Suburban Propane Partners, L.P. (SPH): history, ownership, mission, how it works & makes money

A Brief History of Suburban Propane Partners, L.P. (SPH)

Formation and Early Years

Suburban Propane Partners, L.P. was founded in 1996 as a publicly traded master limited partnership (MLP) focused on the distribution of propane. Initial public offering (IPO) took place on November 1, 1996, with an initial share price of $15 per share. The partnership aimed to deliver propane and related services across residential, commercial, and industrial sectors.

Acquisitions and Growth

Over the years, Suburban Propane expanded its footprint through various acquisitions. By 2021, the company had completed over 60 acquisitions since its inception. In July 2020, Suburban Propane announced its acquisition of Superior Plus LP's US Propane Distribution Business for approximately $900 million.

Financial Performance

In the fiscal year 2022, Suburban Propane reported revenues of $1.48 billion, an increase from $1.16 billion in 2021. The company attributed this growth to higher demand for propane and increased prices due to market conditions.

Partnership Structure

Suburban Propane operates under a MLP structure, which typically provides tax advantages to its partners. The company pays out a significant portion of its cash flow as distributions to its unitholders. As of Q3 2023, the annualized distribution was $2.85 per unit.

Market Presence

Suburban Propane currently serves over 1 million customers across the United States, providing propane services to more than 38 states. The company employs over 2,000 individuals, showcasing its significant role in the propane distribution industry.

Strategic Initiatives

In 2023, Suburban Propane implemented various strategic initiatives aimed at sustainability and reducing carbon emissions. The company has committed to transitioning to renewable propane, with projections indicating an increase in renewable propane production to 15 million gallons by 2025.

Challenges and Future Outlook

The propane market has faced volatility due to fluctuating crude oil prices and supply chain issues. However, Suburban Propane remains optimistic, forecasting a steady growth rate of 5% CAGR over the next five years, driven by increased demand for home heating and energy-efficient products.

A Who Owns Suburban Propane Partners, L.P. (SPH)

Ownership Structure

The ownership of Suburban Propane Partners, L.P. (SPH) is primarily comprised of individual investors and institutional shareholders. As of the latest data, the following ownership breakdown is noted:

Major Institutional Shareholders

Institutional investors play a significant role in the ownership of Suburban Propane. The following institutions are among the largest shareholders:

Insider Ownership

Insider ownership is also significant within Suburban Propane Partners. The key insiders include:

Market Capitalization

The market capitalization of Suburban Propane Partners, L.P. as of October 2023 is approximately $1.2 billion.

Recent Financial Performance

Suburban Propane's financial performance in the last fiscal year displayed the following key figures:

Dividends

Suburban Propane has consistently paid dividends to its shareholders. The following dividend history is noted:

Stock Performance

As of October 2023, the stock performance of Suburban Propane is as follows:

Suburban Propane Partners, L.P. (SPH) Mission Statement

Mission Statement Overview

The mission statement of Suburban Propane Partners, L.P. emphasizes their commitment to providing reliable and safe propane distribution services while prioritizing customer satisfaction and environmental responsibility. The company aims to maintain a leadership position in the propane industry by delivering high-quality services and products.

Core Values

• Customer Commitment: Focused on meeting the needs of customers.
• Safety: Ensuring the highest safety standards in operations.
• Integrity: Conducting business with honesty and transparency.
• Environmental Responsibility: Promoting sustainability through eco-friendly practices.

Financial Performance

As of the fiscal year ended September 30, 2023, Suburban Propane Partners, L.P. reported:

Community Engagement

Suburban Propane Partners engages with local communities through various initiatives:

• Support for Local Charities: Contributes approximately $1.5 million annually.
• Employee Volunteer Programs: Employees participate in over 10,000 volunteer hours yearly.
• Safety Education: Conducts over 300 safety workshops and training sessions.

Market Presence

Suburban Propane operates in over 30 states across the United States and serves around 1 million customers. As of 2023, the company has approximately:

Strategic Goals

Suburban Propane has outlined several strategic goals for the upcoming years:

• Expansion: Increase service areas by 10% by 2025.
• Customer Base Growth: Target a 5% annual increase in customer acquisition.
• Operational Efficiency: Aim for a 15% reduction in operational costs by optimizing logistics and supply chains.
• Sustainability Goals: Implement renewable energy initiatives, aiming for a 20% decrease in carbon footprint by 2030.

How Suburban Propane Partners, L.P. (SPH) Works

Company Overview

Suburban Propane Partners, L.P. is a master limited partnership that primarily provides propane distribution and related services. As of the fiscal year ending September 30, 2022, Suburban Propane reported revenue of approximately $1.16 billion.

Business Segments

Suburban Propane operates through various business segments:

• Propane Distribution
• Propane Marketing
• Service and Equipment Sales
• Other Energy-related Products

Revenue Breakdown

The revenue from its primary segments for the fiscal year 2022 is detailed in the following table:

Operational Footprint

Suburban Propane operates in 41 states across the United States, with over 700 locations providing service nationwide.

Financial Performance

For the fiscal year ending September 30, 2022, key financial metrics included:

Market Position

Suburban Propane holds a significant position within the propane industry, serving approximately 1 million customers.

Distribution Infrastructure

The company operates through a network of:

• Propane distribution terminals
• Transport fleets
• Storage facilities

Customer Base

Suburban Propane's customer demographics are diverse, including:

• Residential clients (80%)
• Commercial clients (15%)
• Industrial clients (5%)

Recent Developments

In 2023, Suburban Propane announced plans for expansion, targeting an investment of $50 million in facility upgrades and technology enhancements.

Dividends and Shareholder Returns

As of the last quarterly report, Suburban Propane declared a cash distribution of $0.325 per unit, with an annualized distribution yield of approximately 8.5%.

Conclusion

Suburban Propane continues to focus on providing reliable propane services, investing in infrastructure, and maintaining a strong financial position in the energy market.

How Suburban Propane Partners, L.P. (SPH) Makes Money

Revenue Streams

Suburban Propane generates revenue primarily through the sale of propane and related services. The company offers various products and services that contribute to its overall financial performance:

• Propane Sales
• Sale of Appliances
• Service and Installation
• Tank Exchange and Leasing

Financial Performance

As of the fiscal year 2022, Suburban Propane reported the following financial figures:

Propane Sales Volume

In terms of propane sales volume, Suburban Propane reported:

Market Share and Competitors

Suburban Propane holds a notable position in the propane market with approximately 10% of the total U.S. propane retail sales. Major competitors include:

• AmeriGas Partners, L.P.
• Ferrellgas Partners, L.P.
• Circle K

Customer Base

The customer base for Suburban Propane includes:

• Residential Customers
• Commercial Customers
• Agricultural Customers
• Industrial Customers

Recent Acquisitions

In 2022, Suburban Propane completed the acquisition of Agri-Energy, which expanded its operations in the Midwest and increased its customer base significantly. The acquisition was valued at approximately $50 million.

Dividend History

Suburban Propane has a history of providing dividends to its shareholders. In 2022, the company declared quarterly dividends of:

Operational Costs

Key operational costs for Suburban Propane include:

• Transportation costs
• Propane purchase costs
• Labor costs
• Maintenance and repair costs

Future Outlook

Looking ahead, Suburban Propane anticipates growth through increased demand for propane in residential heating and energy generation, with projected revenue growth of 5% to 7% annually over the next five years.