Segment Reporting

3 Months Ended

Mar. 31, 2022

Segment Reporting

Segment Reporting

Note 13.    Segment Reporting

Summarized financial information for the Partnership’s reportable segments is presented in the table below (in thousands):

	Three Months Ended
	March 31,
	2022		2021
Wholesale Segment:
Sales
Gasoline and gasoline blendstocks	$	1,420,226	$	819,398
Other oils and related products (1)		1,356,003		715,169
Crude oil (2)		1,474		16,918
Total	$	2,777,703	$	1,551,485
Product margin
Gasoline and gasoline blendstocks	$	(2,285)	$	16,405
Other oils and related products (1)		53,122		18,615
Crude oil (2)		(3,749)		(4,527)
Total	$	47,088	$	30,493
Gasoline Distribution and Station Operations Segment:
Sales
Gasoline	$	1,276,961	$	756,008
Station operations (3)		115,892		100,164
Total	$	1,392,853	$	856,172
Product margin
Gasoline	$	114,886	$	80,252
Station operations (3)		58,097		50,157
Total	$	172,983	$	130,409
Commercial Segment:
Sales	$	329,982	$	145,670
Product margin	$	8,141	$	4,190
Combined sales and Product margin:
Sales	$	4,500,538	$	2,553,327
Product margin (4)	$	228,212	$	165,092
Depreciation allocated to cost of sales		(21,974)		(20,060)
Combined gross profit	$	206,238	$	145,032

(1) Other oils and related products primarily consist of distillates and residual oil.

(2) Crude oil consists of the Partnership’s crude oil sales and revenue from its logistics activities.

(3) Station operations consist of convenience store and prepared food sales, rental income and sundries.

(4) Product margin is a non-GAAP financial measure used by management and external users of the Partnership’s consolidated financial statements to assess its business. The table above includes a reconciliation of product margin on a combined basis to gross profit, a directly comparable GAAP measure.

Approximately 101 million gallons and 100 million gallons of the GDSO segment’s sales for the three months ended March 31, 2022 and 2021, respectively, were supplied from petroleum products and renewable fuels sourced by the Wholesale segment. The Commercial segment’s sales were predominantly sourced by the Wholesale segment. These intra-segment sales are not reflected as sales in the Wholesale segment as they are eliminated.

A reconciliation of the totals reported for the reportable segments to the applicable line items in the consolidated financial statements is as follows (in thousands):

	Three Months Ended
	March 31,
	2022		2021
Combined gross profit	$	206,238	$	145,032
Operating costs and expenses not allocated to operating segments:
Selling, general and administrative expenses		56,281		46,324
Operating expenses		99,233		80,528
Amortization expense		2,499		2,723
Net gain on sale and disposition of assets		(4,911)		(475)
Total operating costs and expenses		153,102		129,100
Operating income		53,136		15,932
Interest expense		(21,474)		(20,359)
Income tax (expense) benefit		(1,177)		130
Net income (loss)	$	30,485	$	(4,297)

The Partnership’s foreign assets and foreign sales were immaterial as of and for the three months ended March 31, 2022 and 2021.

Segment Assets

The Partnership’s terminal assets are allocated to the Wholesale and Commercial segments, and its retail gasoline stations are allocated to the GDSO segment. Due to the commingled nature and uses of the remainder of the Partnership’s assets, it is not reasonably possible for the Partnership to allocate these assets among its reportable segments.

The table below presents total assets by reportable segment at March 31, 2022 and December 31, 2021 (in thousands):

		Wholesale		Commercial		GDSO		Unallocated		Total
March 31, 2022	$	729,831	$	—	$	1,871,058	$	552,183	$	3,153,072
December 31, 2021	$	739,523	$	—	$	1,655,475	$	436,167	$	2,831,165