Global Partners LP(US:GLP)2025-11-07 15:56Sales and Revenue - For the three and nine months ended September 30, 2025, the company sold $4.5 billion and $13.5 billion of refined petroleum products, gasoline blendstocks, renewable fuels, and crude oil, respectively [170]. - Total sales for the three months ended September 30, 2025, reached $4,694,416,000, an increase of 6.2% from $4,422,238,000 in the same period of 2024 [212]. - Total sales increased to $4.7 billion for the three months ended September 30, 2025, up $272.2 million, or 6%, from $4.4 billion in 2024, driven by a volume increase of 218 million gallons [220]. - Wholesale gasoline and gasoline blendstocks sales increased to $2.1 billion for the three months ended September 30, 2025, up $297.7 million, or 17%, from $1.8 billion in 2024 [224]. - Sales from distillates and other oils increased to $1.0 billion for the three months ended September 30, 2025, up $95.9 million, or 10%, from $0.9 billion in 2024 [228]. Financial Performance - Net income for the three months ended September 30, 2025, was $29,025,000, a decrease of 36.7% compared to $45,922,000 for the same period in 2024 [210]. - EBITDA for the three months ended September 30, 2025, was $97,130,000, down 18.4% from $119,059,000 in the prior year [210]. - Distributable cash flow for the three months ended September 30, 2025, was $52.98 million, a decrease of $18.15 million, or 25.5%, compared to $71.13 million in 2024 [220]. - Gross profit for the three months ended September 30, 2025, was $271.4 million, down $14.6 million, or 5%, from $286.0 million in 2024 [222]. - Adjusted EBITDA for the nine months ended September 30, 2025, was $288,216,000, slightly down from $291,282,000 in the same period of 2024 [213]. Operational Metrics - The total volume of product sold was 1.9 billion gallons for the three months ended September 30, 2025, an increase of 218 million gallons from 1.7 billion gallons in 2024 [220]. - Wholesale segment volume increased to 1,399,596 gallons for the three months ended September 30, 2025, compared to 1,185,784 gallons in 2024, representing a growth of 18% [210]. - The company operates a portfolio of 1,540 gasoline stations, including 290 directly operated convenience stores, primarily in the Northeast [180]. - The company has a significant presence in the New England states and New York, distributing gasoline, distillates, and renewable fuels to wholesalers and retailers [169]. Expenses and Costs - SG&A expenses rose to $76.3 million for the three months ended September 30, 2025, an increase of $5.8 million, or 8%, compared to $70.5 million in 2024 [237]. - Operating expenses decreased by $4.6 million, or 3%, to $132.5 million for the three months ended September 30, 2025, from $137.1 million in 2024 [239]. - Selling, general and administrative expenses (SG&A) include marketing costs, employee salaries, and professional fees, impacting overall financial performance [205]. - Maintenance capital expenditures were $34.1 million for the nine months ended September 30, 2025, compared to $31.9 million in 2024 [257]. - Expansion capital expenditures were $21.2 million for the nine months ended September 30, 2025, down from $24.6 million in 2024 [260]. Debt and Financing - The company issued $450 million aggregate principal amount of 7.125% senior notes due 2033 to fund the purchase of a portion of its 7.00% senior notes due 2027 [172]. - The company redeemed all $400.0 million of the 2027 Notes, recording a loss from early extinguishment of debt of $3.0 million for the nine months ended September 30, 2025 [290]. - The company had $240.6 million outstanding on the working capital revolving credit facility and $124.8 million on the revolving credit facility as of September 30, 2025 [281]. - The average interest rates for the credit agreement were 6.6% for the nine months ended September 30, 2025, down from 7.6% in 2024 [280]. - The company was in compliance with financial covenants requiring maintenance of minimum working capital amounts and leverage ratios as of September 30, 2025 [285]. Market and Economic Risks - The company is exposed to risks from changes in commodity prices, which could adversely affect its financial condition and cash available for distribution to unitholders [167]. - The company faces risks from price volatility in refined petroleum products, which can impact financial condition and cash available for distribution [186]. - Higher prices and inflation may reduce demand for gasoline and convenience store products, impacting sales and financial condition [190]. - Tariffs and import/export controls could significantly affect operations and costs, leading to increased expenses [190]. - Technological advances and alternative fuels may reduce demand for heating oil and residual oil, impacting sales [191]. Regulatory and Environmental Factors - Environmental regulations and litigation could significantly impact operations and increase costs, affecting financial condition and results [194]. - The company faces potential adverse effects on sales due to changes in government mandates and tax credits affecting the availability and pricing of ethanol and renewable fuels [192]. - The company relies on marine, pipeline, rail, and truck transportation services for its operations, and disruptions in these services could adversely affect its results [164]. - Disruptions in transportation services, such as hurricanes or labor disputes, could adversely affect logistics and financial performance [188]. Cash Flow and Working Capital - Net cash provided by operating activities was $183.8 million for the nine months ended September 30, 2025, compared to a net cash used of $35.6 million in 2024 [263]. - Working capital decreased by $7.0 million to $200.2 million at September 30, 2025, from $207.2 million at December 31, 2024 [250]. - Net cash provided by operating activities increased by $219.3 million, from ($35.6 million) in 2024 to $183.7 million in 2025 [265]. - Net cash used in investing activities was $64.8 million in 2025, compared to $230.4 million in 2024, which included $215.0 million for the acquisition of terminals from Gulf Oil [267][268]. - Net cash used in financing activities was $109.2 million in 2025, including $400.0 million in repayments for the redemption of the 2027 Notes [270]. Derivative Instruments and Risk Management - The company utilizes various derivative instruments to manage exposure to commodity risk, including exchange-traded futures contracts and over-the-counter transactions [305]. - The fair value of exchange-traded derivative contracts was $17.245 million, with a potential loss of $19.933 million from a 10% price decrease [308]. - The total fair value of all commodity risk derivative instruments was $11.922 million, with a potential loss of $37.275 million from a 10% price decrease [308]. - The company hedges its exposure to price fluctuations in refined petroleum products, renewable fuels, crude oil, and gasoline blendstocks [305]. - The company does not acquire futures contracts for speculative purposes, aiming to minimize market risk [305].