Slide 1: Investor Presentation
Investor Presentation December 2023
Slide 2: Forward-Looking Statements
Forward-Looking Statements Some of the statements in this presentation constitute “forward-looking statements” about Sunoco LP (“SUN”, “we”, “our,” and “us”) that involve risks, uncertainties and assumptions, including, without limitation, the expected future performance of SUN (including expected r
Slide 3: North America's Largest Independent Fuel Distributor & Terminal Operator
North America’s Largest Independent Fuel Distributor & Terminal Operator Transmix / Terminals J.C. Nolan JV Terminal / Pipeline Terminals Wholesale / Retail Sites Puerto Rico Hawaii • Vertically integrated refined product • ~10,000 customers • Own and operate 42 product infrastructure and distributi
Slide 4: Financial Highlights
Financial Highlights Sunoco LP (NYSE: SUN) • Revenue (TTM Q3‘23): ~$23 billion • Credit Ratings: • Market Capitalization: ~$4.6 billion(1) – Moody’s: Ba3 (Stable) • Enterprise Value: ~$8.2 billion(1) – S&P: BB (Stable) – Fitch: BB+ (Stable) • Annual Distribution: $3.368 / unit – Strong coverage, tar
Slide 5: Total Shareholder Return
History of Delivering Superior Unitholder Returns 375% In April 2017, SUN announced a new COVID Inflation, Higher Interest Rates Growth 325% strategic direction • Expanding free cash flow from focusing on refined accretive growth SUN +340%(1) product distribution (25% annual return) 275% and infrast
Slide 6: SUN Is Well Positioned In Highly Attractive Fuel Distribution & Logistics Sector
SUN Is Well Positioned In Highly Attractive Fuel Distribution & Logistics Sector SUN Participates Across The Value Chain Between Refiners & The Consumer Exploration & Production Refining Bulk Shipments Product Terminals Trucking & Logistics Wholesale / Retail • Majority of fuel supply • Wholesale fu
Slide 7: Wholesale Margins Have Normalized Higher
1 Wholesale Margins Have Normalized Higher Wholesale Rack Margins(1) vs Pre-COVID Levels Key Drivers • Higher breakeven margins driven by varying rates of +38% volume recovery post- Wholesale Rack Margins COVID combined with +18% continued inflation and rising +8% cost of capital • Greater volatilit
Slide 8: Higher Breakeven Margins Benefit The Most Efficient Operators
2 Higher Breakeven Margins Benefit The Most Efficient Operators Illustrative Example Relevant Insights Highly fragmented industry: • >60% of fuel stations owned by single site operators(1) Breakeven Margin • Limited economies of Less efficient operators are scale/scope for all but a few forced to ra
Slide 9: Higher Breakevens Expected To Continue
2 Higher Breakevens Expected To Continue Breakeven Elements Recent Themes Future Considerations • Inside gross profit has been • Continued inflation puts ongoing slightly up, primarily driven by retail pressure on inside gross profit Inside Store price increases • Legislative initiatives restricting
Slide 10: Margin Asymmetry In Volatile Environments Is Constructive To Retail Margins
3 Margin Asymmetry In Volatile Environments Is Constructive To Retail Margins When Prices Rise, Margins …But When Prices Fall, Margins Compress… Expand Disproportionately Costs rose ~20% over 100 days Costs declined ~35% over 90 days Margins compressed by ~25% (-12 CPG) Margins expanded by ~45% (+36
Slide 11: SUN Portfolio Is Managed For Stability & Upside
4 SUN Portfolio Is Managed For Stability & Upside • 7-Eleven take-or-pay fuel supply agreement ensures long-term gross profit stability Strong Wholesale Fuel • 7-to-10-year fuel supply agreements with >90% retention rates generate highly ratable volumes Distribution Portfolio • Pass-through pricing
Slide 12: Scale & Sunoco Brand Enable Higher Margin Capture
5 Scale & Sunoco Brand Enable Higher Margin Capture Significant North America’s largest independent fuel distributor… Scale SUN distributes over 8 billion gallons annually • Buying power, sophisticated supply strategy and operational capabilities (e.g. blending, cargo operations) lower cost of goods
Slide 13: Expense Discipline Is A Core Competency
6 Expense Discipline Is A Core Competency $1,000 COVID Inflation $935+ History of $919 Expense Discipline $750 • Since 2019, total operating $739 $754 expenses have grown by ~2% annually while Adjusted $665 $540- EBITDA(1) has grown by ~9% $550 annually $MM $500 $521 $501 • ~ $1.3 billion of growth
Slide 14: Growth Outlook Is Sustainable
7 Growth Outlook Is Sustainable Accretive Growth Generates Increasing Free Cash Flow Will Increasing Free Cash Flow Provide More Growth Opportunities Over the last three years, Organic SUN has invested ~$1.3 billion • As market presence expands, in growth… organic growth opportunities will increase
Slide 15: 2024 Business Outlook & Guidance – Continued Growth & Strong Performance
2024 Business Outlook & Guidance – Continued Growth & Strong Performance Outlook / Key Metrics Key Points Guidance ~8.3 billion • Growth investments will increase volume and market share Fuel Volume / Margin gallons • Breakeven margins will remain elevated ~12.5 CPG • Track record of optimizing gros
Slide 16: 2025 & Beyond – Continued Growth
2025 & Beyond – Continued Growth $1,200 ~8% CAGR 2019 – 2024E $975- Growth Outlook $1,000 $1,000 $935+ $919 Continuation of strong base business $800 Adjusted EBITDA(1) ($MM) $739 $754 + $665 $600 Expanding cash flow enables continued growth $400 = $200 Annual growth in Adjusted EBITDA(1) and distri
Slide 17: Sunoco's Key Investment Considerations
Sunoco’s Key Investment Considerations Attractive Strong Track SUN’s Attractive Sustainable Future Record of Competitive Fundamentals Growth Returns for Performance Advantages Unitholders 17
Slide 18: Committed to Corporate Responsibility
Committed to Corporate Responsibility Demonstrating Environmental Behaving Responsibly in the Building and Maintaining a Awareness and Performance Workplace and the Community Culture of Responsibility Effective Environmental Responsible Work Environment Starts at the Top Protocols • Stringent approa
Slide 19: Reconciliation of Net Income to Adjusted EBITDA & DCF, As Adjusted
Reconciliation of Net Income to Adjusted EBITDA & DCF, As Adjusted(1) 2019 2020 2021 2022 ($ in millions) Net income and comprehensive income $ 313 $ 212 $ 524 $ 475 Depreciation, amortization and accretion 183 189 177 193 Interest expense, net 173 175 163 182 Non-cash unit-based compensation expens