Good day, everyone, and welcome to the Global Partners First Quarter 2023 Financial Results Conference Call. Today's call is being recorded. [Operator Instructions] With us from Global Partners are President and Chief Executive Officer, Mr. Eric Slifka; Chief Financial Officer, Mr. Gregory Hanson; Chief Operating Officer, Mr. Mark Romaine; and Chief Legal Officer, Mr. Sean Geary. At this time, I would like to turn the call over to Mr. Geary for opening remarks. Please go ahead, sir.

Good morning, everyone. Thank you for joining us. Today's call will include forward-looking statements within the meaning of federal securities laws. These statements include projections, expectations and estimates concerning the future financial and operational performance of Global Partners, which are based on assumptions regarding market conditions, demand for liquid energy products and convenience store products. The regulatory and permitting environment, the forward product pricing curve and other factors, which could influence our financial results. We believe these assumptions are reasonable given currently available information. Our assumptions and future performance are subject to a wide range of business risks, uncertainties and factors, which are described in our filings with the Securities and Exchange Commission and which could cause actual results to differ materially from the partnership's historical experience and present expectations or projections. Global Partners undertakes no obligation to revise or update any forward-looking statements. Any material comments concerning future results or operations will be communicated through news releases, publicly announced conference calls or other means that will constitute public disclosure for the purposes of Regulation FD. It's now my pleasure to turn the call over to our President and Chief Executive Officer, Eric Slifka.

Thank you, Sean, and good morning, everyone. Let me begin by thanking the entire Global team for propelling us to a solid start in fiscal 2023. Our performance reflects the great work being done across our liquid energy terminal network and convenient markets every day to deliver quality products and superior service to our customers and guests. Q1 was another strong quarter for our GDSO segment, which posted a 6.1% higher product margin. This increase helped more than offset the effects of warmer than normal temperatures on distillates and other weather-related -- weather-sensitive products. Our results speak to the diversification of our business model, which serves us extremely well in what is frequently a dynamic weather environment. On our year-end call, I spoke with you about three acquisitions we completed in 2022. These transactions have strengthened the earnings power of our GDSO portfolio, adding more than 60 company-operated convenience markets and related fuel operations, along with fuel supply arrangements at more than 55 additional sites. In March, we signed a joint venture agreement to invest alongside ExxonMobil to acquire 64 convenience and fueling facilities in the greater Houston area. The agreement is expected to close in the second quarter of 2023. We are excited about the opportunity to expand our footprint into the fast-growing Texas market and look forward to operating the sites on behalf of the joint venture. On the corporate governance front, during the first quarter, we were extremely pleased to welcome Clare McGrory to our Board of Directors as CFO and COO at Atairos a $6 billion strategic investment firm. Clare has been instrumental in guiding growth-oriented businesses across a wide range of industries. She also brings more than 13 years of energy experience to our Board, having served as CFO, EVP and Treasurer, to Sunoco LP. We look forward to benefiting from Clare strategic experience industry perspectives and leadership background. Turning to our distribution. In April, the Board agreed upon a quarterly cash distribution of $0.6550 or $2.62 on an annualized basis on all our outstanding common units for the period from January 1 to March 31. The distribution will be paid on May 15 to unitholders of record as of the close of business on May 9, 2023. Let me conclude my remarks by updating you on the status of our agreement with Gulf Oil Limited Partnership to acquire five of Gulf's refined product terminals in Connecticut, Maine, Massachusetts and New Jersey. We are continuing to work through the regulatory review process, and we'll share any material developments as appropriate. Now, let me turn the call over to Greg for the financial review. Greg?

Thank you, Eric, and good morning, everyone. Looking at our first quarter 2023 results, adjusted EBITDA was $76 million compared with $74.9 million and net income was $29 million compared with $30.5 million for the same period in 2022. DCF was $46.3 million compared with $49.9 million in the same period last year. Please note that adjusted EBITDA and DCF include a net gain on sale and disposition of assets of $2.1 million and $4.9 million for the first quarter of 2023 and 2022, respectively. TTM distribution coverage as of March 31, 2023, included -- including the Q4 2022 one-time special distribution was 3.3x or 3.2x after factoring in distribution to our preferred unitholders. Excluding the net gain on the sale of assets, which included the gain from our sale of our Revere terminal in June of last year, TTM distribution coverage was 2.7 times or 2.6 times after factoring in distributions to our preferred unitholders. Turning to our segment details. GDSO product margin was up $10.5 million in the quarter to $183.5 million. The gasoline distribution contribution to product margin was up $5.9 million to $120.8 million primarily due to higher fuel margins and an increase in volume sold due to our 2022 acquisitions. Fuel margins increased $0.01 per gallon to $0.32 per gallon in the first quarter of 2023 from $0.31 per gallon in the first quarter of 2022. Station operations product margin, which includes convenience stores and prepared food sales, sundries and rental income, increased $4.6 million to $62.7 million from the first quarter of 2022. This reflected an increase in activity in our convenience stores, in part due to our 2022 acquisitions. At the end of the first quarter, our GDSO portfolio consisted of 1,656 sites, comprised of 343 company-operated sites, 297 commission agents, 188 leasing…

Thank you, Greg. We remain focused on driving returns for our stakeholders through a combination of organic growth, operational efficiency and M&A. We're off to a solid start in 2023 and are well positioned to deliver on our strategic objective. Now Greg, Mark and I will be happy to take your questions. Operator?

[Operator Instructions] Thank you. Our first question comes from the line of Selman Akyol with Stifel. Please proceed with your question.

Thank you. Good morning and congrats on another nice quarter. Let me just start off. On the Gulf Oil, is this taking longer than you originally anticipated? Or do you have any comments there at all on that when you think this financially get done?

Yes, sure. I'll start off, Selman. Good to hear from you. Yes. So I mean it is not taking any longer than we anticipated. I mean I think bet you talk to a lot of companies out there, the FTC is taking longer to review a lot of things. We anticipate going into this acquisition that it potentially could be a long acquisition process with the FTC, but we continue to endeavor to work with them and hopeful to get this thing closed as soon as we get the approval from them.

Got it. Okay. And then turning to your announcement with Exxon, if you could maybe help us understand that a little bit more? I doubt you'll answer me if I ask sort of for pricing or what the investment is. But what I guess I'm really trying to understand is they're going to supply the fuel, you're going to manage the stations. Can you just talk a little bit about how this arrangement is going to be?

Hi, Selman, it's Eric. It's really a partnership. If you think about Exxon is good at certain things, and Global is good at certain things. I think this is a partnership that will allow us to focus on what our expertise is. And that is operating sites that is pricing sites, that is managing sites. And in terms of supply, look, they are refining to emit and they're going to -- their job is going to be to supply to locations, right? So we think it's a fit because, for us, it puts us in a market that we haven't been in with ExxonMobil. And obviously, we think ExxonMobil is going to be a fantastic partner for the Company. And as we've shown in the past, once we end up with assets in markets, we've been able to expand our footprint, right? And so the goal here is operate these assets, get comfortable with the business in Texas and then look to grow it.

Got it. And then -- I'm sorry, go ahead, please.

So I just going to add on the financial side. I mean it's very much almost an equal partnership. We have a 49.9% interest. They have the majority of the interest, but the investment is very much similar. And on the return parameters, we haven't put out any numbers on the actual investment. But I would guide you to that it is in line with our target investment of sort of mid-teens, unlevered IRR on a deal like this and very similar to other acquisitions we made in terms of multiples.

Okay. I do appreciate that. And so then as you think about future expansion in this market, should we look for more of sort of this JV wave growing? Or do you think you would go out and actually -- more typically go out and buy own, lease, manage for other folks that kind of thing?

Yes. We're actively looking to grow the business there, and whether it ends up being a partnership or operated by us, I mean it will be one or the other.

Got it. Okay. So there's nothing that precludes you from doing something outside of it.

Obviously, they're our partner down there. And so for us, the focus would be to grow with them. But should that not happen, we're prepared to move forward on our own.

Got it. Okay. And then just pivoting over, just kind of curious, any improvement on sort of utilization from EVs where you've installed charges? Are you seeing anything on that front? Anything you can talk about there?

Yes. I think utilization has ticked up and before it was in the low single digits, I'd say that's ticked up anywhere from to 6% to 8%. And my view just generally is as more vehicles, electric vehicles come into use, those who have, what I'll call is electric charging stations are going to garner a big part -- bigger part of that market. I still think it's difficult that, that utilization rate to make money. That being said, with government support, there's some potential for actual returns out of the business.

So from that standpoint, as you kind of look forward, do you see adding more charging stations and potentially accessing government funds and all that stuff?

Yes. It's about -- but it's about scale. I mean, you've got to do it in a big enough way to move the needle, right? And you're proposing sites to the government, and they're releasing funds and then you're building it. So any sort of real impact P&L-wise is going to take a little bit, but we have our own riders looking to get and be approved by the government for these funds. So I mean, we're on it, we're after it. It's just going to take a while to scale it up.

Got it.

I think it's still -- yes, I think we're still a little reticent to go after it on our own, right, because I'm not sure what the returns there but with government funds, we think there's a return there.

Got it. And then just commentary in and around the acquisition market, if you'd be so kind.

Yes. It's been very busy, continues to be busy. We're looking at everything and not just at the states that we're in. But we haven't won every potential deal that's out there, but we do like to see them. And frankly, missing some deals tells me that we're showing good financial discipline. But the deals that we think really fit and we can create value with are the ones that we're going to hopefully be successful at in the bids.

Got it. Thank you so much.

We have reached the end of the question-and-answer session. Mr. Slifka, I'd now like to turn the floor back over to you for closing comments.

Sure. Thank you for joining us this morning. We look forward to keeping you updated on our progress. Enjoy the weekend, everybody.

Ladies and gentlemen, this does conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation, and have a wonderful day.