Suburban Propane shares surge despite earnings miss in third quarter

Published 07/08/2025, 14:18
Suburban Propane shares surge despite earnings miss in third quarter

Investing.com -- Suburban Propane Partners, L.P. (NYSE:SPH) reported a wider-than-expected loss for its third quarter, though shares surged 3.2% as investors focused on the company’s debt reduction efforts and operational stability during the seasonally weak period.

The propane distributor posted a third quarter loss of $0.23 per Common Unit, missing analyst estimates of a $0.19 loss. Revenue came in at $226.89 million, significantly below the consensus estimate of $270 million. Despite these misses, the company’s net loss improved from $0.27 per Common Unit in the same quarter last year.

Retail propane gallons sold remained steady at 71.9 million gallons compared to the prior year period, even as temperatures across the company’s service territories were 14% warmer than normal, though 5% cooler than last year’s third quarter. The company maintained stable gross margins despite a 4.7% increase in average propane prices.

"Following a strong fiscal second quarter performance, we were very pleased to deliver a solid counter-seasonal quarter despite unseasonably warm temperatures and volatility in the commodity price environment," said President and CEO Michael A. Stivala. "During the quarter, we used excess cash flows, and proceeds from the issuance of Common Units under our At-the-Market sales program, to fund our growth capital projects and reduce debt by $69 million."

The company’s Adjusted EBITDA for the quarter was flat YoY at $27 million. Operating and general administrative expenses increased slightly by 0.5% to $136.3 million compared to the same period last year.

Suburban Propane improved its Consolidated Leverage Ratio to 4.33x for the twelve-month period ended June 28, 2025. The company’s Board of Supervisors declared a quarterly distribution of $0.325 per Common Unit, equating to $1.30 per Common Unit annually.

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