Overview

• US propane distributor's fiscal Q2 revenue declined year-over-year and missed sole analyst estimate

• Net income and adjusted EBITDA for fiscal Q2 were flat compared to prior year

• Company reduced total debt by more than $64 mln during the quarter

Outlook

• Company expects completion of new RNG facilities in NY and Ohio in H2 fiscal 2026

• Suburban Propane expects to add 200,000 MMBtu per annum to RNG platform after facility completion

• Company expects eligibility for production tax credits as new RNG facility comes online

Result Drivers

• WEATHER IMPACT - Colder temperatures and winter storms in the East drove heat-related demand, but record warmth in the West offset gains, resulting in flat retail propane gallons sold

• RNG OPERATIONS - Improved RNG production and injection due to increased facility uptime and capital investments, with additional benefit from $3.5 mln in production tax credits

• EXPENSE MANAGEMENT - Flat operating and administrative expenses, as higher payroll and vehicle costs were offset by production tax credits and an insurance recovery

Company press release: ID:nPn4Y23g2a

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 1 "strong buy" or "buy", no "hold" and 1 "sell" or "strong sell"

• The average consensus recommendation for the oil & gas refining and marketing peer group is "buy"

• Wall Street's median 12-month price target for Suburban Propane Partners LP is $17.00, about 10.5% below its May 6 closing price of $19.00

• The stock recently traded at 11 times the next 12-month earnings vs. a P/E of 11 three months ago

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