SUNC

Hello. Thank you for standing by. Welcome to Sunoco LP at SunocoCorp LLC Q1 2026 earnings conference call. At this time, all participants are on listen only mode. After the speaker's presentation, there will be a question and answer session. To ask the question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. I will now like to hand the conference over to Scott Grischow. You may begin.

Thank you. Good morning, everyone. On the call with me this morning are Joseph Kim, President and Chief Executive Officer, Karl Fails, Chief Operating Officer, Austin Harkness, Chief Commercial Officer, Brian Hand, Chief Sales Officer, and Dylan Bramhall, Chief Financial Officer. Today's call will contain forward-looking statements that include expectations and assumptions regarding Sunoco LP's future operations and financial performance. Actual results could differ materially, and we undertake no obligation to update these statements based on subsequent events. Please refer to our earnings release as well as our filings with the SEC for a list of these factors. During today's call, we will also discuss certain non-GAAP financial measures, including Adjusted EBITDA and Distributable Cash Flow as adjusted. Please refer to the Sunoco LP website for a reconciliation of each financial measure.

The partnership started off 2026 with a strong quarter, delivering Adjusted EBITDA of $867 million, excluding approximately $9 million of one-time transaction expenses. The first quarter benefited from a one-time gain on the sale of inventory of approximately $102 million. With the acquisition of Parkland Corporation last year and the elevated commodity price environment in the first quarter, we proactively optimized our inventory levels, which resulted in this one-time gain. Karl will provide more detail on the impact from these inventory reduction efforts and discuss segment performance in his remarks. We continued our growth efforts in the first quarter with the closing of the TanQuid acquisition on January 16th. Following the acquisition, Sunoco is Germany's largest independent terminal operator with a network of 16 assets across Germany and Poland.

We expect this acquisition to be immediately accretive to distributable cash flow per common unit in 2026. During the quarter, we spent $106 million on growth capital and $93 million on maintenance capital. First quarter distributable cash flow as adjusted was $535 million. On April 21st, we declared a distribution of $0.9899 per common unit for both Sunoco LP common units and SunocoCorp LLC shares. This 6.25% increase represents a one-time step up of 5% and a quarterly increase of 1.25%. This distribution represents an increase of over 10% versus the first quarter of 2025 and is the result of Sunoco's continued financial stability, execution of highly accretive acquisitions and growth projects, and confidence in future distribution increases.

Our trailing twelve-month coverage ratio was 1.9 times. We continue to target a multi-year distribution growth rate of at least 5%. Our balance sheet and liquidity position remains strong. We had $2.2 billion in availability under our revolving credit facility at the end of the quarter. Leverage at the end of the quarter was approximately 4 times, in line with our long-term target. In summary, our financial position continues to strengthen, which will provide us with continued flexibility to pursue high return growth opportunities while maintaining a healthy balance sheet and a secure and growing distribution for our unitholders. With that, I'll now turn it over to Karl to walk through some additional thoughts on our first quarter performance.

Thanks, Scott. Good morning, everyone. Our results this quarter continue the trend of accretive and sustainable growth for Sunoco as we benefited from a full quarter of operations from Parkland and the closing of our TanQuid acquisition in Europe. Each of our segments delivered strong performance in the first quarter. They are all well-positioned to contribute meaningfully toward achieving our 2026 EBITDA guidance. Starting with our fuel distribution segment, Adjusted EBITDA was $538 million, excluding $9 million of transaction expenses. This compares to $391 million last quarter, excluding transaction expenses, and $220 million in the first quarter of 2025. This growth reflects continued strength in our legacy Sunoco operations, coupled with a full quarter of operations from Parkland.

It is also supported by our ongoing gross profit optimization and growth strategies, both through roll-up acquisitions and growth capital. As Scott mentioned in his remarks, these results also include a one-time benefit of inventory reduction. The level of fuel inventory we hold is always a trade-off between holding more to provide reliable supply and carrying less to deliver better returns on capital. This is especially true as we grow our fuel distribution business. Naturally, our inventory also grows, but we frequently look to optimize our inventory levels to ensure we are delivering on our target returns. This quarter, as a result of inventory reductions, we delivered a $92 million benefit in this segment, unlocking additional cash to reinvest in future growth.

While the size of the benefit was clearly impacted by market prices during the quarter, this was a result of active management of our inventory to a level that is sustainable on an ongoing basis. We distributed 3.8 billion gallons, up 15% versus last quarter and up 82% versus the first quarter of last year. We continue to see volume growth in our legacy Sunoco business with an increase of almost 6% over prior year compared to a relatively flat U.S. demand profile. This growth is a result of effectively deployed capital via our growth capital plan and roll-up M&A transactions. We continue to work on optimizing our volumes in the legacy Parkland assets as we implement our gross profit optimization approach that we've evolved over the years.

Reported margin for the quarter was $0.17 per gallon, compared to $0.177 per gallon last quarter, and $0.115 per gallon for the first quarter of 2025. There were many factors influencing our margin this quarter with the 7-Eleven makeup payment, the gain on inventory reduction, and the return of market volatility compensating for the margin compression experienced with dramatic increases in commodity prices during the quarter. For reference, RBOB futures increased over $1.60 a gallon during the quarter, with diesel futures increasing over $2 a gallon. In our Pipeline System Segment, Adjusted EBITDA for the first quarter was $179 million, compared to $187 million last quarter and $172 million in the first quarter of 2025.

On the volume side, we reported 1.3 million barrels per day of throughput, slightly down from the seasonally strong throughput last quarter and slightly up from the same quarter last year. This segment continues to provide steady and stable income. Moving on to our terminal segment, Adjusted EBITDA for the first quarter was $107 million. This compares to $87 million last quarter and $66 million in the first quarter of last year. We reported around 1 million barrels per day of throughput, which is up from both last quarter and the first quarter of last year. Growth in both earnings and volumes in this segment were supported by the inclusion of TanQuid and a full quarter of legacy Parkland operations. This segment continues to deliver stable results that predictably and accretively grow as we add to the portfolio.

Turning to our refining segment. Adjusted EBITDA for the first quarter was $43 million compared to $41 million last quarter. There was a $10 million benefit in this segment from our inventory reduction efforts that I discussed earlier. Refinery throughput was 22,000 barrels per day compared to 50,000 barrels per day last quarter. As we shared previously, throughput was down as a result of a planned 50-day maintenance turnaround that began at the end of January, which was completed on time and on budget. During the turnaround, we continued to meet regional demand by sourcing supply through our refinery tank farm. The refining margin was strong during the periods of refinery operation and that continues into the second quarter.

To provide more clarity to the market on our refinery performance, we posted an updated indicator crack on our website yesterday and expect to post updates at the beginning of each month. This calculation is intended to be an indicator of general profitability for the refinery using market prices. Before I wrap up, I wanted to make a few comments on the integration of the recent Parkland acquisition. The balance sheet has returned to our long-term target. We are already delivering on synergies, both expense and commercial, which puts us well on track to deliver on 10-plus % accretion before our year 3 commitment. In summary, we continue to build on the strong momentum of the past few years. Each of our segments is delivering, and we will continue to remain focused on safe and reliable operations, expense discipline, and accretive growth.

I will now turn it over to Joe to share his final thoughts. Joe?

Thanks, Karl. Good morning, everyone. Every quarter presents a new set of challenges. This first quarter provided more than most. Obviously, the events in the Middle East created a volatile market. Costs and prices rose dramatically, and at times fell and went back up. Furthermore, normal supply patterns were disrupted. Specifically within Sunoco, we completed a turnaround at our Burnaby refinery and made significant progress on the Parkland integration. Despite all these events, we still delivered an outstanding first quarter. More importantly, we're confident that we'll deliver on our full-year EBITDA guidance, even without the one-time gain from optimizing our inventory. Operationally, our refining team completed the turnaround on budget. Our fuel distribution and midstream teams maintained reliable supply for our customers. Finally, we're on track to deliver 10% plus accretion from the Parkland acquisition.

We have proven year after year in crisis after crisis that we can distinguish ourselves in challenging environments, and thus we have gained a reputation as a strong defensive play. However, we are also a proven growth play. Already this year, we closed on the TanQuid acquisition in Europe, a multi-island acquisition in the Caribbean, and various smaller fuel distribution bolt-on acquisitions in the U.S. We are on track to complete over $500 million of bolt-on acquisitions in 2026. Separately and in totality, these are immediately accretive while maintaining our balance sheet target. When you combine our ongoing accretive growth with a resilient base business, we are stronger than any point since the establishment of Sunoco LP. As a result, we are able to announce a meaningful increase in our quarterly distribution two weeks ago.

The decision to materially increase the distribution had to meet the following criteria. Maintain a strong coverage ratio, protect our balance sheet, remain a growth company, and finally, provide a clear path to increase distributions quarter after quarter over a multiyear timeframe. We're confident the answer is yes on all these factors. Operator, that concludes our prepared remarks. You may open the line for questions.

Thank you. Ladies and gentlemen, as a reminder to ask the question, please press star one one on your telephone, then wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Justin Jenkins with Raymond James. Your line is open.

Great. Thanks. Good morning, everyone. I guess, I mean, just to start on a housekeeping item here, the inventory gain. You gave us a lot of detail on the impact here in the quarter. I think, Karl, you suggested you're at an overall level you're comfortable with. Does that inventory level fluctuate with where commodity prices sit? How should we think about the moving pieces going forward here?

Yeah. Thanks, Justin. This is Karl. Yeah, as I talked on my prepared remarks, inventory decisions are really a trade-off between supply reliability and return on capital. As part of that inventory management, we use derivatives to hedge inventory in the normal course of business. As you mentioned, based on market conditions, we actively manage those inventory positions. In periods of high prices and steep backwardation like we've had in the past few months, we'll typically draw, and then in the less frequent periods of contango, we would build, and our hedging practices are set up accordingly to make sure we can optimize that.

I think if you looked at what we're reporting in the first quarter, that's just a larger step we took as a result of a lot of the growth that we've done over the last 6 to 9 months, you know, including the recent Parkland acquisition. The level that we reduce our inventory to, we feel is responsible, and we can stay there for a long time. Some of those minor optimizations that I talked about based on market conditions, yeah, we'll continue to do regularly. This $100 million was sized and impacted by the higher prices, but it's something that we would have done regardless to manage our business.

It does differ from some of the other companies that have reported so far in the quarter that were talking about, you know, timing-related inventory impacts. Like I said, we're confident we can operate at this level going forward, and there is no symmetric risk if and when prices fall that this gain is reversed.

That's helpful. Second question here on the distribution. Certainly the step up in the quarter, very well received. I guess, how does this play into your overall views on capital allocation for the long term? Then maybe for 2026, more specifically. Joseph Kim, you hinted at this, but presumably this shows a very high degree of confidence in your outlook for the year, even if it might be just a little too soon to update the guide. Is that right?

Yeah. Hey, Justin, this is Joe. Hey, just to build off on Karl's, and I'll take your first question, first. On the inventory optimization, that was just a result of good stewardship and good timing. With that said, the recent 5% step up, we would have done with or without the inventory optimization. As far as kind of giving you some better background as to our step up and our capital allocation, I think maybe kind of talking through how we made this decision would be helpful. You know, our past investments have paid off, especially the NuStar acquisition we did 2 years ago and the Parkland acquisition we did last year. Just as importantly, our base business has proven to be year after year, very resilient.

Our GCAP per common unit has grown materially, and we believe a step up followed by continued quarterly distribution increases would be highly valued by our unit holders. The step up, we wanted that step up to be material, but at the same time, we didn't want to affect our ability to increase distributions over a multiyear period, nor affect our ability to continue growing. We think that the actions that we've taken recently have put us in a very good position to achieve these goals. I think, Justin, if I understand you correctly, the second part of the question was really more about guidance. Is that how I should read it?

Yep. Yeah.

You know, the one key message that I hope that you and the rest of the people on this call take away from today is that we're gonna have an outstanding year and deliver on guidance. That's even after you take out the one-time inventory optimization. Our established practice is not to give guidance after the first quarter unless there's a major acquisition. You know, is the question, is there upside? Of course. However, the amount is still to be determined, and our history shows that we're good at capturing the upside as well as protecting the downside.

Awesome. Thanks, guys. I'll leave it there.

Thank you. Our next question comes from the line of Spiro Dounis with Citigroup. Your line is open.

Hi. This is Chad on for Spiro. Just starting off, could you provide an update on how the conflict in the Middle East is impacting your business and trends today? Have you started to see any demand impacts from the higher prices yet?

Yeah. Hey, Chad. Yeah, I'll answer your question kind of in order there in terms of impact to our operations given the current market volatility. I can touch on margins and demand separately. You know, if you take a step back, given our scale, supply chain optionality and logistics capabilities. It's really, you know, the business really shines during these types of periods of extreme market volatility. Just to give you one example, you know, we normally supply our Hawaii business out of South Korea. What we're finding though right now is it's actually economical to load vessels out of the U.S. Gulf Coast and supply the business via the Panama Canal. I share that because that's really only a move that's available if you have our scale and logistics capabilities.

There's literally, you know, countless other examples of how our operations have been impacted by some of the global disruption of product flows, but that's not always a bad thing. In fact, in our world, a lot of times that can mean value creation. You know, just quickly touching on, you know, on margins. You know, we've always talked about flat price volatility being bullish for margins in the long run. But the way that you get there is margins compress as flat price is on the way up, but then it widens disproportionately on the way down. That's how you get an overall kind of net bullish margin environment.

If you were to pull an RBOB or ULSD chart for year-to-date, I think what you'd find is we've been on a pretty sharp grind up to up and to the right, for essentially through the first 4 and a half months or 4 months and a week of the year. You know, despite that, we just closed out a really strong first quarter for the segment. The second quarter is off to a great start. We haven't even gotten to the part of the story where flat price comes off and margins widen. We feel really good about where we're positioned there. Then I think, you know, you mentioned the question around, you know, impact to consumer demand. You know, we haven't seen any evidence of demand destruction yet.

I say that because it's kind of a function of how high flat prices go and for how long they remain there. That said, I think those of you who follow our story know that if we do encounter a scenario where there's demand destruction, that creates a really strong margin environment as retailers are forced to respond to rising breakevens by taking price. You know, all that said, we're out of the gate really strong to start the year and we feel really good about both the second quarter and delivering on our announced ending 2026.

Okay, got it. That's very helpful. Just wanted to get your thoughts on kind of your M&A outlook with the current macro environment and 2 quarters of sort of the pro forma business. It sounds like you're tracking to $500 million of annual M&A cadence this year, but has there been any changes in the way that you view M&A as a cadence or a scale standpoint from your business yet?

Hey, Chad, this is Joe. The simple answer is no. We view it exactly the way that we outlined it late last year and early this year. Just to kind of give you an update. If you take a step back and you look at all the recent acquisitions that we've done, we've greatly expanded our scale and our geographic footprint. It wasn't too long ago that we were a U.S.-only business, predominantly on the East Coast and in the South. Now we have investment opportunities in the U.S., Canada, Latin America, Greater Caribbean, and Europe. To give you an example, already this year, we have almost $200 million of bolt-on M&A that are either closed or signed or gonna be closed in the very near future.

This doesn't include the $500 million plus TanQuid acquisition that we started the year with. The $500 million a year plus, you know, bolt-on acquisition is very reasonable for us. Bottom line, we're in a good position to deliver on an attractive long-term growth story.

Yeah, very helpful. Thanks for the time today.

Thank you. Our next question comes from the line of Theresa Chen with Barclays. Your line is open.

Morning. Thank you for taking my questions. First question is related to the Burnaby Refinery. Post your planned turnaround, how are operations trending at this point? Given the significant disruption to the liquids markets, over the past two months plus, following the Middle East conflict, can you talk about your ability to capture these elevated margins, not only on the West Coast of North America, but broadly across the Pacific Basin, into Asia and Australia, given your fleet of assets from an infrastructure perspective as well as the refining facility at Burnaby?

Yeah, Theresa. Thanks for the question. This is Karl. As Joe and I mentioned in our prepared remarks, the team in the refinery did a great job delivering on the turnaround on time and on budget, and that really allowed us to restart the refinery in the back part of the quarter into the higher cracks that were in the market. You know, our we've used this phrase a lot, but our crystal ball isn't perfect as far as how long those refining margins will last. I think the possibility of a period of longer cracks is reasonable and would be a tailwind for overall results.

If, if you look at that, the refinery business, it really is a foundational piece of our overall business in British Columbia, and most of the refinery production goes into that market in British Columbia. I think that's a tailwind for that overall business that we'll be able to see the results as we go through the year. Now, clearly, so far into the year, the refinery is outperforming assumptions we made for the Parkland acquisition or even the midpoint of our guidance, as Joe talked about. The refinery is an important part of the portfolio. It's not a large part of the portfolio. You know, it's our smallest segment, but it fits well into our overall business.

When there are big price movements and we have the higher cracks, that can help offset some of the margin compression that Austin talked about in our fuel distribution business. The opposite is also true. As far as your broader question for the rest of the Pacific, I think, you know, Austin has continued to do a great job of looking at what the market is giving us and supplying, you know, his example of how we supply Hawaii, of choosing the options we have to supply our base business in the most economical way possible, and then finding additional opportunities to supply fuel to new customers. Yeah, I think there's gonna be opportunity.

Thank you. Going back to your earlier comments about synergies, post the, you know, acquisitions and the broader, more comprehensive set of assets you have under one portfolio now. Can you speak to the progress made both on the commercial side as well as any existing, you know, cost synergies still to be harvested at this point and what your outlook is for that?

Yeah, I think the outlook is good. As you know us and we've looked backwards on various acquisitions we've done. We start the synergy process even before we close, and that was true in the Parkland acquisition. There were changes that we made, particularly on the expense side, as soon as we took ownership in the fourth quarter, and those are continuing. I think the breadth of the Parkland portfolio means that that runway of getting to the end result on the expense side takes a little longer than some of the other deals we've done, but that work is all going well.

I think on the commercial side, there are significant commercial synergies that we outlined over the last, you know, year since we, since we announced the Parkland deal, and many of those have already been delivered, many are in flight, and there are some still to come. Our guidance was based on $125 million of in-year synergies. To be able to hit that number, we needed to exit the year much higher than that. We're still on pace with that and expect that to continue and us to, you know, the final kind of run rate of $250 million plus, we feel very comfortable with, that should be a floor.

Thank you so much.

You bet.

Thank you. Our next question comes from the line of Gabriel Moreen with Mizuho. Your line is open.

Hey, good morning, everyone. Can I maybe just ask for an update on sort of the midstream side of things and to the extent you're planning to spend any capital there this year? I noticed that your parent announced an expansion of Bayou Bridge going into St. James. Just curious if maybe that would necessitate more storage there, for example.

Gabe, this is Karl again. Clearly our midstream portfolio, we really like, whether it's the pipeline systems assets or our terminal network. You know, Joe talked about we're excited to have TanQuid as part of that portfolio. We spend capital on those, whether it's, you know, maintenance capital to keep our tanks ready to go when market opportunities come or some growth capital. I think our current portfolio is we're always looking for opportunities for larger projects. As we sit here right now, I think our sweet spot is kind of these small to mid-sized projects. We have a portfolio of those and really looking for accretive M&A.

Any projects we do in the midstream space would be to optimize and to help us gain synergies on that M&A. As we sit here today, you know, that could change down the road, but that's our current plan.

Thanks, Karl. I can follow up. I think 7-Eleven is doing a bit of portfolio repositioning in terms of their store base. Can you just talk about whether there's any implications with the 7-Eleven from any of those moves?

Hey, Gabe, it's Joe. We got a great relationship with 7-Eleven. As far as the supply agreement we have with them, nothing changes on that one. That's a rock solid take-or-pay contract with a highly profitable investment-grade company. We feel great on that one. As far as the 7-Eleven doing its portfolio optimization, obviously with our scale and our geographic footprint, anytime there's anything on the market, I think we're a viable partner for a lot of people that are looking to exit. With the synergies we bring to the table, we're always gonna be competitive.

Joe, maybe can I just squeeze one more in on the M&A question from a different angle. Is the current volatile backdrop making it easier to transact in your mind or harder? I'm just curious what your thoughts are on there.

Yeah, harder, easier. I would probably say all things equal, maybe harder overall, maybe more opportunistically better for Sunoco. I think, we have, you know, we know what we're good at and scale and geographic diversity. Given our midstream assets, especially on the terminal level, we're in a good position. I think from that standpoint, it's not gonna affect us. You know, as far as, you know, now that we're more than just a U.S. company and we're in various geographies, as far as opportunities in foreign markets, there's always gonna be some level of tension between countries. The extent of it and the magnitude of it always kind of evolving.

The one thing that we do believe in is that cross-border foreign investment's gonna continue across the world, and we're in a good position to find the right assets wherever it may be. With the synergies that we bring to the table, we're gonna be in a good position to be highly competitive.

Thanks, Trevor.

Thank you. As a reminder, ladies and gentlemen, that's star one one to ask the question. Our next question comes from the line of Ned Baramov with Wells Fargo. Your line is open.

Hey, good morning. Thanks for taking the questions. Could you maybe talk about the interplay between Burnaby, refining margins and the margins on the fuel distribution side in British Columbia? Does the higher crack spread imply lower potential FD margin? Is this market also not seeing any change in demand from higher fuel prices, as you commented earlier?

Yeah, Ned, this is Karl. I'll try to pull it together to answer your question. You know, a couple points that Austin made in his overall answer on margins and then some of the things I talked about at Burnaby. The short answer is, you know, as far as the refinery margin, the fuel distribution margin, as we look at it, we use, you know, internal transfer prices like most people do, and those are based on the market. As most we can run the business while we like having the integrated margin, and we're always making choices to optimize the overall result for Sunoco. As we're looking at those two businesses, we also look at them independently.

I think on the overall margin and consumer demand question, I think Austin hit the nail on the head that those margins will adjust. I would expect that the overall fuel gross profit and the EBITDA that we get in British Columbia should stay the same or grow over time. The refined margin is gonna vary more, right? That's gonna really float based on supply demand going on in the world. Right now we're in a period of higher cracks. While we manage that supply chain as an integrated supply chain, I wouldn't necessarily imply that when refinery cracks are high, that the fuel distribution margins are low. Sometimes they're both higher together. Hopefully that answers your question.

Understood. Yes, very clear. Thank you. Second one on the housekeeping side. Was the Burnaby turnaround spending included in your $93 million of maintenance CapEx for the quarter?

Yes. There was some component of growth CapEx there as well that was included in our reported capital.

Thank you.

You bet.

Thank you. Ladies and gentlemen, I am showing no further questions in the queue. I will now like to turn the call back over to Scott for closing remarks.

Well, thank you for joining us on the call today and for your continued interest in Sunoco. As we said, there's a lot of great things to look forward to in 2026, and we look forward to updating you across the year. Please reach out if you have any questions. Thanks for tuning in and always appreciate your support.

Ladies and gentlemen, that concludes today's conference call. Thank you for your participation. You may now disconnect.

Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Scott Grischow, Senior Vice President of Finance. Please go ahead.

Thank you, and good morning, everyone. On the call with me this morning are Joe Kim, President and Chief Executive Officer; Karl Fails, Chief Operating Officer; Austin Harkness, Chief Commercial Officer; Brian Hand, Chief Sales Officer; and Dylan Bramhall, Chief Financial Officer. Today's call will contain forward-looking statements that include expectations and assumptions regarding Sunoco LP's future operations and financial performance. Actual results could differ materially, and we undertake no obligation to update these statements based on subsequent events. Please refer to our earnings release as well as our filings with the SEC for a list of these factors. During today's call, we will also discuss certain non-GAAP financial measures, Adjusted EBITDA and Distributable Cash Flow as adjusted. Please refer to the Sunoco LP website for a reconciliation of each financial measure.

Before reviewing our Q4 and full year 2025 financial results, I'd like to take a moment to briefly discuss some changes to our financial reporting format, which is included in today's earnings release. First, we have incorporated Parkland's legacy operations into our three segments and have also added a fourth reporting segment for our newly added refining operations. Second, today's and future earnings releases will include select financial information for Sunoco Corp LLC, which we will refer to by its New York Stock Exchange ticker symbol of SUNC. As a reminder, SUNC's only asset is its limited partner interest in Sunoco LP. Because of its limited partner interest in Sun, SUNC consolidates Sunoco LP into its financial statements. Accordingly, on today's call and future calls, we do not intend to cover SUNC's results.

Instead, we have included a schedule in our earnings release that reconciles SUNC's distribution from Sun with SUNC's Distributable Cash Flow, as well as a summarized consolidating balance sheet. SUNC began trading shortly after we closed the Parkland transaction and will be an attractive option to invest in Sunoco, especially for investors outside of the United States, institutional investors, and in personal retirement accounts. We expect minimal corporate income taxes at SUNC for at least five years, which will allow for the SUNC distribution to remain very similar to the Sunoco LP distribution for this period of time. Moving to this quarter's results, the Q4 marked the end of a transformative and record-setting year for Sunoco. We closed the Parkland transaction on October thirty-first, and our team is now fully engaged in integration efforts that are progressing well.

The partnership delivered record Adjusted EBITDA of $706 million in the Q4, excluding approximately $60 million of one-time transaction expenses. Karl will discuss the segment performance in his remarks. However, this consolidated result reflects the ongoing strength of our operations and the contribution from the Parkland acquisition. During the quarter, we spent $130 million on growth capital and $103 million on maintenance capital. Q4 Distributable Cash Flow, as adjusted, was $442 million. On January 27, we declared a distribution of $0.9317 per common unit for both Sunoco LP common units and Sunoco Corp shares. This represents a 1.25% increase over the prior quarter and marks our fifth consecutive quarterly distribution increase.

Our trailing twelve-month coverage ratio finished the year at a strong 1.9 times. We continue to see a multi-year path for an annual distribution growth rate of at least 5%. Looking at the full year 2025, Adjusted EBITDA, excluding transaction-related expenses, came in at a record $2.12 billion, a 36% increase over the prior year. This record year reflected solid underlying growth in our base business, a full year of contribution from our new acquisition, and approximately 2 months from Parkland. Our balance sheet and liquidity position remained strong. We had $2.5 billion in availability under our revolving credit facility at the end of the year, and leverage at the end of the quarter was approximately 4x, in line with our long-term target.

In summary, our financial position continues to be stronger than at any time in Sunoco LP's history, which we believe will provide us with continued flexibility to balance pursuing high return growth opportunities, maintaining a healthy balance sheet, and targeting a secure and growing distribution for our unitholders. With that, I will turn it over to Karl to walk through some additional thoughts on our Q4 performance.

Thanks, Scott. Good morning, everyone. Our results this quarter cap another record year for Sunoco as we meaningfully expanded our operations and significantly grew our cash flows. With the addition of the Parkland and Tankwood assets, we now operate a diversified footprint spanning 32 countries and territories and have become the largest independent fuel distributor in the Americas. Each of our segments delivered strong performance in 2025 and are well-positioned to contribute meaningfully toward achieving our 2026 guidance. Let me share some more perspective on our Q4 results by segment, as well as some thoughts on our 2026 guidance we released last month. Starting with our fuel distribution Adjusted EBITDA was $391 million, excluding $59 million of transaction expenses.

This compares to $238 million last quarter and $192 million in the Q4 of 2024, both excluding transaction expenses. This growth reflects continued strength in our legacy Sunoco operations, coupled with two months of contribution from Parkland.... We distributed 3.3 billion gallons, up 44% versus last quarter and up 54% versus the Q4 of last year. We continued to see volume growth in our legacy Sunoco business, with an increase of more than 2% over prior year, compared to a relatively flat U.S. demand profile. This growth is a result of effectively deployed capital via our growth capital plan and roll-up M&A transactions. We have begun the work to optimize our volumes in Canada and the Caribbean as we implement our gross profit optimization approach that we've evolved over the years.

Reported margin for the quarter was $0.177 per gallon, compared to $0.107 per gallon last quarter, and $0.106 per gallon for the Q4 of 2024. The much higher margin is a result of the addition of the legacy Parkland business to our portfolio that consists of higher-margin geographies and channels. We have also begun the process of evaluating the channels of operation in each geography to ensure the business is matched with the appropriate channel to optimize return on capital. When we step back and look at our fuel distribution business, we have a proven track record of delivering results in the U.S., and the Parkland assets easily fit into our business strategy there. The Caribbean business is proving to be just as good as we thought.

Stable income with the opportunity for growth, especially when it couples with our scale in supplying our East Coast business from the water. In Canada, as we dig into the operation, the business is even better than we expected, with higher stability and higher margins than our U.S. business, which we have proven is very stable. When you put the pieces together, the business is strong, and we are confident that we will continue to grow both fuel profit and EBITDA in this segment growing going forward. That confidence comes from a foundation of strong underlying businesses with good industry fundamentals. Higher break-even margins and market volatility continue to support our fuel profit. Adding on our proven gross profit optimization approach, quick and thoughtful channel management evaluations, and our capital deployment strategy only increases our optimism.

The final layer comes from the greater scale, enhanced geographic diversity, and improved supply optionality, delivering synergies and enabling continued EBITDA growth. We are very excited about the future of our fuel distribution business. In our pipeline system segment, Adjusted EBITDA for the Q4 was $187 million, compared to $182 million in the Q3, and $193 million in the Q4 of 2024, excluding transaction expenses. On the volume side, we reported 1.4 million barrels per day of throughput, up from the Q3 and consistent with Q4 of last year. Like last year, the Q4 was our strongest quarter of the year, with seasonal strength in our agricultural-supported markets, as well as good performance across the rest of the system. Moving on to our terminal segment.

Adjusted EBITDA for the Q4 was $87 million. This compares to $76 million in the Q3 and $61 million in the Q4 of 2024, all excluding the impact of transaction expenses. We reported around 715,000 barrels per day of throughput, which is up from both last quarter and the Q4 of last year. Earnings and volumes in this segment were boosted by the inclusion of terminals income from our Parkland acquisition. This segment continues to deliver stable results, and we're looking forward to the positive addition of our recently closed Tankwood acquisition in the Q1. Turning to our new refining segment. Adjusted EBITDA for the Q4 was $41 million, excluding $1 million of transaction expenses.

This reflects approximately two months of operations following the close of the Parkland transaction at the end of October. Refinery performance was much improved in 2025 compared to previous years, and we look forward to that trend continuing under our ownership. As we have stated before, the refinery is an important piece of the supply chain, supporting our market-leading fuel distribution business in Western Canada. Our goal is to stabilize and improve operations regardless of what the market crack provides in terms of earnings. Before I wrap up, let me talk a little bit more about 2026. In early January, we shared our full year guidance.

On the last call, we highlighted our confidence in the highly accretive value Parkland brings to our operations, and the guidance reflects this confidence with an Adjusted EBITDA range of $3.1 billion-$3.3 billion. Supporting that Adjusted EBITDA guidance were a few assumptions. First, that we would close on our Tankwood acquisition in the Q1, and we accomplished that in January. Second, we expect to realize $125 million of the total $250 million annual synergy target in 2026, and as Scott mentioned earlier, the integration is going well, and we are well on track to deliver on synergies. Third, the guidance includes the planned 50-day maintenance turnaround at the refinery that began in late January.

Turning to capital allocation, we expect maintenance capital to be in the $400-$450 million range, consistent with our much larger footprint and the refinery turnaround in the Q1. Additionally, we continue to see very attractive opportunities to grow our business. This will come from a portfolio of at least $600 million of generally quick spend, quick return capital projects, as well as acquisitions, which we included an expected floor on for the first time. To summarize, 2025 was another record year for Sunoco, and we are well positioned for another record year in 2026.

...Our outlook is supported by disciplined expense management, a proven strategy of optimizing gross profit, and effectively and accretively deploying capital. We enter the year with strong momentum and confidence in our ability to deliver sustained value for our investors. I will now turn it over to Joe to share his final thoughts. Joe?

Thanks, Karl. Good morning, everyone. We came into 2025 financially healthy, and we finished the year bigger and stronger than where we started. Within a very eventful year, there are a few highlights I want to point out. First, our legacy Sunoco business remains resilient. All segments performed well in 2025, and we delivered on our guidance. And more importantly, we expect continued strong performance. All segments are off to a good start, and independently, 2026 would have been another record year for Sunoco legacy assets. Second, we expect the Parkland acquisition to be a home run. Karl and Scott have already discussed the material progress we've made on creating value for our stakeholders, but I think it's worthwhile to take a step back and look at the bigger picture.

The Parkland acquisition will be another example of our ability to deliver on value-creating growth year after year. There is growth, and there's value-creating growth. We delivered value-creating growth for our unitholders. Let me provide a couple of examples. First, our DCF per common unit continues to grow. Sunoco is the only AMZI constituent to grow DCF per common unit for each of the last eight years, and we expect this to continue. Second, our credit profile continues to improve. We are already ahead of schedule with our leverage back to 4x. Our balance sheet is in a very good position. I'll finish with a final thought. We have earned a solid reputation as a defensive play within the midstream sector, given our ability to deliver strong results in volatile commodity environments, as well as macro challenges such as inflation and even pandemics.

I think it is well-deserved, and we remain well-positioned to differentiate ourselves within future challenges. But let's also recognize that we're an attractive growth play. The products that we move and distribute will continue to fuel the U.S. and other economies across the world for decades to come. We have positioned ourselves as a consolidator. With the addition of Parkland and Tankwood, we're now a bigger company. In our case, bigger means more scale, more scale equates to more synergies, and more synergies mean continued value-creating growth. We have a strong track record of identifying and delivering on growth. Thus, we stated in our January guidance that we have at least $500 million of bolt-on acquisition opportunities each year for the foreseeable future. This is beyond our growth capital. Simply put, we are uniquely positioned as both a thoughtful defensive play as well as an attractive growth story.

As a result, we have never reduced our distribution, but instead, we have increased our distribution for the last three years. With Parkland and other investments, we're in an even better position to continue distribution growth for both Sun and SUNC unitholders. Expect a minimum of 5% annual growth in 2026, and continued growth over a multiyear period. Operator, that concludes our prepared remarks. You may open the line for questions.

As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Our first question comes from the line of Theresa Chen from Barclays.

Good morning. Maybe beginning with the fundamentals of the fuel distribution business, how is demand trending across your footprint pro forma Parkland? And on the 17.7-cent per gallon metric, can you walk us through the drivers of the result this quarter here, and how much of that performance was driven by structural versus maybe more transient factors in your view? And from your perspective, is this CPG sustainable over the medium to long term? Or what would you consider as a good run rate or a normalized CPG? And to completely close this loop, is there a specific CPG level that underlies your $250 million synergy target as well?

Yeah. Hey, hey, Theresa, this is Austin. Yeah, let me maybe start in, in sort of reverse order, answering your question. So, you know, starting with CPG, you know, as you pointed out, as a result of the transaction, our margin profile has evolved higher. You know, whether to put stock in 17.7 as, and pegging that as the new waterline, I think, you know, is you know, probably it's directionally accurate and in terms of direction and magnitude, but with precision, I think, you know, we've always said a couple of caveats. One, there's gonna be quarter-to-quarter variability in our CPG numbers.

And then second, you know, as Karl shared in his prepared remarks, as a result of this acquisition, we're gonna be breaking out and executing against our playbook on gross profit optimization and channel management. And so for those reasons, there might be movement in both our volume and CPG numbers, independent of what the market might afford. You know, and in terms of, you know, do we have a specific number in mind? You know, historically, we haven't... You know, we don't target or solve for a CPG number. What we solve for, you know, as we've shared in the past, is fuel profit and sustained EBITDA growth over time.

And so, so with that said, you know, in terms of drivers, it might make sense to walk through the different geographic regions in our kind of newly expanded portfolio now, and what's driving that. Because essentially, what we found is, you know, Parkland had more street margin exposure in their portfolio than the legacy Sunoco business. And we've always said we're very specific and selective in where we want that street margin exposure and the geographies that Parkland had exposure to, we really like. So starting with the U.S. business, I think the story is pretty familiar. You know, demand from an EIA standpoint has been flat to slightly off toward the end of the year on a year-over-year basis. Obviously, Sunoco outperformed those trends given our deployment of growth capital.

And then on the margin side, you know, we continue to see a bullish margin environment buoyed by elevated breakevens. And so, you know, if demand, you know, moves one way or the other relative to trend, if it exceeds trend, we're well positioned to participate in that environment. If it underperforms trend, obviously, as we've seen in the past, you guys know that that creates a pretty bullish margin environment for us to operate in. So, so we feel really good about the U.S. business. And, and then turning to Canada, you know, as we shared in, and Joe and Carl shared in the prepared remarks, we're really excited about the Canadian business, and the closer we get to it, the more we like it. And, and that's for a couple reasons.

If you think about demand, you know, from a trend standpoint, Canadian refined product demand tends to mirror that in the U.S., albeit on a relative basis, it's been stronger in recent years. So, you know, where the U.S. has been flat to slightly off on a year-over-year basis, Canada's been flat to slightly up over the last couple of years. The margin environment is actually very strong. So where we have street margin exposure in Canada are markets that structurally look and feel very similar to the West Coast in the U.S. and the Northeast, where you have high barriers to entry, highly regulated markets, high real estate costs, high labor costs. And if you followed our story, you know that those things are highly correlated with strong margin environments. So we feel really good about the business.

Overall, the Canadian business is gonna be an outstanding addition to our portfolio. And then moving on to the Caribbean. Man, we continue to be really excited about the Caribbean. I think, you know, it's important to remember that we talk about the Caribbean as if it's this singular, monolithic region. The reality is, we deliver refined products to 25 different jurisdictions in the region, 22 of which we have onshore business in. And so each of those are gonna come with their own specific volume and demand, or volume and margin profiles. What I will say largely is, volume is very strong in the region.

A lot of that's driven by markets where we have exposure, like in South America, where, for example, a country like Guyana, where we're the major share player, has had 20+% GDP growth over the last three years. And Suriname is likely up next, given the offshore oil discoveries in both of those countries. But across the region, we've seen strong demand. And then on the margin side of things, you know, the markets kind of fall into one of two categories. What we've seen is there's highly regulated pricing environments, which has actually had the result of stabilizing margins higher for all participants in those markets.

And then there's the more kind of free market, open competition, markets, where our share, our global supply chain, and our scale allow us to enjoy and command a significant margin advantage over other participants in the market. So just to wrap it all up, I think overall, you know, I think we've proven over the years the consistency and resiliency of the fuel distribution segment and our ability to grow EBITDA year-over-year. And now with our addition of the Canadian business and the Caribbean business, we're better positioned than ever in the segment to continue to grow EBITDA going forward.

Thank you for that detailed answer, Austin. Maybe turning to the infrastructure outlook, can you walk us through the pro forma terminaling portfolio post-integration of Parkland and Tankwood? And how do the assets now position you across the Atlantic and Pacific basins amid evolving product flows? And where do you see the most attractive growth opportunities from here within your portfolio?

Yeah, Theresa, this is Karl. Yeah, we've got our, as you point out, across the geographies that Austin just talked about, in each one of those geographies, and then if you add Europe in, into the mix, we have critical infrastructure in each of those markets. And I think it varies by market, but our general approach and view is, in many of those markets, I'd say the Caribbean is probably the easiest one to think about, our infrastructure really supports and is foundational for our fuel distribution business. In other markets, take Europe, you know, we don't have a fuel distribution business yet, but the assets that we've picked up are highly utilized and in very important infrastructure to in the supply chain of those markets.

And then we have other geographies, whether it's in the West Coast or in the Northeast, where our terminal and pipeline network supports other people's moving product around, as well as our own business. And so I think we have examples of each ends of that spectrum, and we've talked about the opportunity for this vertical integration between our fuel distribution business and our assets. But we've also talked about how all parties are welcome, and we have customers, because our overall approach is to fully utilize the assets that we have. So as we go forward, I think the same playbook is applicable. We think there's more runway to go. I think there's more opportunity, whether it's through kind of quick-hitting capital projects that we've talked about or additional M&A opportunities to grow that footprint.

Thank you.

Thank you. One moment for our next question. Our next question comes from the line of Jeremy Tonet from J.P. Morgan Securities LLC.

Hey, good morning. This is Eli, on for Jeremy. Just wanted to start on the outlook for bolt-on M&A, which I know you touched on in opening remarks. I'm not sure if this has historically been part of forward guidance, but if we think about the $500 million annual target with respect to your guide, should we think about sort of execution there as upside to the guide and the long-term outlook? I know you guys executed a roll-up earlier in the year, so just thinking about contributions from that and the overall strategy with respect to guidance. Thanks.

Hey, Eli, this is Joe. Like I said in my prepared remarks, I think we have a highly attractive long-term growth story. The foundation of that is we're in a very good financial position. We've invested wisely, and our free cash flow continues to grow, so we have more dollars to spend on growth on a going-forward basis. And as Carl and Austin talked about, the Parkland acquisition and with our entry into Europe, we've greatly expanded our scale and our geography. So, you know, not too long ago, we were basically a U.S.-only business. Now, we have investment opportunities in U.S., Canada, Greater Caribbean, and Europe. The U.S. is gonna still remain our foundation. Like, for example, last year, we did over 10 small bolt-on acquisitions in the U.S. alone.

We could have probably done a lot more, but we kinda slowed down because we had the Parkland acquisition we're closing on. So the runway of doing these, you know, we gave the guidance of $500 million. We could probably do that alone in the U.S. Then you add on Canada, Greater Caribbean, and you add on Europe, you can see why we think that that providing guidance of doing at least $500 million, we think is a floor and is very reasonable for us for next year and for multiple years to come. On the valuation standpoint, you know, the landscape hasn't changed that much for us.

We think the valuations are still highly attractive, and the reason why we believe that, because we're one of the very few, maybe only company in this sector that can bring material synergies to the table. So valuation remains in the same ballpark, but as we get bigger and we have more scale, we remain efficient, being a low-cost provider, we get advantage economics. That's why we felt very comfortable this year, providing a bolt-on guidance for our investors. As far as, you know, you mentioned a question about guidance. Here's the way I think you should, or you should think about it. If we do more than, you know, materially more than $500 million in 2026, yeah, that gives us some upside for 2026. It depends on the timing of that.

But I think the way you should think about it is that, that's the floor, and that's a sustainable floor on a multi-year basis, which gives us kind of a year-after-year growth in our story.

Awesome. Appreciate the color there. And then, you know, thinking about the impact of these bolt-ons, maybe with respect to the SUNC dividend and Sun distribution equivalents, you know, I know you extended that equivalence recently, but if we think about sort of these bolt-ons helping avoid any tax leakage, you know, has the team considered extending that guidance? Again, I know you already extended it, but just, in the context of Sun and SUNC, the way they trade, you know, just thinking about the long-term kind of tax protection there. Thanks.

Yeah, Eli, this is Scott. You know, in our, our investment materials that we published last year, we talked about the fact that we expect minimal corporate income taxes for at least five years. A lot of that was predicated on our outlook for the business itself, and certainly continuing to invest in the business, either through acquisitions or growth capital, will help us manage that tax profile going forward. So as we sit here today, there's really no change to that minimal corporate income taxes for at least five years, which again has given us confidence that the distribution between SUNC and Sunoco LP will continue for that period of time.

Eli, let me add one other thing to that. I think one of your... where you're going with the question is that we gave the five year, at least five years, with, I would say, probably a modest assumption of growth. We believe we're gonna grow materially, so any type of material growth on top of that will put us in an even a better position on a going-forward basis.

Great. Thanks, guys.

Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Our next question comes from the line of Selman Akyol from Stifel.

Thank you. Good morning. So just a point of clarification real quick. On the $500 million in bolt-on acquisitions, would that all be U.S.-based, or would that be across your entire footprint now?

No, Mr. Akyol , it'll be across the whole footprint. I guess the point I was trying to make earlier is that the U.S. is kind of the foundation, and on a U.S. alone, we may be able to do that just on U.S. alone, but the way we're gonna look at it is best projects win. So now we get to choose between U.S., Caribbean, Europe, Canada. And then, so the best projects is the ones we're gonna take, we're gonna look at first, but in totality, it's the whole kind of global perspective.

Got it. And then, last week, there was a rescission on the Greenhouse Gas Endangerment Finding. So rolling back sort of greenhouse gases is a threat to public health. Can you guys just talk about how that may be impacting you or what you think that might do?

Yeah, it's early stages, so more clarity is gonna come out in the future. But here's some initial thoughts. In the short run, there's no effect on Sun. Longer term, it is bullish for refined products, all other variables equal. Additionally, at any time there's any legislation that creates potentially state-by-state specs and add complexity, that's always gonna be good for Sun. We thrive in those environments whenever there's complexity, and we have the team and scale to source from all different areas, so that's gonna be bullish for us. On a personal level, and I think I speak for many people, the elimination of the annoying start-stop engine cutoff function, I think is gonna be a really good development.

Okay. And then last one for me, and you've kind of teased it up several times where you talk about distribution growth of at least 5%. And then, you know, listening to all your comments, things seem to be going exceedingly well. Your outlook seems to be very confident and very bright. So what does it actually take to see something on the plus side of 5%?

Yeah, so, you know, here's the most important takeaway. We have a multiyear growth in distribution. For this year, you know, we raised it 2% three years ago, 4%, 4% two years ago, and we raised a little bit over 5% last year. And this year, we stated at a minimum 5%. As far as an exact amount, we haven't determined that yet, but then the takeaway is it's gonna be on a multiyear basis. We're in a really good position. You know, we're... It's not just distribution. We're gonna take care of our balance sheet. We're gonna remain a growth company.

So, you can tell from our results, and you can tell from the guidance, you can tell from the tone of this call, we think that we're gonna continue to grow our business, and we're gonna grow DCF per common unit. Our cash flows are gonna expand. We're in a very good position from a capital allocation standpoint. We're gonna have more dollars to deploy to all three areas. The exact allocation, that's our job to optimize that, to make sure that we don't just take care of the short run, but for the long run. So, stay tuned, as the year goes on, we'll provide more clarity as to the exact allocation, but the takeaway should be the number is growing, so we're gonna have more options to deploy that in all three areas.

All right. Thank you very much.

Thank you. One moment for our next question. Our next question comes from the line of Elvira Scotto from RBC Capital Markets.

Hey, good morning. On M&A, I have a couple questions on M&A. I guess, first, where do you see the greatest opportunity? Is it terminal fuel distribution? And then my second question on M&A is: Is there a gating item on M&A? You talk about sort of a $500 million floor. You've become a much bigger, more diversified company. I mean, is there a ceiling or anything that would, you know, keep you from doing, you know, more substantial M&A?

Hey, Elvira Scotto. As far as the greater opportunity, the answer is all of the above. We're gonna grow our midstream business, we're gonna grow our fuel distribution business, and we're gonna grow in all the geographies that we're in right now. So, that's the position that we like being in, where we're not, you know, so focused on a single geography or so focused on a single segment of our business. And the way we're gonna do it is that we have growing growth capital. You know, some of the Parkland acquisitions that we acquired, for example, like in Guyana, Suriname, we've already have 3 terminal projects in the works in those markets. So we're gonna get some natural growth from being in the right market with the right business.

From a decision between which one, I always go back to capital discipline and choosing the best projects, and we've got a wide, a wide range of opportunities, and we'll pick the best projects. As far as your question about a gating item or a ceiling, probably a little bit of clarification on the guidance we gave. We said at least $500 million of bolt-on acquisition. That's not saying that we think that's a target acquisition number, and, you know, based on the fact that we're already back to our 4x leverage within 3 or 4 months, 2 months. So we're gonna take care of our balance sheet. If we were, you know, I think after the Parkland transaction, we said we'll be back between 12-18 months.

Well, we got back a lot quicker, so now we're in even a better position to grow on a going-forward basis. 500, as I thought, was a pretty low bar for us to at least give the street that these bolt-on acquisitions aren't just sporadic, that we may pick up, you know, a few this year, maybe a few, a couple of years from now. They're ratable in the fact that U.S. is a super highly fragmented market on the fuel distribution side, so we have ample opportunity. As far as Canada and the Greater Caribbean, it's not as fragmented as the U.S., but there's plenty of opportunities. And I keep emphasizing, scale matters in this business.

Whenever you're the biggest player with the most efficiencies, regardless of what the market valuation is, we have an opportunity to take a turn or two or more down from that acquisition, so that becomes highly attractive to us. So I would give guidance to the Street that we think that $500 million of bolt-on acquisitions. This doesn't include growth capital, this doesn't include bigger opportunistic acquisition. But as a baseline, I think you should view us as that we have a solid layer of organic growth capital, and we have a solid layer of bolt-on M&A.

... Thank you. That's, that's very helpful. And then my next question is, now that you've closed on Parkland, you know, you've had it for a few months, how do you feel about your synergy target? And, you know, you have a very good track record of exceeding these targets on your acquisitions. So, you know, do you think—do you think there's a possibility of exceeding your target here?

Yeah, Elvira, this is Karl. Yeah, we're very excited about Parkland. I think Austin gave a good rundown of the various geographies from a fuel distribution side, and I'd say from the other parts of the business that we picked up, I think we're equally excited. Yeah, I think our past history would show if you were deciding to take the over or the under, I would take the over on us delivering on our synergies also. I think our main focus is delivering on the synergies quickly, and so for us to deliver in 2026, $125 million, clearly we'll be ramping up through the year. Some of those activities already started in the Q4.

And so we should exit the year well north of that $125 million on a run rate basis. But the other thing that's super important is the base business, and so our view on how strong that base business is and the sustainability of that going forward is just as important. And so it's really the combination of those factors that gives us confidence in the 2026 guidance, and then going forward in 2027 and 2028. So, you know, Joe mentioned in his last answer, the two metrics that we look at in totality that are the most important. It's really where our leverage sits, and are we, you know, delivering on our commitments on growing the DCF per LP unit? And we're very confident in those for this year and beyond.

I guess the bottom line is, I think, NuStar was a home run acquisition, and Parkland's gonna be another home run acquisition for us.

Great. Thank you very much.

Thanks.

Thank you. At this time, I would now like to turn the conference back over to Scott Grischow for closing remarks.

Thanks for joining us on the call today. There are a lot of exciting things to look forward to in 2026 for Sunoco, and we look forward to updating you across the year. In the meantime, please feel free to reach out if you have any questions. Thanks for tuning in, and we appreciate your support.

This concludes today's conference call. Thank you for participating. You may now disconnect.