Company: SPH
Filing Date: 2025-08-07
Form Type: 10-Q
Source: 0000950170-25-104656
Chunk: 6

Company: SUBURBAN PROPANE PARTNERS LP
Filing Date: 2025-08-07
Form: 10-Q
Item: Part I, Item 2
Chunk 6
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 vary significantly from year to year as our costs fluctuate with the propane, fuel oil, crude oil and natural gas commodity markets and infrastructure conditions.  In addition, periods of sustained higher commodity and/or transportation prices can lead to customer conservation, resulting in reduced demand for our product.

According to the Energy Information Administration, U.S. propane inventory levels at the end of June 2025 were 75.7 million barrels, which was nominally lower than June 2024 levels and 9.9% higher than the five-year average for June.  The slight decline in inventory levels and continued strong global demand contributed to an increase in average posted propane prices (basis Mont Belvieu, Texas) of 4.7% compared to the prior year third quarter.

Seasonality

The retail propane and fuel oil distribution businesses, as well as the retail natural gas marketing business, are seasonal because these fuels are primarily used for heating in residential and commercial buildings.  Historically, approximately two‑thirds of our retail propane volume is sold during the  six-month peak heating season from October through March. The fuel oil business tends to experience greater seasonality given its more limited use for space heating and approximately three-fourths of our fuel oil volumes are sold between October and March.  Consequently, sales and operating profits are concentrated in our first and second fiscal quarters.  Cash flows from operations, therefore, are greatest during the second and third fiscal quarters when customers pay for product purchased during the winter heating season.  We expect lower operating profits and either net losses or lower net income during the period from April through September (our third and fourth fiscal quarters).  To the extent necessary, we will reserve cash from the second and first quarters for distribution to holders of our Common Units in the fourth quarter and the following fiscal year first quarter.