Sunoco LP Announces Fourth Quarter and Full Year 2020
Financial and Operating Results
DALLAS, Feb. 17, 2021 /PRNewswire/ --Sunoco LP (NYSE: SUN) ("SUN" or the "Partnership") today reported
nancial and operating results for the three- and twelve-month periods ended December 31, 2020.
For the three months ended December 31, 2020, net income was $83 million versus $83 million in the fourth
quarter of 2019.
Adjusted EBITDA(1) for the quarter totaled $159 million compared with $168 million in the fourth quarter of 2019.
This year-over-year decrease reects lower reported fuel volume and margins partially oset by a decline in
operating expenses(2).
Distributable Cash Flow, as adjusted(1), for the quarter was $97 million, compared to $120 million a year ago.
The Partnership sold 1.8 billion gallons in the fourth quarter of 2020, down 12% from the fourth quarter of 2019.
Fuel margin for all gallons sold was 9.2 cents per gallon for the quarter compared to 9.9 cents per gallon a year
ago. In the fourth quarter of 2020, fuel margin included approximately $8 million of one-time write-os
associated with prior period fuel tax and inventory related items. In addition, fourth quarter margin included an
unfavorable timing impact of approximately $9 million related to SUN's inventory valuation and associated
hedges. For the full year 2020, the impact of this inventory valuation and hedging activity resulted in
approximately $2 million of margin favorability.
For the twelve months ended December 31, 2020, net income was $212 million versus $313 million in 2019.
Adjusted EBITDA(1) for the full year 2020 totaled $739 million, up 11% from $665 million a year ago. This year-
over-year increase reects higher reported fuel margins of 11.9 cents per gallon compared to 10.1 cents per
gallon a year ago and a 11% decline in operating expenses(2) partially oset by a 13% reduction in gallons sold to
7.1 billion.
Distributable Cash Flow, as adjusted(1), for the full year 2020 was $517 million, compared to $453 million a year
ago.
Recent Accomplishments and Business Outlook
Generated record Adjusted EBITDA of $739 million in 2020, up 11% from full year 2019, and continued to
strengthen leverage and coverage metrics with leverage of 4.18 timesand trailing twelve months coverage of
1.50 timesat the end of 2020.
Completed a private oering of $800 million 4.500% Senior Notes due 2029 on November 9, 2020. SUN used
the proceeds from the oering to fund the cash tender oer for its 4.875% Senior Notes due 2023. SUN
redeemed the remaining 4.875% Senior Notes due 2023 on January 15, 2021.
Acquired a terminal in New York on December 15, 2020 for approximately $12 million plus working capital
adjustments. The acquisition was funded with cash on hand and amounts available on SUN's revolving credit
1
facility. The approximately 350,000 barrel rened products waterborne terminal is consistent with SUN's
strategy of expanding the midstream portfolio and providing further income diversication and stability.
SUN expects the acquisition to be accretive to unitholders in the rst year.
The Partnership expects full year 2021 Adjusted EBITDA to be between $725 and $765 million. SUN expects
2021 fuel volumes to be between 7.25 and 7.75 billion gallons, fuel margins to be between 11.0 and 12.0
cents per gallon, operating expenses(2) in a range of $440 to $450 million, growth capital expenditures of at
least $120 million, and maintenance capital expenditures of approximately $45 million.
Distribution and Coverage
On January 28, 2021, the Board of Directors of SUN's general partner declared a distribution for the fourth quarter
of 2020 of $0.8255 per unit, which corresponds to $3.3020 per unit on an annualized basis. The distribution will
be paid on February 19, 2021 to common unitholders of record on February 8, 2021. Current quarter cash
coverage was 1.13times and trailing twelve months coverage was 1.50times.
Liquidity and Leverage
At December 31, 2020, SUN had no borrowings against its revolving credit facility and other long-term debt of $3.1
billion. The Partnership maintained ample liquidity of approximately $1.5billion at the end of the quarter under
its $1.5 billion revolving credit facility that matures in July 2023 and has no Senior Notes maturities prior to 2026.
SUN's leverage ratio of net debt to Adjusted EBITDA, calculated in accordance with its credit facility, was 4.18times
at the end of the fourth quarter compared to 4.61 times at the end of the fourth quarter of 2019.
Capital Spending
SUN's gross capital expenditures for the fourth quarter were $45 million, which included $25 million for growth
capital and $20 million for maintenance capital. For the full year 2020, the Partnership spent $124 million on
gross capital expenditures, which included $89 million on growth capital and $35 million on maintenance capital.
SUN's segment results and other supplementary data are provided after the nancial tables below.
(1) Adjusted EBITDA and Distributable Cash Flow, as adjusted, 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 Flow, as adjusted, and a reconciliation to net income.
(2) Operating expenses include general and administrative, other operating and lease expenses.
Earnings Conference Call
Sunoco LP management will hold a conference call on Thursday, February 18, at 8:00 a.m. CT (9:00 a.m. ET) to
discuss results and recent developments. To participate, dial 877-407-6184(toll free) or 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 Webcasts and Presentations.
2
Sunoco LP (NYSE: SUN)is a master limited partnership with core operations that include the distribution of motor
fuel to approximately 10,000 convenience stores, independent dealers, commercial customers and distributors
located in more than 30 states as well as rened product transportation and terminalling assets. SUN's general
partner is owned by Energy Transfer Operating, L.P., a wholly owned subsidiary of Energy Transfer LP (NYSE: ET).
Forward-Looking Statements
This news 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. In addition to the risks and uncertainties previously disclosed, the Partnership has also been, or
may in the future be, impacted by new or heightened risks related to the COVID-19 pandemic and the recent
decline in commodity prices, and we cannot predict the length and ultimate impact of those risks. The
Partnership undertakes no obligation to update or revise any forward-looking statement to reect new
information or events.
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, Vice President – Investor Relations and Treasury
(214) 840-5660, scott.grischow@sunoco.com
Derek Rabe, CFA, Manager – Investor Relations, Strategy and Growth
(214) 840-5553, derek.rabe@sunoco.com
Media:
Alexis Daniel, Manager – Communications
(214) 981-0739, alexis.daniel@sunoco.com
– Financial Schedules Follow –
SUNOCO LP
CONSOLIDATED BALANCE SHEETS
3
(Dollars in millions)
(unaudited)
December 31,
2020
December 31,
2019
Assets
Current assets:
Cash and cash equivalents
$ 97
$ 21
Accounts receivable, net
295
399
Receivables from aliates
11
12
Inventories, net
382
419
Other current assets
62
73
Total current assets 847
924
Property and equipment 2,231
2,134
Accumulated depreciation (806)
(692)
Property and equipment, net
1,425
1,442
Other assets:
Finance lease right-of-use assets, net
3
29
Operating lease right-of-use assets, net
536
533
Goodwill
1,564
1,555
Intangible assets, net
588
646
Other noncurrent assets
168
188
Investment in unconsolidated aliate
136
121
Total assets
$ 5,267
$ 5,438
Liabilities and equity
Current liabilities:
Accounts payable
$ 267
$ 445
Accounts payable to aliates
79
49
Accrued expenses and other current liabilities
282
219
Operating lease current liabilities
19
20
Current maturities of long-term debt
6
11
Total current liabilities 653
744
Operating lease non-current liabilities 538 530
4
Revolving line of credit
162
Long-term debt, net 3,106
2,898
Advances from aliates 125
140
Deferred tax liability 104
109
Other noncurrent liabilities 109
97
Total liabilities 4,635
4,680
Commitments and contingencies
Equity:
Limited partners:
Common unitholders
 (83,333,631 units issued and outstanding as of December 31, 2020 and
 82,985,941 units issued and outstanding as of December 31, 2019) 632
758
Class C unitholders - held by subsidiary
 (16,410,780 units issued and outstanding as of December 31, 2020 and
 December 31, 2019)
Total equity 632
758
Total liabilities and equity
$ 5,267
$ 5,438
SUNOCO LP
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Dollars in millions, except per unit data)
(unaudited)
Three Months Ended
December 31,
Year Ended
December 31,
2020
2019
2020
2019
Revenues:
Motor fuel sales
$ 2,463
$ 4,002
$ 10,332
$ 16,176
Non motor fuel sales
55
61
240
278
Lease income
35
35
138
142
Total revenues 2,553 4,098 10,710 16,596
5
Cost of sales and operating expenses:
Cost of sales
2,271
3,813
9,654
15,380
General and administrative
25
35
112
136
Other operating
56
68
275
304
Lease expense
15
16
61
61
Loss (gain) on disposal of assets and impairment charges
(5)
22
2
68
Depreciation, amortization and accretion
47
46
189
183
Total cost of sales and operating expenses 2,409
4,000
10,293
16,132
Operating income 144
98
417
464
Other income (expense):
Interest expense, net
(44)
(43)
(175)
(173)
Other income (expense), net
2
2
3
Equity in earnings of unconsolidated aliate
2
2
5
2
Loss on extinguishment of debt
(13)
(13)
Income before income taxes 91
57
236
296
Income tax expense (benet)
8
(26)
24
(17)
Net income and comprehensive income
$ 83
$ 83
$ 212
$ 313
Net income per common unit:
Common units - basic
$ 0.78
$ 0.76
$ 1.63
$ 2.84
Common units - diluted
$ 0.77
$ 0.75
$ 1.61
$ 2.82
Weighted average limited partner units
outstanding:
Common units - basic
83,147,345
82,813,411
83,062,159
82,755,520
Common units - diluted
83,912,647
83,713,959
83,716,464
83,551,962
Cash distribution per unit $ 0.8255
$ 0.8255
$ 3.30
$ 3.30
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.
The key operating metrics by segment and accompanying footnotes set forth below are presented for the three
6
months and years ended December 31, 2020 and 2019 and have been derived from our historical consolidated
nancial statements.
Three Months Ended December 31,
2020
2019
Fuel
Distribution
and
Marketing
All Other
Total
Fuel
Distribution
and
Marketing
All Other
Total
(dollars and gallons in millions, except gross prot per gallon)
Revenues:
Motor fuel sales
$ 2,361
$ 102
$ 2,463
$ 3,846
$ 156
$ 4,002
Non motor fuel sales
8
46
54
13
48
61
Lease income
38
(3)
35
37
(2)
35
Total revenues $ 2,407
$ 145
$ 2,552
$ 3,896
$ 202
$ 4,098
Gross prot (1):
Motor fuel sales
$ 198
$ 14
$ 212
$ 193
$ 20
$ 213
Non motor fuel sales
13
22
35
13
24
37
Lease
38
(3)
35
37
(2)
35
Total gross prot $ 249
$ 33
$ 282
$ 243
$ 42
$ 285
Net income and comprehensive income $ 97
$ (14)
$ 83
$ 57
$ 26
$ 83
Adjusted EBITDA (2) $ 157
$ 2
$ 159
$ 147
$ 21
$ 168
Operating Data:
Total motor fuel gallons sold
1,829
2,087
Motor fuel gross prot cents per gallon (3)
9.2 ¢
9.9 ¢
Year Ended December 31,
2020 2019
7
Fuel
Distribution
and
Marketing
All
Other
Total
Fuel
Distribution
and
Marketing
All
Other
Total
(dollars and gallons in millions, except gross prot per gallon)
Revenues:
Motor fuel sales
$ 9,930
$ 402
$ 10,332
$ 15,522
$ 654
$ 16,176
Non motor fuel sales
54
186
240
62
216
278
Lease income
127
11
138
131
11
142
Total revenues $ 10,111
$ 599
$ 10,710
$ 15,715
$ 881
$ 16,596
Gross prot (1):
Motor fuel sales
$ 691
$ 73
$ 764
$ 817
$ 89
$ 906
Non motor fuel sales
48
106
154
53
115
168
Lease
127
11
138
131
11
142
Total gross prot $ 866
$ 190
$ 1,056
$ 1,001
$ 215
$ 1,216
Net income and comprehensive income $ 208
$ 4
$ 212
$ 290
$ 23
$ 313
Adjusted EBITDA (2) $ 654
$ 85
$ 739
$ 545
$ 120
$ 665
Operating Data:
Total motor fuel gallons sold
7,094
8,193
Motor fuel gross prot cents per gallon (3)
11.9 ¢
10.1 ¢
The following table presents a reconciliation of Adjusted EBITDA to net income and Adjusted EBITDA to
Distributable Cash Flow, as adjusted, for the three months and years ended December 31, 2020 and 2019:
Three Months Ended
December 31,
Year Ended
December 31,
2020
2019
2020
2019
(in millions)
(in millions)
Adjusted EBITDA
Fuel distribution and marketing
$ 157
$ 147
$ 654
$ 545
All other
2
21
85
120
159 168 739 665
8
Total Adjusted EBITDA
Depreciation, amortization and accretion
(47)
(46)
(189)
(183)
Interest expense, net
(44)
(43)
(175)
(173)
Non-cash unit-based compensation expense
(3)
(3)
(14)
(13)
(Loss) gain on disposal of assets and impairment charges
5
(22)
(2)
(68)
Loss on extinguishment of debt
(13)
(13)
Unrealized gain (loss) on commodity derivatives
(6)
1
(6)
5
Inventory adjustments
44
8
(82)
79
Equity in earnings of unconsolidated aliate
2
2
5
2
Adjusted EBITDA related to unconsolidated aliate
(3)
(3)
(10)
(4)
Other non-cash adjustments
(3)
(5)
(17)
(14)
Income tax (expense) benet
(8)
26
(24)
17
Net income and comprehensive income
$ 83
$ 83
$ 212
$ 313
Adjusted EBITDA (2) $ 159
$ 168
$ 739
$ 665
Adjusted EBITDA related to unconsolidated aliate
3
3
10
4
Distributable cash ow from unconsolidated aliate
(3)
(3)
(10)
(4)
Cash interest expense
42
41
168
166
Current income tax expense (benet)
(41)
19
(22)
Transaction-related income taxes
31
31
Maintenance capital expenditures
20
17
35
40
Distributable Cash Flow 97
120
517
450
Transaction-related expenses
3
Distributable Cash Flow, as adjusted (2)
$ 97
$ 120
$ 517
$ 453
Distributions to Partners:
Limited Partners $ 69
$ 69
$ 274
$ 273
General Partners 18
18
71
72
Total distributions to be paid to partners
$ 87
$ 87
$ 345
$ 345
Common Units outstanding - end of period 83.3
83.0
83.3
83.0
Distribution coverage ratio (4)
1.13x
1.39x
1.50x
1.32x
___________________________
9
(1) Excludes depreciation, amortization and accretion.
(2) Adjusted EBITDA is dened as earnings before net interest expense, income taxes, depreciation, amortization and accretion
expense, allocated non-cash compensation expense, unrealized gains and losses on commodity derivatives and inventory
adjustments, and certain other operating expenses reected in net income that we do not believe are indicative of ongoing
core operations, such as gain or loss on disposal of assets and non-cash impairment charges. We dene Distributable Cash
Flow, as adjusted, as Adjusted EBITDA less cash interest expense, including the accrual of interest expense related to our
long-term debt which is paid on a semi-annual basis, current income tax expense, maintenance capital expenditures and
other non-cash adjustments.
We believe Adjusted EBITDA and Distributable Cash Flow, as adjusted, 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 Flow, as adjusted, 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.
Adjusted EBITDA and Distributable Cash Flow, as adjusted, 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. Adjusted EBITDA and Distributable Cash Flow, as adjusted, 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 Adjusted EBITDA does not reect cash requirements for such
replacements; and
as not all companies use identical calculations, our presentation of Adjusted EBITDA and Distributable Cash
Flow, as adjusted, may not be comparable to similarly titled measures of other companies.
Adjusted EBITDA reects amounts for the unconsolidated aliate based on the same recognition and
measurement methods used to record equity in earnings of unconsolidated aliate. Adjusted EBITDA related to
unconsolidated aliate excludes the same items with respect to the unconsolidated aliate as those excluded
from the calculation of Adjusted EBITDA, such as interest, taxes, depreciation, depletion, amortization and other
non-cash items. Although these amounts are excluded from Adjusted EBITDA related to unconsolidated aliate,
such exclusion should not be understood to imply that we have control over the operations and resulting
revenues and expenses of such aliate. We do not control our unconsolidated aliate; therefore, we do not
control the earnings or cash ows of such aliate. The use of Adjusted EBITDA or Adjusted EBITDA related to
unconsolidated aliate as an analytical tool should be limited accordingly. Inventory adjustments that are
10
excluded from the calculation of Adjusted EBITDA represent changes in lower of cost or market reserves on the
Partnership's inventory. These amounts are unrealized valuation adjustments applied to fuel volumes remaining
in inventory at the end of the period.
(3) Excludes the impact of inventory adjustments consistent with the denition of Adjusted EBITDA.
(4) The distribution coverage ratio for a period is calculated as Distributable Cash Flow attributable to partners, as adjusted,
divided by distributions expected to be paid to partners of Sunoco LP in respect of such a period.
View original content to download multimedia:http://www.prnewswire.com/news-releases/sunoco-lp-
announces-fourth-quarter-and-full-year-2020-nancial-and-operating-results-301230156.html
SOURCE Sunoco LP
11