Good morning and welcome to the CrossAmerica Partners Fourth Quarter 2020 Earnings Conference Call. My name is Brandon, and I'll be your operator for today. At this time, all participants are in a listen only mode. Later we will conduct the question-and-answer session [Operator instructions]. Please note that this conference is being recorded. I will now turn the presentation over to our CFO, Eric Javidi. You may begin sir.

Thank you, operator. Good morning, and thank you for joining the CrossAmerica Partners fourth quarter and year-end 2020 earnings call. With me today are Charles Nifong, CEO and President; and other members of our executive leadership team. Charles will provide some opening comments, a brief overview of CrossAmerica's operational performance and highlights from the full year and quarter, and then I will discuss the financial results. At the end, we will open up the call to questions. I should point out that today's call will follow some presentation slides that we will utilize during this morning's event. These slides are available as part of the webcast and are posted on the CrossAmerica website. Before I begin, I would like to remind everyone that today's call including the question-and-answer session may include forward-looking statements regarding expected revenue, future plans, future operational metrics and opportunities and expectations of the organization. There can be no assurance that management's expectations, beliefs and projections will be achieved or that actual results will not differ from expectations. Please see CrossAmerica's filings with the Securities and Exchange Commission including annual reports on Form 10-K and quarterly reports on Form 10-Q for a discussion of important factors that could affect our actual results. Forward-looking statements represent the judgment of CrossAmerica's management as of today's date and the organization disclaims any intent or obligation to update any forward-looking statements. During today's call, we may also provide certain performance measures that do not conform to U.S. generally accepted accounting principles or GAAP. We have provided schedules that reconcile these non-GAAP measures with our reported results on a GAAP basis as part of our earnings press release. Today's call is being webcast and a recording of this conference call will be available on the CrossAmerica website for a period of 60 days. With that, I'll now turn the call over to Charles.

Thank you Eric. I appreciate everyone joining us this morning. As always, we thank you for your interest in the partnership and hope that you are well. During today's call, I will briefly go through some of the operating highlights for the fourth quarter and full year of 2020. I will also provide some color on the continuing impacts from COVID-19 along with a few other updates similar to what I provided during our prior calls this past year. Eric will then review in more detail the financial results. If you turn to slide 4, I will briefly review some of our results. For the fourth quarter of 2020, our wholesale fuel volume increased 22% when compared to the fourth quarter of 2019 largely due to the acquisitions and exchanges that were completed during 2020, offset by the impact of COVID-19. Along with a strong increase in last year, we also saw a 15% increase in our wholesale fuel margin per gallon year-over-year driving our wholesale fuel gross profit up 39% for the quarter. As I have done in prior quarters, I will provide some color on same-store volume performance to provide insight on business conditions. In terms of same-store comparable week year-over-year volume performance, weekly volumes at the start of the quarter were generally off in the high single digits relative to the prior year. Beginning in mid-November as COVID mitigation efforts across the country intensified, we saw a decline in same-store volumes from this trend level. We experienced a sharp drop in volumes a week of Thanksgiving as same-store volumes were off 15% to 20% from the prior year. December volumes were off in the range of low double digits on a same-store year-over-year basis. For the quarter overall, same-store volume was off in low double digits relative…

Thanks Charles. If you please turn to Slide 10 I'd like to review our fourth quarter and full year results for the partnership. We reported adjusted EBITDA of $24.4 million for the fourth quarter of 2020 which was a decline of 4% when compared to the same period of 2019. Our distributable cash flow for the fourth quarter of 2020 was $26.2 million versus $18.8 million for the fourth quarter of 2019 reflecting an increase of 40% year-over-year. Our distributable cash flow for the fourth quarter benefited from the performance of our wholesale segment, lower cash interest and a current tax benefit from bonus depreciation on eligible capital expenditures. Our distribution coverage on a paid basis for the fourth quarter of 2020 was 1.32x a 27% improvement versus 1.04x for the fourth quarter of 2019. As Charles touched on earlier our operating expenses increased over $17 million for the fourth quarter of 2020 compared to the fourth quarter of 2019, driven by the increase in our company-operated site count as a result of the April 2020 acquisition of retail and wholesale assets. Our average company-operated site count increased to 149 sites from 0 sites in the fourth quarter of 2019. Additionally, a fair number of our company-operated sites are leased and so the rent component of operating expenses at our company-operated sites increased $3.2 million. For the full year, our adjusted EBITDA was $107.4 million representing an increase of 4% with distributable cash flow increasing 28% to $102.5 million. Our distribution coverage on a paid basis for the full year of 2020 was 1.31x which was an improvement over the 1.11x that we experienced for the 12 months ended December 31, 2019. Slide 11, if you turn to the next slide we ended the quarter with a leverage ratio as…

Thank you. We will now begin the question-and-answer session. [Operator Instructions] And from Baraboo Growth we have Walter Morris. Please, go ahead.

Yes, gentlemen. Congratulations on navigating the cross currents of 2020.

Thank you.

My question relates to the tax benefits realized in 2020. Could you go into greater detail on the background and tax laws that produced those tax benefits? And now that the Couche-Tard exchanges are completed, should we expect a little or no tax benefits going forward? Thank you.

Yes. So, as it relates to the tax benefits that we recorded during the year, there are a few sources for them, but the main benefit that we had was from the accelerated depreciation due to all the acquisitions that we did during the year. And so, going forward to the extent that there is less acquisitions, you should see that impact being reduced in the future.

Without any additional acquisitions, would that number go to essentially zero going forward?

Yes. I don't want to go into too much in, like, predicting or forecasting the future, but suffice it to say that, the tax -- being in a tax benefit position is in large part driven by the benefit of being able to take the 100% accelerated depreciation. So to the extent they're not continuing current new acquisitions you shouldn't expect to see that same type of position going forward.

Right. And obviously, it's all subject to current tax loss in the future as well.

Thank you, gentlemen.

Thank you.

[Operator Instructions] And from RBC Capital Markets we have Elvira Scotto. Please go ahead.

Hey, good morning, everyone. A quick question around CapEx. It looks like -- can you just talk about the CapEx spend for the year? First quarter and second quarter were about $5 million, third quarter and fourth quarter were about $10 million to $12 million. Just how do we think about that CapEx spend, the cadence of that? And what drove that?

Yes. So, for last year there are a few factors going on. One of the significant ones that we touched on in the industry was the need to upgrade dispensers for EMV compliance. And so a fair amount of that was related to those types of activities. And then also in addition as part of our fuel initiative, we've done a fair amount of brand conversions. So, you also see that number in there as well. And as we touched on in our comments, for the fuel conversion, that is a number that typically from the suppliers we are reimbursed for it over time or after completion. So, there'll be a lag between when you see that number spend and when it comes in. And also given the way that we're reimbursed for it over time you're not necessarily going to see that reimbursement come in on the cash flow statement it sometimes will come in through other means.

Okay, treat. That's helpful. And then can you just talk a little bit about the environment for M&A and what you're seeing out there?

Yes. So, it's continued to be an active environment. As we touched on in our comments we're always seeing opportunities. I think the question for now that's out there in the marketplace is when you're evaluating opportunities what's the framework in which you're evaluating them because sellers certainly have expectations that you're going to look at things through a return to normal environment. And obviously, as buyers, we have a different framework through which we view things. And the question is in terms of the COVID impact what is going to be transitory? And when will that COVID impact in and what is perhaps permanent? And so I think there is some friction there between buyers and sellers in regards to expectations for economics and what set of numbers that people want to evaluate transactions on. But the marketplace continues to be active. But from our perspective, we're going to be continuing to be focused on the things that I touched on in the call and be disciplined about what types of sites that we're going to go after.

Great. Thank you.

[Operator Instructions]

All right.

We are showing no more questions. Mr. Javidi, I'll will turn it back to you for closing remarks.

Yes. Thank you everyone for joining. We appreciate it. And if obviously to the extent there are other questions you know where to find us. But thank you all for joining this morning.

Thank you. Ladies and gentlemen, this concludes today's conference. Thank you for joining. You may now disconnect.