Sprague Resources LP (SRLP): history, ownership, mission, how it works & makes money

A Brief History of Sprague Resources LP (SRLP)

Formation and Initial Growth

Sprague Resources LP was formed in 2014. It originated when Sprague Operating Resources LLC, a company engaged in the distribution and marketing of petroleum products, decided to bring its operations together into a publicly traded entity. The company began its operations focusing mainly on the northeastern United States and expanded its footprint over time.

Business Model and Services

The company operates a midstream energy business, including the distribution of refined petroleum products, heating oil, and lubricants. Sprague Resources LP also provides logistics and storage capabilities. As of 2022, Sprague managed over 1 billion gallons of fuel annually and maintained approximately 1,100 fueling locations.

Financial Performance

In the fiscal year ending December 31, 2022, Sprague Resources reported revenues of approximately $1.54 billion, showing a year-over-year increase driven by higher fuel prices and demand recovery post-pandemic.

Market Position and Competitors

Sprague Resources LP ranks among the significant players in the northeastern fuel market, competing with other major companies such as P66, ExxonMobil, and Sunoco. The company has carved out a niche in both residential and commercial heating oil markets.

Acquisitions and Expansion

In 2018, Sprague acquired Murphy Oil's marketing operations, which enhanced its market share and expanded its customer base. They have also invested significantly in infrastructure, including $20 million in terminal upgrades and tank expansions over a span of three years.

Recent Developments

As of September 2023, Sprague Resources has announced plans for further expansion into renewable energy sources, aiming to diversify its offerings amid shifting market demands. The company is allocating approximately $10 million towards research and development of biofuels and other sustainable energy solutions.

Stock Performance

Sprague Resources LP is traded on the New York Stock Exchange under the ticker symbol SRLP. As of October 2023, the stock price was approximately $16.75 per share, with a market capitalization of about $450 million.

Environmental and Regulatory Compliance

The company ensures compliance with various environmental regulations set forth by the Environmental Protection Agency (EPA) and local regulations. In 2022, Sprague allocated $3 million for environmental compliance and sustainability programs.

Future Outlook

Analysts predict a strong growth trajectory for Sprague Resources LP, with projected revenues expected to reach approximately $1.7 billion by the end of 2024, driven by increased market demand and strategic investments in infrastructure and new technologies.

A Who Owns Sprague Resources LP (SRLP)

Ownership Structure

Sprague Resources LP (SRLP) operates under a complicated ownership structure typical of publicly traded limited partnerships. As of the latest available data, the major stakeholders in Sprague Resources are:

• Sprague Resources Holdings LLC - 73.3% ownership
• Public shareholders - 26.7% ownership
• Management and insider holdings - approximately 2.5%

Institutional Investors

Institutional investors significantly influence SRLP's ownership through large stock holdings. As of the most recent filings:

Management Team

The executive team of Sprague Resources LP is vital for its operations and strategic direction. Key members include:

• David L. Borkowski - Chief Executive Officer
• Matthew R. Dyer - Chief Financial Officer
• Ian L. McCullough - Chief Operating Officer
• Sarah J. Hargrove - Chief Marketing Officer

Recent Financial Performance

As of the end of the fiscal year, Sprague Resources LP reported:

Market Capitalization

The market capitalization of Sprague Resources LP fluctuates based on stock performance. As of the latest trading data, the market cap stands at:

• Market Cap - USD 650 million
• Stock Price - USD 25.30 per share
• Outstanding Shares - 25.7 million shares

Recent Developments

In early 2023, Sprague Resources LP announced:

• Acquisition of a small regional distributor for USD 50 million.
• Expansion plans into the renewable energy sector.
• Increased quarterly distributions to unitholders by 5%.

Sprague Resources LP (SRLP) Mission Statement

Corporate Overview

Sprague Resources LP is a leading full-service energy company engaged in the supply and distribution of fuels, lubricants, and related services. As of Q3 2023, the company reported revenues of approximately $1.89 billion.

Mission Statement

Sprague Resources LP's mission statement emphasizes their commitment to delivering high-quality products and services while maintaining operational excellence and sustainability in the energy sector.

Core Values

• Integrity: Adhering to the highest ethical standards in all business practices.
• Customer Focus: Prioritizing customer needs and building long-term relationships.
• Sustainability: Promoting environmentally responsible practices across operations.
• Innovation: Investing in technology and processes to enhance efficiency and service delivery.

Financial Performance

As of the latest financial reporting, Sprague Resources LP reported an adjusted EBITDA of $103 million for the fiscal year 2022.

Market Position and Strategy

Sprague Resources LP ranks among the top ten fuel distributors in the Northeast U.S., holding a substantial market share. In 2023, the company expanded its service territory, acquiring additional distribution terminals to enhance its logistical capabilities.

Sustainability Commitment

The company aims to reduce its carbon footprint by 25% by 2030 through various initiatives, including technological upgrades and operational efficiencies.

Community Engagement

Sprague actively participates in community development programs, contributing approximately $1.5 million annually to local initiatives.

Future Outlook

Forecasts indicate that Sprague Resources LP anticipates a revenue growth rate of approximately 5% in the upcoming year, bolstered by strategic partnerships and market expansion efforts.

How Sprague Resources LP (SRLP) Works

Business Model

Sprague Resources LP (SRLP) operates primarily in the energy sector, focusing on the distribution and marketing of heating oil, diesel fuel, and gasoline products. The company also engages in the sale of natural gas and renewable energy products.

Market Presence

As of Q3 2023, Sprague reported operating in approximately 24 states across the northeastern and midwestern United States, with a strong emphasis on the New England market.

Financial Performance

For the fiscal year ending December 31, 2022, Sprague Resources reported:

Product Offerings

Sprague Resources offers a range of products, including:

• Heating Oil
• Diesel Fuel
• Gasoline
• Natural Gas
• Renewable Energy Products

In 2023, the company sold over 1 billion gallons of fuel products.

Logistics and Supply Chain

Sprague manages multiple terminals and storage facilities, facilitating efficient distribution. As of 2023, the company has:

Customer Segments

Sprague Resources caters to various customer segments, including:

• Residential Customers
• Commercial Enterprises
• Industrial Clients
• Government Contracts

Recent Developments

In April 2023, Sprague announced a strategic partnership with SolarTech Inc. to enhance its renewable energy offerings, focusing on solar-based solutions and aiming for a 20% increase in renewable energy sales by 2025.

Market Trends

As of 2023, the demand for heating oil in the Northeast is projected to rise by 3.5% annually, driven by fluctuating natural gas prices and increased winter heating needs. The renewable energy sector is also expected to grow by 15% in the next five years.

Conclusion

Sprague Resources LP continues to adapt to market trends by diversifying its product offerings and expanding its renewable energy initiatives, reflecting a proactive approach to changing energy demands.

How Sprague Resources LP (SRLP) Makes Money

Overview of Business Segments

Sprague Resources LP (SRLP) operates primarily in the energy sector, focusing on the marketing and distribution of refined petroleum products. The company generates revenue through various business segments:

• Wholesale Fuel Distribution
• Retail Fuel Sales
• Terminal Services
• Natural Gas Marketing

Wholesale Fuel Distribution

Sprague’s wholesale fuel distribution segment is a significant revenue driver. In 2022, the company reported wholesale fuel sales revenue of approximately $1.2 billion.

Retail Fuel Sales

The retail segment of Sprague Resources LP includes a network of convenience stores and gas stations. In the fiscal year 2022, retail fuel sales contributed around $600 million to the total revenue.

Terminal Services

Sprague operates several terminals for storage and distribution services. Revenue from terminal services amounted to approximately $50 million in 2022.

Natural Gas Marketing

Natural gas marketing activities also contribute to Sprague’s revenue streams. In 2022, this segment generated an estimated revenue of $150 million.

Revenue Breakdown

Cost Structure

Understanding Sprague's cost structure is essential for analyzing profitability. Key costs include:

• Cost of Goods Sold (COGS)
• Operating Expenses
• Marketing and Advertising Expenses
• Administrative Expenses

Financial Performance Indicators

Sprague Resources LP has shown various financial performance indicators over recent years:

• Gross Profit Margin: 15% in 2022
• Net Income: $25 million in 2022
• EBITDA Margin: 10% in 2022
• Debt-to-Equity Ratio: 1.5 as of year-end 2022

Market Position and Competitive Advantage

Sprague's market position is bolstered by its extensive distribution network and established relationships with suppliers and customers. As of 2022, the company held a market share of approximately 5% in the northeastern United States fuel distribution market.

Conclusion of Financial Data

Sprague's diversified revenue streams, including wholesale distribution, retail sales, terminal services, and natural gas marketing contribute significantly to its overall financial health. The company's consistent revenue generation and strategic market positioning create a robust framework for sustained profitability.