NEWS RELEASE
Sunoco LP Announces First Quarter Financial and
Operating Results
5/3/2017
- Completed the private placement of $300 million in SUN preferred equity to ETE
- Maintained quarterly distribution of 82.55 cents, an increase of 1.0 percent compared to rst quarter 2016
- Executed denitive agreement to divest a majority of company-operated convenience stores to 7-Eleven, Inc. for
$3.3 billion; transaction includes 15-year take-or-pay fuel supply agreement with 7-Eleven
- Launched sales process for remaining company-operated convenience stores in North and West Texas, New
Mexico and Oklahoma
Conference Call Scheduled for 9:30 a.m. CT (10:30 a.m. ET) on Thursday, May 4
DALLAS, May 3, 2017 /PRNewswire/ --Sunoco LP (NYSE: SUN) ("SUN" or the "Partnership") today announced
nancial and operating results for the three-month period ended March 31, 2017.
Revenue totaled $4.4 billion, an increase of 36.7 percent, compared to $3.2 billion in the rst quarter of 2016. The
increase was the result of the average selling price of fuel being 56 cents per gallon higher than last year, additional
wholesale gallons sold and increased merchandise sales.
Total gross prot was $503 million, compared to $511 million in the rst quarter of 2016.
The key driver of the decrease was lower wholesale motor fuel prots partly oset by increases in retail motor fuel
and merchandise prots.
Income from operations was $48 million, versus $92 million in the rst quarter of 2016. General and administrative
expenses increased $6 million from the rst quarter 2016 to $64 million primarily due to increased salary and
benet costs. Other operating expenses increased $14 million from the rst quarter 2016 to $263 million as a
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result of stores acquired or opened in the last 12 months.
Net income was $1 million, or ($0.22) per diluted unit, versus $62 million, or $0.47 per diluted unit, in the rst
quarter of 2016.
Adjusted EBITDA (1) for the quarter totaled $155 million, compared with $159 million in the rst quarter of 2016.
The unfavorable year-over-year comparison reects decreased wholesale motor fuel gross prot contribution and
increased total operating expenses.
Distributable cash ow (1), as adjusted, was $77 million, compared to $112 million a year ago. This year over year
decrease reects an increase in cash interest expense.
On a weighted-average basis, fuel margin for all gallons sold decreased to 14.5 cents per gallon, compared to 14.7
cents per gallon in the rst quarter of 2016. The decrease was primarily attributable to lower margins in the
wholesale segment.
Net income for the wholesale segment was $42 million compared to $87 million a year ago. Adjusted EBITDA was
$95 million, versus $103 million in the rst quarter of last year. Total wholesale gallons sold were 1,313 million,
compared to 1,233 million in the rst quarter of 2016, an increase of 6.5 percent as a result of growth in both the
Southwest geography and unbranded business and contribution from the Emerge acquisition. This includes
gallons sold to consignment stores and third-party customers, including independent dealers, fuel distributors and
commercial customers. The Partnership earned 10.6 cents per gallon on these volumes, compared to 11.4 cents
per gallon a year earlier.
Net loss for the retail segment was $41 million compared to a net loss of $25 million a year ago. Adjusted EBITDA
was $60 million, versus $56 million in the rst quarter of last year. Total retail gallons sold decreased by 2.1 percent
to 595 million gallons as a result of the decreased demand across SUN's operating geography, particularly along the
East Coast. The Partnership earned 23.1 cents per gallon on these volumes, compared to 21.3 cents per gallon a
year earlier.
Total merchandise sales increased by 3.1 percent from a year ago to $540 million, reecting the contribution from
third party acquisitions and new-to-industry locations opened during the last 12 months. Merchandise sales
contributed $170 million of gross prot with a retail merchandise margin of 31.6 percent, a decrease of 0.1
percentage points from the rst quarter of 2016.
Same-store merchandise sales decreased by 1.1 percent during the rst quarter, reecting weakness in
convenience store and restaurant operations in Texas, partly oset by growth in SUN's East Coast and Hawaiian
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operations. Same-store gallons decreased by 5.7 percent as a result of weakness throughout SUN's retail
geography. In the Texas oil producing regions, same-store merchandise sales increased by 1.6 percent, and same-
store gallons increased 1.1 percent. Both same store merchandise sales and same store fuel sales were impacted
from a leap day in the rst quarter of last year by approximately 1.1 percent.
As of March 31, 2017, SUN operated 1,355 convenience stores and retail fuel outlets along the East Coast, in the
Southwest and in Hawaii. Third party wholesale customers totaled 7,825.
SUN's other recent accomplishments include the following:
On January 18, SUN announced it retained NRC Realty & Capital Advisors, LLC ("NRC") to assist with strategic
alternatives for approximately 100 real estate assets.
On March 30, SUN and Energy Transfer Equity, L.P. (NYSE: ETE) ("ETE") announced the completion of a private
placement of $300 million in SUN preferred equity to ETE.
On April 6, SUN announced the planned divestiture of company-operated convenience stores in the
continental United States.
SUN entered into a denitive asset purchase agreement for the sale of a majority of its company-
operated convenience stores to 7-Eleven, Inc. Total consideration in the transaction is $3.3 billion in
cash plus fuel, merchandise and other inventories. 
As part of the transaction, SUN will enter into a 15-year take-or-pay fuel supply agreement with a 7-
Eleven subsidiary under which SUN will supply approximately 2.2 billion gallons of fuel annually.
SUN retained JP Morgan Securities, LLC to manage the marketing process for the remaining
approximately 200 company-operated convenience stores in North and West Texas, New Mexico and
Oklahoma in a separate process.
SUN's segment results and other supplementary data are provided after the nancial tables below.
Distribution
On April 27, 2017 the Board of Directors of SUN's general partner declared a distribution for the rst quarter of
2017 of $0.8255 per unit, which corresponds to $3.3020 per unit on an annualized basis. This distribution was
unchanged from the fourth quarter 2016 and represented a 1.0 percent increase compared with the rst quarter of
2016. The distribution will be paid on May 16 to unitholders of record on May 9.
SUN's distribution coverage ratio for the rst quarter was 0.74 times. The distribution coverage ratio on a trailing
12-month basis was 0.88 times.
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Liquidity
At March 31, SUN had borrowings against its revolving line of credit of $761 million and other long-term debt of
$3.6 billion. Availability on the revolving credit facility after borrowings and letters of credit commitments was $718
million. In the rst quarter of 2017, SUN issued 1.3 million common units through its at-the-market equity
program, generating net proceeds of $33 million. The leverage ratio of debt to Adjusted EBITDA, calculated in
accordance with SUN's credit agreements, including the revolving credit facility and Term Loan A, was 6.31 times at
the end of the rst quarter. 
(1) Adjusted EBITDA and distributable cash ow are non-GAAP nancial measures of performance that have limitations and should not be
considered as a substitute for net income. Please refer to the discussion and tables under "Reconciliations of Non-GAAP Measures" later in this
news release for a discussion of our use of Adjusted EBITDA and distributable cash ow, and a reconciliation to net income.
Earnings Conference Call
Sunoco LP management will hold a conference call on Thursday, May 4, at 9:30 a.m. CT (10:30 a.m. ET) to discuss
rst quarter results and recent developments. To participate, dial 201-389-0877 approximately 10 minutes early
and ask for the Sunoco LP conference call. The call will also be accessible live and for later replay via webcast in the
Investor Relations section of Sunoco's website at www.SunocoLP.com under Events and Presentations.
Sunoco LP (NYSE: SUN) is a master limited partnership that operates 1,355 convenience stores and retail fuel
sites and distributes motor fuel to 7,825 convenience stores, independent dealers, commercial customers and
distributors located in 30 states. Our parent -- Energy Transfer Equity, L.P. (NYSE: ETE) -- owns SUN's general partner
and incentive distribution rights.
Forward-Looking Statements
This press release may include certain statements concerning expectations for the future that are forward-looking
statements as dened by federal law. Such forward-looking statements are subject to a variety of known and
unknown risks, uncertainties, and other factors that are dicult to predict and many of which are beyond
management's control. An extensive list of factors that can aect future results are discussed in the Partnership's
Annual Report on Form 10-K and other documents led from time to time with the Securities and Exchange
Commission. The Partnership undertakes no obligation to update or revise any forward-looking statement to reect
new information or events.
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The information contained in this press release is available on our website at www.SunocoLP.com
Qualied Notice
This release is intended to be a qualied notice under Treasury Regulation Section 1.1446-4(b). Brokers and
nominees should treat 100 percent of Sunoco LP's distributions to non-U.S. investors as being attributable to
income that is eectively connected with a United States trade or business. Accordingly, Sunoco LP's distributions
to non-U.S. investors are subject to federal income tax withholding at the highest applicable eective tax rate.
Contacts
Investors:
Scott Grischow, Senior Director – Investor Relations and Treasury
(214) 840-5660, scott.grischow@sunoco.com
Patrick Graham, Senior Analyst – Investor Relations and Finance
(214) 840-5678, patrick.graham@sunoco.com
Media:
Alyson Gomez, Director – Communications
(469) 646-1758, alyson.gomez@sunoco.com
Je Shields, Communications Manager
(215) 977-6056, je.shields@sunoco.com
– Financial Schedules Follow –
SUNOCO LP
CONSOLIDATED BALANCE SHEETS
(unaudited)
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March 31,
2017
December 31,
2016
(in millions, except units)
Assets
Current assets:
Cash and cash equivalents $ 74 $ 119
Accounts receivable, net 442 539
Receivables from aliates 13 3
Inventories, net 512 573
Other current assets 162 155
Total current assets 1,203 1,389
Property and equipment, net 3,299 3,373
Other assets:
Goodwill 2,612 2,618
Intangible assets, net 1,292 1,255
Other noncurrent assets 48 66
Total assets
$ 8,454 $ 8,701
Liabilities and equity
Current liabilities:
Accounts payable $ 438 $ 616
Accounts payable to aliates 111 109
Advances from aliates 1 87
Accrued expenses and other current liabilities 371 372
Current maturities of long-term debt 5 5
Total current liabilities 926 1,189
Revolving line of credit 761 1,000
Long-term debt, net 3,534 3,509
Deferred tax liability 626 643
Other noncurrent liabilities 178 164
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Total liabilities 6,025 6,505
Commitments and contingencies (Note 12)
Equity:
Limited partners:
Series A Preferred unitholder - aliated
 (12,000,000 units issued and outstanding as of March 31, 2017 and
 no units issued and outstanding as of December 31, 2016) 300
Common unitholders - public
 (53,704,891 units issued and outstanding as of March 31, 2017 and
 52,430,220 units issued and outstanding as of December 31, 2016) 1,458 1,467
Common unitholders - aliated
 (45,750,826 units issued and outstanding as of March 31, 2017 and
 December 31, 2016) 671 729
Class C unitholders - held by subsidiary
 (16,410,780 units issued and outstanding as of March 31, 2017 andDecember 31, 2016)
Total equity 2,429 2,196
Total liabilities and equity
$ 8,454 $ 8,701
SUNOCO LP
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(unaudited)
For the Three Months Ended March 31,
2017 2016
(in millions, except unit and per unit amounts)
Revenues:
Retail motor fuel $ 1,516 $ 1,116
Wholesale motor fuel sales to third parties 2,243 1,496
Wholesale motor fuel sales to aliates 21 7
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Merchandise 540 524
Rental income 23 22
Other 51 50
Total revenues 4,394 3,215
Cost of sales:
Retail motor fuel cost of sales 1,379 984
Wholesale motor fuel cost of sales 2,138 1,352
Merchandise cost of sales 370 358
Other 4 10
Total cost of sales 3,891 2,704
Gross prot
503 511
Operating expenses:
General and administrative 64 58
Other operating 263 249
Rent 34 33
Loss on disposal of assets 7 1
Depreciation, amortization and accretion 87 78
Total operating expenses 455 419
Income from operations
48 92
Interest expense, net 64 28
Income (loss) before income taxes (16) 64
Income tax expense (benet) (17) 2
Net income and comprehensive income $ 1 $ 62
Net income (loss) per limited partner unit:
Common - basic and diluted $ (0.22) $ 0.47
Weighted average limited partner units outstanding:
Common units - public (basic) 52,858,782 49,588,960
Common units - public (diluted) 52,965,132 49,610,314
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Common units - aliated (basic and diluted) 45,750,826 37,864,373
Cash distribution per unit
$ 0.8255 $ 0.8173
Key Operating Metrics
The following information is intended to provide investors with a reasonable basis for assessing our historical
operations but should not serve as the only criteria for predicting our future performance. We operate our business
in two primary operating divisions, wholesale and retail, both of which are included as reportable segments.
Key operating metrics set forth below are presented as of and for the three months ended March 31, 2017 and
2016 and have been derived from our historical consolidated nancial statements.
The accompanying footnotes to the following two key operating metrics tables can be found immediately preceding
our capital spending discussion.
For the Three Months Ended March 31,
2017 2016
Wholesale Retail Total Wholesale Retail Total
(dollars and gallons in millions, except motor fuel gross prot per gallon)
Revenues:
Retail motor fuel $ $ 1,516 $ 1,516 $ $ 1,116 $ 1,116
Wholesale motor fuel sales
to third parties 2,243 2,243 1,496 1,496
Wholesale motor fuel sale
to aliates 21 21 7 7
Merchandise 540 540 524 524
Rental income 19 4 23 19 3 22
Other 13 38 51 18 32 50
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Total revenues $ 2,296 $ 2,098 $ 4,394 $ 1,540 $ 1,675 $ 3,215
Gross prot:
Retail motor fuel $ $ 137 $ 137 $ $ 132 $ 132
Wholesale motor fuel 126 126 151 151
Merchandise 170 170 166 166
Rental and other 28 42 70 36 26 62
Total gross prot $ 154 $ 349 $ 503 $ 187 $ 324 $ 511
Net income (loss) and
comprehensive income
(loss)
$ 42 $ (41) $ 1 $ 87 $ (25) $ 62
Adjusted EBITDA (2) $ 155 $ 159
Distributable cash ow, as
adjusted (2) $ 77 $ 112
Operating Data:
Total motor fuel gallons sold:
Retail 595 595 608 608
Wholesale 1,313 1,313 1,233 1,233
Motor fuel gross prot cents
per gallon (1):
Retail 23.1 ¢ 23.1 ¢ 21.3 ¢ 21.3 ¢
Wholesale 10.6 ¢ 10.6 ¢ 11.4 ¢ 11.4 ¢
Volume-weighted average for
all gallons 14.5 ¢ 14.7 ¢
Retail merchandise margin 31.6% 31.7%
The following table presents a reconciliation of net income to EBITDA, Adjusted EBITDA and distributable cash ow
for the three months ended March 31, 2017 and 2016:
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For the Three Months Ended March 31,
2017 2016
Wholesale Retail Total Wholesale Retail Total
(in millions)
Net income (loss) and comprehensive
income (loss)
$ 42 $ (41) $ 1 $ 87 $ (25) $ 62
Depreciation, amortization and accretion 22 65 87 17 61 78
Interest expense, net 20 44 64 12 16 28
Income tax expense (benet) 1 (18) (17) (1) 3 2
EBITDA
$ 85 $ 50 $ 135 $ 115 $ 55 $ 170
Non-cash compensation expense 4 4 2 1 3
Loss on disposal of assets 2 5 7 1 1
Unrealized gain on commodity derivatives (5) (5) (3) (3)
Inventory adjustments 13 1 14 (11) (1) (12)
Adjusted EBITDA
$ 95 $ 60 $ 155 $ 103 $ 56 $ 159
Cash interest expense 60 27
Income tax expense (current) 2
Maintenance capital expenditures 18 19
Distributable cash ow
$ 77 $ 111
Transaction-related expenses 1
Series A Preferred distribution
Distributable cash ow, as adjusted $ 77 $ 112
_______________________________
(1) Excludes the impact of inventory fair value adjustments consistent with the denition of Adjusted EBITDA.
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(2) EBITDA is dened as earnings before net interest expense, income taxes, depreciation, amortization and accretion expense. Adjusted EBITDA
further adjusts EBITDA to reect certain other non-recurring and non-cash items. We dene Adjusted EBITDA to also include adjustments for
unrealized gains and losses on commodity derivatives and inventory fair value adjustments. We dene distributable cash ow as Adjusted
EBITDA less cash interest expense, including the accrual of interest expense related to our long-term debt that is paid on a semi-annual basis,
Series A Preferred distribution, current income tax expense, maintenance capital expenditures, and other non-cash adjustments. Further
adjustments are made to distributable cash ow for certain transaction-related and non-recurring expenses that are included in net income.
We believe EBITDA, Adjusted EBITDA and distributable cash ow are useful to investors in evaluating our operating performance because:
Adjusted EBITDA is used as a performance measure under our revolving credit facility;
securities analysts and other interested parties use such metrics as measures of nancial performance, ability to make distributions to
our unitholders and debt service capabilities;
our management uses them for internal planning purposes, including aspects of our consolidated operating budget, and capital
expenditures; and
distributable cash ow provides useful information to investors as it is a widely accepted nancial indicator used by investors to
compare partnership performance, and as it provides investors an enhanced perspective of the operating performance of our assets
and the cash our business is generating.
EBITDA, Adjusted EBITDA and distributable cash ow are not recognized terms under GAAP and do not purport to be alternatives to net income
(loss) as measures of operating performance or to cash ows from operating activities as a measure of liquidity. EBITDA, Adjusted EBITDA and
distributable cash ow have limitations as analytical tools, and one should not consider them in isolation or as substitutes for analysis of our
results as reported under GAAP. Some of these limitations include:
they do not reect our total cash expenditures, or future requirements for capital expenditures or contractual commitments;
they do not reect changes in, or cash requirements for, working capital;
they do not reect interest expense or the cash requirements necessary to service interest or principal payments on our revolving credit
facility or term loan;
although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be
replaced in the future, and EBITDA and Adjusted EBITDA do not reect cash requirements for such replacements; and
as not all companies use identical calculations, our presentation of EBITDA, Adjusted EBITDA and distributable cash ow may not be
comparable to similarly titled measures of other companies.
Capital Spending
SUN's gross capital expenditures for the rst quarter were $66 million, which included $48 million for growth capital
and $18 million for maintenance capital. Approximately $14.4 million of the growth capital spent was for the
construction of new-to-industry sites, of which 10 opened in the rst quarter. The construction of all 10 of these
sites started in 2016.
Excluding acquisitions, SUN expects approximately $150 million to be spent on growth capital and approximately
$90 million to be spent on maintenance capital for the full year 2017.
Growth capital spending includes the rebuilding of locations SUN is operating on the Indiana Toll Road.
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/sunoco-lp-
announces-rst-quarter-nancial-and-operating-results-300451056.html
SOURCE Sunoco LP
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