GLP - Earnings call 3 2023 | Global Partners LP

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Operator

Good day, everyone, and welcome to the Global Partners Third Quarter 2023 Financial Results Conference Call. Today's call is being recorded. [Operator Instructions].

With us from Global Partners are President and Chief Executive Officer, Mr. Eric Slifka; Chief Financial Officer; Mr. Officer; Operating Chief Hansen, Mr. Gregory Chief Mark Mr. Officer; Romaine and Legal Sean Geary. I'd At the like call time, over turn to this to Mr. Geary remarks. for opening ahead, sir. go Please

Sean Geary

will liquid financial These based statements Good the us. projections, assumptions which expectations the you are Thank concerning regulatory energy include product performance conditions, regarding for products the other environment, demand of include store believe these the and of influence and convenience curve estimates call given assumptions Partners, future meaning permitting laws. could morning, within operational are our forward-looking on securities forward for information. results. We federal and pricing products, and which reasonable statements market factors, available and everyone. currently Today's joining Global financial

or are which a business to constitute Partners obligation the news Any results of and cause means Our filings of wide which described to performance and assumptions statements. uncertainties to risks, materially experience the the update in future Commission, could forward-looking expectations future any of concerning with conference comments will Exchange are for partnership's present Regulation material will no projections. Global announced calls publicly be that communicated operations undertakes releases, our public factors, historical revise and through from and actual disclosure or differ or and FD. other range purposes results Securities subject

over and to my President Executive call it's Eric turn our the Slifka. Now pleasure to Officer, Chief

Eric Slifka

everyone. Thank you, Sean, and good morning,

terminals maintained Enterprises $XXX.X this context, Texas, retail. In agreement barrels our transformational combined providing only sulfur for with today, Let in put of Southeastern be the Global, Coast operations barrels. supply, commercial we in products, and X.X and terminals, million a terminaling in Motiva Atlantic The acquisition and Northeast our Plantation including and X.X what shell direct diesel platforms released diversifies The the into portfolio including by ultra-low definitive for to the Explorer of of with in terminal U.S. connections million XX product Motiva acquire geographies Magellan new refined we located me wholesale, the storage for terminals Colonial will we approximately U.S. transaction primarily along all, capacity infrastructure to deal throughput growth capacity the the The ethanol. addition refined utilized a for and approximately adding bulk well product To in enterprise, consider gasoline, be to is agreement is million. XX pipelines. begin critical, take-or-pay strategically XX-year with Motiva. with underpinned highly from

brief of approximately closing, barrels. million aligns serve increase of XX. transaction million capacity September and acquiring truck. drive flexibility rail Maryland, Georgia assets overview in pipeline, combined are storage me about North X million bulk with we're acquiring. multiple the combined The of we with Let synergies. bulk provide a capacity barge, midstream customers ship, capacity assets million infrastructure provide The and and X.X critical including of in assets with operating Virginia, optimize terminals modes, to terminals assets storage a our that XX of Southeast Upon strategy barrels. in consist through This be storage our Carolina will capacity Florida X.X South barrels, storage with Coast and from acquire, the XX% terminals approximately barrels. The X.X XX.X Carolina approximately of assets capacity The X a terminals combined of an Texas to bulk consist our Atlantic of a invest of as consist with

we our addition, capacity gained as continue we volumes operational In to own further for grow.

our customary also approvals. Massachusetts, these this closing and forward planned Maine, Motiva oil to I terminal Connecticut refined and touch full New X in year, conditions, including acquisition subject expect terminals close Jersey. regulatory transaction of developing their the assets on to by product potential. of We to look the We Gulf to end want optimizing to

through review diligently remain We acquisition the that hopeful regulatory the work year. process continue able we and this to to will complete be

team which expectations in The solid year. was results global Turning market with with to our line quarter, the in in normalized compared delivered a QX. last more

and We midstream deliver with fuel and value continue our products providing essential downstream markets, storage across and liquid to the energy customers integrated through services assets. distribution retail

Edward located convenience Fort strategy, and of Massachusetts and at fueling charging company-owned fuel station vehicle and Alltown newly activated York. in Fresh electric in stations our charging our Kitchen The fast our at recently Marketplace stations. part DC alternative first Extrema New our As Worcester, we are opened

not charging with by EV sites charges have first stations the portfolio. owned and our in new party are the owned We the third more a charging sites by construction. station are While first X global, under they X operate

to We on contributing regional and energy continue focus to state initiatives.

sources, we Given believe well integral to energy we scale the our business, of consumers. providing role for options of range play transition a are GDSO multifueling alternative positioned in the to an

our increased approved unitholders on on record to of to Turning a cash as November the or of November close X, consecutive The basis distribution. the all in common XXXX. cash on annualized the distribution outstanding Board marks business which XX of $X.XXXX quarter July, the eighth of has distribution In Board quarterly This to on units. be will distribution. an the $X.XX paid

Greg? call the Greg With his over for turn financial review. me that, let now to

Gregory Hanson

and you, Thank good Eric, everyone. morning,

release, year With third third As we results, conditions results in quarter our the of pleased received market volatility comparison performance third Eric backwardation our in in noted to more the strong XXXX quarter expectations. were this in XXXX said, third is challenging. line of normalized year-over-year noted, record period. this the are as and the which quarter with due compared benefited we somewhat morning's with earnings that to our market that in That the commodity in quarter

partnership million DCF, XXXX. $XX.X adjusted and $XXX the quarter XXXX. Adjusted compared and XXXX, quarter commencing our adjusted metric For this third $XX.X XXXX. EPS in be spring of make our $XX.X EBITDA Please in $XXX.X proportionate compared than the retails enhanced XX to related joint $XXX as XXXX, venture DCF X.Xx was our that closed distribution preferred in or DCF was coverage we our DCF unitholders. distributions includes the this million with compared financial XXXX agreement. interest note million presented a our of our not performance. TTM adjusted the in with our an special EBITDA with EBITDA in quarter including in as new for and was the to third past that Adjusted DCF calculated was Net $XX.X million, determine share was to distribution third share or quarter to million $XXX.X XX.XX% of on quarter to investors factoring and of income lower third provide distribution used million QX agreement 'XX June. Adjusted September ability perspective XX, versus is after X.Xx DCF is million and may under in higher solely asset million in our of partner

Oceanic strong third food quarter, product In $X.XX X/XX/XXXX declining to gallon QX QX segment product quarter $XXX.X comparison, million to store since last XXXX. distribution due due were National margins third the both quarter impacted commission prices Administration, Northeast of gasoline and prices million the quarter. consisted to year's sundries as Tidewater which and influenced down sites, quarter station $X.XX operations of Atmospheric $XX.X to negatively quarter, end On cents to GDSO third in and gasoline C-store rain wholesale September recordkeeping began, in our margins for our million XXX third in income $X.X X/XX/XXXX. uniquely its gasoline in of XXXX per declined X,XXX which rental basis, and wettest includes wholesale We experienced the this the primarily of million. third Convenience. XXX year's per company-operated agents, $XX consumer ago 'XX in 'XX, third and for gasoline XXX sundries, XXXX $XXX million experiencing the our $XX.X dealers GDSO to due Product such $X.XX Station comprised was to excessive products the margin to to from compared contractors. convenience acquisition demand from XXX from with margin, of sites million, prepared sales. At fuel $X.XX product Turning gasoline the details. to years from fuel margins VC margins, with in the and summer lower portfolio GDSO declined distribution XXX quarter increased carwash fuel and operations a part margin decreased sales,

venture. XX partners' In joint of our addition, retail we on operate sites behalf Spring

segment. Wholesale the at Looking

oils to XXXX quarter, Third decreased margin and distillates decreased gasoline $XX.X $XX.X favorable product $XX.X margin decreased due product distillates other from to blendstock less gasoline Gasoline and to product residual million $XX.X million. million $XX.X million, oil. to and and the market quarter million $X.X in conditions million margin for primarily

million, $X favorable conditions primarily million Our to due margin product Commercial $X.X segment bunkering. decreased less market to in

due CapEx, incentive third expenses million, million to our maintenance expenses XXXX quarter of months million in salinization versus CapEX third of was decreased we $XX in salary increase Through to decrease million, acquisition accrued rent of of and and including the $XX.X and higher the on $XX comp, in $XX.X $XX.X in $XXX.X our decrease credit Looking quarter $XX.X third average in lower quarter third expense, CapEx. maintenance segment, $X.X at increases due million in $X.X expansion of in $X.X in gas expense. a was to SG&A the discretionary Interest expenses. million related investments in our our and offset of in had CapEx $XX.X million expansion offset additional in costs to in the part by higher consisting decreased expense of a million to the of quarter we facilities million primarily environmental year, in the primarily XXXX, including wages million million GDSO an quarter first balances business. 'XX booked expense interest rates. and partially reserve and in Operating CapEx in X by $XX.X benefits. the third

of projects, million expenditures of expect million $XX timing For current of year, opportunities revising continue of or in to of in million to previous availability the maintenance events full capital and of related our $XX requiring planned $XX the range investments. million unanticipated expectations workforce, are to we on our gasoline $XX completion stations, primarily million. our part anticipated investments additional million. XXXX $XX whether to year to the to the Based projects in estimates CapEx equipment our depend through a of and XXXX, from for we end maintenance from $XX expansion These range on

at [ third quarter, the X/XX remains and approximately funded facilities. capacity as excess in leverage, Our X.XXx have agreement EBITDA is to continue end ] with we debt sheet near of ample product car of balance defined our the strong which at to

outstanding borrowings $XXX.X credit $XXX million. borrowings facility million million credit our outstanding total XX, credit revolving our revolving of facility. on million capital under million outstanding As agreement our XX, of of and $XX.X September under $XX This $XXX consisted were working

some provide me additional let color announced on Now Motiva. transaction the with

noted, purchase price product a refined the Eric terminals States and acquiring of $XXX.X cash. Southeastern Atlantic United we for As Coast, are in across Texas XX the million

finance as agreement defined in On We and pro the basis, expect our Xx. of Motiva our acquisition within expect Gulf bank transactions, our the current a be facilities. levers under including will we long-term to target forma that

In accretive we first expenses, acquisition full operations. of addition, excluding transition-related the to expect in year first the year be

Relations counter. upcoming our Investor at Looking

in Next City. Midstream Fargo Conference month, participating York we in XXXX New will and Wells Utilities the be

meeting to For participating, forward of look who those with you. you are we

back call comments. Now Eric let the turn for me to Eric? closing

Eric Slifka

Greg. you, Thank

through optimization our U.S. ahead, demand allocation, M&A, and deal in provider the our creating transformational the stable. on balanced X Motiva long-term Looking remain terminals growth of Refined on is believe reputation of remained to strategic initiatives for capital drive a critical infrastructure. unitholders. We that . for a product our we leading value our focused midstream builds that as acquisition Global, asset

and Greg, Operator? be Now happy your I to questions. will take Mark

Operator

[Operator Instructions] Our with question Akyol Selman first from Stifel. comes

Timothy Howard

Selman. Tim on is Congrats This for the on terminal acquisition.

Just wanted with that. off start to

as well relates synergies . expand with wondering and and terminal down prospects it the and to enhanced bit a on you little Houston? you opportunities in Just could see how footprint growth JV this your ExxonMobil maybe as if

Eric Slifka

So a I of us -- those it's think This questions. is will we couple -- handle Eric.

sort an that bank we're providing tenant, source business the And really going tenant. Look, Motiva business there, of then every is look in oil in heating wholesale hedging the that taking in it. But an us the for bets oil Tim, as in as retail Obviously, we say, assets on we potentially in little and well revenue put Northeast. I'd of markets now into way, then as at backed that competitive to as a anchor because of are throughout here First, in and this our we many those deal wholesale bit by we material we went is a started the more anchor we a maybe that And historically, are market. is as business. transaction. story terminaling behind the from assets heating it's These in And position to think business We any acquisitions. This putting the are a expand is similar, bought not a terminals. retail business. being the

also think opportunity as assets We for around there's supply an these well.

else I and don't vertically integrated successfully you Florida it you model . our deployed the coast Northeast leveraging business that And add. in into down if well we've so anything it's and into really throughout taking now to position have that really know that physical as markets. Mark, as Texas want the these moving

Mark Romaine

only been owned maintained. these and assets they're think to to Motiva run said, assets. That thing in many opportunities to X being find optimize and add I is they've and expect invest for The these Yes. to some and very would terminals I by successfully these that years well we

only with the add that's highlighted. benefits and that synergies thing the all strategic to of Eric that, So I along would

Eric Slifka

question look, value the the here. we going asked And try around is This of our and all own Yes. assets. provide best to we're into a to partners you that. Look, does deal a how this where for play also ExxonMobil

our try in our And do partner fact, work provide so to to that. is going there to, to we're with a to if way value JV,

Theresa Chen

Understood.

like good out switching of to then of the And just golf Sounds set opportunities guys. a acquisitions. you

the acquisition of tackle what's wondering get kind closed next to Just thing to year-end? the by

Gregory Hanson

the work diligent FTC in Yes. agents we're and comment on. to I really it's mean, with a continue to Tim, going we regulatory all manner,

Selman Akyol

for Got the X me. last it. SP-X then And

guys into a EV way. seems and you So service, a charging own obviously, guys recently you couple it put like the couple on stations that more

what for what wondering drove own And even of being them? expand rationale kind have on to then going you to this you'd the ultimately, if Just you now? beyond guys like further

Mark Romaine

forefront to trying that We're EVs. Yes, extent to will transition that coming that space be in tried us. we We Tim, at it's cases, limited we've into realize to the stay energy lead. some lean can. not to And the at

the say, to X We I be of volumes are those handling of the today, first in handling renewable diesel would volumes. market

things front, own our and that it strategy. strategy. on works in EV learn the formulate lean we're to to work invest and and trying trying like and to said, But continue advantage our to with to and We biodiesel shape the this take We're blending. really like the of how capital I put incentives funding continue watch along in and

is on So it's it to fair trying time spending really of something but evolution we that an invest we're we're and where a can. amount

Eric Slifka

the And transition dollars working states federal government make so towns and local work to Yes. really doing their happen And the look, disciplined, right? we're to part the of what put to is is to goal that the the financially quicker. -- make with we're sure so and

gives so a lowers better us and returns, it our it risk. having of And chance

Operator

I further floor [Operator Mr. this at Instructions]. for closing There to no Slifka turn would now back over the are questions to comments. like time.

Eric Slifka

Thank keeping you you our We progress. morning. updated for to joining forward everybody. us Thanks, this on look

Operator

teleconference. today's concludes This

participation. Thank may time. your You lines disconnect for your you this at

Global Partners (GLP) 9 Nov 232023 Q3 Earnings call transcript