Sunoco LP (SUN) Bundle
A Brief History of SUN
As of 2024, Sunoco LP (SUN) continues to be a significant player in the fuel distribution and logistics sectors, with a history marked by strategic acquisitions and operational expansions. The company has undergone substantial transformation, particularly highlighted by its acquisition of NuStar Logistics in May 2024, which significantly broadened its operational scope and asset base.
Acquisition of NuStar Logistics
The acquisition of NuStar Logistics was completed on May 3, 2024, for a total cash consideration of approximately $2.85 billion, which included the assumption of debt and the redemption of preferred units. This acquisition added significant assets and operations to SUN, enhancing its market position in the fuel distribution sector.
| Financial Metrics | Amount (in millions) |
|---|---|
| Total Cash Consideration | $2,850 |
| NuStar Revenue (2024) | $583 |
| NuStar Net Income (2024) | $56 |
Recent Financial Performance
For the nine months ending September 30, 2024, SUN reported a net income of $733 million, compared to $500 million for the same period in 2023. The increase in net income can be attributed to enhanced operational efficiencies and the integration of NuStar's assets.
Net cash provided by operating activities during the first nine months of 2024 was $426 million, slightly up from $416 million in 2023. The operational metrics reflect a strong performance driven by increased revenues from the newly acquired segments.
| Performance Metrics | 2024 | 2023 |
|---|---|---|
| Net Income | $733 million | $500 million |
| Net Cash from Operating Activities | $426 million | $416 million |
Debt and Financing Activities
As of September 30, 2024, SUN's total long-term debt stood at $7.26 billion, significantly increasing from $3.58 billion at the end of 2023 due to the debt assumed from the NuStar acquisition. The debt profile includes various senior notes with differing maturities and interest rates.
| Debt Instruments | Amount (in millions) |
|---|---|
| 5.750% Senior Notes due 2025 | $600 |
| 6.000% Senior Notes due 2026 | $500 |
| Total Debt | $7,337 |
Joint Ventures and Strategic Partnerships
On July 1, 2024, SUN established a joint venture with Energy Transfer, combining their crude oil and produced water gathering assets in the Permian Basin. This joint venture operates over 5,000 miles of pipelines and has a crude oil storage capacity exceeding 11 million barrels, strengthening SUN's position in the oil logistics sector.
The investment in the Permian joint venture was valued at $1.28 billion as of September 30, 2024, with the joint venture generating significant revenue and operational income.
| Joint Venture Metrics | Amount (in millions) |
|---|---|
| Investment Value | $1,280 |
| Joint Venture Revenue (Q3 2024) | $3,700 |
| Net Income (Q3 2024) | $90 |
Looking Ahead
With a robust portfolio bolstered by the NuStar acquisition and strategic joint ventures, SUN is poised for continued growth in the fuel distribution and logistics markets. The company plans to invest in further capital expenditures, projecting $300 million in growth capital for the full year 2024.
A Who Owns Sunoco LP (SUN)
Ownership Structure
As of 2024, Sunoco LP (SUN) operates as a master limited partnership (MLP). The ownership is primarily divided between common unitholders and the general partner, Energy Transfer LP. The following table summarizes the key ownership components:
| Owner Type | Ownership Percentage | Ownership Details |
|---|---|---|
| Common Unitholders | Approximately 93% | Common units held by public investors and institutional investors |
| General Partner | 7% | Owned by Energy Transfer LP, which manages operations |
Major Shareholders
The largest shareholders of Sunoco LP include both institutional investors and individual stakeholders. Below is a list of major shareholders as of September 30, 2024:
| Shareholder | Ownership Percentage | Type of Shareholder |
|---|---|---|
| Energy Transfer LP | 7% | General Partner |
| The Vanguard Group, Inc. | 10.3% | Institutional Investor |
| BlackRock, Inc. | 9.5% | Institutional Investor |
| State Street Corporation | 5.2% | Institutional Investor |
| Invesco Ltd. | 4.8% | Institutional Investor |
Recent Transactions Impacting Ownership
In May 2024, Sunoco LP completed the acquisition of NuStar Logistics, which significantly impacted its ownership structure and financials. The acquisition involved:
- Cash consideration of $2.85 billion for the acquisition of NuStar.
- Redemption of NuStar's preferred units totaling $784 million.
- Increase in total assets to $14.12 billion as of September 30, 2024.
Financial Performance and Market Position
As of September 30, 2024, Sunoco LP reported the following financial metrics:
| Metric | Value |
|---|---|
| Net Income | $733 million |
| Adjusted EBITDA | $1.018 billion |
| Total Assets | $14.12 billion |
| Total Debt | $7.34 billion |
Distribution Information
Sunoco LP maintains a distribution policy that provides regular cash distributions to its unitholders. The most recent cash distribution was:
| Distribution Type | Amount | Payment Date |
|---|---|---|
| Quarterly Distribution | $0.8756 per unit | August 19, 2024 |
Conclusion on Ownership Dynamics
The ownership dynamics of Sunoco LP reflect a structure typical of master limited partnerships, with a significant portion held by institutional investors and a controlling interest held by Energy Transfer LP. The recent acquisition of NuStar has positioned Sunoco LP for enhanced operational capacity and market competitiveness.
Sunoco LP (SUN) Mission Statement
Corporate Mission
Sunoco LP (SUN) aims to be a leading provider of fuel and convenience products, serving customers through a network of retail locations and distribution channels. The mission emphasizes a commitment to operational excellence, customer satisfaction, and sustainable practices.
Core Values
- Integrity: Maintaining transparency and ethical practices in all operations.
- Innovation: Continuously seeking new ways to improve service delivery and product offerings.
- Sustainability: Committing to environmentally responsible practices.
- Customer Focus: Prioritizing the needs and satisfaction of customers.
Financial Performance Overview
As of September 30, 2024, Sunoco LP reported significant financial metrics that reflect the company's operational capabilities and market position. Below is a summary of key financial data:
| Metric | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Net Income | $2 million | $272 million | ($270 million) |
| Adjusted EBITDA | $456 million | $257 million | $199 million |
| Motor Fuel Gallons Sold | 2,138 million | 2,118 million | 20 million |
| Revenues | $5,751 million | $6,320 million | ($569 million) |
| Cash Distribution per Unit | $0.8756 | $0.8420 | $0.0336 |
Strategic Goals for 2024
Sunoco LP has outlined strategic goals aimed at enhancing its market presence and operational efficiency:
- Expansion: Targeting growth through acquisitions and partnerships, exemplified by the acquisition of NuStar Energy.
- Operational Efficiency: Implementing cost-reduction strategies to improve profit margins.
- Customer Engagement: Enhancing customer experience through improved service delivery and product availability.
Recent Acquisitions
In 2024, Sunoco LP completed major acquisitions that significantly impacted its operational scale:
- NuStar Energy L.P. acquisition on May 3, 2024, valued at approximately $2.85 billion.
- Zenith European terminals acquisition for €170 million (approximately $185 million).
Market Position and Competitive Advantage
Sunoco LP's competitive advantage lies in its extensive distribution network and strategic partnerships, allowing it to efficiently serve a broad customer base. The company operates over 1,300 retail locations and continues to expand its footprint in the fuel distribution market.
Financial Health and Future Outlook
As of September 30, 2024, Sunoco LP's total assets amounted to $14.122 billion, while total debt stood at $7.337 billion. The company maintains a healthy liquidity position with $116 million in cash and a $1.42 billion unused credit facility, which supports its growth initiatives.
| Indebtedness Summary | September 30, 2024 | December 31, 2023 |
|---|---|---|
| Total Debt | $7.337 billion | $3.580 billion |
| Long-term Debt, Net | $7.259 billion | $3.580 billion |
| Weighted Average Interest Rate | 7.30% | N/A |
Commitment to Sustainability
Sunoco LP is dedicated to implementing sustainable practices across its operations. This includes initiatives aimed at reducing carbon emissions and promoting the use of renewable energy sources.
Conclusion on Mission Alignment
Sunoco LP's mission statement is deeply aligned with its operational strategies and financial objectives, focusing on growth, sustainability, and customer satisfaction.
How Sunoco LP (SUN) Works
Overview of Operations
Sunoco LP (SUN) operates primarily in the fuel distribution, pipeline systems, and terminal segments. The company is known for its extensive network and strategic acquisitions, enhancing its operational capabilities.
Financial Performance
As of September 30, 2024, Sunoco reported the following financial metrics:
| Metric | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Net Income | $2 million | $272 million | $(270) million |
| Segment Adjusted EBITDA | $456 million | $257 million | $199 million |
| Revenues | $5,751 million | $6,320 million | $(569) million |
| Cash Distribution per Unit | $0.8756 | $0.8420 | $0.0336 |
Segment Analysis
Sunoco's financial performance can be broken down into its key segments: Fuel Distribution, Pipeline Systems, and Terminals.
Fuel Distribution
In the Fuel Distribution segment, the company sold 2,138 million gallons of motor fuel in Q3 2024, an increase from 2,118 million gallons in Q3 2023. The profit per gallon improved to 12.8 cents from 12.5 cents in the previous year.
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Gallons Sold | 2,138 million | 2,118 million |
| Profit per Gallon | 12.8 cents | 12.5 cents | Fuel Profit | $96 million | $388 million |
Pipeline Systems
The Pipeline Systems segment achieved a throughput of 1,165 barrels per day in Q3 2024, with a segment profit of $159 million, a significant increase from the previous year.
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Throughput (barrels per day) | 1,165 | — |
| Segment Profit | $159 million | $— million |
Terminals
The Terminals segment reported a throughput of 694 barrels per day in Q3 2024, up from 421 barrels per day in Q3 2023, indicating a strong performance driven by recent acquisitions.
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Throughput (barrels per day) | 694 | 421 |
| Segment Profit | $101 million | $60 million |
Capital Expenditures and Investments
For the nine months ended September 30, 2024, Sunoco's total capital expenditures amounted to $212 million, which included $146 million for growth capital and $66 million for maintenance capital.
Debt and Liquidity
As of September 30, 2024, Sunoco's total long-term debt was $7.337 billion, up from $3.580 billion at the end of 2023. The company has a revolving credit facility with a balance of $50 million and unused availability of $1.42 billion.
| Debt Type | Amount (as of September 30, 2024) |
|---|---|
| Credit Facility | $50 million |
| Senior Notes Due 2025 | $600 million |
| Senior Notes Due 2026 | $500 million |
| Senior Notes Due 2027 | $600 million |
| Total Long-Term Debt | $7.337 billion |
Recent Acquisitions
Notable acquisitions include:
- NuStar Energy L.P. on May 3, 2024, valued at approximately $2.850 billion.
- Zenith Energy terminals in March 2024 for €170 million ($185 million).
- A terminal in Portland, Maine for approximately $24 million in August 2024.
Investment in Joint Ventures
As of September 30, 2024, Sunoco holds a 32.5% interest in a joint venture with Energy Transfer, with a carrying value of $1.28 billion.
How Sunoco LP (SUN) Makes Money
Business Model Overview
Sunoco LP (SUN) operates as a master limited partnership primarily engaged in the distribution of motor fuels and the operation of midstream energy infrastructure. The company is the largest independent distributor of motor fuel in North America and has a significant presence in over 40 U.S. states, Puerto Rico, Europe, and Mexico.
Revenue Streams
Sunoco LP generates revenue through various streams, including:
- Sales Revenue: Generated from the sale of motor fuels.
- Service Revenue: Income from ancillary services related to fuel distribution.
- Lease Revenue: Income from leasing terminal and storage facilities.
| Revenue Type | Q3 2024 Revenue (in millions) | Q3 2023 Revenue (in millions) | YTD Q3 2024 Revenue (in millions) | YTD Q3 2023 Revenue (in millions) |
|---|---|---|---|---|
| Sales Revenue | $5,424 | $6,208 | $16,673 | $17,123 |
| Service Revenue | $298 | $73 | $654 | $191 |
| Lease Revenue | $29 | $39 | $97 | $113 |
| Total Revenue | $5,751 | $6,320 | $17,424 | $17,427 |
Acquisitions and Expansion
In 2024, Sunoco LP expanded its operations significantly through strategic acquisitions:
- Acquired NuStar Energy L.P. on May 3, 2024, issuing approximately 51.5 million common units valued at approximately $2.85 billion and assuming about $3.5 billion in debt.
- Acquired liquid fuels terminals in Amsterdam and Bantry Bay for €170 million ($185 million).
- Acquired a terminal in Portland, Maine for approximately $24 million.
Financial Performance
As of September 30, 2024, Sunoco LP reported the following financials:
| Financial Metric | Q3 2024 (in millions) | Q3 2023 (in millions) |
|---|---|---|
| Operating Income | $107 | $338 |
| Net Income | $2 | $272 |
| Net Income Attributable to Partners | $2 | $272 |
| Basic Net Income per Common Unit | $(0.26) | $2.99 |
| Diluted Net Income per Common Unit | $(0.26) | $2.95 |
Debt and Financing
As of September 30, 2024, Sunoco LP's total long-term debt was $7.259 billion. Recent financing activities included:
- Issued $750 million of 7.000% senior notes due 2029 and $750 million of 7.250% senior notes due 2032 in April 2024.
- Redeemed subordinated notes totaling $403 million and terminated a credit facility totaling $455 million following the NuStar acquisition.
Cash Distribution
For the nine months ended September 30, 2024, Sunoco LP declared cash distributions per common unit of $2.6268, compared to $2.5260 for the same period in 2023.
| Distribution Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Cash Distribution per Unit | $0.8756 | $0.8420 |
Operational Efficiency
Sunoco LP maintains a significant operational footprint, including:
- Approximately 14,000 miles of pipeline.
- Over 100 terminals.
- Serving approximately 7,400 branded locations and additional independent dealers.
Joint Ventures
On July 16, 2024, Sunoco LP announced a joint venture with Energy Transfer, combining crude oil and produced water gathering assets in the Permian Basin. The joint venture operates over 5,000 miles of pipelines with storage capacity exceeding 11 million barrels.
| Joint Venture Financials | Q3 2024 Revenue (in millions) | Operating Income (in millions) | Net Income (in millions) |
|---|---|---|---|
| Permian Joint Venture | $3,700 | $91 | $90 |
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Updated on 16 Nov 2024
Resources:
- Sunoco LP (SUN) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Sunoco LP (SUN)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Sunoco LP (SUN)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.