Suburban Propane Partners, L.P.

What they do

The Partnership distributes propane, renewable propane, renewable natural gas (RNG), fuel oil and refined fuels, and markets natural gas and electricity in deregulated markets. It serves approximately 1.0 million residential, commercial, industrial, and agricultural customers through about 750 locations in 42 states, with operations concentrated in the east and west coasts, the midwest, and Alaska. It also installs and services home comfort equipment, including heating and ventilation. In fiscal 2025, it sold approximately 400.5 million gallons of propane and 16.5 million gallons of fuel oil and refined fuels.

Revenue drivers

• Retail propane — Primary segment; sold 400.5 million gallons in fiscal 2025 and is seasonal, with roughly two-thirds of volume sold from October through March.
• Fuel oil and refined fuels — Smaller segment; sold 16.5 million gallons in fiscal 2025, with about three-fourths of volumes sold between October and March.
• Natural gas and electricity marketing — Operated through Agway Energy Services, LLC, offering retail gas and electricity in deregulated markets; also seasonal, tied to heating demand.
• Renewable natural gas and low-carbon fuels — Platform through Suburban Renewable Energy, LLC; includes RNG production facilities (Stanfield, AZ; Columbus, OH; Adirondack Farms, NY) and benefits from environmental credits, such as California LCFS and D3 RINs.

Recent performance

For the third quarter ended June 27, 2026, the Partnership reported a net loss of $17.5 million, or $0.26 per Common Unit, versus a net loss of $14.8 million ($0.23 per unit) in the prior year quarter. Adjusted EBITDA for the quarter was $18.0 million, down from $27.0 million in the prior year. Retail propane gallons sold declined 1.8% to 70.6 million gallons, hurt by warmer-than-normal April temperatures. Total gross margin was $160.3 million, unchanged from the prior year, but excluding mark-to-market adjustments it fell 2.4% due to lower volumes. For fiscal 2025, annual revenue was $1.43 billion, net income $106.6 million, and diluted EPS $1.62.

Strategy

Management continues to manage commodity costs and pricing in a volatile environment, using hedging to reduce price risk. Growth capital is being directed to renewable natural gas projects, including new anaerobic digester facilities in Upstate New York (placed into service after the quarter) and Columbus, Ohio (expected in the fourth quarter of fiscal 2026). The Partnership also uses an at-the-market equity program to fund growth capital and reduce debt; debt was reduced by more than $36 million in the third quarter. Operational focus remains on customer service, managing selling prices, and cost discipline, while growing the counter-seasonal customer base.

Risks

• Weather and seasonality — Demand is highly weather-sensitive; near-record warm April temperatures in fiscal 2026 reduced heat-related demand, and sustained warm winters can lower volumes.
• Commodity price volatility — Wholesale propane, fuel oil and natural gas costs can move rapidly; the Partnership may not fully or immediately pass on cost increases, squeezing margins.
• Product supply and transportation — Supply disruptions or transportation constraints could affect the ability to meet customer demand and increase product costs.
• Renewable energy project execution — Construction and commissioning of new RNG facilities carry execution risks, including delays and cost overruns, and revenue depends on volatile environmental attribute prices.

Outlook

The Partnership expects to bring its Columbus, Ohio RNG facility into service during the fourth quarter of fiscal 2026, leaving all three RNG facilities operational for fiscal 2027. Management sees continued organic growth opportunities in RNG through capacity optimization and feedstock intake. Seasonally, the fourth fiscal quarter typically yields lower operating profits or net losses, with cash flows from heating-season sales expected in the second and third quarters.