• Adjusted EBITDA: $97.8 million for Q4 2024, down from $112.1 million in Q4 2023.
• Adjusted DCF: $46.1 million for Q4 2024, compared to $58.8 million in Q4 2023.
• GDSO Product Margin: Decreased by $31.8 million to $213.6 million in Q4 2024.
• Gasoline Distribution Product Margin: Decreased by $32.1 million to $145.7 million in Q4 2024.
• Fuel Margins: Decreased $0.08 to $0.36 per gallon in Q4 2024 from $0.44 in Q4 2023.
• Station Operations Product Margin: Increased by $0.3 million to $67.9 million in Q4 2024.
• Wholesale Segment Product Margin: Increased by $27.9 million to $79.8 million in Q4 2024.
• Operating Expenses: Increased by $12.1 million to $128.1 million in Q4 2024.
• SG&A Expenses: Decreased by $1.9 million to $79.4 million in Q4 2024.
• Interest Expense: $34.4 million in Q4 2024, up from $20.7 million in Q4 2023.
• CapEx: $46.8 million in Q4 2024, with $15 million in maintenance and $31.8 million in expansion.
• Fueling Stations and C-Stores: Totaled 1,584 sites at the end of Q4 2024.
• Distribution: $0.74 per common unit for Q4 2024, marking the 13th consecutive quarterly increase.
• Leverage Ratio: Funded debt-to-EBITDA at 3.47x as of December 31, 2024.

• Warning! GuruFocus has detected 7 Warning Sign with GLP.

Release Date: February 28, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Global Partners LP (NYSE:GLP) successfully integrated 30 new terminals, significantly expanding their storage capacity to approximately 22 million barrels.
• The company secured a 25-year take-or-pay contract with Motiva Enterprises, enhancing their long-term revenue stability.
• Both the Wholesale and GDSO segments demonstrated robust growth, with significant increases in product margins.
• The company declared its 13th consecutive quarterly distribution increase, reflecting a strong financial position.
• Global Partners LP (NYSE:GLP) maintains a strong balance sheet with ample capacity in their credit facilities, positioning them well for future growth opportunities.

Negative Points

• Adjusted EBITDA for Q4 2024 decreased to $97.8 million from $112.1 million in the same period of 2023.
• GDSO product margin decreased by $31.8 million in the quarter, primarily due to lower fuel margins year-over-year.
• Interest expenses increased significantly to $34.4 million in Q4 2024, primarily due to new senior notes and higher credit facility balances.
• Operating expenses rose by $12.1 million in Q4 2024, reflecting the addition of new terminals.
• The potential implementation of tariffs on oil and gas imports creates uncertainty and could increase supply costs.

Q & A Highlights

Q: Can you elaborate on how tariffs might affect your supply, particularly from outside US borders? A: Mark Romaine, Chief Operating Officer, explained that while they don't disclose specific percentages for competitive reasons, Canadian barrels are crucial for the supply landscape in New England and the Northeast. The company is prepared to source barrels from anywhere, thanks to their flexible system, which allows them to adapt to changes in supply dynamics, including potential tariffs.

Q: Do potential tariffs influence your acquisition strategy or geographic focus? A: Eric Slifka, President and CEO, stated that potential tariffs do not alter their acquisition strategy. The flexibility of their terminals allows them to source product globally, ensuring supply continuity despite potential cost increases. This adaptability is seen as a competitive advantage, reinforcing their current business model and investment strategy.

Q: What are your growth plans for the Houston area? A: Mark Romaine highlighted that they plan to grow all three business segments in Houston: retail, terminals, and wholesale. They are disciplined in acquisitions, seeking value and synergies. The company sees opportunities for organic growth in their recently acquired terminals and aims to enhance retail operations and sales.

Q: Are there any changes in the acquisition landscape, such as pricing or bid-ask spreads? A: Eric Slifka noted that the market remains active with numerous opportunities. Asset quality significantly influences pricing, and while some spreads have widened, Global Partners remains active and optimistic about completing transactions in the coming year.

Q: How does your system's flexibility impact your ability to manage supply chain disruptions? A: Mark Romaine emphasized that their system's design allows them to source barrels from various locations, mitigating supply chain disruptions. This flexibility is crucial in maintaining supply and optimizing costs, regardless of external challenges like tariffs.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.