Global Partners LP (GLP) Earnings

Management highlights

Good morning, everyone, and thank you for joining us on today's earnings call. We started 2026 with a strong first quarter driven by solid execution across our operating segments and supported by the continued strength of our integrated liquid energy platform in a dynamic commodity environment marked by heightened geopolitical tension and global supply disruptions. Our business is built to perform across a wide range of market conditions, and given the current volatility, we remain focused on managing risks and opportunities while continuing to optimize our asset base to enhance returns. Our results this quarter were driven by a colder than normal winter in the Northeast and more favorable market conditions in wholesale and commercial markets, along with improved fuel margins in our gasoline distribution and station operations segment. Importantly, these results reinforce the resiliency of our model. We do not rely on any single commodity, geography, or market dynamic to generate cash flow. Instead, we manage a diversified portfolio of assets and adjust our operating approach to reflect the conditions in front of us. That flexibility remains a core strength of Global. Whether markets are volatile or more stable, our focus is the same, disciplined execution, prudent capital allocation, and maintaining a strong balance sheet to support long-term value creation for our unit holders. Turning briefly to our distribution, last month our board approved a quarterly cash distribution of $76.50 per common unit, or $3.06 on an annualized basis. This marks our 18th consecutive quarterly increase supported by healthy coverage and the cash-generating capacity of our business. The distribution will be paid on May 15th to unit holders of record as of May 11th.

Guidance

For full year 2026, we expect maintenance CapEx in the range of $60 to $70 million and expansion CapEx excluding acquisitions in the range of $75 to $85 million. Our current CapEx estimates depend in part on the timing of project completions, the availability of equipment and labor, weather, and any unforeseen events or opportunities that require additional maintenance or investment.

Segment performance

GDSO segment product margin increased 11.4 million in the quarter to 199.3 million. Product margin from gasoline distribution increased 10.9 million to 136.7 million, primarily reflecting higher fuel margins year over year. On a cents per gallon basis, fuel margin increased by six cents to 41 cents in Q126 from $0.35 in Q1 2025. Station operations product margin, which includes convenience store and prepared food sales, sundries, and rental income, increased $0.5 million to $62.6 million in the first quarter of 2026. At quarter end, our GDSO portfolio of fueling stations and C-stores consisted of 1,513 sites, exclusive of the 68 sites under our Spring Partners Retail Joint Venture. Turning to our wholesale segment, first quarter product margin increased $60.5 million to $154.1 million. Product margin from gasoline and gasoline blend stocks increased $44.1 million to $101.2 million. And product margin from distillates and other oils increased $16.4 million to $52.9 million. These increases in our wholesale segment product margin are primarily due to more favorable market conditions in gasoline and residual oil. In our commercial segment, product margin increased 4.6 million to 11.7 million, primarily due to more favorable market conditions.

Risks & headwinds

Our assumptions and future performance are subject to a wide range of business risk, uncertainties, and factors, including supply and demand, which could cause actual results to differ materially as described in our filings with the Securities and Exchange Commission. We do expect the current steep backwardation in the forward product pricing curve to increase the cost of carrying our hedged inventory in future periods, and we remain focused on disciplined inventory management.

Analyst Q&A

• Q: Are you seeing any changes in customer patterns, any signs of demand destruction at all, given the higher fuel prices yet?

  A: I mean, nothing noticeable in the quarter in March. You know, obviously one thing we track is average fill-ups and average gallons per fill-up, and we have seen some decline in that through March and April. But overall, I mean, the consumer continues to be pretty healthy. I do think obviously that higher gasoline prices will impact the share of wallet going forward. So it's something we continue to lean in on promotions and loyalty in our C-Store to drive customers into our stores. But depending on how long this prolong goes on, it could have a further impact on potential demand at the pump.

• Q: How's that going given the volatility? And I'm really kind of thinking, you know, March you had one month of the volatility, but you've seen certainly more of that as we've gone into the second quarter. I'm just kind of wondering how CPG is holding up.

  A: Eric margins continue to show the same historic resiliency that they have. And if there is a decline in volume, you know, margins historically have expanded. Right. So I you know, I think that that is going to hold true. And I think that that's what we're seeing now. But generally, too, there's a lot of price volatility in the market. And so you're waking up, you know, certain days and the product prices are moving 15, 20, 30 cents. To me, that volatility represents an opportunity. The amount of price changes that we're making, somebody quoted me internally here, we've made um the same amount of price changes already that we typically make in a year wow that's that's in the tens of thousands that's in the tens of thousands wow that's quite a stat

• Q: In this environment how do you think about acquisitions are they easier is it you'd rather pause and see how things shake out? Is there anything that's changed?

  A: Yeah, no, we continue to look at everything that's out there. I would say the landscape is as competitive as it's ever been. But we're trying to be involved in every process that is out there. And it'll be interesting to sort of see if anything or what gets done or what gets sold.

• Q: You guys referenced sort of the higher carrying costs for inventories at wholesale, but I guess just in general. But is there any thoughts of carrying lower inventories given the carrying costs or is that just – cost of doing business, and we're not having a problem getting any products, so we'll keep inventories robust.

  A: Hey, Salmon. Good morning. It's Mark. Yeah, that's actually, you know, and something that we've done historically. It's part of our playbook, and it does kind of highlight the benefit or the value of the storage capacity that we have, and we can tailor our inventory levels based on market conditions, as you might expect. when markets get extremely backwards, we're able to reduce inventories down significantly during that, during that run up, capture additional margin, and then mitigate some of the risks associated with holding inventory. So we're at a point now where we're, you know, we've drawn down inventories in this environment. We'll continue to manage them tightly. Uh, you know, on the flip side, if a market's contango, obviously we're building inventory. So that is a key risk mitigation lever that we're able to pull and really kind of tailor to the market conditions of the current environment.

• Q: Let me just ask you one macro question. I don't know if it's unanswerable or not. So we're getting ready to go into the driving season, the summer driving season, sort of peak demand season. The U.S. has been selling down. Our exports are pretty robust. Do you think there's supply tightness out there as we get into the summer at all? Do you have any thoughts on kind of what that's going to look like this summer just in general with everything going on?

  A: Yeah, it's Mark again, Selman. I think, you know, if you look at inventories, and we just had this conversation yesterday, they're pretty low. You know, we've got a lot of exports leaving the Gulf, maybe some leave in New York, imports for gasoline into in a pad one have been have been very light. And we've been drawing, you know, the US has been drawing inventories pretty aggressively over the last, call it six weeks, maybe eight weeks. So we're at a pretty low level heading into a key driving season. Um, you know, some of this, some of it will depend on how long the, you know, the current situation goes on. But even if, even if the conflict is resolved tomorrow, there's been a lot of damage done to worldwide, to, to production and inventories are, are at a pretty low level across the board. So it'll be interesting to see how that plays out. You know, I don't think, I don't think an end to the war is going to solve the problem immediately. The system's going to take time when I say system, I mean worldwide, but we're obviously specifically focused on pad one and to a lesser degree pad three. But, um, you know, I think you're going to have some lasting impact to that and we'll see how it plays out, but there is some underlying fundamental strength in the market. that I think we're going to see play out for, I might say, at least through the end of the year. Eric, I just want to add one other thing. It'll be interesting to see how countries position themselves vis-a-vis inventory and storage for moments like this, and if a lot of other countries look at storing crude or products in caverns or throughout the country and make sure that they have product on hand and how that plays out into price. A: Yeah, we've already seen comments. Yeah, that's a big macro point, right? Because even if everything came back, it's not going to be the same as it was before, right? So it'll be different. And if countries go and decide they want to build secure inventory that they can use in a market like this, you know, that's going to put pressure on supply because it's going to show up as increased demand. Yeah, we've already seen comments coming out of Australia for that.