GLP-PB — Global Partners LP

Summary of Global Partners LP Q1 2026 Earnings Call

1. Key Financial Results and Metrics:

• Net Income: $70.1 million, up from $18.7 million in Q1 2025.
• EBITDA: $142.1 million, compared to $91.9 million in the prior year.
• Adjusted EBITDA: $140.4 million, up from $91.3 million.
• Distributable Cash Flow (DCF): $96.4 million, compared to $45.7 million; adjusted DCF was $96.8 million versus $46.5 million.
• Distribution: Quarterly cash distribution of $76.50 per common unit, marking the 18th consecutive increase, with a coverage ratio of 1.96x (1.9x including preferred distributions).
• Operating Expenses: Increased to $129.2 million, with SG&A rising by $25.6 million to $99.3 million due to higher performance-based compensation.
• Capital Expenditures (CapEx): Totaled $31.9 million, with maintenance CapEx at $10 million and expansion CapEx at $21.9 million.

2. Strategic Updates and Business Highlights:

• The company emphasized disciplined execution and prudent capital allocation as core strengths.
• The GDSO segment's product margin increased by $11.4 million to $199.3 million, driven by higher fuel margins.
• The wholesale segment saw a significant product margin increase of $60.5 million to $154.1 million due to favorable market conditions.
• Global Partners LP continues to explore acquisition opportunities despite a competitive landscape.

3. Forward Guidance and Outlook:

• The company expects maintenance CapEx for the full year to be between $60 million and $70 million, and expansion CapEx (excluding acquisitions) to be between $75 million and $85 million.
• Management is preparing for various scenarios due to ongoing geopolitical tensions affecting global energy markets.

4. Bad News, Challenges, or Points of Concern:

• There are signs of potential demand destruction due to rising fuel prices, with observed declines in average fill-ups.
• The company anticipates increased carrying costs for hedged inventory due to steep backwardation in the pricing curve.
• Operating expenses are expected to normalize, but the increase in SG&A raises concerns about cost management.

5. Notable Q&A Insights:

• Management noted no significant changes in customer behavior in March, but acknowledged a decline in average fill-ups and gallons per fill-up as fuel prices rise.
• The company is actively managing inventory levels in response to market conditions, particularly during periods of backwardation.
• Concerns were raised about supply tightness entering the summer driving season, with low inventory levels and robust exports potentially impacting availability.
• The management highlighted that even if geopolitical tensions ease, the recovery of production and inventory levels may take time, suggesting lasting impacts on the market.

Overall, Global Partners LP reported strong financial results for Q1 2026, driven by favorable market conditions and disciplined operations, while also navigating challenges related to rising fuel prices and geopolitical uncertainties.