Welcome to Sunoco LP and SunocoCorp Q1 2026 earnings conference call. I would now like to hand the conference over to Scott Grischow. You may begin. Thank you, and good morning, everyone. On the call with me this morning are Joe Kim, President and Chief Executive Officer, Karl Fails, Chief Operating Officer, Austin Harkness, Chief Commercial Officer, Brian Hand, Chief Sales Officer, and Dylan Bramhall, Chief Financial Officer. Today's call will contain forward-looking statements that include expectations and assumptions regarding Sunoco LP's future operations and financial performance. Actual results could differ materially, and we undertake no obligation to update these statements based on subsequent events. Please refer to our earnings release as well as our filings with the SEC for a list of these factors. During today's call, we will also discuss certain non-GAAP financial measures, including adjusted EBITDA and distributable cash flow as adjusted. Please refer to the Sunoco LP website for a reconciliation of each financial measure. The partnership started off 2026 with a strong quarter, delivering adjusted EBITDA of $867 million, excluding approximately $90 million of one-time transaction expenses. The first quarter benefited from a one-time gain on the sale of inventory of approximately $102 million. With the acquisition of Parkland Corporation last year and the elevated commodity price environment in the first quarter, we proactively optimized our inventory levels, which resulted in this one-time gain. Karl will provide more detail on the impact from these inventory reduction efforts and discuss segment performance in his remarks. We continued our growth efforts in the first quarter with the closing of the TanQuid acquisition on January 16th. Following the acquisition, Sunoco is Germany's largest independent terminal operator with a network of 16 assets across Germany and Poland. We expect this acquisition to be immediately accretive to distributable cash flow per common unit in 2026. During the quarter, we spent $106 million on growth capital and $93 million on maintenance capital. First quarter distributable cash flow as adjusted was $535 million. On April 21st, we declared a distribution of $0.9899 per common unit for both Sunoco LP common units and SunocoCorp shares. This 6.25% increase represents a one-time step-up of 5% and a quarterly increase of 1.25%. This distribution represents an increase of over 10% versus the first quarter of 2025 and is the result of Sunoco's continued financial stability, execution of highly accretive acquisitions and growth projects, and confidence in future distribution increases. Our trailing 12-month coverage ratio was 1.9x, and we continue to target a multi-year distribution growth rate of at least 5%. Our balance sheet and liquidity position remains strong. We had $2.2 billion in availability under our revolving credit facility at the end of the quarter, and leverage at the end of the quarter was approximately 4 x, in line with our long-term target. In summary, our financial position continues to strengthen, which will provide us with continued flexibility to pursue high return growth opportunities while maintaining a healthy balance sheet and a secure and growing distribution for our unitholders. With that, I'll now turn it over to Karl to walk through some additional thoughts on our first quarter performance. Thanks, Scott. Good morning, everyone. Our results this quarter continue the trend of accretive and sustainable growth for Sunoco, as we benefited from a full quarter of operations from Parkland and the closing of our TanQuid acquisition in Europe. Each of our segments delivered strong performance in the first quarter. They are all well-positioned to contribute meaningfully toward achieving our 2026 EBITDA guidance. Starting with our fuel distribution segment. Adjusted EBITDA was $538 million, excluding $9 million of transaction expenses. This compares to $391 million last quarter, excluding transaction expenses, and $220 million in the first quarter of 2025. This growth reflects continued strength in our legacy Sunoco operations, coupled with a full quarter of operations from Parkland. It is also supported by our ongoing gross profit optimization and growth strategies, both through roll-up acquisitions and growth capital. As Scott mentioned in his remarks, these results also include a one-time benefit of inventory reduction. The level of fuel inventory we hold is always a trade-off between holding more to provide reliable supply and carrying less to deliver better returns on capital. This is especially true as we grow our fuel distribution business. Naturally, our inventory also grows, but we frequently look to optimize our inventory levels to ensure we are delivering on our target returns. This quarter, as a result of inventory reductions, we delivered a $92 million benefit in this segment, unlocking additional cash to reinvest in future growth. While the size of the benefit was clearly impacted by market prices during the quarter, this was a result of active management of our inventory to a level that is sustainable on an ongoing basis. We distributed 3.8 billion gallons, up 15% versus last quarter and up 82% versus the first quarter of last year. We continue to see volume growth in our legacy Sunoco business with an increase of almost 6% over prior year compared to a relatively flat U.S. demand profile. This growth is a result of effectively deployed capital via our growth capital plan and roll-up M&A transactions. We continue to work on optimizing our volumes in the legacy Parkland assets as we implement our gross profit optimization approach that we've evolved over the years. Reported margin for the quarter was $0.17 per gallon compared to $17.7 per gallon last quarter, and $11.5 per gallon for the first quarter of 2025. There were many factors influencing our margin this quarter with the 7-Eleven makeup payment, the gain on inventory reduction, and the return of market volatility compensating for the margin compression experienced with dramatic increases in commodity prices during the quarter. For reference, RBOB futures increased over $1.60 a gallon during the quarter, with diesel futures increasing over $2 a gallon. In our Pipeline Systems segment, adjusted EBITDA for the first quarter was $179 million compared to $187 million last quarter, and $172 million in the first quarter of 2025. On the volume side, we reported 1.3 million barrels per day of throughput, slightly down from the seasonally strong throughput last quarter and slightly up from the same quarter last year. This segment continues to provide steady and stable income. Moving on to our Terminal segment, Adjusted EBITDA for the first quarter was $107 million. This compares to $87 million last quarter and $66 million in the first quarter of last year. We reported around 1 million barrels per day of throughput, which is up from both last quarter and the first quarter of last year. Growth in both earnings and volumes in this segment were supported by the inclusion of TanQuid and a full quarter of legacy Parkland operations. This segment continues to deliver stable results that predictably and accretively grow as we add to the portfolio. Turning to our refining segment. Adjusted EBITDA for the first quarter was $43 million compared to $41 million last quarter. There was a $10 million benefit in this segment from our inventory reduction efforts that I discussed earlier. Refinery throughput was 22,000 barrels per day compared to 50,000 barrels per day last quarter. As we shared previously, throughput was down as a result of a planned 50-day maintenance turnaround that began at the end of January, which was completed on time and on budget. During the turnaround, we continued to meet regional demand by sourcing supply through our refinery tank farm. The refining margin was strong during the periods of refinery operation, and that continues into the second quarter. To provide more clarity to the market on our refinery performance, we posted an updated indicator crack on our website yesterday and expect to post updates at the beginning of each month. This calculation is intended to be an indicator of general profitability for the refinery using market prices. Before I wrap up, I wanted to make a few comments on the integration of the recent Parkland acquisition. The balance sheet has returned to our long-term target. We are already delivering on synergies, both expense and commercial, which puts us well on track to deliver on 10 +% accretion before our year three commitment. In summary, we continue to build on the strong momentum of the past few years. Each of our segments is delivering, and we will continue to remain focused on safe and reliable operations, expense discipline, and accretive growth. I will now turn it over to Joe to share his final thoughts. Joe? Thanks, Karl. Good morning, everyone. Every quarter presents a new set of challenges. This first quarter provided more than most. Obviously, the events in the Middle East created a volatile market. Costs and prices rose dramatically, and at times fell and went back up. Furthermore, normal supply patterns were disrupted. Specifically, within Sunoco, we completed a turnaround at our Burnaby Refinery and made significant progress on the Parkland integration. Despite all these events, we still delivered an outstanding first quarter. More importantly, we're confident that we'll deliver on our full-year EBITDA guidance, even without the one-time gain from optimizing our inventory. Operationally, our refining team completed the turnaround on budget. Our fuel distribution and midstream teams maintained reliable supply for our customers. Finally, we're on track to deliver 10% + accretion from the Parkland acquisition. We have proven year- after- year in crisis after crisis that we can distinguish ourselves in challenging environments, and thus we have gained a reputation as a strong defensive play. However, we're also a proven growth play. Already this year, we closed on the TanQuid acquisition in Europe, a multi-island acquisition in the Caribbean, and various smaller fuel distribution bolt-on acquisitions in the U.S. We're on track to complete over $500 million of bolt-on acquisitions in 2026. Separately and in totality, these are immediately accretive while maintaining our balance sheet target. When you combine our ongoing accretive growth with the resilient base business, we're stronger than any point since the establishment of Sunoco LP. As a result, we're able to announce a meaningful increase in our quarterly distribution two weeks ago. The decision to materially increase the distribution had to meet the following criteria. Maintain a strong coverage ratio, protect our balance sheet, remain a growth company, and finally, provide a clear path to increase distributions quarter after quarter over a multiyear timeframe. We're confident the answer is yes on all these factors. Operator, that concludes our prepared remarks. You may open the line for questions. Thank you. Ladies and gentlemen, as a reminder to ask the question, please press star one one on your telephone, then wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Justin Jenkins with Raymond James. Your line is open. Great. Thanks. Good morning, everyone. I guess maybe just to start on a housekeeping item here, the inventory gain. You gave us a lot of detail on the impact here in the quarter. I think, Karl, you suggested you're at an overall level you're comfortable with. Does that inventory level fluctuate with where commodity prices sit? Or how should we think about the moving pieces going forward here? Yeah. Thanks, Justin. This is Karl. Yeah, as I talked on my prepared remarks, inventory decisions are really a trade-off between supply reliability and return on capital. As part of that inventory management, we use derivatives to hedge inventory in the normal course of business. As you mentioned, based on market conditions, we actively manage those inventory positions. In periods of high prices and steep backwardation like we've had in the past few months, we'll typically draw, and then in the less frequent periods of contango, we would build, and our hedging practices are set up accordingly to make sure we can optimize that. I think if you look at what we're reporting in the first quarter, that's just a larger step we took as a result of a lot of the growth that we've done over the last six to nine months, you know, including the recent Parkland acquisition. The level that we reduce our inventory to, we feel is responsible, and we could stay there for a long time. Some of those minor optimizations that I talked about based on market conditions, yeah, we'll continue to do regularly. This $100 million was sized and impacted by the higher prices, but it's something that we would have done regardless to manage our business. It does differ from some of the other companies that have reported so far in the quarter that talking about, you know, timing related inventory impacts. Like I said, we're confident we can operate at this level going forward, and there is no symmetric risk if and when prices fall that this gain is reversed. That's helpful. Second question here on the distribution. Certainly the step up in the quarter, very well-received. I guess how does this play into your overall views on capital allocation for the long term? Then maybe for 2026, more specifically. Joe, you hinted at this, but presumably this shows a very high degree of confidence in your outlook for the year, even if it might be just a little too soon to update the guide. Is that right? Yeah. Hey, Justin, this is Joe. Hey, just to build off on what Karl said, I'll take your 1st question first. On the inventory optimization, that was just a result of good stewardship and good timing. With that said, the recent 5% step up, we would have done with or without the inventory optimization. As far as kind of giving you some better background as to our step up and our capital allocation, I think maybe kind of talking through how we made this decision would be helpful. You know, our past investments have paid off, especially the NuStar acquisition we did two years ago and the Parkland acquisition we did last year. Just as importantly, our base business has proven to be year after year, very resilient. As a result, our DCF per common unit has grown materially, and we believed a step up followed by continued quarterly distribution increases would be highly valued by our unit holders. As far as the step up, we wanted that step up to be material, but at the same time, we didn't want to affect our ability to increase distributions over a multi-year period, nor affect our ability to continue growing. We think that the actions that we've taken recently have put us in a very good position to achieve these goals. I think, Justin, if I understand you correctly, the second part of the question was really more about guidance. Is that how I should read it? Yep. Yeah. You know, the one key message that I hope that you and the rest of the people on this call take away from today is that we're gonna have an outstanding year and deliver on guidance. That's even after you take out the one-time inventory optimization. Our established practice is not to give guidance after the first quarter unless there's a major acquisition. You know, is there upside? Of course. However, the amount is still to be determined, and our history shows that we're good at capturing the upside as well as protecting the downside. Awesome. Thanks, guys. I'll leave it there. Thank you. Our next question comes from the line of Spiro Dounis with Citigroup. Your line is open. Hi. This is Chad on for Spiro. Just starting off, could you provide an update on how the conflict in the Middle East is impacting your business and trends today? Have you started to see any demand impacts from the higher prices yet? Yeah. Hey, Chad. I'll answer your questions kind of in order there in terms of impact to our operations given the current market volatility and I can touch on margins and demand separately. You know, if you take a step back, given our scale, supply chain optionality and logistics capabilities. You know, the business really shines during these types of periods of extreme market volatility. Just to give you one example, you know, we normally supply our Hawaii business out of South Korea. What we're finding though right now is it's actually economical to load vessels out of the U.S. Gulf Coast and supply the business via the Panama Canal. I share that because that's really only a move that's available if you have our scale and logistics capabilities. There, there's literally, you know, countless other examples of how our operations have been impacted by some of the global disruption of product flows, that's not always a bad thing. In fact, in our world, a lot of times that can mean value creation. You know, just quickly touching on, you know, on margins. You know, we've always talked about flat price volatility being bullish for margins in the long run. The way that you get there is margins compress as flat price is on the way up, but then it widens disproportionately on the way down, and that's how you get an overall kind of net bullish margin environment. If you were to pull an RBOB or ULSD chart for year- to- date, I think what you'd find is we've been on a pretty sharp grind up to up and to the right for essentially through the first four and a half months or four months and a week of the year. You know, despite that, we just closed out a really strong first quarter for the segment. The second quarter is off to a great start. We haven't even gotten to the part of the story where flat price comes off and margins widen. We feel really good about where we're positioned there. Then I think, you know, you mentioned a question around, you know, impact to consumer demand. You know, we haven't seen any evidence of demand destruction yet. I say that because it's kind of a function of how high flat prices go and for how long they remain there. That said, I think those of you who follow our story know that if we do encounter a scenario where there's demand destruction, that creates a really strong margin environment as retailers are forced to respond to rising breakevens by taking price. You know, all that said, we're out of the gate really strong to start the year, and we feel really good about both the second quarter and delivering on an outstanding 2026. Okay, got it. That's very helpful. Just wanted to get your thoughts on kind of your M&A outlook with the current macro environment and two quarters of sort of the pro forma business. It sounds like you're tracking to $500 million of annual M&A cadence this year, has there been any changes in the way that you view M&A as a cadence or a scale standpoint from your business yet? Hey, Chad, this is Joe. The simple answer is no. We view it exactly the way that we outlined it late last year and early this year. Just to kind of give you an update, if you take a step back and you look at all the recent acquisitions that we've done, we've greatly expanded our scale and our geographic footprint. It wasn't too long ago that we were a U.S.-only business, predominantly on the East Coast and in the South. Now we have investment opportunities in the U.S., Canada, Latin America, Greater Caribbean, and Europe. To give you an example, already this year, we have almost $200 million of bolt-on M&A that are either closed or signed or gonna be closed in the very near future. This doesn't include the $500 + million TanQuid acquisition that we started the year with. The $500+ million a year, you know, on bolt-on acquisition is very reasonable for us. Bottom line, we're in a good position to deliver on an attractive, long-term growth story. Got it. Very helpful. Thanks for the time today. Thank you. Our next question comes from the line of Theresa Chen with Barclays. Your line is open. Morning. Thank you for taking my questions. First question is related to the Burnaby Refinery. Post your plan turnaround, how are operations trending at this point? Given the significant disruption to the liquids markets over the past two months plus following the Middle East conflict, can you talk about your ability to capture these elevated margins not only on the West Coast of North America, but broadly across the Pacific Basin into Asia and Australia, given your fleet of assets from an infrastructure perspective as well as the refining facility at Burnaby? Yeah, Theresa, thanks for the question. This is Karl. As Joe Kim and I mentioned in our prepared remarks, the team in the refinery did a great job delivering on the turnaround on time and on budget, and that really allowed us to restart the refinery in the back part of the quarter into the higher cracks that were in the market. You know, we've used this phrase a lot, but our crystal ball isn't perfect as far as how long those refining margins will last. I think the possibility of a period of longer cracks is reasonable and would be a tailwind for overall results. If you look at the refinery business, it really is a foundational piece of our overall business in British Columbia. Most of the refinery production goes into that market in British Columbia. I think that's a tailwind for that overall business that we'll be able to see the results as we go through the year. Now, clearly, so far into the year, the refinery is outperforming assumptions we made for the Parkland acquisition or even the midpoint of our guidance as Joe talked about. The refinery is an important part of the portfolio. It's not a large part of the portfolio. You know, it's our smallest segment, but it fits well into our overall business. When there are big price movements and we have the higher cracks-That can help offset some of the margin compression that Austin talked about in our fuel distribution business, and the opposite is also true. As far as your broader question for the rest of the Pacific, I think, you know, Austin and his team do a great job of looking at what the market is giving us and supplying, you know, as an example of how we supply Hawaii, of choosing the options we have to supply our base business in the most economical way possible, and then finding additional opportunities to supply fuel to new customers. Yeah, I think there's gonna be opportunity. Thank you. Going back to your earlier comments about synergies, post, the, you know, acquisitions and the broader, more comprehensive set of assets you have under one portfolio now, can you speak to the progress made both, on the commercial side as well as any existing, you know, cost synergies still to be harvested at this point and what your outlook, is for that? Yeah, I think the outlook is good. As you know us and we've looked backwards on various acquisitions we've done, we start the synergy process even before we close, and that was true in the Parkland acquisition. There were changes that we made, particularly on the expense side, as soon as we took ownership in the fourth quarter, and those are continuing. I think the breadth of the Parkland portfolio means that that runway of getting to the end result on the expense side takes a little longer than some of the other deals we've done, but that work is all going well. I think on the commercial side, there are significant commercial synergies that we outlined over the last, you know, year since we, since we announced the Parkland deal, and many of those have already been delivered, many are in flight, and there are some still to come. You know, our guidance was based on $125 million of in-year synergies. To be able to hit that number, we needed to exit the year much higher than that. We're still on pace with that and expect that to continue and us to, you know, the final kind of run rate of $250+ million, we feel very comfortable with, and that should be a floor. Thank you so much. You bet. Thank you. Our next question comes from the line of Gabriel Moreen with Mizuho. Your line is open. Hey, good morning, everyone. Can I maybe just ask for an update on sort of the midstream side of things and to the extent you're planning to spend any capital there this year? I noticed that your parent announced an expansion of Bayou Bridge going into St. James. Just curious if maybe that would necessitate more storage there, for example. Yeah, Gabe, this is Karl again. Clearly our midstream portfolio, we really like, whether it's the Pipeline Systems assets or our terminal network. You know, Joe talked about we're excited to have TanQuid as part of that portfolio. We spend capital on those, whether it's, you know, maintenance capital to keep our tanks ready to go when market opportunities come or some growth capital. I think our current portfolio is we're always looking for opportunities for larger projects. As we sit here right now, I think our sweet spot is kind of these small to mid-size projects. We have a portfolio of those and then really looking for accretive M&A, and any projects we do in the midstream space would be to optimize and to help us gain synergies on that M&A. As we sit here today, you know, that could change down the road, but that's our current plan. Thanks, Karl. I can follow up. I think 7-Eleven is doing a bit of portfolio repositioning in terms of their store base. Can you just talk about whether there's any implications with the 7-Eleven from any of those moves? Hey, Gabe, it's Joe. As far as we got a great relationship with 7-Eleven. As far as the supply agreement we have with them, nothing changes on that one. That's a rock solid take or pay contract with a highly profitable investment-grade company. We feel great on that one. As far as the 7-Eleven doing a portfolio optimization, obviously with our scale and our geographic footprint, anytime there's anything on the market, I think we're a viable partner for a lot of people that are looking to exit. And with the synergies we bring to the table, we're always gonna be competitive. Joe, maybe can I just squeeze one more in, the M&A question from a different angle. Is the current volatile backdrop making it easier to transact in your mind or harder? I'm just curious what your thoughts are on there. Yeah. Harder, easier, I would probably say all things equal, maybe harder overall, maybe more opportunistically better for Sunoco. I think, we have, you know, we know what we're good at and scale and geographic diversity and given our midstream assets, especially on the terminal level, we're in a good position. I think from that standpoint, it's not gonna affect us. You know, as far as, you know, now that we're more than just a U.S. company and we're, and we're in various geographies, as far as opportunities in foreign markets, there's always gonna be some level of tension between countries. The extent of it, the magnitude of it, always kind of evolving. The one thing that we do believe in is that cross-border foreign investment is gonna continue across the world, and we're in a good position to find the right assets wherever it may be. With the synergies that we bring to the table, we're gonna be in a good position to be highly competitive. Thanks, Joe. Okay. Thank you. As a reminder, ladies and gentlemen, that's star one one to ask the question. Our next question comes from the line of Ned Baramov with Wells Fargo. Hey, good morning. Thanks for taking the questions. Could you maybe talk about the interplay between Burnaby refining margins and the margins on the fuel distribution side in British Columbia? Does the higher crack spread imply lower potential FD margin? Is this market also not seeing any change in demand from higher fuel prices as you commented earlier? Yeah, Ned, this is Karl. I'll try to pull it together to answer your question, you know, a couple of points that Austin made in his overall answer on margins and then some of the things I talked about at Burnaby. The short answer is, you know, as far as the refinery margin, the fuel distribution margin, as we look at it, we use, you know, internal transfer prices like most people do, and those are based on the market. As most we can run the business while we like having the integrated margin, and we're always making choices to optimize the overall result for Sunoco. As we're looking at those two businesses, we also look at them independently. I think on the overall margin and consumer demand question, I think Austin hit the nail on the head that those margins will adjust. I would expect that the overall fuel gross profit and the EBITDA that we get in British Columbia should stay the same or grow over time. The refining margin is gonna vary more, right? That's gonna really float based on supply demand going on in the world. Right now we're in a period of higher cracks. While we manage that supply chain as an integrated supply chain, I wouldn't necessarily imply that when refinery cracks are high, that the fuel distribution margins are low. Sometimes they're both higher together. Hopefully that answers your question. Understood. Yes, very clear. Thank you. Second one on the housekeeping side, was the Burnaby turnaround spending included in your $93 million of maintenance CapEx for the quarter? Yes, there was some component of growth CapEx there as well that was included in our reported capital. Thank you. You bet. Thank you. Ladies and gentlemen, I'm showing no further questions in the queue. I will now like to turn the call back over to Scott for closing remarks. Well, thank you for joining us on the call today and for your continued interest in Sunoco. As we said, there's a lot of great things to look forward to in 2026. We look forward to updating you across the year. Please reach out if you have any questions. Thanks for tuning in and always appreciate your support. Ladies and gentlemen, that concludes today's conference call. Thank you for your participation. You may now disconnect.