Segment Reporting

6 Months Ended

Jun. 30, 2020

Segment Reporting [Abstract]

Segment Reporting Disclosure [Text Block]

Segment Reporting

Our financial statements reflect two reportable segments, Fuel Distribution and Marketing and All Other.

We report Adjusted EBITDA by segment as a measure of segment performance. We define Adjusted EBITDA as net income before net interest expense, income tax expense and depreciation, amortization and accretion expense, non-cash unit-based compensation expense, gains and losses on disposal of assets and impairment charges, unrealized gains and losses on commodity derivatives, inventory adjustments, and certain other operating expenses reflected in net income that we do not believe are indicative of ongoing core operations. Inventory adjustments that are excluded from the calculation of Adjusted EBITDA represent changes in lower of cost or market reserves on the Partnership's inventory. These amounts are unrealized valuation adjustments applied to fuel volumes remaining in inventory at the end of the period.

The following table presents financial information by segment for the three and six months ended June 30, 2020 and 2019:

	Three Months Ended June 30,
	2020											2019
	Fuel Distribution and Marketing			All Other			Intercompany Eliminations		Totals			Fuel Distribution and Marketing			All Other			Intercompany Eliminations		Totals
	(in millions)
Revenue
Motor fuel sales	$	1,930		$	62				$	1,992		$	4,193		$	173				$	4,366
Non motor fuel sales	20			34					54			16			58					74
Lease income	29			5					34			31			4					35
Intersegment sales	152			—			(152	)	—			463			16			(479	)	—
Total revenue	2,131			101			(152	)	2,080			4,703			251			(479	)	4,475
Gross profit (1)
Motor fuel	275			19					294			171			19					190
Non motor fuel	13			17					30			13			31					44
Lease	29			5					34			31			4					35
Total gross profit	317			41					358			215			54					269
Total operating expenses	117			33					150			139			33					172
Operating income	200			8					208			76			21					97
Interest expense, net	(37		)	(7		)			(44		)	(35		)	(8		)			(43		)
Other income (expense), net	—			—					—			—			6					6
Equity in earnings of unconsolidated affiliate	1			—					1			—			—					—
Income from operations before income taxes	164			1					165			41			19					60
Income tax expense	3			5					8			2			3					5
Net income (loss) and comprehensive income (loss)	$	161		$	(4	)			$	157		$	39		$	16				$	55
Depreciation, amortization and accretion	36			11					47			37			10					47
Interest expense, net	37			7					44			35			8					43
Income tax expense	3			5					8			2			3					5
Non-cash unit-based compensation expense	3			—					3			3			—					3
Loss on disposal of assets and impairment charges	—			6					6			—			2					2
Unrealized loss on commodity derivatives	—			—					—			3			—					3
Inventory adjustments	(87		)	(3		)			(90		)	(4		)	—					(4		)
Equity in earnings of unconsolidated affiliate	(1		)	—					(1		)	—			—					—
Adjusted EBITDA related to unconsolidated affiliate	3			—					3			—			—					—
Other non-cash adjustments	5			—					5			4			(6		)			(2		)
Adjusted EBITDA	$	160		$	22				$	182		$	119		$	33				$	152
Capital expenditures	$	15		$	3				$	18		$	28		$	3				$	31
Total assets as of June 30, 2020 and December 31, 2019, respectively	$	4,014		$	1,107				$	5,121		$	4,189		$	1,249				$	5,438

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(1)

Excludes depreciation, amortization and accretion.

	Six Months Ended June 30,
	2020											2019
	Fuel Distribution and Marketing			All Other			Intercompany Eliminations		Totals			Fuel Distribution and Marketing			All Other			Intercompany Eliminations		Totals
	(in millions)
Revenue
Motor fuel sales	$	4,969		$	189				$	5,158		$	7,635		$	314				$	7,949
Non motor fuel sales	31			94					125			35			113					148
Lease income	59			10					69			63			7					70
Intersegment sales	445			—			(445	)	—			827			48			(875	)	—
Total revenue	5,504			293			(445	)	5,352			8,560			482			(875	)	8,167
Gross profit (1)
Motor fuel	269			46					315			429			46					475
Non motor fuel	24			58					82			30			64					94
Lease	59			10					69			63			7					70
Total gross profit	352			114					466			522			117					639
Total operating expenses	272			68					340			274			116					390
Operating income	80			46					126			248			1					249
Interest expense, net	(75		)	(13		)			(88		)	(71		)	(14		)			(85		)
Other income (expense), net	—			—					—			3			—					3
Equity in earnings of unconsolidated affiliate	2			—					2			—			—					—
Income (loss) from operations before income taxes	7			33					40			180			(13		)			167
Income tax expense (benefit)	3			8					11			4			(1		)			3
Net income (loss) and comprehensive income (loss)	$	4		$	25				$	29		$	176		$	(12	)			$	164
Depreciation, amortization and accretion	73			19					92			71			21					92
Interest expense, net	75			13					88			71			14					85
Income tax expense (benefit)	3			8					11			4			(1		)			3
Non-cash unit-based compensation expense	7			—					7			6			—					6
Loss on disposal of assets and impairment charges	—			8					8			4			46					50
Unrealized loss (gain) on commodity derivatives	6			—					6			(3		)	—					(3		)
Inventory adjustments	139			(2		)			137			(97		)	—					(97		)
Equity in earnings of unconsolidated affiliate	(2		)	—					(2		)	—			—					—
Adjusted EBITDA related to unconsolidated affiliate	5			—					5			—			—					—
Other non-cash adjustments	10			—					10			5			—					5
Adjusted EBITDA	$	320		$	71				$	391		$	237		$	68				$	305
Capital expenditures	$	40		$	19				$	59		$	48		$	9				$	57
Total assets as of June 30, 2020 and December 31, 2019, respectively	$	4,014		$	1,107				$	5,121		$	4,189		$	1,249				$	5,438

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(1)

Excludes depreciation, amortization and accretion.