WHIPPANY, N.J. - Suburban Propane (NYSE:SPH) Partners, L.P. (NYSE:SPH) reported a shortfall in its second-quarter earnings, with a per Common Unit income of $1.73, which was below the analyst estimate of $1.90.
The company's revenue for the quarter was $498.09 million, also not meeting the consensus estimate of $551 million. This performance marks a decline from the previous year's second quarter, where the company posted net income of $104.5 million or $1.63 per Common Unit.
President and CEO Michael A. Stivala attributed the weaker quarter to inconsistent weather patterns and unseasonably warm weather, which negatively impacted customer demand for heating. Despite these challenges, Stivala highlighted the company's efforts to mitigate the effects of the warm weather on volumes sold through operational management and customer base growth initiatives. He also noted improvements in the company's renewable natural gas (RNG) operations and ongoing capital improvement plans.
The company's retail propane gallons sold decreased by 2.7% compared to the prior year, primarily due to the warm weather conditions experienced during the quarter. Despite the lower volumes sold, Suburban Propane managed to increase its total gross margin by 4.4% to $308.0 million, thanks in part to higher unit margins.
Looking ahead, Suburban Propane continues to focus on strategic growth initiatives, including the expansion of its core propane operations and investments in renewable energy alternatives. The company's dedication to operational excellence and strategic investments aims to foster long-term growth despite the short-term headwinds faced in the heating season.
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