CrossAmerica Partners LP: Reports First Quarter 2015 Results
(Thomson Reuters ONE) -
CrossAmerica Partners LP Reports First Quarter 2015 Results
- Generated total gross profit of $35.0 million compared to first
quarter 2014 total gross profit of $16.7 million, an increase of 110%.
-The Partnership generated $1.1 million in income in the first quarter from the
equity interest in CST Fuel Supply.
- Total gallons distributed was 240.7 million compared to first
quarter 2014 volume of 159.7 milliongallons of fuel, a 51% increase.
- Generated Distributable Cash Flow of $10.1 million compared to
$7.5 million for the same period in2014.
Allentown, PA, May 8, 2015 - CrossAmerica Partners LP (NYSE: CAPL),
headquartered in Allentown, PA, a leading wholesale distributor of motor fuels
and owner and lessee of real estate used in the retail distribution of motor
fuels, today reported financial results for the first quarter ended March
31, 2015.
Three Months Results
"During the first quarter, we saw solid growth in our wholesale fuel supply
sales and rental income, thanks to our acquisitions and partnership with CST
Brands. Our consolidated fuel sales saw a 51 percent increase in gallons sold
and our rental income grew 10 percent," said Joe Topper, CEO of CrossAmerica
Partnership. "We have also positioned ourselves for future growth with $125
million in acquisitions during this quarter and further consolidated our strong
partnership with CST Brands allowing for future strategic acquisitions in the
years ahead."
For the three month period ended March 31, 2015, we reported revenue of $484.6
million compared to $482.0 million in revenue for the first quarter 2014.
Wholesale Segment
During the first quarter 2015, we distributed, on a wholesale basis, 233.8
million gallons of motor fuel at an average wholesale gross margin of $0.056 per
gallon, resulting in a wholesale gross profit of $13.1 million. For the three
month period ending March 31, 2014, we distributed, on a wholesale basis, 159.6
million gallons of fuel at an average wholesale gross margin of $0.059 per
gallon, resulting in a wholesale gross profit of $9.4 million. The increase of
40% in gross profit from wholesale fuel sales for the first quarter 2015
relative to 2014 was attributable to a 47% increase in volume, from the
acquisitions that have been completed since the first quarter 2014 offset by
certain marketplace volume declines and the closure of certain sites. Wholesale
fuel margin per gallon for the quarter was approximately 5% lower relative to
the first quarter 2014, primarily due to the decline in purchase discounts
provided to us by suppliers due to the lower fuel prices. The Partnership
receives certain discounts from suppliers based on a percentage of the purchase
price of fuel and the dollar value of these discounts varies with the fuel
price.
Our gross profit from our Other revenues for the wholesale segment, which
primarily consist of rental income, was $8.0 million for the first quarter of
2015 compared to $6.1 million for the same period in 2014. The increase in
rental income was associated with our previously announced acquisitions of Nice
N Easy and Landmark stores, which we lease to CST.
Retail Segment
For the first quarter 2015, we sold 46.4 million gallons at an average retail
motor fuel gross margin of $0.102 per gallon, net of commissions and credit card
fees, resulting in a retail gross profit of $4.7 million. For the same period
in 2014, we sold 15.3 million gallons at an average retail motor fuel gross
margin of $0.021 per gallon, net of commissions and credit card fees, resulting
in a retail gross profit of $0.3 million. The increase in retail gross profit
from retail motor fuel sales for the first quarter of 2015 relative to 2014 was
due to an increase in the number of sites. During the quarter, we also
generated $7.8 million in gross margin from the sale of food and merchandise
from the acquisitions of Petroleum Marketers, Inc. ("PMI") and Erickson Oil
Products, Inc. ("Erickson"). We did not have retail food and merchandise
operations in the first quarter of 2014.
Non-GAAP Metrics
Distributable Cash Flow (See Supplemental Disclosure Regarding Non-GAAP
Financial Information below) was $10.1 million for the three month period ended
March 31, 2015 compared to $7.5 million for the same period in 2014. The
increase in Distributable Cash Flow was due primarily to an increase in overall
gross profit, when compared to the same period in 2014. Distributable Cash Flow
per diluted limited partner unit was $0.41 for the three months ended March
31, 2015 compared to $0.40 for the same period in 2014. Included in the EBITDA,
Adjusted EBITDA and Distributable Cash figures are $1.0 million in acquisition
expenses and $2.9 million in equity-based incentive compensation expense.
Liquidity and Capital Resources
For the quarter ended March 31, 2015, cash flow provided by operating activities
totaled $10.9 million. Cash flow used in investing activities was $125.7
million, primarily related to acquisitions. Cash flow used in financing
activities was $104.5 million. Overall, cash decreased by $10.3 million. Cash,
as of March 31, 2015, was $4.9 million.
Total capital expenditures, excluding acquisitions, for the three months ended
March 31, 2015 were $0.5 million.
Distributions
The Board of the Directors of our General Partner declared a quarterly
distribution of $0.5425 per unit on February 27, 2015 with respect to the fourth
quarter of 2014. The distribution was paid on March 17, 2015 to all unitholders
of record as of March 9, 2015. We anticipate that the Board of Directors will
consider the declaration of future distributions with respect to the first
quarter of 2015 at its next scheduled Board meeting in June, to align the
distribution declaration and payment with CST's dividend declaration and payment
schedule. The amount and timing of any distribution is subject to the
discretion of the Board of Directors of our General Partner.
Conference Call
The Company will host a conference call on May 8, 2015 at 9:00 a.m. Eastern Time
(8:00 a.m. Central Time) to discuss first quarter earnings results. The
conference call numbers are 800-774-6070 or 630-691-2753 and the passcode for
both is 5854571#. A live audio webcast of the conference call and the related
earnings materials, including reconciliations of any non-GAAP financial measures
to GAAP financial measures and any other applicable disclosures, will be
available on that same day on the investor section of the CrossAmerica website
(www.crossamericapartners.com). To listen to the audio webcast, go to http://
www.crossamericapartners.com/en-us/investors/eventsandpresentations. After the
live conference call, a replay will be available for a period of thirty days.
The replay numbers are 888-843-7419 or 630-652-3042 and the passcode for both is
5854571#. An archive of the webcast will be available on the investor section of
the CrossAmerica website at www.crossamericapartners.com/ en-
us/investors/eventsandpresentations within 24 hours after the call for a period
of sixty days.
CROSSAMERICA PARTNERS LP
CONSOLIDATED STATEMENTS OF INCOME
(Thousands of Dollars, Except per Share Amounts)
(Unaudited)
Three Months Ended March 31,
--------------------------
2015 2014
--------------------------
Operating revenues((a)) $ 484,647 $ 482,021
Cost of sales((b)) 449,651 465,354
--------------------------
Gross profit 34,996 16,667
--------------------------
Income from CST Fuel Supply equity 1,098 -
Operating expenses:
Operating expenses 13,737 2,168
General and administrative expenses 11,318 4,527
Depreciation, amortization and accretion expense 11,502 5,966
--------------------------
Total operating expenses 36,557 12,661
--------------------------
Gain on sales of assets, net 30 1,480
--------------------------
Operating income (loss) (433) 5,486
Other income, net 59 104
Interest expense (4,278) (4,027)
--------------------------
Income (loss) before income taxes (4,652) 1,563
Income tax expense (benefit) (1,681) 135
--------------------------
Consolidated net income (loss) (2,971) 1,428
Net loss attributable to noncontrolling interests 5 -
--------------------------
Net income (loss) attributable to CrossAmerica limited (2,966) 1,428
partners
--------------------------
Distributions to incentive distribution right holders (170) (31)
--------------------------
Net income (loss) available to CrossAmerica limited $ (3,136) $ 1,397
partners
--------------------------
Net income (loss) per CrossAmerica limited partner
unit:
Basic earnings per common unit $ (0.13) $ 0.07
Diluted earnings per common unit $ (0.13) $ 0.07
Basic and diluted earnings per subordinated unit $ (0.13) $ 0.07
Weighted-average CrossAmerica limited partner units:
Basic common units 16,935,125 11,115,643
Diluted common units((c)) 17,057,909 11,156,261
Basic and diluted subordinated units 7,525,000 7,525,000
--------------------------
Total diluted common and subordinated units((c)) 24,582,909 18,681,261
-------------
Supplemental information:
(a) Includes excise taxes of: $ 20,511 $ 8,314
(a) Includes revenues from fuel sales to related $ 98,924 $ 198,211
parties of:
(a) Includes income from rentals of: $ 11,732 $ 10,695
(b) Includes expenses from fuel sales to related $ 96,040 $ 194,627
parties of:
(b) Includes expenses from rentals of: $ 3,522 $ 3,815
(c) Diluted common units are not used in the calculation of diluted earnings per
common unit because to do so would be antidilutive.
Segment Results
Wholesale
The following table highlights the results of operations and certain operating
metrics of our Wholesale segment. The narrative following these tables provides
an analysis of the results of operations of that segment (thousands of dollars,
except for the number of distribution sites and per gallon amounts):
Three Months Ended March 31,
Operating revenues:
Motor fuel-third party $ 273,375 $ 243,482
Motor fuel-intersegment and related party 165,475 219,090
--------------------
Motor fuel operating revenues 438,850 462,572
Other(a) 11,209 9,778
--------------------
Total operating revenues $ 450,059 $ 472,350
--------------------
Gross profit:
Motor fuel-third party $ 7,148 $ 4,683
Motor fuel-intersegment and related party 5,984 4,677
--------------------
Motor fuel gross profit 13,132 9,360
Other(b) 7,967 6,142
--------------------
Total gross profit 21,099 15,502
--------------------
Income from CST Fuel Supply((c)) 1,098 -
Operating expenses 3,723 1,833
Depreciation, amortization and accretion expense 8,773 5,479
Gain on sales of assets, net 30 1,480
--------------------
Operating income $ 9,731 $ 9,670
--------------------
Motor fuel distribution sites (end of period):((d))
Motor fuel-third party
Independent dealers 387 249
Lessee dealers 277 238
--------------------
Total motor fuel sites-third party 664 487
--------------------
Motor fuel-intersegment and related party
Affiliated dealers (related party) 199 259
CST (related party) 43 -
Commission agents (retail segment) 77 55
Retail convenience stores (retail segment) 138 -
--------------------
Total motor fuel sites-intersegment and related party
457 314
Motor fuel distribution sites (average during the period):
Motor fuel-third party sites 678 488
Motor fuel-related party sites
431 319
Three Months Ended March 31,
--------------------
Total volume of gallons distributed (in thousands) 2015 2014
233,812----------
Motor fuel gallons distributed per site per day (in 159,581
thousands):((e))
Motor fuel-third party sites
Total weighted average motor fuel distributed-third party 2,226 2,071
sites
Independent dealers 2,643 2,125
Lessee dealers 1,299 1,388
Motor fuel-intersegment and related party sites
Total weighted average motor fuel distributed-intersegment
and related party sites 2,527 2,393
Affiliated dealers (related party) 2,259 2,248
CST (related party) 4,506 -
Commission agents (retail segment) 2,629 3,097
Retail convenience stores (retail segment) 2,210 -
Wholesale margin per gallon-total system $ 0.0562 $ 0.0587
Wholesale margin per gallon-third party $ 0.0527 $ 0.0515
Wholesale margin per gallon-intersegment and related
party $ 0.0610 $
0.0681
a. Primarily consists of rental income.
b. Primarily consists of rental income, net of rent expense on subleased
properties.
c. Represents distributions from our ownership in CST Fuel Supply.
d. In addition, we distribute motor fuel to 16 sub-wholesalers who distribute
to additional sites.
e. Includes 39.5 million and 15.2 million gallons of intersegment volumes
distributed from our wholesale segment to our retail segments three months
ended March 31, 2015 and 2014, respectively.
Retail
The following table highlights the results of operations and certain operating
metrics of our Retail segment. The narrative following these tables provides an
analysis of the results of operations of that segment (thousands of dollars,
except for the number of convenience stores and per gallon amounts):
Three Months Ended March 31,
-------------------
2015 2014
---------
Operating revenues:
Motor fuel $ 106,193 $ 53,302
Merchandise 34,863 -
Other(a) 1,847 1,054
-------------------
Total operating revenues Gross profit: $ 142,903 $ 54,356
---------
Motor fuel $ 4,717 $ 321
Merchandise 7,775 -
Other 1,567 875
-------------------
Total gross profit 14,059 1,196
-------------------
Operating expenses 10,014 335
Depreciation, amortization and accretion expense 2,729 487
-------------------
Operating income $ 1,316 $ 374
-------------------
Retail sites (end of period):
Commission agents((b)) 77 55
Company operated convenience stores((c)) 145 -
-------------------
Total system sites at the end of the period 222 55
-------------------
Total system operating statistics:
Average retail sites during the period 195 55
Motor fuel sales (gallons per site per day) 2,646 3,097
Motor fuel gross profit per gallon, net of credit card fees
and commissions $ 0.1018 $ 0.0211
Commission agents statistics:
Average retail sites during the period 77 55
Motor fuel sales (gallons per site per day) 2,629 3,097
Motor fuel gross profit per gallon, net of credit card fees
and commissions $ 0.0392 $ 0.0211
Company operated convenience store retail site statistics:
Average retail sites during the period 118
Motor fuel sales (gallons per site per day) 2,657
Motor fuel gross profit per gallon, net of credit card fees $ 0.1418
Merchandise sales (per site per day) $ 3,279
n/a n/a n/a
n/a
Merchandise gross profit percentage, net of credit card fees 22.3% n/a a)
Primarily consists of rental income and car wash revenues.
b) A commission agent site is a site where we own or lease the property
and then lease or sublease the site to the commission agent, who pays rent to us
and operates all of the non-fuel related operations at the sites for their own
account.
c) Our company operated retail convenience stores are classified as non-
core to the consolidated operations of CST.
Supplemental Disclosure Regarding Non-GAAP Financial Information
We use the non-GAAP financial measures EBITDA, Adjusted EBITDA and Distributable
Cash Flow in this report. EBITDA represents net income before deducting interest
expense, income taxes and depreciation and amortization. Adjusted EBITDA
represents EBITDA as further adjusted to exclude gains or losses on sales of
assets, equity-based incentive compensation, equitybased director compensation
and acquisition related costs and severance expenses. Distributable Cash Flow
represents Adjusted EBITDA less cash interest expense, sustaining capital
expenditures net of any reimbursements and current income tax expense.
EBITDA, Adjusted EBITDA and Distributable Cash Flow are used as supplemental
financial measures by management and by external users of our financial
statements, such as investors and lenders. EBITDA and Adjusted EBITDA are used
to assess our financial performance without regard to financing methods, capital
structure or income taxes and our ability to incur and service debt and to fund
capital expenditures. In addition, Adjusted EBITDA is used to assess the
operating performance of our business on a consistent basis by excluding the
impact of sales of our assets which do not result directly from our wholesale
distribution of motor fuel and our leasing of real property. EBITDA, Adjusted
EBITDA and Distributable Cash Flow are also used to assess our ability to
generate cash sufficient to make distributions to our unit-holders.
We believe the presentation of EBITDA, Adjusted EBITDA and Distributable Cash
Flow provides useful information to investors in assessing our financial
condition and results of operations. EBITDA, Adjusted EBITDA and Distributable
Cash Flow should not be considered alternatives to net income, net cash provided
by operating activities or any other measure of financial performance or
liquidity presented in accordance with U.S. GAAP. EBITDA, Adjusted EBITDA and
Distributable Cash Flow have important limitations as analytical tools because
they exclude some but not all items that affect net income and net cash provided
by operating activities. Additionally, because EBITDA, Adjusted EBITDA and
Distributable Cash Flow may be defined differently by other companies in our
industry, our definitions may not be comparable to similarly titled measures of
other companies, thereby diminishing their utility.
The following table presents reconciliations of EBITDA, Adjusted EBITDA, and
Distributable Cash Flow to net income, the most directly comparable U.S. GAAP
financial measure, for each of the periods indicated (in thousands, except for
per unit amounts):
Three Months Ended March 31,
--------------------
2015 2014
--------------------
Net income (loss) available to CrossAmerica limited partners $ (3,136) $ 1,397
Interest expense 4,278 4,027
Income tax expense (benefit) (1,681) 135
Depreciation, amortization and accretion 11,502 5,966
--------------------
EBITDA $ 10,963 $ 11,525
Equity-based incentive compensation expense 2,942 914
Gain on sales of assets, net (30) (1,480)
Acquisition costs((a)) 1,002 313
Inventory fair value adjustments 706 -
--------------------
Adjusted EBITDA $ 15,583 $ 11,272
Cash interest expense (3,909) (3,044)
Sustaining capital expenditures((b)) (520) (559)
Current income tax expense (1,059) (144)
--------------------
Distributable Cash Flow $ 10,095 $ 7,525
24,583 ----------
Diluted common and subordinated units 18,681
Distributable Cash Flow per diluted limited partner unit $ 0.4106 $ 0.4028
Distributions paid per limited partner unit $ 0.5425 $ 0.5125
Distribution coverage
0.76x 0.79x
(a) Relates to certain discrete acquisition related costs, such as legal
and other professional fees and severance expenses associated with recently
acquired companies.
(b) Under our partnership agreement, sustaining capital expenditures are
capital expenditures made to maintain our long-term operating income or
operating capacity. Examples of sustaining capital expenditures are those made
to maintain existing contract volumes, including payments to renew existing
distribution contracts, or to maintain our sites in leasable condition, such as
parking lot or roof replacement/renovation, or to replace equipment required to
operate our existing business.
About CrossAmerica Partners LP
CrossAmerica Partners, headquartered in Allentown, PA, is a leading wholesale
distributor of motor fuels and owner and lessee of real estate used in the
retail distribution of motor fuels. Its general partner, CrossAmerica GP LLC, is
a wholly owned subsidiary of CST Brands, Inc., one of the largest independent
retailers of motor fuels and convenience merchandise in North America. Formed in
2012, CrossAmerica Partners distributes fuel to over 1,100 locations and owns or
leases nearly 750 sites in twenty-one states: Pennsylvania, New Jersey, Ohio,
Florida, New York, Massachusetts, Kentucky, New Hampshire, Maine, Tennessee,
Maryland, Delaware, Illinois, Indiana, West Virginia, Virginia, Texas,
Minnesota, Michigan, Wisconsin, and South Dakota. The Partnership has long-term
established relationships with several major oil brands, including ExxonMobil,
BP, Shell, Chevron, Sunoco, Valero, Gulf and Citgo. CrossAmerica Partners ranks
as one of ExxonMobil's largest distributors by fuel volume in the United States
and in the top 10 for additional brands. For additional information, please
visit www.crossamericapartners.com.
Contacts
Investors: Karen Yeakel, Vice President - Investor Relations, 610-625-8126
Randy Palmer, Director - Investor Relations, 210-692-2160
Safe Harbor Statement
Statements contained in this release that state the Company's or management's
expectations or predictions of the future are forwardlooking statements. The
words "believe," "expect," "should," "intends," "estimates," "target" and other
similar expressions identify forward-looking statements. It is important to note
that actual results could differ materially from those projected in such
forwardlooking statements. For more information concerning factors that could
cause actual results to differ from those expressed or forecasted, see
CrossAmerica's Form 10-Q or Form 10-K filed with the Securities and Exchange
Commission, and available on the CrossAmerica's website at
www.crossamericapartners.com. The Partnership undertakes no obligation to
publicly update or revise any statements in this release, whether as a result of
new information, future events or otherwise.
This announcement is distributed by GlobeNewswire on behalf of
GlobeNewswire clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: CrossAmerica Partners LP via GlobeNewswire
[HUG#1920175]
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Datum: 08.05.2015 - 14:23 Uhr
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News-ID 391934
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