GLOBAL PARTNERS LP (GLP)·Q1 2025 Earnings Summary

Executive Summary

• Q1 2025 delivered a clean EPS beat on better wholesale performance: Diluted EPS of $0.36 versus S&P Global consensus of -$0.03, while revenue of $4.59B missed a single estimate of $5.64B as mix tilted to wholesale; EBITDA rose 61% YoY to $91.9M, with Adj. EBITDA at $91.1M . Revenue/EPS estimates noted below (S&P Global)*
• Wholesale product margin more than doubled YoY ($93.6M vs $49.4M) on favorable gasoline/distillate markets, colder weather (~9% colder YoY), and added terminal capacity (Gulf, ExxonMobil acquisitions) .
• GDSO fuel cent-per-gallon (CPG) margin increased to $0.35 (from $0.33), though station ops margin fell on site sales/conversions (portfolio optimization); GDSO product margin was essentially flat YoY ($187.9M vs $187.7M) .
• Distribution raised to $0.745 per unit for Q1 (from $0.740 in Q4), with strong TTM coverage (2.03x; 1.96x post preferreds); leverage (funded debt/EBITDA) steady at 3.28x .
• Near-term stock catalysts: large EPS beat vs a negative consensus, seasonal/weather tailwinds to wholesale, integration gains from 2024 terminal additions, and steadily rising common distributions .

What Went Well and What Went Wrong

• What Went Well

  • Wholesale outperformance: Product margin jumped to $93.6M (+$44.2M YoY) on more favorable gasoline/distillate markets and added terminal capacity (Gulf terminals, East Providence) . CFO: “It was a nice cold winter… 9% colder… integration of our terminaling assets… allowed us to take advantage of market opportunities” .
  • Strong GDSO CPG margins: Fuel margins rose to $0.35/gal (+$0.02 YoY), supporting gasoline distribution margin ($125.8M vs $121.6M), despite fewer operated sites .
  • Cash returns: Quarterly distribution increased to $0.745, with TTM distribution coverage at 2.03x (1.96x after preferreds), underscoring payout sustainability .

• What Went Wrong

  • Top-line vs consensus: Sales of $4.59B trailed a single S&P estimate of $5.64B, reflecting mix and market conditions even as profitability was solid* .
  • Station operations headwind: Station ops product margin declined to $62.1M (from $66.1M) as GLP sold/converted certain company-operated sites and saw lower sundries .
  • Higher interest expense: Interest expense rose to $36.0M (+$6.3M YoY), tied to higher average credit facility balances from 2024 terminal acquisitions .

Financial Results

Vs. S&P Global Consensus (Q1 2025):

• Revenue: $4.59B actual vs $5.64B estimate → Miss ($1.05B, ~-18.6%)*
• EPS: $0.36 actual vs -$0.03 estimate → Beat by $0.39*

Segment Product Margin ($ Millions)

KPIs

Guidance Changes

Note: GLP does not provide formal revenue/EPS guidance; management focused qualitative commentary on market conditions, integration, and capital allocation .

Earnings Call Themes & Trends

Management Commentary

• CEO: “Our Wholesale segment performed well, driven by the successful integration of additional terminal assets, strong execution across the team, and a favorable market backdrop… We remain focused on delivering long-term growth through disciplined execution” .
• CFO: “Net income… was $18.7M versus a net loss of $5.6M last year… The primary growth driver… was the strong performance of our Wholesale segment… mark-to-market impacts were minimal in Q1 this year” .
• On weather and terminals: “It was a nice cold winter… 9% colder… [and] the integration of our terminaling assets… allowed us to take advantage of market opportunities” .
• On tariffs: “Very brief… created some volatility… often benefits us, but it was very short-lived… no impact from a supply or market condition standpoint… if it’s going to impact us, it will impact… store sales” .

Q&A Highlights

• M&A and portfolio optimization: Management is opportunistic across retail and terminals; “M&A is busy… finding the right deal that… competitively advantages us” while continuing to optimize the GDSO footprint .
• Wholesale drivers: Colder winter and terminal integrations (ExxonMobil East Providence, Gulf) boosted wholesale; Q1’24 mark-to-market headwinds complicate YoY comp .
• Tariffs: Brief 2-day episode with Canadian oil; minimal ongoing impact to supply/margins; potential consumer drag in stores is the bigger watch item .

Estimates Context

• Q1 2025 vs S&P Global consensus: Revenue $4.59B vs $5.64B estimate (miss); EPS $0.36 vs -$0.03 estimate (beat). Post-print, estimates may require upward revision to EPS and EBITDA trajectories given wholesale strength and reduced marks volatility; revenue forecasting remains sensitive to price/volume and mix across segments . Revenue/EPS estimates noted below (S&P Global)*
• With only one revenue and EPS estimate in Q1, consensus depth was limited (n=1 for both metrics), magnifying surprise optics.*

Key Takeaways for Investors

• Wholesale engine is delivering: integration synergies and favorable markets drove a clean profitability beat despite top-line miss; watch wholesale conditions into Q2 seasonality .
• Retail quality over quantity: site rationalizations weigh on station ops but CPG remains structurally healthy; GLP continues to prioritize returns and mix .
• Balance sheet and payouts: leverage stable (~3.3x) with ample liquidity; distribution raised again with robust TTM coverage (2.03x/1.96x post prefs) .
• Weather and volatility are tailwinds: colder winter and brief tariff volatility benefited margins; persistent volatility often supports fuel margins per mgmt .
• Watch interest expense trajectory: higher debt service remains a headwind after 2024 financing of terminal acquisitions; any refinancing/tender activity (seen in Q2) can influence run-rate .
• Medium-term thesis: diversified platform (terminals + GDSO + commercial) with scalable integration synergies and disciplined capital allocation supports durable cash flow and distribution growth through cycles .
• Near-term trading setup: strong EPS beat vs negative consensus and reiterated operating momentum in wholesale could underpin positive sentiment; revenue optics less indicative for GLP given product-mix and pricing dynamics .

Footnotes:

• Revenue and EPS estimates, estimate counts, and surprises marked with an asterisk (*) are Values retrieved from S&P Global.
• All other figures and qualitative statements are sourced from GLP’s Q1 2025 press release/8-K and earnings call, and prior quarter materials as cited.