GLOBAL PARTNERS LP [GLP] Filings

10-Q 1 glp-20240630x10q.htm 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)
☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2024

OR

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-32593

Global Partners LP

(Exact name of registrant as specified in its charter)

Delaware		74-3140887
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

P.O. Box 9161
800 South Street
Waltham, Massachusetts 02454-9161
(Address of principal executive offices, including zip code)

(781) 894-8800
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Units representing limited partner interests	GLP	New York Stock Exchange

9.50% Series B Fixed Rate Cumulative Redeemable	GLP pr B	New York Stock Exchange
Perpetual Preferred Units representing limited partner interests

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer ☒			Accelerated filer ☐
Non-accelerated filer ☐			Smaller reporting company ☐
			Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The issuer had 33,995,563 common units outstanding as of August 5, 2024.

Table of Contents

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements (unaudited)		3

Consolidated Balance Sheets as of June 30, 2024 and December 31, 2023		3

Consolidated Statements of Operations for the three and six months ended June 30, 2024 and 2023		4

Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2024 and 2023		5

Consolidated Statements of Cash Flows for the six months ended June 30, 2024 and 2023		6

Consolidated Statements of Partners’ Equity for the six months ended June 30, 2024 and 2023		7

Notes to Consolidated Financial Statements		8

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		35

Item 3. Quantitative and Qualitative Disclosures About Market Risk		60

Item 4. Controls and Procedures		61

PART II. OTHER INFORMATION		62

Item 1. Legal Proceedings		62

Item 1A. Risk Factors		62

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		62

Item 5. Other Information		62

Item 6. Exhibits		62

SIGNATURES		64

Table of Contents

Item 1.Financial Statements

GLOBAL PARTNERS LP

CONSOLIDATED BALANCE SHEETS

(In thousands, except unit data)

(Unaudited)


	June 30,		December 31,
	2024		2023
Assets
Current assets:
Cash and cash equivalents	$	14,114	$	19,642
Accounts receivable, net		602,206		551,764
Accounts receivable-affiliates		10,221		8,142
Inventories		567,018		397,314
Brokerage margin deposits		21,253		12,779
Derivative assets		6,056		17,656
Prepaid expenses and other current assets		79,069		90,531
Total current assets		1,299,937		1,097,828
Property and equipment, net		1,686,543		1,513,545
Right of use assets, net		264,269		252,849
Intangible assets, net		21,660		20,718
Goodwill		426,063		429,215
Equity method investments		87,781		94,354
Other assets		42,491		37,502
Total assets	$	3,828,744	$	3,446,011
Liabilities and partners’ equity
Current liabilities:
Accounts payable	$	557,839	$	648,717
Working capital revolving credit facility-current portion		281,200		16,800
Lease liability-current portion		53,973		59,944
Environmental liabilities-current portion		5,493		5,057
Trustee taxes payable		77,627		67,398
Accrued expenses and other current liabilities		199,378		179,887
Derivative liabilities		7,975		4,987
Total current liabilities		1,183,485		982,790
Working capital revolving credit facility-less current portion		—		—
Revolving credit facility		200,000		380,000
Senior notes		1,185,326		742,720
Lease liability-less current portion		216,888		200,195
Environmental liabilities-less current portion		74,560		71,092
Financing obligations		136,590		138,485
Deferred tax liabilities		66,010		68,909
Other long-term liabilities		60,310		61,160
Total liabilities		3,123,169		2,645,351
Partners’ equity
Series A preferred limited partners (0 and 2,760,000 units issued and outstanding at June 30, 2024 and December 31, 2023, respectively)		—		67,476
Series B preferred limited partners (3,000,000 units issued and outstanding at June 30, 2024 and December 31, 2023)		72,305		72,305
Common limited partners (33,995,563 units issued and 33,802,582 outstanding at June 30, 2024 and 33,995,563 units issued and 33,882,357 outstanding at December 31, 2023)		631,433		658,670
General partner interest (0.67% interest with 230,303 equivalent units outstanding at June 30, 2024 and December 31, 2023)		2,370		1,828
Accumulated other comprehensive (loss) income		(533)		381
Total partners’ equity		705,575		800,660
Total liabilities and partners’ equity	$	3,828,744	$	3,446,011

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

GLOBAL PARTNERS LP

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per unit data)

(Unaudited)


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2024		2023		2024		2023
Sales	$	4,409,698	$	3,831,690	$	8,555,090	$	7,862,017
Cost of sales		4,121,814		3,589,031		8,052,071		7,397,294
Gross profit		287,884		242,659		503,019		464,723
Costs and operating expenses:
Selling, general and administrative expenses		72,370		66,696		142,151		128,952
Operating expenses		129,959		110,379		250,109		218,732
Amortization expense		1,989		2,018		3,858		4,102
Net (gain) loss on sale and disposition of assets		(303)		884		(2,804)		(1,244)
Total costs and operating expenses		204,015		179,977		393,314		350,542
Operating income		83,869		62,682		109,705		114,181
Other (loss) income and (expense):
(Loss) income from equity method investments		(346)		1,204		(1,725)		1,204
Interest expense		(35,531)		(21,806)		(65,227)		(43,874)
Income before income tax expense		47,992		42,080		42,753		71,511
Income tax expense		(1,843)		(691)		(2,206)		(1,091)
Net income		46,149		41,389		40,547		70,420
Less: General partner’s interest in net income, including incentive distribution rights		3,802		2,339		6,938		4,121
Less: Preferred limited partner interest in net income		2,097		3,463		6,013		6,926
Less: Redemption of Series A preferred limited partner units		2,634		—		2,634		—
Net income attributable to common limited partners	$	37,616	$	35,587	$	24,962	$	59,373
Basic net income per common limited partner unit	$	1.11	$	1.05	$	0.74	$	1.75
Diluted net income per common limited partner unit	$	1.10	$	1.05	$	0.73	$	1.75
Basic weighted average common limited partner units outstanding		33,910		33,986		33,936		33,986
Diluted weighted average common limited partner units outstanding		34,278		34,006		34,273		34,008

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

GLOBAL PARTNERS LP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

(Unaudited)


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2024		2023		2024		2023
Net income	$	46,149	$	41,389	$	40,547	$	70,420
Other comprehensive (loss) income:
Change in pension liability		(330)		672		(914)		1,124
Total other comprehensive (loss) income		(330)		672		(914)		1,124
Comprehensive income	$	45,819	$	42,061	$	39,633	$	71,544

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

GLOBAL PARTNERS LP

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)


	Six Months Ended
	June 30,
	2024		2023
Cash flows from operating activities
Net income	$	40,547	$	70,420
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Depreciation and amortization		67,752		53,445
Amortization of deferred financing fees		3,704		2,711
Bad debt expense		(72)		496
Unit-based compensation expense		6,711		3,161
Write-off of financing fees		1,440		482
Net gain on sale and disposition of assets		(2,804)		(1,244)
Loss (income) from equity method investments		1,725		(1,204)
Dividends received on equity method investments		204		—
Changes in operating assets and liabilities:
Accounts receivable		(50,370)		47,549
Accounts receivable-affiliate		(2,079)		(8,365)
Inventories		(170,931)		222,251
Broker margin deposits		(8,474)		7,784
Prepaid expenses, all other current assets and other assets		10,606		(5,568)
Accounts payable		(90,878)		(132,292)
Trustee taxes payable		10,229		13,020
Change in derivatives		14,588		(9,344)
Accrued expenses, all other current liabilities and other long-term liabilities		9,746		(17,365)
Net cash used in (provided by) operating activities		(158,356)		245,937
Cash flows from investing activities
Acquisition of terminals		(215,000)		—
Equity method investments		(10,063)		(69,482)
Capital expenditures		(32,223)		(37,286)
Seller note issuances		(7,938)		(8,155)
Dividends received of equity method investments		14,707		—
Proceeds from sale of property and equipment, net		18,343		7,350
Net cash used in investing activities		(232,174)		(107,573)
Cash flows from financing activities
Net borrowings from (payments on) working capital revolving credit facility		264,400		(64,000)
Net (payments on) borrowings from revolving credit facility		(180,000)		20,000
Proceeds from senior notes, net		441,301		—
Redemption of Series A preferred units		(69,000)		—
Repurchase of common units		(7,902)		—
LTIP units withheld for tax obligations		(1,818)		(469)
Distribution equivalent rights		(566)		(560)
Distributions to limited partners and general partner		(61,413)		(86,331)
Net cash provided by (used in) financing activities		385,002		(131,360)
Cash and cash equivalents
(Decrease) increase in cash and cash equivalents		(5,528)		7,004
Cash and cash equivalents at beginning of period		19,642		4,040
Cash and cash equivalents at end of period	$	14,114	$	11,044
Supplemental information
Cash paid during the period for interest	$	35,350	$	33,400

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

GLOBAL PARTNERS LP

CONSOLIDATED STATEMENTS OF PARTNERS’ EQUITY

(In thousands)

(Unaudited)


	Series A		Series B						Accumulated
	Preferred		Preferred		Common		General		Other		Total
	Limited		Limited		Limited		Partner		Comprehensive		Partners’
Three and six months ended June 30, 2024	Partners		Partners		Partners		Interest		Income (Loss)		Equity
Balance at December 31, 2023	$	67,476	$	72,305	$	658,670	$	1,828	$	381	$	800,660
Net income (loss)		2,135		1,781		(12,654)		3,136		—		(5,602)
Distributions to limited partners and general partner		(2,135)		(1,781)		(23,797)		(3,037)		—		(30,750)
Unit-based compensation		—		—		2,596		—		—		2,596
Other comprehensive income		—		—		—		—		(584)		(584)
LTIP units withheld for tax obligations		—		—		(1,818)		—		—		(1,818)
Distribution equivalent rights		—		—		(519)		—		—		(519)
Dividends on repurchased units		—		—		21		—		—		21
Balance at March 31, 2024	$	67,476	$	72,305	$	622,499	$	1,927	$	(203)	$	764,004
Redemption of preferred units		(66,366)		—		(2,634)		—		—		(69,000)
Net income		316		1,781		40,250		3,802		—		46,149
Distributions to limited partners and general partner		(1,426)		(1,781)		(24,137)		(3,359)		—		(30,703)
Unit-based compensation		—		—		4,115		—		—		4,115
Other comprehensive income		—		—		—		—		(330)		(330)
Repurchase of common units		—		—		(7,902)		—		—		(7,902)
Distribution equivalent rights		—		—		(777)		—		—		(777)
Dividends on repurchased units		—		—		19		—		—		19
Balance at June 30, 2024	$	—	$	72,305	$	631,433	$	2,370	$	(533)	$	705,575


	Series A		Series B						Accumulated
	Preferred		Preferred		Common		General		Other		Total
	Limited		Limited		Limited		Partner		Comprehensive		Partners’
Three and six months ended June 30, 2023	Partners		Partners		Partners		Interest		Income (Loss)		Equity
Balance at December 31, 2022	$	67,226	$	72,305	$	648,956	$	406	$	(449)	$	788,444
Net income		1,682		1,781		23,786		1,782		—		29,031
Distributions to limited partners and general partner		(1,682)		(1,781)		(53,458)		(1,952)		—		(58,873)
Unit-based compensation		—		—		1,094		—		—		1,094
Other comprehensive income		—		—		—		—		452		452
LTIP units withheld for tax obligations		—		—		(469)		—		—		(469)
Distribution equivalent rights		—		—		(406)		—		—		(406)
Dividends on repurchased units		—		—		15		—		—		15
Balance at March 31, 2023	$	67,226	$	72,305	$	619,518	$	236	$	3	$	759,288
Net income		1,682		1,781		35,587		2,339		—		41,389
Distributions to limited partners and general partner		(1,682)		(1,781)		(22,267)		(1,749)		—		(27,479)
Unit-based compensation		—		—		2,067		—		—		2,067
Other comprehensive income		—		—		—		—		672		672
Distribution equivalent rights		—		—		(411)		—		—		(411)
Dividends on repurchased units		—		—		6		—		—		6
Balance at June 30, 2023	$	67,226	$	72,305	$	634,500	$	826	$	675	$	775,532

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

GLOBAL PARTNERS LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1. Organization and Basis of Presentation

Organization

Global Partners LP (the “Partnership”) is a master limited partnership formed in March 2005. The Partnership owns, controls or has access to a large terminal network of refined petroleum products and renewable fuels—with connectivity to strategic rail, pipeline and marine assets—spanning from Maine to Florida and into the U.S. Gulf States. The Partnership is one of the largest independent owners, suppliers and operators of gasoline stations and convenience stores, primarily in Massachusetts, Maine, Connecticut, Vermont, New Hampshire, Rhode Island, New York, New Jersey and Pennsylvania (collectively, the “Northeast”) and Maryland and Virginia. As of June 30, 2024, the Partnership had a portfolio of 1,595 owned, leased and/or supplied gasoline stations, including 322 directly operated convenience stores, primarily in the Northeast, as well as 64 gasoline stations located in Texas that are operated by the Partnership’s unconsolidated affiliate, Spring Partners Retail LLC (“SPR”). The Partnership is also one of the largest distributors of gasoline, distillates, residual oil and renewable fuels to wholesalers, retailers and commercial customers in the New England states and New York. The Partnership engages in the purchasing, selling, gathering, blending, storing and logistics of transporting petroleum and related products, including gasoline and gasoline blendstocks (such as ethanol), distillates (such as home heating oil, diesel and kerosene), residual oil, renewable fuels, crude oil and propane and in the transportation of petroleum products and renewable fuels by rail from the mid-continent region of the United States and Canada.

Global GP LLC, the Partnership’s general partner (the “General Partner”), manages the Partnership’s operations and activities and employs its officers and substantially all of its personnel, except for most of its gasoline station and convenience store employees who are employed by Global Montello Group Corp. (“GMG”), a wholly owned subsidiary of the Partnership and for substantially all of the employees who primarily or exclusively provide services to SPR, who are employed by SPR Operator LLC (“SPR Operator”), also a wholly owned subsidiary of the Partnership.

The General Partner, which holds a 0.67% general partner interest in the Partnership, is owned by affiliates of the Slifka family. As of June 30, 2024, affiliates of the General Partner, including its directors and executive officers and their affiliates, owned 6,608,977 common units, representing a 19.4% limited partner interest.

2024 Events

Redemption of Series A Preferred Units—On April 15, 2024, the Partnership redeemed all of its outstanding Series A Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units (the “Series A Preferred Units”) at a redemption price of $25.00 per unit, plus a $0.514275 per unit cash distribution for the period from February 15, 2024 through April 14, 2024. Effective April 15, 2024, the Series A Preferred Units are no longer outstanding. See Note 13 for additional information.

Acquisition of Terminals from Gulf Oil—On April 9, 2024, the Partnership acquired four refined-product terminals from Gulf Oil Limited Partnership. See Note 2 for additional information.

Credit Agreement Facility Reallocation and Accordion Reduction—On February 5, 2024, the Partnership and the lenders under the Partnership’s credit agreement agreed, pursuant to the terms of our credit agreement, to (i) a reallocation of $300.0 million of the revolving credit facility to the working capital revolving credit facility and (ii) reduce the accordion feature from $200.0 million to $0. After giving effect to the reallocation and the accordion reduction, the working capital revolving credit facility is $950.0 million and the revolving credit facility is $600.0 million, for a total commitment of $1.55<

GLOBAL PARTNERS LP [GLP] Filings
GLOBAL PARTNERS LP [GLP-PB] Filings
10-Q	[2024-08-07]
10-Q	[2024-05-08]
10-K	[2024-02-29]
10-Q	[2023-11-09]
10-Q	[2023-08-04]
10-Q	[2023-05-05]
10-K	[2023-02-27]
10-Q	[2022-11-04]
10-Q	[2022-08-05]
10-Q	[2022-05-06]
10-K	[2022-02-28]
10-Q	[2021-11-05]
10-Q	[2021-08-06]
10-Q	[2021-05-07]
10-K	[2021-03-05]
10-Q	[2020-11-05]
10-Q	[2020-08-06]
10-Q	[2020-05-08]
10-K	[2020-03-06]
10-Q	[2019-11-07]
10-Q	[2019-08-08]
10-Q	[2019-05-09]
10-K	[2019-03-08]
10-Q	[2018-11-08]
10-Q	[2018-08-09]
10-Q	[2018-05-09]
10-K	[2018-03-09]
10-Q	[2017-11-08]
10-Q	[2017-08-09]
10-Q	[2017-05-09]
10-K	[2017-03-10]
10-Q	[2016-11-07]
10-Q	[2016-08-08]
10-Q	[2016-05-09]
10-K	[2016-02-29]
10-Q	[2015-11-06]
10-Q	[2015-08-07]
10-Q	[2015-05-08]
10-K	[2015-03-13]
10-Q	[2014-11-07]
10-Q	[2014-08-08]
10-Q	[2014-05-09]
10-K	[2014-04-01]
10-Q	[2013-11-07]
10-Q	[2013-08-08]
10-Q	[2013-05-09]
10-K	[2013-03-15]
10-Q	[2012-11-09]
10-Q	[2012-08-08]
10-Q	[2012-05-09]
10-K	[2012-03-12]

GLOBAL PARTNERS LP [GLP] Filings

GLOBAL PARTNERS LP [GLP-PB] Filings