Sunoco Management Discusses Q2 2012 Results - Earnings Call Transcript
Now I'll begin by providing an update on the strategic actions of the company, and then we'll move into the earnings and business update for both Sunoco Logistics Partners and Sunoco.
As most of you are aware, on April 30, 2012, Sunoco announced that it had entered into a merger agreement to be acquired by Energy Transfer Partners LP. We continue to move forward with this merger process, as seen by ETP's filing of the first amendment of Form F-4 registration statement last week. We are on track and working towards closing this transaction in the early part of the fourth quarter.
In July, we also announced an agreement to form Philadelphia Energy Solutions, a joint venture with The Carlyle Group at the Philadelphia refinery. Sunoco will be contributing this Philadelphia refinery assets in exchange for a nonoperating minority interest of approximately 33%.
Sunoco will receive cash proceeds for the liquidation of working capital related to the refinery. These cash proceeds are in line with expectations when we announced the exit from refining. Sunoco will have no ongoing capital obligations with respect to the refinery. We believe that this structure provides the best opportunity for the success of the Philadelphia refinery and look forward to closing the transaction with The Carlyle Group, which we anticipate to be in September.Now moving onto the results from the second quarter. As you can see from Slide 4, Sunoco reported net income before special items of $129 million or $1.22 per share for the second quarter.I'll summarize our results in 3 areas. Our Logistics business continues to deliver strong results and execute on growth opportunities. Sunoco Logistics is progressing well on projects to grow their fee-based earnings and anticipates $350 million to $400 million in organic growth projects for 2012. Mike Hennigan will provide an overview of the results of Sunoco Logistics Partners in a few moments.
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