Sunoco LP

What they do

Sunoco operates midstream assets including over 14,000 miles of pipeline and over 160 terminals, and distributes over 15 billion gallons of motor fuel annually to approximately 11,000 Sunoco and partner branded locations plus independent dealers and commercial customers. The Partnership also operates a refinery and fuel terminals, and completed the acquisition of Parkland, an international fuel distributor, marketer and convenience retailer with operations in 26 countries across the Americas. Energy Transfer owns 100% of the General Partner's membership interest, 28,463,967 common units and all incentive distribution rights.

Revenue drivers

• Fuel Distribution segment — Distributes motor fuel to branded locations, independent dealers and commercial customers; sold approximately 4.1 billion gallons in Q2 2026 at a fuel margin of 17.1 cents per gallon, generating $504 million of Adjusted EBITDA in the quarter.
• Pipeline Systems segment — Operates over 14,000 miles of pipeline; averaged approximately 1.3 million barrels per day of throughput in Q2 2026 and generated $190 million of Adjusted EBITDA.
• Terminals segment — Operates over 160 terminals; averaged approximately 1.1 million barrels per day of throughput in Q2 2026 and generated $113 million of Adjusted EBITDA, up from $71 million a year earlier.
• Refinery segment — Averaged approximately 57 thousand barrels per day of throughput in Q2 2026 and generated $175 million of Adjusted EBITDA.

Recent performance

Second quarter 2026 net income was $283 million versus $86 million in the second quarter of 2025. Adjusted EBITDA was $982 million, including $14 million of one-time transaction-related expenses, compared to $454 million a year earlier. Distributable Cash Flow, as adjusted, was $608 million versus $300 million in Q2 2025. The Fuel Distribution segment drove much of the increase, with Adjusted EBITDA of $504 million versus $206 million, while Pipeline Systems, Terminals and Refinery segments each contributed positively. Quarterly revenue rose from $6.03 billion in 2025-09-30 to $14.26 billion in 2026-06-30.

Strategy

Sunoco completed the Parkland acquisition on October 31, 2025, paying approximately $2.60 billion in cash and transferring 51,517,198 SunocoCorp common units, which added operations in 26 countries. On January 16, 2026, it acquired TanQuid for approximately 465 million euros (about $540 million), adding 15 fuel terminals in Germany and one in Poland, funded with cash on hand and its Credit Facility. Management declared a second quarter 2026 distribution of $1.0023 per unit, up 1.25% sequentially and over 10% year over year, and stated this is consistent with a multi-year distribution growth rate of at least 5%. The company has also pursued smaller bolt-on acquisitions of fuel distribution sites, including 151 consignment sites in Q2 2025 for approximately $105 million.

Risks

• Acquisition integration — The company faces risk in successfully integrating Parkland's international operations and realizing expected benefits.
• Motor fuel price and demand volatility — Results are exposed to changes in motor fuel prices, demand, and competition from alternative fuels or improved fuel efficiency.
• Tariffs and trade policy — The imposition or increase of tariffs on steel or other raw materials, or changes in trade agreements, could affect costs and operations.
• Dependence on Energy Transfer — The Partnership's structure creates conflicts of interest with its General Partner and its affiliates, and limits fiduciary duties.

Outlook

Management increased full year 2026 Adjusted EBITDA guidance by $400 million to a range of $3.5 billion to $3.7 billion. The company reported a leverage ratio of net debt to Adjusted EBITDA of approximately 3.7 times at June 30, 2026, with approximately $2.3 billion of liquidity remaining on its revolving credit facility. Sunoco stated its capital allocation strategy includes a multi-year distribution growth rate of at least 5%, following its seventh consecutive quarterly distribution increase.