We believe Adjusted EBITDA and Distributable Cash Flow, as adjusted, are useful to investors in evaluating our operating
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
they do not reect our total cash expenditures, or future requirements for capital expenditures or contractual
they do not reect changes in, or cash requirements for, working capital;
they do not reect 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 reect 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 reects amounts for the unconsolidated aliate based on the same recognition and measurement methods
used to record equity in earnings of unconsolidated aliate. Adjusted EBITDA related to unconsolidated aliate excludes the
same items with respect to the unconsolidated aliate 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 aliate, such exclusion should not be understood to imply that we have control over
the operations and resulting revenues and expenses of such aliate. We do not control our unconsolidated aliate; therefore,
we do not control the earnings or cash ows of such aliate. The use of Adjusted EBITDA or Adjusted EBITDA related to
unconsolidated aliate as an analytical tool should be limited accordingly. Inventory adjustments that are 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 denition 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.
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