DETAILS OF FIRST QUARTER RESULTS
Logistics earned $57 million pretax in the first quarter of 2012 versus $31 million in the first quarter of 2011. The increase in earnings was primarily due to expanded crude oil volumes and margins resulting from market related opportunities in West Texas. Higher crude oil pipeline fees and earnings attributable to acquisitions completed during 2011 also contributed to the improved results.
Retail Marketing had a pretax loss of $6 million in the current quarter versus pretax income of $12 million in the first quarter of 2011. The decrease in earnings was primarily attributable to higher expenses largely associated with the increase in company-operated sites and lower retail gasoline margins which were negatively impacted by rising crude oil costs during the quarter.
Refining and Supply
Refining and Supply had a pretax loss of $87 million in the current quarter versus a $138 million loss in the first quarter of 2011. The increase in earnings was largely due to lower expenses attributable to the idling of the Marcus Hook refinery in December 2011 and lower depreciation expense resulting from significant asset write-downs during the second half of 2011. These positive factors were partially offset by lower realized margins and production volumes. Average crude throughputs were down 36 and 27 percent, respectively, versus the first and fourth quarters of 2011 as a result of the sale of the Toledo refinery in March 2011 and the idling of the Marcus Hook refinery.
Corporate administrative expenses were $14 million pretax in the current quarter versus $22 million in the first quarter of 2011. The decrease was largely driven by lower staffing and incentive compensation costs.
Net financing expenses and other were $31 million pretax in the first quarter of 2012 compared to $28 million in the first quarter of 2011. The increase is primarily attributable to higher interest expense associated with borrowings of Sunoco Logistics Partners L.P.