Global Partners Shifts Focus to Store Restructuring

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Global Partners Shifts Focus to Store Restructuring

08/08/2013

WALTHAM, Mass. -- Now that it has amassed approximately 900 gas stations and convenience stores in nine states, Global Partners LP has shifted its focus to rebuilding current locations.

The master limited partnership's (MLP) "Raise and Rebuild" program has been a success thus far, President and CEO Eric Slifka said during today's 2013 fiscal second-quarter earnings call.

Global Partners recently opened “restructured” locations in Darien, Conn.; Billerica, Mass.; South Kingston, R.I.; and Stratford, Conn., the CEO reported. He did not mention during the call what future store restructuring plans the MLP has moving forward.

Slifka did discuss, however, the company’s profits in detail. Global Partners achieved a net income of $8.7 million for its second quarter ended June 30. This figure was considerably lower than the $18.5 million the MLP earned in its 2012 second quarter.

"Our second-quarter 2013 results were not as strong as the same period in 2012, primarily because of lower retail gasoline margins and a less favorable distillates market," Slifka said.

Despite the large earnings decline, he expressed plenty of confidence in the future. In fact, the company raised its quarterly distribution to shareholders by 1 percent, often considered a sign of financial strength.

"We believe in the strategic direction of the partnership," Slifka said. "Despite short-term challenges, we believe that we will be able to deliver value to our unitholders through the optimization of our operating assets, our organic projects under development and other strategic initiatives."

These comments apparently were not enough to dissuade investors, though. The MLP's New York Stock Exchange shares were 13 percent lower in this morning's trade.

Waltham, Mass.-based Global Partners LP's convenience stores and gas stations are located in Connecticut, Maine, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island and Vermont. It sells fuel under the Mobil, Exxon, Shell, Sunoco, CITGO, Gulf and Global brands.