Note 23. Supplemental Guarantor Condensed Consolidating Financial Statements

The Partnership’s wholly owned subsidiaries, other than GLP Finance, are guarantors of senior notes issued by the Partnership and GLP Finance. As such, the Partnership is subject to the requirements of Rule 3-10 of Regulation S-X of the SEC regarding financial statements of guarantors and issuers of registered guaranteed securities. The Partnership presents condensed consolidating financial information for its subsidiaries within the notes to consolidated financial statements in accordance with the criteria established for parent companies in the SEC’s Regulation S-X, Rule 3-10(d).

The following condensed consolidating financial information presents the Condensed Consolidating Balance Sheets as of March 31, 2019 and December 31, 2018, the Condensed Consolidating Statements of Operations for the three months ended March 31, 2019 and 2018 and the Condensed Consolidating Statements of Cash Flows for the three months ended March 31, 2019 and 2018 of the Partnership’s 100% owned guarantor subsidiaries, the non-guarantor subsidiary and the eliminations necessary to arrive at the information for the Partnership on a consolidated basis. The principal elimination entries eliminate investments in subsidiaries and intercompany balances and transactions.

Condensed Consolidating Balance Sheet

March 31, 2019

(In thousands)


	(Issuer)		Non-
	Guarantor		Guarantor
	Subsidiaries		Subsidiary		Eliminations		Consolidated
Assets
Current assets:
Cash and cash equivalents	$	8,153	$	485	$	—	$	8,638
Accounts receivable, net		403,419		127		130		403,676
Accounts receivable - affiliates		4,873		130		(130)		4,873
Inventories		464,866		—		—		464,866
Brokerage margin deposits		19,943		—		—		19,943
Derivative assets		8,044		—		—		8,044
Prepaid expenses and other current assets		98,939		205		—		99,144
Total current assets		1,008,237		947		—		1,009,184
Property and equipment, net		1,110,046		3,130		—		1,113,176
Right of use assets, net		312,346		86		—		312,432
Intangible assets, net		55,220		—		—		55,220
Goodwill		326,486		—		—		326,486
Other assets		29,492		—		—		29,492
Total assets	$	2,841,827	$	4,163	$	—	$	2,845,990

Liabilities and partners’ equity
Current liabilities:
Accounts payable	$	343,131	$	67	$	—	$	343,198
Accounts payable - affiliates		(34)		34		—		—
Working capital revolving credit facility - current portion		219,500		—		—		219,500
Lease liability—current portion		69,760		17		—		69,777
Environmental liabilities - current portion		6,092		—		—		6,092
Trustee taxes payable		39,458		—		—		39,458
Accrued expenses and other current liabilities		89,144		84		—		89,228
Derivative liabilities		12,916		—		—		12,916
Total current liabilities		779,967		202		—		780,169
Working capital revolving credit facility - less current portion		150,000		—		—		150,000
Revolving credit facility		217,000		—		—		217,000
Senior notes		665,138		—		—		665,138
Long-term lease liability—less current portion		252,404		60		—		252,464
Environmental liabilities - less current portion		56,374		—		—		56,374
Financing obligations		149,860		—		—		149,860
Deferred tax liabilities		42,677		—		—		42,677
Other long-term liabilities		42,786		—		—		42,786
Total liabilities		2,356,206		262		—		2,356,468

Partners' equity
Global Partners LP equity		485,621		2,370		—		487,991
Noncontrolling interest		—		1,531		—		1,531
Total partners' equity		485,621		3,901		—		489,522
Total liabilities and partners' equity	$	2,841,827	$	4,163	$	—	$	2,845,990

Condensed Consolidating Balance Sheet

December 31, 2018

(In thousands)


	(Issuer)		Non-
	Guarantor		Guarantor
	Subsidiaries		Subsidiary		Eliminations		Consolidated
Assets
Current assets:
Cash and cash equivalents	$	7,050	$	1,071	$	—	$	8,121
Accounts receivable, net		334,689		52		36		334,777
Accounts receivable - affiliates		5,435		36		(36)		5,435
Inventories		386,442		—		—		386,442
Brokerage margin deposits		14,766		—		—		14,766
Derivative assets		26,390		—		—		26,390
Prepaid expenses and other current assets		98,877		100		—		98,977
Total current assets		873,649		1,259		—		874,908
Property and equipment, net		1,128,826		3,806		—		1,132,632
Intangible assets, net		58,532		—		—		58,532
Goodwill		327,406		—		—		327,406
Other assets		30,813		—		—		30,813
Total assets	$	2,419,226	$	5,065	$	—	$	2,424,291

Liabilities and partners' equity
Current liabilities:
Accounts payable	$	308,941	$	38	$	—	$	308,979
Accounts payable - affiliates		(169)		169		—		—
Working capital revolving credit facility - current portion		103,300		—		—		103,300
Environmental liabilities - current portion		6,092		—		—		6,092
Trustee taxes payable		42,613		—		—		42,613
Accrued expenses and other current liabilities		117,149		125		—		117,274
Derivative liabilities		4,494		—		—		4,494
Total current liabilities		582,420		332		—		582,752
Working capital revolving credit facility - less current portion		150,000		—		—		150,000
Revolving credit facility		220,000		—		—		220,000
Senior notes		664,455		—		—		664,455
Environmental liabilities - less current portion		57,132		—		—		57,132
Financing obligations		149,997		—		—		149,997
Deferred tax liabilities		42,856		—		—		42,856
Other long-term liabilities		57,905		—		—		57,905
Total liabilities		1,924,765		332		—		1,925,097

Partners' equity
Global Partners LP equity		494,461		2,870		—		497,331
Noncontrolling interest		—		1,863		—		1,863
Total partners' equity		494,461		4,733		—		499,194
Total liabilities and partners' equity	$	2,419,226	$	5,065	$	—	$	2,424,291

Condensed Consolidating Statement of Operations

Three Months Ended March 31, 2019

(In thousands)


	(Issuer)		Non-
	Guarantor		Guarantor
	Subsidiaries		Subsidiary		Eliminations		Consolidated
Sales	$	2,979,363	$	365	$	(102)	$	2,979,626
Cost of sales		2,822,200		684		(102)		2,822,782
Gross profit (loss)		157,163		(319)		—		156,844
Costs and operating expenses:
Selling, general and administrative expenses		40,992		98		—		41,090
Operating expenses		82,529		415		—		82,944
Lease exit and termination gain		(493)		—		—		(493)
Amortization expense		2,976		—		—		2,976
Net loss on sale and disposition of assets		553		—		—		553
Total costs and operating expenses		126,557		513		—		127,070
Operating income (loss)		30,606		(832)		—		29,774
Interest expense		(22,956)		—		—		(22,956)
Income (loss) before income tax expense		7,650		(832)		—		6,818
Income tax expense		(24)		—		—		(24)
Net income (loss)		7,626		(832)		—		6,794
Net loss attributable to noncontrolling interest		—		332		—		332
Net income (loss) attributable to Global Partners LP		7,626		(500)		—		7,126
Less: General partners' interest in net income, including incentive distribution rights		304		—		—		304
Less: Series A preferred limited partner interest in net income		1,682		—		—		1,682
Net income (loss) attributable to common limited partners	$	5,640	$	(500)	$	—	$	5,140

Condensed Consolidating Statement of Operations

Three Months Ended March 31, 2018

(In thousands)


	(Issuer)		Non-
	Guarantor		Guarantor
	Subsidiaries		Subsidiary		Eliminations		Consolidated
Sales	$	2,802,584	$	392	$	(85)	$	2,802,891
Cost of sales		2,657,810		836		(85)		2,658,561
Gross profit		144,774		(444)		—		144,330
Costs and operating expenses:
Selling, general and administrative expenses		39,274		92		—		39,366
Operating expenses		73,667		382		—		74,049
Gain on trustee taxes		(52,627)		—		—		(52,627)
Amortization expense		2,468		—		—		2,468
Net loss on sale and disposition of assets		1,867		—		—		1,867
Total costs and operating expenses		64,649		474		—		65,123
Operating income (loss)		80,125		(918)		—		79,207
Interest expense		(21,445)		—		—		(21,445)
Income (loss) before income tax benefit		58,680		(918)		—		57,762
Income tax benefit		913		—		—		913
Net income (loss)		59,593		(918)		—		58,675
Net loss attributable to noncontrolling interest		—		367		—		367
Net income (loss) attributable to Global Partners LP		59,593		(551)		—		59,042
Less: General partners' interest in net income, including incentive distribution rights		396		—		—		396
Net income (loss) attributable to common limited partners	$	59,197	$	(551)	$	—	$	58,646

Condensed Consolidating Statement Cash Flows

Three Months Ended March 31, 2019

(In thousands)


	(Issuer)		Non-
	Guarantor		Guarantor
	Subsidiaries		Subsidiary		Consolidated
Cash flows from operating activities
Net cash used in operating activities	$	(86,451)	$	(586)	$	(87,037)

Cash flows from investing activities
Capital expenditures		(10,229)		—		(10,229)
Seller note issuances		(640)		—		(640)
Proceeds from sale of property and equipment		4,228		—		4,228
Net cash used in investing activities		(6,641)		—		(6,641)

Cash flows from financing activities
Net borrowings from working capital revolving credit facility		116,200		—		116,200
Net payments on revolving credit facility		(3,000)		—		(3,000)
LTIP units withheld for tax obligations		(8)		—		(8)
Distributions to limited partners and general partner		(18,997)		—		(18,997)
Net cash provided by financing activities		94,195		—		94,195

Cash and cash equivalents
Increase (decrease) in cash and cash equivalents		1,103		(586)		517
Cash and cash equivalents at beginning of period		7,050		1,071		8,121
Cash and cash equivalents at end of period	$	8,153	$	485	$	8,638

Condensed Consolidating Statement Cash Flows

Three Months Ended March 31, 2018

(In thousands)


	(Issuer)		Non-
	Guarantor		Guarantor
	Subsidiaries		Subsidiary		Consolidated
Cash flows from operating activities
Net cash used in operating activities	$	(103,500)	$	(214)	$	(103,714)

Cash flows from investing activities
Capital expenditures		(9,557)		—		(9,557)
Proceeds from sale of property and equipment		800		—		800
Net cash used in investing activities		(8,757)		—		(8,757)

Cash flows from financing activities
Net borrowings from working capital revolving credit facility		125,000		—		125,000
Distributions to limited partners and general partner		(15,694)		—		(15,694)
Net cash provided by financing activities		109,306		—		109,306

Cash and cash equivalents
Decrease in cash and cash equivalents		(2,951)		(214)		(3,165)
Cash and cash equivalents at beginning of period		13,035		1,823		14,858
Cash and cash equivalents at end of period	$	10,084	$	1,609	$	11,693