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Highlights

  • SPB’s Q3 2024 revenue dropped 9.1% YoY, primarily due to lower sales in Wholesale and U.S. Propane segments
  • The company's loss before income taxes improved in the third quarter, narrowing to USD 86.9 million from USD 97.1 million in the previous year
  • The company has lowered its 2024 adjusted EBITDA growth forecast from around 5% to flat compared to 2023 pro forma adjusted EBITDA

Superior Plus Corp. (TSX:SPB) is a prominent North American distributor of propane, natural gas, renewable energy, and related services, serving 770,000 customers across the U.S. and Canada.

In the third quarter of 2024 (Q3 2024), total revenue of SPB decreased by 9.1% YoY, reaching USD 359.4 million, compared to USD 395.5 million in Q3 2023. This decline was primarily driven by reduced revenue in the Wholesale Propane, Canadian Propane, and U.S. Propane segments. Q3F 2024 gross profit also saw a 2.9% YoY decrease, amounting to USD 209.1 million, reflecting the impact of lower sales.

Despite the revenue drop, the company's loss before income taxes improved in Q3 2024, narrowing to USD 86.9 million from USD 97.1 million in the previous year. This reduction in loss was mainly attributed to lower operating expenses. Net losses for the period were also reduced to USD 62.0 million, benefiting from income tax recovery, compared to a higher loss of USD 80.3 million in Q3 2023.

Recent Business Update

In a recent business update, the company’s Certarus segment reported a 15% increase in adjusted EBITDA for Q3 2024 compared to the same period last year, showcasing strong performance despite facing some regional pricing pressures. The company also provided guidance on its financial leverage, stating that it expects its leverage ratio to remain around 4.0x for 2024. However, Superior Plus reaffirmed its medium-term target to reduce the leverage ratio to approximately 3.0x.

Company Outlook

The company has lowered its 2024 adjusted EBITDA growth forecast from around 5% to flat compared to 2023 pro forma adjusted EBITDA.

Top 10 Shareholders

The top 10 shareholders of Superior Plus collectively own around 28.05% of the company's total shares. Marquard & Bahls AG holds the largest stake at approximately 9.98%, followed by The Vanguard Group, Inc., which owns about 3.25% of the company.

Stock Performance

The stock price has declined by approximately 7.04% over the past three months and 20.27% over the past six months. Currently, it is trading below the average of its 52-week high of CAD 10.35 and 52-week low of CAD 5.15. As of January 23, 2025, the stock closed at CAD 6.33.

Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is January 23, 2025. The reference data in this report has been partly sourced from EODHD/Others.