Susser Petroleum Partners LP Reports First Quarter 2013 Results

       Susser Petroleum Partners LP Reports First Quarter 2013 Results

Declares Quarterly Distribution

Investor Call Scheduled Today at 11 a.m. ET

PR Newswire

HOUSTON, May 8, 2013

HOUSTON, May 8, 2013 /PRNewswire/ --Susser Petroleum Partners LP (NYSE:
SUSP), a wholesale distributor of motor fuels, today reported financial and
operating results for the first quarter ended March 31, 2013.

Net income for the quarter was $8.2 million, or $0.38 per unit. Adjusted
EBITDA^(1) totaled $11.2 million and distributable cash flow^(1) was $10.4
million. Total revenue for the quarter was $1,081.2 million.

"Results from the Partnership continue to be in line with our expectations,"
said Sam L. Susser, Chairman and Chief Executive Officer. "Gross profit
benefited from year-over-year growth of 4.4% in total gallons distributed as
well as an increase in average margin per gallon sold.

"The purchase and leaseback arrangement with Susser Holdings continues to
provide the Partnership with a growing stream of stable fuel gross profit and
a real estate portfolio that will generate visible rental income and the
potential for long-term asset appreciation."

First Quarter 2013 Compared to Pro Forma First Quarter 2012

The analysis below compares actual first quarter 2013 results to pro forma
first quarter 2012 results. The pro forma results reflect revenues and gross
margins as if the Partnership had completed its initial public offering and
related transactions and had been operating as an independent entity under its
current contractual arrangements with affiliates since January 1, 2012.
Please refer to the section below titled, "Factors Affecting Comparability and
Explanation of Pro Forma Results" for additional information.

Revenue for the first quarter totaled $1,081.2 million, a 0.4% increase
compared to $1,076.5 million (pro forma) in the comparable period of 2012. The
increase was driven by a 4.4% increase in gallons sold, partially offset by a
decline in selling price per gallon. In the first quarter of 2013, 67.6% of
revenues were generated from motor fuel sales to affiliates, 32.1% were from
motor fuel sales to other third-parties, and 0.3% came from rental and other
income.

Gross profit for the quarter totaled $15.6 million, a 15.2% increase compared
to pro forma gross profit of $13.5 million in the first quarter of 2012. On a
weighted average basis, fuel margin for all gallons sold increased to 3.6
cents per gallon in the first quarter of 2013 compared to pro forma 3.4 cents
per gallon in the prior-year period.

Affiliate customers as of March 31 include 562 Stripes convenience stores
operated by our parent company, Susser Holdings Corporation (NYSE: SUSS), as
well as SUSS' sales of motor fuel under consignment arrangements at
approximately 90 independently operated convenience stores. Motor fuel
gallons sold to affiliates during the first quarter increased 5.7% versus the
prior-year period to 251.1 million gallons. Gross profit on these gallons
totaled $7.4 million, or 3.0 cents per gallon, versus a pro forma $7.1 million
in the comparable three-month period last year, or 3.0 cents per gallon.

Third-party customers of SUSP include approximately 490 independent dealers
under long-term fuel supply agreements and over 1,700 other commercial
customers as of March 31. Total gallons of motor fuel sold to third parties
increased year-over-year by 1.7% to 115.8 million gallons for the quarter.
Gross profit on these gallons was $5.8 million, or 5.0 cents per gallon,
compared to $4.8 million, or 4.2 cents per gallon, in the prior-year period on
a pro forma basis.

Capital Spending and Financing

SUSP completed purchase and leaseback transactions for six Stripes convenience
stores during the first quarter and two more so far in the second quarter.
Since its initial public offering in September 2012, SUSP has completed the
purchase and leaseback of 16 Stripes stores for a cumulative cost of $65.4
million, including post-completion true-up.

Including the Stripes store purchases, SUSP's gross capital expenditures for
the first quarter were $27.9 million, which included $0.1 million for
maintenance capital. At March 31, SUSP had borrowings against its revolving
line of credit of $58.6 million and other long-term debt of $123.2 million, a
portion of which was collateralized by $122.3 million of marketable
securities.

2013 Guidance

SUSP's management team is reaffirming the following previously issued guidance
for 2013. Please refer to disclosures below regarding forward-looking
statements.

                                                        FY 2013     Q1 2013

                                                        Guidance    Actual
Motor Fuel Gallons (billions) (a)                       1.45 - 1.60 0.37
Fuel Margin (cents/gallon) (a)                          3.3 - 3.5   3.6
New Stripes stores expected to be purchased by SUSP (b) 25 - 35     6
New Wholesale dealer and consignment sites (c)          25 - 40     5
Maintenance Capital Spending (millions)                 $1 - $3     $0.1
Expansion Capital Spending (millions) (d)               $95-$135    $27.8

(a) Includes affiliated and third-party gallons.
(b) Based on Susser Holdings Corporation guidance of 29 - 35 new Stripes
     stores to be built in 2013.
(c) Does not reflect existing wholesale store closures, which are typically
     lower volume locations than new sites.
(d) Expansion capital includes Stripes store purchases. The Partnership does
     not provide guidance on potential acquisitions.
     Adjusted EBITDA and distributable cash flow are non-GAAP financial
     measures of performance that have limitations and should not be
     considered as a substitute for net income. Please refer to the discussion
(1)  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, and reconciliation to net income for the periods
     presented.



Quarterly Distribution

SUSP announced today that the board of directors of its general partner has
approved its quarterly distribution for the first quarter of 2013 of $0.4375
per unit. This amount corresponds to $1.75 per unit on an annualized basis.
The total distribution amount of approximately $9.6 million is being paid from
distributable cash flow of $10.4 million for the quarter.

The distribution will be paid on May 30 to unitholders of record on May 20.
Immediately prior to the distribution there will be 21,878,872 units
outstanding, including all of the Partnership's common and subordinated units.

Factors Affecting Comparability and Explanation of Pro Forma Results

SUSP completed its initial public offering of common units representing
limited partner interests on September 25, 2012. Reported results of
operations for the three-month period ending March 31, 2012 reflect the
results of Susser Petroleum Company LLC, the Partnership's "Predecessor".
Prior to September 25, 2012, the Predecessor did not charge intercompany gross
profit on motor fuel sales to Susser Holdings' Stripes® convenience stores.
Additionally, not all of the wholesale operations of the Predecessor were
contributed to SUSP, such as consignment location fuel sales and the fuel
transportation assets and operations. As a result, actual operating results
are not comparable on a period-to-period basis.

Selected supplemental pro forma information is being provided which reflects
certain SUSP results as if the current structure and contracts had been in
place on January 1, 2012. The pro forma results show actual gallons sold but
reflect revenues and gross margins as if the Partnership had completed its
initial public offering and related transactions and had been operating as an
independent entity under its current contractual arrangements with affiliates
since January 1, 2012. Additional details regarding our pro forma adjustments
are included in the attached tables. Management believes the pro forma
presentation provides investors with a more relevant comparison to historical
and future periods as opposed to actual results.

First Quarter Earnings Conference Call

Susser's management team will hold a conference call today at 11:00 a.m. ET
(10:00 a.m. CT) to discuss first quarter 2013 results for both Susser Holdings
Corporation and Susser Petroleum Partners LP. To participate in the call, dial
480-629-9771 10 minutes early and ask for the Susser conference call. The call
will also be accessible live and for later replay via webcast in the Investor
Relations section of Susser Holdings' web site at www.susser.com and Susser
Petroleum Partners' web site at www.susserpetroleumpartners.com under Events
and Presentations. A telephone replay will be available through May 15 by
calling 303-590-3030 and using the pass code 4614394#.

About Susser Petroleum Partners LP

Houston-based Susser Petroleum Partners LP is a publicly-traded partnership
formed by Susser Holdings Corporation to engage in the primarily fee-based
wholesale distribution of motor fuels to Susser Holdings and third parties.
Susser Petroleum Partners distributes over 1.4 billion gallons of motor fuel
annually from major oil companies and independent refiners to Susser Holdings'
Stripes® convenience stores, independently operated consignment locations,
convenience stores and retail fuel outlets operated by independent operators
and other commercial customers in Texas, New Mexico, Oklahoma and Louisiana.

Forward-Looking Statements

This news release contains "forward-looking statements." These statements are
based on current plans and expectations and involve a number of risks and
uncertainties that could cause actual results and events to vary materially,
including but not limited to: Susser Holdings' business strategy, operations
and conflicts of interest with us; our ability to renew or renegotiate our
long-term distribution contracts with our customers; changes in the price of
and demand for the motor fuel that we distribute; our dependence on two
principal suppliers; competition in the wholesale motor fuel distribution
industry; seasonal trends; increased costs; our ability to make acquisitions;
environmental laws and regulations; dangers inherent in the storage of motor
fuel; our reliance on SHC for transportation services; and other unforeseen
factors. For a full discussion of these and other risks and uncertainties,
refer to the "Risk Factors" section of the Partnership's most recently filed
annual report on Form 10-K and subsequent quarterly filings. These
forward-looking statements are based on and include our estimates as of the
date hereof. Subsequent events and market developments could cause our
estimates to change. While we may elect to update these forward-looking
statements at some point in the future, we specifically disclaim any
obligation to do so, even if new information becomes available, except as may
be required by applicable law.

Qualified Notice

This release is intended to be a qualified notice under Treasury Regulation
Section 1.1446-4(b). Brokers and nominees should treat 100 percent of Susser
Petroleum Partners' distributions to non-U.S. investors as being attributable
to income that is effectively connected with a United States trade or
business. Accordingly, Susser Petroleum Partners' distributions to non-U.S.
investors are subject to federal income tax withholding at the highest
applicable effective tax rate.

Financial statements follow

Pro Forma Results

The following presentationcompares actual first quarter 2013 results tothe
pro forma revenues and gross profit for SUSP in the first quarter of 2012 had
the transactions and contracts related to the IPO occurred as of January 1,
2012. Specifically, the following pro forma schedules give effect to:

  othe contribution by our Predecessor to us of substantially all of the
    assets and operations comprising its wholesale motor fuel distribution
    business (other than its motor fuel consignment business and
    transportation assets and substantially all of its accounts receivable and
    payable);
  othe contribution by SUSS and our Predecessor to us of certain convenience
    store properties;
  oour entry into a fuel distribution contract with SUSS, which provides (i)
    a three cent fixed profit margin on the motor fuel distributed to SUSS for
    its Stripes® convenience stores, instead of no margin historically
    reflected in our Predecessor financial statements and (ii) a three cent
    fixed profit margin on all volumes sold to SUSS for its independently
    operated consignment locations, instead of the variable and higher margin
    received by our Predecessor under consignment contracts; and
  oour entry into the SUSS Transportation Contract and the elimination of
    revenues and costs associated with the transportation business that were
    included in our Predecessor's results of operations.

As used in the following table, "affiliates" refers to sales to SUSS for its
Stripes® convenience stores and independently operated consignment locations;
"third-party" refers to sales to independently operated dealer supply
locations and other commercial customers.

                                                   

                                                   Three Months Ended
                                                   March 31,    March 31,

                                                   2012         2013
                                                   Pro Forma    Actual
                                                   (in thousands)
Revenues:
Motor fuel sales to third parties                  $ 351,845  $ 347,504
Motor fuel sales to affiliates                     722,496    730,727
Rental income                                      839        1,629
Other income                                       1,352      1,299
Total revenue                                      1,076,532  1,081,159
Gross profit:
Motor fuel sales to third parties                  4,813      5,797
Motor fuel sales to affiliates                     7,123      7,418
Rental income                                      839        1,629
Other                                              729        712
Total gross profit                                 $ 13,504   $ 15,556
Operating Data:
Motor fuel gallons sold:
Third-party dealers and other commercial customers 113,927    115,831
Affiliated gallons                                 237,441    251,052
Total gallons sold                                 351,368    366,883
Motor fuel gross profit cents per gallon:
Third-party                                        4.2 ¢      5.0¢
Affiliated                                         3.0¢      3.0¢
Volume-weighted average for all gallons            3.4¢      3.6¢







Susser Petroleum Partners LP
Consolidated Statements of Operations
Unaudited
                               Three Months Ended
                               March31,                 March31,

                               2012                      2013
                               Predecessor
                               (dollars in thousands, except unit and per unit
                               amounts)
Revenues:
Motor fuel sales to third      $     438,801        $    347,504
parties
Motor fuel sales to affiliates 630,444              730,727
Rental income                  1,364                1,629
Other income                   2,045                1,299
Total revenues                 1,072,654            1,081,159
Cost of sales:
Motor fuel cost of sales to    431,689              341,707
third parties
Motor fuel cost of sales to    630,444              723,309
affiliates
Other                          638                  587
Total cost of sales            1,062,771            1,065,603
Gross profit                   9,883                15,556
Operating expenses:
General and administrative     2,649                3,899
Other operating                1,436                631
Rent                           1,070                204
Loss on disposal of assets     111                  22
Depreciation, amortization and 1,884                1,821
accretion
Total operating expenses       7,150                6,577
Income from operations         2,733                8,979
Interest expense, net          (87)                 (683)
Income before income taxes     2,646                8,296
Income tax expense             (972)                (69)
Net income and comprehensive   $     1,674          $    8,227
income
Net income per limited partner
unit:
Common                                              $    0.38
Subordinated                                        $    0.38
Limited partner units
outstanding:
Common units - public                                    10,925,000
Common units - affiliated                                14,436
Subordinated units -                                     10,939,436
affiliated
Cash distribution per unit                          $    0.4375





Susser Petroleum Partners LP
Consolidated Balance Sheets
                                                      December31,   March31,

                                                      2012           2013
                                                                     unaudited
                                                      (inthousands)
Assets
Current assets:
Cash and cash equivalents                             $  6,752     $ 9,325
Accounts receivable, net of allowance for doubtful
accounts of $103 at December 31, 2012, and $189 at    33,008       41,549
March 31, 2013
Receivables from affiliates                           59,543       57,301
Inventories, net                                      2,981        24,008
Other current assets                                  821          147
Total current assets                                  103,105      132,330
Property and equipment, net                           68,173       94,749
Other assets:
Marketable securities                                 148,264      122,267
Goodwill                                              12,936       12,936
Intangible assets, net                                23,131       22,469
Other noncurrent assets                               191          172
Total assets                                          $  355,800   $ 384,923
Liabilities and unitholders' equity
Current liabilities:
Accounts payable                                      $  88,884    $ 119,552
Accrued expenses and other current liabilities        1,101        3,725
Current maturities of long-term debt                  24           24
Total current liabilities                             90,009       123,301
Revolving line of credit                              35,590       58,600
Long-term debt                                        149,241      123,135
Deferred tax liability, long-term portion             152          152
Other noncurrent liabilities                          2,476        2,344
Total liabilities                                     277,468      307,532
Commitments and contingencies:
Unitholders' equity:
Susser Petroleum Partners LP unitholders' equity:
Common unitholders - public (10,925,000 units issued  210,462      209,852
and outstanding)
Common unitholders - affiliated (14,436 units issued  (175)        (175)
and outstanding)
Subordinated unitholders - affiliated (10,939,436     (131,955)    (132,286)
units issued and outstanding)
Total unitholders' equity                             78,332       77,391
Total liabilities and unitholders' equity             $  355,800   $ 384,923

Key Operating Metrics

The following table sets forth, for the periods indicated, information
concerning key measures we rely on to gauge our operating performance.
Historical results include our Predecessor's results of operations. 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.

                           Three Months Ended
                           March 31,                          March31,

                           2012(1)                            2013
                           Predecessor
                           (in thousands, except for selling price and cents
                           per gallon)
Revenues:
Motor fuel sales to third  $       438,801             $      347,504
parties (2)
Motor fuel sales to        630,444                     730,727
affiliates (2)
Rental income              1,364                       1,629
Other income               2,045                       1,299
Total revenue              1,072,654                   1,081,159
Gross profit:
Motor fuel gross profit to 7,112                       5,797
third parties (2)
Motor fuel gross profit to —                           7,418
affiliates (2)
Rental income              1,364                       1,629
Other                      1,407                       712
Total gross profit         $       9,883               $      15,556
Net income                 $       1,674               $      8,227
Adjusted EBITDA(3)         $       4,917               $      11,227
Distributable cash flow                                $      10,435
(3)
Operating Data:
Total motor fuel gallons
sold:
Third-party                141,582                     115,831
Affiliated gallons         209,786                     251,052
Average wholesale selling  $       3.04                $      2.94
price per gallon
Motor fuel gross profit
cents per gallon (2):
Third-party                5.0 ¢                       5.0¢
Affiliated                 0.0¢                       3.0¢
Volume-weighted average    2.0¢                       3.6¢
for all gallons

(1) Results represent Predecessor.

(2)For the first quarter 2012, affiliated sales only include sales to
Stripes® convenience stores, for which our Predecessor historically received
no margin, and third-party motor fuel sales and gross profit cents per gallon
includes the motor fuel sold directly to independently operated consignment
locations, as well as sales to third-party dealers and other commercial
customers. Following our IPO on September 25, 2012, we sell fuel to SUSS for
both Stripes® convenience stores and SUSS' independently operated consignment
locations at a fixed profit margin of approximately three cents per gallon,
and these sales are classified as affiliated sales.

(3) We define EBITDA as net income before net interest expense, income tax
expense and depreciation and amortization expense. Adjusted EBITDA further
adjusts EBITDA to reflect certain other non-recurring and non-cash items. We
define distributable cash flow as Adjusted EBITDA less cash interest expense,
cash state franchise tax expense, maintenance capital expenditures, and other
non-cash adjustments. EBITDA, Adjusted EBITDA and distributable cash flow are
not financial measures calculated in accordance with GAAP.

We believe EBITDA, Adjusted EBITDA and distributable cash flow are useful to
investors in evaluating our operating performance because:

  oAdjusted EBITDA is used as a performance measure under our revolving
    credit facility;
  osecurities analysts and other interested parties use such metrics as
    measures of financial performance, ability to make distributions to our
    unitholders and debt service capabilities;
  othey are used by our management for internal planning purposes, including
    aspects of our consolidated operating budget, and capital expenditures;
    and
  odistributable cash flow provides useful information to investors as it is
    a widely accepted financial indicator used by investors to compare
    partnership performance, 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 flow are not recognized terms
under GAAP and do not purport to be alternatives to net income (loss) as
measures of operating performance. EBITDA, Adjusted EBITDA and distributable
cash flow 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:

  othey do not reflect our total cash expenditures, or future requirements,
    for capital expenditures or contractual commitments;
  othey do not reflect changes in, or cash requirements for, working capital;
  othey do not reflect interest expense, or the cash requirements necessary
    to service interest or principal payments on our revolving credit
    facility or term loan;
  oalthough 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 reflect cash requirements
    for such replacements; and
  obecause not all companies use identical calculations, our presentation of
    EBITDA, Adjusted EBITDA and distributable cash flow may not be comparable
    to similarly titled measures of other companies.

The following table presents a reconciliation of net income to EBITDA,
Adjusted EBITDA and distributable cash flow:

                                                 Three Months Ended
                                                 March31,    March31,

                                                 2012         2013
                                                 Predecessor
                                                 (in thousands)
Net income                                       $   1,674    $ 8,227
Depreciation, amortization and accretion         1,884        1,821
Interest expense, net                            87           683
Income tax expense                               972          69
EBITDA                                           4,617        10,800
Non-cash stock-based compensation                189          405
Loss on disposal of assets and impairment charge 111          22
Adjusted EBITDA                                  $   4,917    $ 11,227
Cash interest expense                                         587
State franchise tax expense (cash)                            69
Maintenance capital expenditures                              136
Distributable cash flow                                       $ 10,435



Contacts: Susser Petroleum Partners LP
          Mary Sullivan, Chief Financial Officer
          (832) 234-3600, msullivan@susser.com
          Dennard- Lascar Associates
          Anne Pearson, Senior Vice President
          (210) 408-6321, apearson@dennardlascar.com
          Ben Burnham, Vice President
          (773) 599-3745, bburnham@dennardlascar.com



SOURCE Susser Petroleum Partners LP

Website: http://www.susser.com
 
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