8-K
Global Partners LP (GLP)
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): November 5, 2021
GLOBAL PARTNERS LP
(Exact name of registrant as specified in its charter)
| Delaware | 001-32593 | 74-3140887 |
|---|---|---|
| (State or other jurisdiction<br><br> of incorporation) | (Commission<br><br> File Number) | (IRS Employer<br><br> Identification No.) |
P.O. Box 9161
800 South Street
Waltham, Massachusetts 02454-9161
(Address of Principal Executive Offices)
\(781\) 894-8800
\(Registrant’s telephone number, including area code\)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common Units representing limited partner interests | GLP | New York Stock Exchange |
| 9.75% Series A Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units representing limited partner interests | GLP pr A | New York Stock Exchange |
| 9.50% Series B Fixed Rate Cumulative Redeemable Perpetual Preferred Units representing limited partner interests | GLP pr B | New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.02. | Results of Operations and Financial Condition |
|---|
On November 5, 2021, Global Partners LP (the “Partnership”) issued a press release announcing its third quarter 2021 financial results. The press release contains measures that may be deemed non-GAAP financial measures as defined in Item 10 of Regulation S-K under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The most directly comparable generally accepted accounting principles (“GAAP”) financial measures and information reconciling the GAAP and non-GAAP financial measures are also included in the press release. A copy of the Partnership’s press release is attached hereto as Exhibit 99.1 and incorporated herein by reference.
The information furnished pursuant to Item 2.02 in this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed to be “filed” for the purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section, unless the Partnership specifically states that the information is to be considered “filed” under the Exchange Act or incorporates it by reference into a filing under the Securities Act of 1933, as amended, or the Exchange Act.
| Item 7.01. | Regulation FD Disclosure |
|---|
The information set forth under Item 2.02 of this Current Report on Form 8-K is hereby incorporated in Item 7.01 by reference.
The information furnished pursuant to Item 7.01 in this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed to be “filed” for the purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section, unless the Partnership specifically states that the information is to be considered “filed” under the Exchange Act or incorporates it by reference into a filing under the Securities Act of 1933, as amended, or the Exchange Act.
| Item 9.01. | Financial Statements and Exhibits |
|---|---|
| (d) | Exhibits |
| --- | --- |
| 99.1 | Global Partners LP<br> Press Release dated November 5, 2021 |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| GLOBAL PARTNERS LP | ||
|---|---|---|
| By: | Global GP LLC | |
| its general partner | ||
| Dated: November 5, 2021 | By: | /s/ Sean T. Geary |
| Sean T. Geary | ||
| Acting General Counsel, Secretary and | ||
| Vice President – Mergers & Acquisitions |
Exhibit 99.1
Global Partners Reports Third-Quarter 2021 Financial Results
WALTHAM, Mass.--(BUSINESS WIRE)--November 5, 2021--Global Partners LP (NYSE: GLP) today reported financial results for the third quarter ended September 30, 2021.
“Margin growth in all three segments highlighted a solid third quarter that demonstrated the resilience of our integrated business model, from our terminal network to our retail portfolio,” said Eric Slifka, the Partnership’s President and CEO. “With COVID-19 restrictions eased, we continued to see improved demand across our portfolio.
“GDSO (Gasoline Distribution and Station Operations) margins and volume posted double-digit percentage growth in the quarter, despite a significant increase in wholesale fuel prices year-over-year,” Slifka continued. “In addition, we benefited from favorable market conditions in gasoline and distillates in our Wholesale segment and increased volume and improved margins in our Commercial segment.
“Our Q3 performance underscores our role as a critical infrastructure company. Every day, we provide the essential products and services people need to fuel their vehicles, heat their homes, run their businesses, and add convenience to their lives,” Slifka said. “Like other businesses, we encountered spot supply chain disruptions and labor shortages. We were able to mitigate these issues where possible, minimizing impacts, and our third-quarter results were strong.”
Financial Highlights
Net income attributable to the Partnership was $33.6 million, or $0.86 per diluted common limited partner unit, for the third quarter of 2021 compared with $18.2 million, or $0.47 per diluted common limited partner unit, for the same period in 2020.
Earnings before interest, taxes, depreciation and amortization (EBITDA) was $79.4 million for the third quarter of 2021 compared with $65.0 million for the year-earlier period.
Adjusted EBITDA for the three months ended September 30, 2021 was $79.2 million compared with $65.9 million for the third quarter of 2020.
Distributable cash flow (DCF) totaled $49.7 million for the third quarter of 2021 compared with $31.3 million for the 2020 period.
Gross profit in the third quarter of 2021 increased to $203.1 million from $169.2 million a year earlier, primarily reflecting higher product margins in the GDSO segment and more favorable market conditions in the Wholesale segment, primarily in gasoline and gasoline blendstocks and other oils and related products.
Combined product margin, which is gross profit adjusted for depreciation allocated to cost of sales, was $223.9 million in the third quarter of 2021 compared with $189.3 million in the third quarter of 2020.
Combined product margin, EBITDA, Adjusted EBITDA, and DCF are non-GAAP (Generally Accepted Accounting Principles) financial measures, which are explained in greater detail below under “Use of Non-GAAP Financial Measures.” Please refer to Financial Reconciliations included in this news release for reconciliations of these non-GAAP financial measures to their most directly comparable GAAP financial measures for the three and nine months ended September 30, 2021 and 2020.
GDSO segment product margin was $177.7 million in the third quarter of 2021 compared with $158.9 million in the third quarter of 2020, primarily reflecting an increase in fuel volume and increases in activity at the Partnership’s convenience stores.
Wholesale segment product margin was $42.3 million in the third quarter of 2021 compared with $28.9 million in the third quarter of 2020, primarily reflecting more favorable market conditions in gasoline and distillates in the 2021 period.
Commercial segment product margin was $3.9 million compared with $1.5 million in the third quarter of 2020, primarily driven by an increase in volume sold and improved margins.
Sales were $3.3 billion in the third quarter of 2021 compared with $2.0 billion in the same period of 2020, primarily due to an increase in prices. Wholesale segment sales increased to $1.8 billion in the third quarter of 2021 from $1.2 billion in the year-earlier period. GDSO segment sales were $1.3 billion in the third quarter of 2021 versus $0.8 billion in the third quarter of 2020. Commercial segment sales were $202.5 million in the third quarter of 2021 compared with $83.5 million in the third quarter of 2020.
Volume in the third quarter of 2021 was 1.3 billion gallons compared with 1.4 billion gallons in the same period of 2020. Wholesale segment volume was 813.4 million gallons in the third quarter of 2021 and 916.7 million gallons in the third quarter of 2020. GDSO volume was 416.8 million gallons in the third quarter of 2021 compared with 376.3 million gallons in the third quarter of 2020. Commercial segment volume was 101.2 million gallons in the third quarter of 2021 compared with 60.9 million gallons in the year-earlier period.
Recent Highlights
- During the third quarter, the Partnership acquired 14 convenience stores and Citgo-branded gasoline stations, predominantly in Vermont.
- In October, Global announced a quarterly cash distribution of $0.5750 per unit, or $2.30 per unit on an annualized basis, on all of its outstanding common units for the period from July 1 to September 30, 2021. The distribution will be paid November 12, 2021 to unitholders of record as of the close of business on November 8, 2021.
Business Outlook
“Looking ahead, we are well-positioned both financially and operationally as we prepare to close out 2021,” Slifka said. “While we remain mindful about the uncertainty of COVID-19, we are encouraged by the improved demand environment in our business. With global supply shortages and a sharp rise in prices creating challenges for natural gas heading into the winter months, our industry will have the opportunity to reinforce the benefits of liquid fuels as a reliable and cost-effective source of energy.”
The extent to which the COVID-19 pandemic may affect our operating results remains uncertain. The COVID-19 pandemic has had, and may continue to have, material adverse consequences for general economic, financial and business conditions, and could materially and adversely affect our business, financial condition and results of operations and those of our customers, suppliers and other counterparties.
Conference Call and Webcast
Global Partners’ third-quarter 2021 earnings conference call is scheduled to begin at 10:00 a.m. ET today. The dial-in numbers are (877) 709-8155 (U.S. and Canada) or (201) 689-8881 (International). Please plan to dial in to the call at least 15 minutes prior to the start time. The webcast can be accessed via a link at https://ir.globalp.com.
About Global Partners LP
With approximately 1,600 locations primarily in the Northeast, Global Partners is one of the region’s largest independent owners, suppliers and operators of gasoline stations and convenience stores. Global also owns, controls or has access to one of the largest terminal networks in New England and New York, through which it distributes gasoline, distillates, residual oil and renewable fuels to wholesalers, retailers and commercial customers. In addition, Global engages in the transportation of petroleum products and renewable fuels by rail from the mid-continental U.S. and Canada. Global, a master limited partnership, trades on the New York Stock Exchange under the ticker symbol “GLP.” For additional information, visit www.globalp.com.
Use of Non-GAAP Financial Measures
Product Margin
Global Partners views product margin as an important performance measure of the core profitability of its operations. The Partnership reviews product margin monthly for consistency and trend analysis. Global Partners defines product margin as product sales minus product costs. Product sales primarily include sales of unbranded and branded gasoline, distillates, residual oil, renewable fuels, crude oil and propane, as well as convenience store sales, gasoline station rental income and revenue generated from logistics activities when the Partnership engages in the storage, transloading and shipment of products owned by others. Product costs include the cost of acquiring products and all associated costs including shipping and handling costs to bring such products to the point of sale as well as product costs related to convenience store items and costs associated with logistics activities. The Partnership also looks at product margin on a per unit basis (product margin divided by volume). Product margin is a non-GAAP financial measure used by management and external users of the Partnership’s consolidated financial statements to assess its business. Product margin should not be considered an alternative to net income, operating income, cash flow from operations, or any other measure of financial performance presented in accordance with GAAP. In addition, product margin may not be comparable to product margin or a similarly titled measure of other companies.
EBITDA and Adjusted EBITDA
EBITDA and Adjusted EBITDA are non-GAAP financial measures used as supplemental financial measures by management and may be used by external users of Global Partners’ consolidated financial statements, such as investors, commercial banks and research analysts, to assess the Partnership’s:
- compliance with certain financial covenants included in its debt agreements;
- financial performance without regard to financing methods, capital structure, income taxes or historical cost basis;
- ability to generate cash sufficient to pay interest on its indebtedness and to make distributions to its partners;
- operating performance and return on invested capital as compared to those of other companies in the wholesale, marketing, storing and distribution of refined petroleum products, gasoline blendstocks, renewable fuels, crude oil and propane, and in the gasoline stations and convenience stores business, without regard to financing methods and capital structure; and
- viability of acquisitions and capital expenditure projects and the overall rates of return of alternative investment opportunities.
Adjusted EBITDA is EBITDA further adjusted for gains or losses on the sale and disposition of assets and goodwill and long-lived asset impairment charges. EBITDA and Adjusted EBITDA should not be considered as alternatives to net income, operating income, cash flow from operating activities or any other measure of financial performance or liquidity presented in accordance with GAAP. EBITDA and Adjusted EBITDA exclude some, but not all, items that affect net income, and these measures may vary among other companies. Therefore, EBITDA and Adjusted EBITDA may not be comparable to similarly titled measures of other companies.
Distributable Cash Flow
Distributable cash flow is an important non-GAAP financial measure for the Partnership’s limited partners since it serves as an indicator of success in providing a cash return on their investment. Distributable cash flow as defined by the Partnership’s partnership agreement is net income plus depreciation and amortization minus maintenance capital expenditures, as well as adjustments to eliminate items approved by the audit committee of the board of directors of the Partnership’s general partner that are extraordinary or non-recurring in nature and that would otherwise increase distributable cash flow.
Distributable cash flow as used in our partnership agreement also determines our ability to make cash distributions on our incentive distribution rights. The investment community also uses a distributable cash flow metric similar to the metric used in our partnership agreement with respect to publicly traded partnerships to indicate whether or not such partnerships have generated sufficient earnings on a current or historic level that can sustain distributions on preferred or common units or support an increase in quarterly cash distributions on common units. Our partnership agreement does not permit adjustments for certain non-cash items, such as net losses on the sale and disposition of assets and goodwill and long-lived asset impairment charges.
Distributable cash flow should not be considered as an alternative to net income, operating income, cash flow from operations, or any other measure of financial performance presented in accordance with GAAP. In addition, distributable cash flow may not be comparable to distributable cash flow or similarly titled measures of other companies.
Forward-looking Statements
Certain statements and information in this press release may constitute “forward-looking statements.” The words “believe,” “expect,” “anticipate,” “plan,” “intend,” “foresee,” “should,” “would,” “could” or other similar expressions are intended to identify forward-looking statements, which are generally not historical in nature, although not all forward-looking statements contain such identifying words. These forward-looking statements are based on Global’s current expectations and beliefs concerning future developments and their potential effect on the Partnership. While management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting the Partnership will be those that it anticipates. Forward-looking statements involve significant risks and uncertainties (some of which are beyond the Partnership’s control) including, without limitation, the impact and duration of the COVID-19 pandemic, uncertainty around the timing of an economic recovery in the United States which will impact the demand for the products we sell and the services that we provide, uncertainty around the impact of the COVID-19 pandemic to our counterparties and our customers and their corresponding ability to perform their obligations and/or utilize the products we sell and/or services we provide, uncertainty around the impact and duration of federal, state and municipal regulations related to the COVID-19 pandemic, and assumptions that could cause actual results to differ materially from the Partnership’s historical experience and present expectations or projections.
For additional information regarding known material factors that could cause actual results to differ from the Partnership’s projected results, please see Global’s filings with the SEC, including its Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.
Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. Global undertakes no obligation to publicly update or revise any forward-looking statements after the date they are made, whether as a result of new information, future events or otherwise.
| GLOBAL PARTNERS LP<br><br> CONSOLIDATED STATEMENTS OF OPERATIONS<br><br> (In thousands, except per unit data)<br><br> (Unaudited) | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Three Months Ended<br><br> September 30, | Nine Months Ended<br><br> September 30, | |||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||
| Sales | $ | 3,323,910 | $ | 2,061,382 | $ | 9,156,382 | $ | 6,126,052 | ||||
| Cost of sales | 3,120,852 | 1,892,141 | 8,630,247 | 5,571,126 | ||||||||
| Gross profit | 203,058 | 169,241 | 526,135 | 554,926 | ||||||||
| Costs and operating expenses: | ||||||||||||
| Selling, general and administrative expenses | 54,674 | 43,218 | 155,029 | 143,158 | ||||||||
| Operating expenses | 92,151 | 82,235 | 260,848 | 241,502 | ||||||||
| Amortization expense | 2,742 | 2,712 | 8,138 | 8,137 | ||||||||
| Net (gain) loss on sale and disposition of assets | (192 | ) | 691 | (675 | ) | 623 | ||||||
| Long-lived asset impairment | - | 203 | 188 | 1,927 | ||||||||
| Total costs and operating expenses | 149,375 | 129,059 | 423,528 | 395,347 | ||||||||
| Operating income | 53,683 | 40,182 | 102,607 | 159,579 | ||||||||
| Interest expense | (19,660 | ) | (19,854 | ) | (60,339 | ) | (62,544 | ) | ||||
| Income before income tax (expense) benefit | 34,023 | 20,328 | 42,268 | 97,035 | ||||||||
| Income tax (expense) benefit | (386 | ) | (2,136 | ) | (789 | ) | 205 | |||||
| Net income | 33,637 | 18,192 | 41,479 | 97,240 | ||||||||
| Net loss attributable to noncontrolling interest | - | 38 | - | 528 | ||||||||
| Net income attributable to Global Partners LP | 33,637 | 18,230 | 41,479 | 97,768 | ||||||||
| Less: General partner's interest in net income, including | ||||||||||||
| incentive distribution rights | 993 | 324 | 2,581 | 857 | ||||||||
| Less: Preferred limited partner interest in net income | 3,463 | 1,682 | 8,746 | 5,046 | ||||||||
| Net income attributable to common limited partners | $ | 29,181 | $ | 16,224 | $ | 30,152 | $ | 91,865 | ||||
| Basic net income per common limited partner unit (1) | $ | 0.86 | $ | 0.48 | $ | 0.89 | $ | 2.71 | ||||
| Diluted net income per common limited partner unit (1) | $ | 0.86 | $ | 0.47 | $ | 0.88 | $ | 2.68 | ||||
| Basic weighted average common limited partner units outstanding | 33,897 | 33,924 | 33,934 | 33,887 | ||||||||
| Diluted weighted average common limited partner units outstanding | 34,087 | 34,209 | 34,225 | 34,241 |
(1) Under the Partnership's partnership agreement, for any quarterly period, the incentive distribution rights ("IDRs") participate in net income only to the extent of the amount of cash distributions actually declared, thereby excluding the IDRs from participating in the Partnership's undistributed net income or losses. Accordingly, the Partnership's undistributed net income or losses is assumed to be allocated to the common unitholders and to the General Partner's general partner interest. Net income attributable to common limited partners is divided by the weighted average common units outstanding in computing the net income per limited partner unit.
| GLOBAL PARTNERS LP<br><br> CONSOLIDATED BALANCE SHEETS<br><br> (In thousands)<br><br> (Unaudited) | ||||
|---|---|---|---|---|
| September 30,<br><br> 2021 | December 31,<br><br> 2020 | |||
| Assets | ||||
| Current assets: | ||||
| Cash and cash equivalents | $ | 15,365 | $ | 9,714 |
| Accounts receivable, net | 360,928 | 227,317 | ||
| Accounts receivable - affiliates | 2,391 | 2,410 | ||
| Inventories | 413,387 | 384,432 | ||
| Brokerage margin deposits | 35,317 | 21,661 | ||
| Derivative assets | 12,692 | 16,556 | ||
| Prepaid expenses and other current assets | 84,071 | 119,340 | ||
| Total current assets | 924,151 | 781,430 | ||
| Property and equipment, net | 1,089,386 | 1,082,486 | ||
| Right of use assets, net | 274,236 | 290,506 | ||
| Intangible assets, net | 28,587 | 35,925 | ||
| Goodwill | 328,569 | 323,565 | ||
| Other assets | 32,062 | 26,588 | ||
| Total assets | $ | 2,676,991 | $ | 2,540,500 |
| Liabilities and partners' equity | ||||
| Current liabilities: | ||||
| Accounts payable | $ | 314,949 | $ | 207,873 |
| Working capital revolving credit facility - current portion | 102,900 | 34,400 | ||
| Lease liability - current portion | 62,344 | 75,376 | ||
| Environmental liabilities - current portion | 4,455 | 4,455 | ||
| Trustee taxes payable | 39,855 | 36,598 | ||
| Accrued expenses and other current liabilities | 114,751 | 126,774 | ||
| Derivative liabilities | 40,288 | 12,055 | ||
| Total current liabilities | 679,542 | 497,531 | ||
| Working capital revolving credit facility - less current portion | 150,000 | 150,000 | ||
| Revolving credit facility | 43,400 | 122,000 | ||
| Senior notes | 738,884 | 737,605 | ||
| Long-term lease liability - less current portion | 222,615 | 226,648 | ||
| Environmental liabilities - less current portion | 49,055 | 49,166 | ||
| Financing obligations | 145,037 | 146,535 | ||
| Deferred tax liabilities | 56,377 | 56,218 | ||
| Other long-term liabilities | 58,035 | 59,298 | ||
| Total liabilities | 2,142,945 | 2,045,001 | ||
| Partners' equity | 534,046 | 495,499 | ||
| Total liabilities and partners' equity | $ | 2,676,991 | $ | 2,540,500 |
| GLOBAL PARTNERS LP<br><br> FINANCIAL RECONCILIATIONS<br><br> (In thousands)<br><br> (Unaudited) | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Three Months Ended<br><br> September 30, | Nine Months Ended<br><br> September 30, | |||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||
| Reconciliation of gross profit to product margin | ||||||||||||
| Wholesale segment: (1) | ||||||||||||
| Gasoline and gasoline blendstocks | $ | 22,458 | $ | 17,136 | $ | 62,379 | $ | 84,966 | ||||
| Crude oil | (2,814 | ) | (2,729 | ) | (10,662 | ) | 2,004 | |||||
| Other oils and related products | 22,625 | 14,523 | 54,580 | 59,414 | ||||||||
| Total | 42,269 | 28,930 | 106,297 | 146,384 | ||||||||
| Gasoline Distribution and Station Operations segment: | ||||||||||||
| Gasoline distribution | 112,446 | 101,405 | 294,001 | 305,405 | ||||||||
| Station operations | 65,269 | 57,462 | 176,567 | 154,904 | ||||||||
| Total | 177,715 | 158,867 | 470,568 | 460,309 | ||||||||
| Commercial segment (1) | 3,916 | 1,545 | 10,807 | 9,398 | ||||||||
| Combined product margin | 223,900 | 189,342 | 587,672 | 616,091 | ||||||||
| Depreciation allocated to cost of sales | (20,842 | ) | (20,101 | ) | (61,537 | ) | (61,165 | ) | ||||
| Gross profit | $ | 203,058 | $ | 169,241 | $ | 526,135 | $ | 554,926 | ||||
| Reconciliation of net income to EBITDA and Adjusted EBITDA | ||||||||||||
| Net income | $ | 33,637 | $ | 18,192 | $ | 41,479 | $ | 97,240 | ||||
| Net loss attributable to noncontrolling interest | - | 38 | - | 528 | ||||||||
| Net income attributable to Global Partners LP | 33,637 | 18,230 | 41,479 | 97,768 | ||||||||
| Depreciation and amortization | 25,692 | 24,745 | 76,172 | 75,192 | ||||||||
| Interest expense | 19,660 | 19,854 | 60,339 | 62,544 | ||||||||
| Income tax expense (benefit) | 386 | 2,136 | 789 | (205 | ) | |||||||
| EBITDA (2) | 79,375 | 64,965 | 178,779 | 235,299 | ||||||||
| Net (gain) loss on sale and disposition of assets | (192 | ) | 691 | (675 | ) | 623 | ||||||
| Long-lived asset impairment | - | 203 | 188 | 1,927 | ||||||||
| Adjusted EBITDA (2) | $ | 79,183 | $ | 65,859 | $ | 178,292 | $ | 237,849 | ||||
| Reconciliation of net cash provided by operating activities to EBITDA and Adjusted EBITDA | ||||||||||||
| Net cash provided by operating activities | $ | 152,615 | $ | 88,286 | $ | 99,057 | $ | 250,289 | ||||
| Net changes in operating assets and liabilities and certain non-cash items | (93,286 | ) | (45,321 | ) | 18,594 | (77,621 | ) | |||||
| Net cash from operating activities and changes in operating | ||||||||||||
| assets and liabilities attributable to noncontrolling interest | - | 10 | - | 292 | ||||||||
| Interest expense | 19,660 | 19,854 | 60,339 | 62,544 | ||||||||
| Income tax expense (benefit) | 386 | 2,136 | 789 | (205 | ) | |||||||
| EBITDA (2) | 79,375 | 64,965 | 178,779 | 235,299 | ||||||||
| Net (gain) loss on sale and disposition of assets | (192 | ) | 691 | (675 | ) | 623 | ||||||
| Long-lived asset impairment | - | 203 | 188 | 1,927 | ||||||||
| Adjusted EBITDA (2) | $ | 79,183 | $ | 65,859 | $ | 178,292 | $ | 237,849 | ||||
| Reconciliation of net income to distributable cash flow | ||||||||||||
| Net income | $ | 33,637 | $ | 18,192 | $ | 41,479 | $ | 97,240 | ||||
| Net loss attributable to noncontrolling interest | - | 38 | - | 528 | ||||||||
| Net income attributable to Global Partners LP | 33,637 | 18,230 | 41,479 | 97,768 | ||||||||
| Depreciation and amortization | 25,692 | 24,745 | 76,172 | 75,192 | ||||||||
| Amortization of deferred financing fees | 1,211 | 1,329 | 3,810 | 3,896 | ||||||||
| Amortization of routine bank refinancing fees | (1,002 | ) | (1,008 | ) | (3,052 | ) | (2,933 | ) | ||||
| Maintenance capital expenditures | (9,841 | ) | (11,963 | ) | (28,135 | ) | (24,789 | ) | ||||
| Distributable cash flow (2)(3)(4) | 49,697 | 31,333 | 90,274 | 149,134 | ||||||||
| Distributions to preferred unitholders (5) | (3,463 | ) | (1,682 | ) | (8,746 | ) | (5,046 | ) | ||||
| Distributable cash flow after distributions to preferred unitholders | $ | 46,234 | $ | 29,651 | $ | 81,528 | $ | 144,088 | ||||
| Reconciliation of net cash provided by operating activities to distributable cash flow | ||||||||||||
| Net cash provided by operating activities | $ | 152,615 | $ | 88,286 | $ | 99,057 | $ | 250,289 | ||||
| Net changes in operating assets and liabilities and certain non-cash items | (93,286 | ) | (45,321 | ) | 18,594 | (77,621 | ) | |||||
| Net cash from operating activities and changes in operating | ||||||||||||
| assets and liabilities attributable to noncontrolling interest | - | 10 | - | 292 | ||||||||
| Amortization of deferred financing fees | 1,211 | 1,329 | 3,810 | 3,896 | ||||||||
| Amortization of routine bank refinancing fees | (1,002 | ) | (1,008 | ) | (3,052 | ) | (2,933 | ) | ||||
| Maintenance capital expenditures | (9,841 | ) | (11,963 | ) | (28,135 | ) | (24,789 | ) | ||||
| Distributable cash flow (2)(3)(4) | 49,697 | 31,333 | 90,274 | 149,134 | ||||||||
| Distributions to preferred unitholders (5) | (3,463 | ) | (1,682 | ) | (8,746 | ) | (5,046 | ) | ||||
| Distributable cash flow after distributions to preferred unitholders | $ | 46,234 | $ | 29,651 | $ | 81,528 | $ | 144,088 |
(1) Segment reporting results for the three and nine months ended September 30, 2020 have been reclassified between the Wholesale and Commercial segments to conform to the Partnership's current presentation.
(2) EBITDA, Adjusted EBITDA and distributable cash flow for each of the three and nine months ended September 30, 2021 include a $3.1 million expense for compensation resulting from the retirement of the Partnership's former chief financial officer in August of 2021. EBITDA, Adjusted EBITDA and distributable cash flow for the nine months ended September 30, 2021 include a $6.6 million expense for compensation and benefits resulting from the passing of the Partnership's general counsel in May of 2021. This expense relates to contractual commitments including the acceleration of grants previously awarded as well as a discretionary award in recognition of service.
(3) As defined by the Partnership's partnership agreement, distributable cash flow is not adjusted for certain non-cash items, such as net losses on the sale and disposition of assets and goodwill and long-lived asset impairment charges.
(4) Distributable cash flow for the nine months ended September 30, 2020 includes a $6.3 million income tax benefit related to the CARES Act net operating loss carryback provisions.
(5) Distributions to preferred unitholders represent the distributions payable to the Series A preferred unitholders and the Series B preferred unitholders earned during the period. Distributions on the Series A preferred units and the Series B preferred units are cumulative and payable quarterly in arrears on February 15, May 15, August 15 and November 15 of each year.
Contacts
Gregory B. Hanson
Chief Financial Officer
Global Partners LP
\(781\) 894-8800
Sean T. Geary
Acting General Counsel, Secretary and Vice President – Mergers & Acquisitions
Global Partners LP
\(781\) 894-8800