Total | |
Refining and Supply | | $ | (70 | ) | | $ | 138 | | | $ | (70 | ) | | $ | (17 | ) | | $ | (19 | ) |
Retail Marketing | | | 34 | | | | 73 | | | | 68 | | | | 1 | | | | 176 | |
Logistics | | | 27 | | | | 30 | | | | 40 | | | | 35 | | | | 132 | |
Chemicals: | | | | | | | | | | | | | | | | | | | | |
Continuing operations | | | 5 | | | | 7 | | | | 5 | | | | 6 | | | | 23 | |
Discontinued operations | | | 33 | | | | — | | | | — | | | | — | | | | 33 | |
Coke | | | 51 | | | | 56 | | | | 44 | | | | 25 | | | | 176 | |
Corporate and Other: | | | | | | | | | | | | | | | | | | | | |
Corporate expenses | | | (23 | ) | | | (30 | ) | | | (28 | ) | | | (27 | ) | | | (108 | ) |
Net financing expenses and other | | | (28 | ) | | | (27 | ) | | | (28 | ) | | | (27 | ) | | | (110 | ) |
| | | | | | | | | | | | | | | | | | | | |
Pretax income (loss) attributable to Sunoco, Inc. shareholders before special items | | | 29 | | | | 247 | | | | 31 | | | | (4 | ) | | | 303 | |
Income tax expense (benefit) attributable to Sunoco, Inc. shareholders | | | 12 | | | | 89 | | | | 4 | | | | (17 | ) | | | 88 | |
| | | | | | | | | | | | | | | | | | | | |
Income attributable to Sunoco, Inc. shareholders before special items | | | 17 | | | | 158 | | | | 27 | | | | 13 | | | | 215 | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | |
Special items: | | | | | | | | | | | | | | | | | | | | |
Continuing operations | | | (45 | ) | | | (22 | ) | | | 62 | | | | 123 | | | | 118 | |
Discontinued operations* | | | (169 | ) | | | — | | | | — | | | | — | | | | (169 | ) |
| | | | | | | | | | | | | | | | | | | | |
Pretax income (loss) from special items | | | (214 | ) | | | (22 | ) | | | 62 | | | | 123 | | | | (51 | ) |
Income tax expense (benefit) | | | (134 | ) | | | (9 | ) | | | 24 | | | | 49 | | | | (70 | ) |
| | | | | | | | | | | | | | | | | | | | |
Income (loss) from special items | | | (80 | ) | | | (13 | ) | | | 38 | | | | 74 | | | | 19 | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | |
Net income (loss) attributable to Sunoco, Inc. shareholders | | $ | (63 | ) | | $ | 145 | | | $ | 65 | | | $ | 87 | | | $ | 234 | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | |
Earnings (loss) per share of common stock (diluted): | | | | | | | | | | | | | | | | | | | | |
Income attributable to Sunoco, Inc. shareholders before special items | | $ | 0.14 | | | $ | 1.31 | | | $ | 0.22 | | | $ | 0.11 | | | $ | 1.79 | |
Income (loss) from special items | | | (0.67 | ) | | | (0.11 | ) | | | 0.32 | | | | 0.61 | | | | 0.16 | |
| | | | | | | | | | | | | | | | | | | | |
Net income (loss) attributable to Sunoco, Inc. shareholders | | $ | (0.53 | ) | | $ | 1.20 | | | $ | 0.54 | | | $ | 0.72 | | | $ | 1.95 | |
| | | | | | | | | | | | | | | | | | | | |
| * | Represents a loss recognized in connection with the divestment of the polypropylene chemicals business. |
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SUNOCO INC.
EARNINGS PROFILE OF SUNOCO BUSINESSES
(Millions of Dollars, Except Per-Share Amounts)
(Unaudited)
| | | | |
| | | 2011 | |
| | | First Quarter | |
Refining and Supply | | $ | (138 | ) |
Retail Marketing | | | 12 | |
Logistics | | | 31 | |
Chemicals: | | | | |
Continuing operations | | | (9 | ) |
Discontinued operations | | | — | |
Coke | | | 9 | |
Corporate and Other: | | | | |
Corporate expenses | | | (22 | ) |
Net financing expenses and other | | | (24 | ) |
| | | | |
Pretax loss attributable to Sunoco, Inc. shareholders before special items | | | (141 | ) |
Income tax benefit attributable to Sunoco, Inc. shareholders | | | (19 | ) |
| | | | |
Loss attributable to Sunoco, Inc. shareholders before special items | | | (122 | ) |
| | | | |
| |
Special items | | | 51 | |
Income tax expense | | | 30 | |
| | | | |
Income from special items | | | 21 | |
| | | | |
| |
Net loss attributable to Sunoco, Inc. shareholders | | $ | (101 | ) |
| | | | |
| |
Earnings (loss) per share of common stock (diluted): | | | | |
Loss attributable to Sunoco, Inc. shareholders before special items | | $ | (1.01 | ) |
Income from special items | | | 0.17 | |
| | | | |
Net loss attributable to Sunoco, Inc. shareholders | | $ | (0.84 | ) |
| | | | |
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SUNOCO, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Millions of Dollars)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | |
| | | 2010 | |
| | | 1st | | | 2nd | | | 3rd | | | 4th | | | Total | |
Revenues | | | | | | | | | | | | | | | | | | | | |
Sales and other operating revenue
(including consumer excise taxes) | | $ | 8,166 | | | $ | 9,572 | | | $ | 9,319 | | | $ | 10,207 | | | $ | 37,264 | |
Interest income | | | — | | | | 1 | | | | 3 | | | | 1 | | | | 5 | |
Gain on remeasurement of pipeline equity interests | | | — | | | | — | | | | 128 | | | | — | | | | 128 | |
Other income, net | | | 26 | | | | 13 | | | | 29 | | | | 24 | | | | 92 | |
| | | | | | | | | | | | | | | | | | | | |
| | | 8,192 | | | | 9,586 | | | | 9,479 | | | | 10,232 | | | | 37,489 | |
| | | | | | | | | | | | | | | | | | | | |
Costs and Expenses | | | | | | | | | | | | | | | | | | | | |
Cost of products sold and operating expenses | | | 7,311 | | | | 8,350 | | | | 8,300 | | | | 9,071 | | | | 33,032 | |
Consumer excise taxes | | | 530 | | | | 608 | | | | 617 | | | | 594 | | | | 2,349 | |
Selling, general and administrative expenses | | | 146 | | | | 167 | | | | 159 | | | | 182 | | | | 654 | |
Depreciation, depletion and amortization | | | 114 | | | | 122 | | | | 128 | | | | 130 | | | | 494 | |
Payroll, property and other taxes | | | 34 | | | | 24 | | | | 37 | | | | 21 | | | | 116 | |
Provision for asset write-downs and other matters | | | 45 | | | | 22 | | | | (3 | ) | | | 45 | | | | 109 | |
Interest cost and debt expense | | | 39 | | | | 40 | | | | 43 | | | | 42 | | | | 164 | |
Interest capitalized | | | (3 | ) | | | (3 | ) | | | (4 | ) | | | (5 | ) | | | (15 | ) |
| | | | | | | | | | | | | | | | | | | | |
| | | 8,216 | | | | 9,330 | | | | 9,277 | | | | 10,080 | | | | 36,903 | |
| | | | | | | | | | | | | | | | | | | | |
Income (loss) from continuing operations before income tax expense (benefit) | | | (24 | ) | | | 256 | | | | 202 | | | | 152 | | | | 586 | |
Income tax expense (benefit) | | | (9 | ) | | | 80 | | | | 30 | | | | 34 | | | | 135 | |
| | | | | | | | | | | | | | | | | | | | |
Income (loss) from continuing operations | | | (15 | ) | | | 176 | | | | 172 | | | | 118 | | | | 451 | |
Loss from discontinued operations | | | (23 | ) | | | — | | | | — | | | | — | | | | (23 | ) |
| | | | | | | | | | | | | | | | | | | | |
Net income (loss) | | | (38 | ) | | | 176 | | | | 172 | | | | 118 | | | | 428 | |
Less: Net income attributable to noncontrolling interests | | | 25 | | | | 31 | | | | 107 | | | | 31 | | | | 194 | |
| | | | | | | | | | | | | | | | | | | | |
Net income (loss) attributable to Sunoco, Inc. shareholders | | $ | (63 | ) | | $ | 145 | | | $ | 65 | | | $ | 87 | | | $ | 234 | |
| | | | | | | | | | | | | | | | | | | | |
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SUNOCO, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Millions of Dollars)
(Unaudited)
| | | | |
| | | 2011 | |
| | | First Quarter | |
Revenues | | | | |
Sales and other operating revenue (including consumer excise taxes) | | $ | 10,609 | |
Interest income | | | 4 | |
Other income, net | | | 25 | |
| | | | |
| | | 10,638 | |
| | | | |
Costs and Expenses | | | | |
Cost of products sold and operating expenses | | | 9,819 | |
Consumer excise taxes | | | 548 | |
Selling, general and administrative expenses | | | 145 | |
Depreciation, depletion and amortization | | | 112 | |
Payroll, property and other taxes | | | 37 | |
Provision for asset write-downs and other matters | | | 6 | |
Interest cost and debt expense | | | 43 | |
Interest capitalized | | | (6 | ) |
| | | | |
| | | 10,704 | |
| | | | |
| |
Loss before income tax expense | | | (66 | ) |
Income tax expense | | | 14 | |
| | | | |
Net loss | | | (80 | ) |
Less: Net income attributable to noncontrolling interests | | | 21 | |
| | | | |
Net loss attributable to Sunoco, Inc. shareholders | | $ | (101 | ) |
| | | | |
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SUNOCO, INC.
CONSOLIDATED BALANCE SHEETS
(Millions of Dollars)
(Unaudited)
| | | | | | | | |
| | | At March 31, | | | At December 31, | |
| | | 2011 | | | 2010 | |
Assets | | | | | | | | |
Cash and cash equivalents | | $ | 1,480 | | | $ | 1,485 | |
Accounts and notes receivable, net | | | 2,875 | | | | 2,679 | |
Note receivable from sale of Toledo refinery | | | 285 | | | | — | |
Inventories | | | 1,165 | | | | 404 | |
Deferred income taxes | | | 74 | | | | 129 | |
Toledo refinery and related assets held for sale | | | — | | | | 1,029 | |
| | | | | | | | |
Total current assets | | | 5,879 | | | | 5,726 | |
| | | | | | | | |
| | |
Investments and long term receivables | | | 163 | | | | 160 | |
Note receivable from sale of Toledo refinery | | | 200 | | | | — | |
Properties, plants and equipment, net | | | 7,148 | | | | 7,055 | |
Deferred charges and other assets | | | 396 | | | | 356 | |
| | | | | | | | |
Total assets | | $ | 13,786 | | | $ | 13,297 | |
| | | | | | | | |
| | |
Liabilities and Equity | | | | | | | | |
Accounts payable and accrued liabilities | | $ | 5,023 | | | $ | 4,466 | |
Short-term borrowings | | | 115 | | | | 115 | |
Current portion of long-term debt | | | 205 | | | | 178 | |
Taxes payable | | | 317 | | | | 170 | |
| | | | | | | | |
Total current liabilities | | | 5,660 | | | | 4,929 | |
| | | | | | | | |
| | |
Long-term debt | | | 2,152 | | | | 2,136 | |
Retirement benefit liabilities | | | 483 | | | | 481 | |
Deferred income taxes | | | 1,226 | | | | 1,390 | |
Other deferred credits and liabilities | | | 571 | | | | 562 | |
| | | | | | | | |
Total liabilities | | | 10,092 | | | | 9,498 | |
| | | | | | | | |
| | |
Equity | | | | | | | | |
Sunoco, Inc. shareholders’ equity | | | 2,950 | | | | 3,046 | |
Noncontrolling interests | | | 744 | | | | 753 | |
| | | | | | | | |
Total equity | | | 3,694 | | | | 3,799 | |
| | | | | | | | |
Total liabilities and equity | | $ | 13,786 | | | $ | 13,297 | |
| | | | | | | | |
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SUNOCO, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Millions of Dollars)
(Unaudited)
| | | | | | | | |
| | | For the Three Months Ended | |
| | | March 31, | |
| | | 2011 | | | 2010 | |
Cash Flows from Operating Activities: | | | | | | | | |
Net loss | | $ | (80 | ) | | $ | (38 | ) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | | | | | | | | |
Loss on divestment of discontinued polypropylene operations | | | — | | | | 169 | |
Provision for asset write-downs and other matters | | | 6 | | | | 45 | |
Depreciation, depletion and amortization | | | 112 | | | | 117 | |
Deferred income tax benefit | | | (133 | ) | | | (48 | ) |
Payments less than (in excess of) expense for retirement plans* | | | 3 | | | | (134 | ) |
Changes in working capital pertaining to operating activities: | | | | | | | | |
Accounts and notes receivable | | | (200 | ) | | | (11 | ) |
Inventories | | | (743 | ) | | | (248 | ) |
Accounts payable and accrued liabilities | | | 559 | | | | 341 | |
Income tax refund receivable and taxes payable | | | 149 | | | | 319 | |
Other | | | (41 | ) | | | (11 | ) |
| | | | | | | | |
Net cash provided by (used in) operating activities | | | (368 | ) | | | 501 | |
| | | | | | | | |
Cash Flows from Investing Activities: | | | | | | | | |
Capital expenditures | | | (150 | ) | | | (161 | ) |
Acquisitions | | | (36 | ) | | | — | |
Proceeds from divestments**: | | | | | | | | |
Toledo refinery and related inventory | | | 546 | | | | — | |
Other divestments | | | 6 | | | | 8 | |
Other | | | (6 | ) | | | — | |
| | | | | | | | |
Net cash provided by (used in) investing activities | | | 360 | | | | (153 | ) |
| | | | | | | | |
Cash Flows from Financing Activities: | | | | | | | | |
Net repayments of short-term borrowings | | | — | | | | (282 | ) |
Net proceeds from issuance of long-term debt | | | 70 | | | | 571 | |
Repayments of long-term debt | | | (23 | ) | | | (303 | ) |
Net proceeds from sale of Sunoco Logistics Partners L.P. limited partnership units | | | — | | | | 145 | |
Cash distributions to noncontrolling interests | | | (30 | ) | | | (27 | ) |
Cash dividend payments | | | (18 | ) | | | (18 | ) |
Other | | | 4 | | | | 1 | |
| | | | | | | | |
Net cash provided by financing activities | | | 3 | | | | 87 | |
| | | | | | | | |
Net increase (decrease) in cash and cash equivalents | | | (5 | ) | | | 435 | |
Cash and cash equivalents at beginning of period | | | 1,485 | | | | 377 | |
| | | | | | | | |
Cash and cash equivalents at end of period | | $ | 1,480 | | | $ | 812 | |
| | | | | | | | |
| * | Payments for the three months ended March 31, 2010 exclude 3.59 million shares of Sunoco common stock valued at $90 million that were contributed to the Company’s defined benefit plans in February 2010. |
| ** | Proceeds from divestments for the three months ended March 31, 2010 exclude $348 million from the sale of the Company’s polypropylene operations which was received on April 1, 2010. |
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