Financial Data and Key Metrics Changes - Adjusted EBITDA for Q3 2021 was $23.3 million, which is $8.9 million lower than the previous year but $3.2 million or 16% higher than Q3 2019 [11][22] - The net loss for Q3 was $20.9 million or $0.33 per common unit, compared to a net loss of $15.5 million or $0.25 per common unit in the prior year [21] - Total gross margins for Q3 were $143.9 million, a decrease of $2.5 million or 1.7% compared to the prior year [28] Business Line Data and Key Metrics Changes - Retail propane gallons sold in Q3 were 76.7 million gallons, a 1.7% increase from the prior year, driven by increased commercial and industrial demand [23] - Residential volumes decreased by 14% compared to the prior year, while commercial and industrial volumes increased by 14% [24] Market Data and Key Metrics Changes - Average wholesale propane prices for Q3 were $0.87 per gallon, which is 112% higher than the prior year but 4% lower than Q2 of fiscal 2021 [27] - Overall average temperatures during Q3 were 9% warmer than normal and the prior year, impacting demand patterns [25] Company Strategy and Development Direction - The company is focused on reducing debt, strengthening the balance sheet, and building out its renewable energy platform [12][38] - Investments in renewable energy technologies, such as renewable dimethyl ether, are seen as a game changer for the propane industry [17][41] - The company aims to leverage its logistics expertise and vast network to support the energy transition [42][43] Management's Comments on Operating Environment and Future Outlook - Management noted that demand in commercial and industrial sectors is normalizing back to pre-pandemic levels [8] - The company remains committed to delivering sustainable profitable growth and is well-positioned for the ongoing energy transition [39][38] Other Important Information - The company reduced debt by approximately $30 million in Q3, totaling $68 million year-to-date [13] - A $0.10 per common unit increase in the annualized distribution rate was announced, effective with the quarterly distribution [18] - The company executed a refinancing of $775 million of senior notes, lowering annual interest requirements by about $7 million [14][33] Q&A Session Summary - No questions were raised during the Q&A session, and the management team concluded the call with final remarks [46]

Financial Data and Key Metrics Changes - The company reported adjusted EBITDA of $172 million, which is an increase of more than $41 million or 32% compared to the prior year, marking the strongest second quarter performance since 2015 [4][6] - Net income for the second quarter was $126.3 million, improving by $44.1 million or 53.7% compared to the prior year [7] - Total gross margins increased to $304 million, up $48.4 million or 18.9% year-over-year, primarily due to higher propane volumes sold and improved unit margins [9] Business Line Data and Key Metrics Changes - Retail propane gallons sold increased by 16.5% to 169.1 million gallons, driven by demand across all customer segments, particularly in the residential segment [8] - The company experienced organic customer base growth, contributing to increased propane volumes [5] Market Data and Key Metrics Changes - Average wholesale propane prices for the second quarter were $0.90 per gallon, which is 123% higher than the prior second quarter and 58% higher than the first quarter of fiscal 2021 [9] - The company noted that wholesale propane prices have started to recede in the early part of the third fiscal quarter, currently in the low $0.80 per gallon range [9] Company Strategy and Development Direction - The company is focused on customer base growth and retention initiatives, which have resulted in organic growth through the first half of fiscal 2021 [16] - The management emphasized a disciplined approach to acquisitions and debt reduction efforts to strengthen the balance sheet and enhance financial flexibility for strategic growth [16] Management Comments on Operating Environment and Future Outlook - Management highlighted the positive impact of colder weather on demand and the normalization of demand in commercial industrial segments as COVID-19 restrictions eased [4][5] - Looking ahead, the company expects a shift back to a more traditional mix of business between residential and commercial industrial activities, with growth in commercial and industrial activities beyond pre-pandemic levels [17][18] Other Important Information - The company declared a quarterly distribution of $0.30 per common unit, equating to an annualized rate of $1.20 per common unit, to be paid on May 11th [15] - The company repaid $68.6 million of borrowings under the revolver, bringing total debt outstanding as of March 2021 to $89 million lower than the previous year [13] Q&A Session Summary - The call concluded without specific questions being documented, indicating a focus on the prepared remarks and management's insights rather than a detailed Q&A session [20][21]

[PART I. FINANCIAL INFORMATION](index=5&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Financial Statements (Unaudited)](index=5&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS%20(UNAUDITED)) Presents the unaudited condensed consolidated financial statements for the quarterly period ended March 27, 2021 [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets increased to $2.13 billion while total liabilities decreased, resulting in higher partners' capital Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 27, 2021 | September 26, 2020 | | :--- | :--- | :--- | | **Total current assets** | $229,843 | $115,958 | | **Total assets** | $2,128,734 | $2,047,253 | | **Total current liabilities** | $237,509 | $244,516 | | **Long-term borrowings** | $1,172,786 | $1,210,176 | | **Total liabilities** | $1,633,386 | $1,684,872 | | **Total partners' capital** | $495,348 | $362,381 | [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Net income significantly increased for the three and six-month periods ending March 27, 2021, driven by higher revenues Statement of Operations - Three Months Ended (in thousands) | Metric | March 27, 2021 | March 28, 2020 | | :--- | :--- | :--- | | **Total Revenues** | $537,238 | $401,055 | | **Operating Income** | $147,157 | $97,625 | | **Net Income** | $127,216 | $77,361 | | **Net Income per Common Unit - basic** | $2.03 | $1.24 | Statement of Operations - Six Months Ended (in thousands) | Metric | March 27, 2021 | March 28, 2020 | | :--- | :--- | :--- | | **Total Revenues** | $842,429 | $734,933 | | **Operating Income** | $204,843 | $157,479 | | **Net Income** | $165,193 | $117,524 | | **Net Income per Common Unit - basic** | $2.64 | $1.89 | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operations increased, while investing cash use decreased and financing cash use increased for the six months ended March 27, 2021 Cash Flow Summary - Six Months Ended (in thousands) | Cash Flow Activity | March 27, 2021 | March 28, 2020 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $101,829 | $91,319 | | **Net cash (used in) investing activities** | $(19,305) | $(40,106) | | **Net cash (used in) financing activities** | $(78,935) | $(48,459) | | **Net increase in cash and cash equivalents** | $3,589 | $2,754 | [Notes to Condensed Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Provides detailed notes on accounting policies, acquisitions, debt structure, and segment performance - The Partnership is primarily engaged in the retail marketing and distribution of propane, fuel oil, and refined fuels, with **propane accounting for the substantial majority of assets, revenues, and earnings**[30](index=30&type=chunk)[31](index=31&type=chunk) - On November 12, 2020, the Partnership acquired the assets of a propane retailer in North Carolina for **$7.685 million**. It also made strategic investments in Oberon Fuels, a producer of renewable dimethyl ether (rDME), to support its **'Go Green' initiatives**[51](index=51&type=chunk)[52](index=52&type=chunk) Long-Term Borrowings as of March 27, 2021 (in thousands) | Instrument | Principal Amount | | :--- | :--- | | 5.5% senior notes, due 2024 | $525,000 | | 5.75% senior notes, due 2025 | $250,000 | | 5.875% senior notes, due 2027 | $350,000 | | Revolving Credit Facility | $56,200 | | **Subtotal** | **$1,181,200** | Segment Revenues - Six Months Ended (in thousands) | Segment | March 27, 2021 | March 28, 2020 | | :--- | :--- | :--- | | Propane | $749,952 | $633,111 | | Fuel oil and refined fuels | $47,761 | $57,393 | | Natural gas and electricity | $17,626 | $18,919 | | **Total Reportable Segments** | **$814,739** | **$709,423** | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=30&type=section&id=ITEM%202.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Management discusses key operating factors, financial results, liquidity, and capital resources for the period [Executive Overview](index=30&type=section&id=Executive%20Overview) Highlights the operational impacts of the COVID-19 pandemic, product cost volatility, and business seasonality - The COVID-19 pandemic led to **lower revenues from certain commercial and industrial customers** due to operational curtailments, though **residential demand increased** due to stay-at-home initiatives[121](index=121&type=chunk) - Average posted propane prices (Mont Belvieu) were **142.8% higher** in the second quarter of fiscal 2021 compared to the prior year's second quarter, driven by lower U.S. inventory levels[125](index=125&type=chunk) - The business is highly seasonal, with approximately **two-thirds of retail propane volume sold** during the peak heating season from October through March[126](index=126&type=chunk) [Results of Operations and Financial Condition](index=32&type=section&id=Results%20of%20Operations%20and%20Financial%20Condition) Financial performance improved significantly in Q2 and H1 fiscal 2021, driven by cooler weather and higher propane volumes Q2 FY2021 vs Q2 FY2020 Performance | Metric | Q2 FY2021 | Q2 FY2020 | Change | | :--- | :--- | :--- | :--- | | Net Income | $127.2M | $77.4M | +64.3% | | Adjusted EBITDA | $172.0M | $130.6M | +31.7% | | Retail Propane Gallons Sold | 169.1M | 145.1M | +16.5% | - Average temperatures in Q2 FY2021 were **9% cooler** than the prior year's second quarter, contributing to increased heat-related demand[133](index=133&type=chunk) Adjusted EBITDA Reconciliation - Three Months Ended (in thousands) | Line Item | March 27, 2021 | March 28, 2020 | | :--- | :--- | :--- | | Net income | $127,216 | $77,361 | | EBITDA | $172,921 | $125,825 | | **Adjusted EBITDA** | **$172,038** | **$130,648** | Adjusted EBITDA Reconciliation - Six Months Ended (in thousands) | Line Item | March 27, 2021 | March 28, 2020 | | :--- | :--- | :--- | | Net income | $165,193 | $117,524 | | EBITDA | $257,546 | $213,975 | | **Adjusted EBITDA** | **$252,059** | **$216,022** | [Liquidity and Capital Resources](index=39&type=section&id=Liquidity%20and%20Capital%20Resources) The Partnership maintains strong liquidity with increased operating cash flow and sufficient borrowing capacity - Net cash provided by operating activities for the first half of fiscal 2021 **increased by $10.5 million** compared to the prior year, primarily due to higher earnings[176](index=176&type=chunk) - During the first half of fiscal 2021, the Partnership made net repayments of **$38.4 million** under the Revolving Credit Facility and paid **$37.4 million** in distributions to Common Unitholders[179](index=179&type=chunk) - As of March 27, 2021, available borrowing capacity under the Revolving Credit Facility was **$390.2 million**[182](index=182&type=chunk) - A quarterly distribution of **$0.30 per Common Unit** was announced on April 22, 2021, payable in May 2021[185](index=185&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=40&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) Outlines the Partnership's exposure to commodity price and interest rate risks and its hedging strategies - The Partnership's primary market risk is **commodity price volatility** for propane and fuel oil. This risk is managed through supply contracts and derivative instruments (futures, options, swaps) to hedge physical inventory and fixed-price sales contracts[190](index=190&type=chunk)[192](index=192&type=chunk)[194](index=194&type=chunk) - **Interest rate risk** is associated with variable-rate borrowings under the Revolving Credit Facility, which are based on LIBOR plus an applicable margin[197](index=197&type=chunk) - A sensitivity analysis as of March 27, 2021, estimated that a hypothetical 10% adverse change in market prices for open derivative instruments would result in a **decrease in potential future net gains of $2.7 million**[200](index=200&type=chunk) [Controls and Procedures](index=43&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) Management confirms the effectiveness of disclosure controls and procedures as of March 27, 2021 - The Partnership's principal executive officer and principal financial officer concluded that **disclosure controls and procedures were effective** as of March 27, 2021[203](index=203&type=chunk) - There were **no material changes** in the Partnership's internal control over financial reporting during the quarter ended March 27, 2021[204](index=204&type=chunk) [PART II. OTHER INFORMATION](index=44&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Legal Proceedings](index=44&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) Reports no new or material legal proceedings for the period - None[207](index=207&type=chunk) [Risk Factors](index=44&type=section&id=ITEM%201A.%20RISK%20FACTORS) Refers to the detailed risk factors disclosed in the Partnership's most recent Annual Report on Form 10-K - The report refers to the risk factors disclosed in the Partnership's **Annual Report on Form 10-K** for the fiscal year ended September 26, 2020[208](index=208&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=44&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) Reports the withholding of Common Units from executives to satisfy tax obligations on vested restricted units - During the three months ended March 27, 2021, a total of **2,052 Common Units were withheld** from executive officers for income tax purposes related to the vesting of restricted units[209](index=209&type=chunk) [Exhibits](index=45&type=section&id=ITEM%206.%20EXHIBITS) Lists the exhibits filed with the report, including required CEO and CFO certifications - Exhibits filed with the report include **CEO and CFO certifications** under Sections 302 and 906 of the Sarbanes-Oxley Act, along with Inline XBRL documents[216](index=216&type=chunk)

Suburban Propane Partners, L.P. (NYSE:SPH) Q1 2021 Earnings Conference Call February 4, 2021 9:00 AM ET Company Participants Davin D'Ambrosio - Vice President and Treasurer Mike Stivala - President and Chief Executive Officer Mike Kuglin - Chief Financial Officer and Chief Accounting Officer Operator Good morning and welcome to the Suburban Propane Partners L.P.'s First Quarter Results. All participants will be in a listen-only mode. [Operator Instructions] After today's presentation there will be an opport ...

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