Sunoco 2009 Annual Report Download - page 82

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Income from discontinued operations in 2009 includes a net gain on divestment consisting of the following
components (in millions of dollars):
Pretax
Gain
(Loss)
After-tax
Gain
(Loss)
Gain on sale of refinery .......................................... $ 39 $23
Gain on sale of related inventory* .................................. 42 25
Retirement benefit plan settlement and curtailment losses .............. (11) (7)
$ 70 $41
* Reflects the gain from the sale of inventories that were valued at lower LIFO costs prevailing in prior years.
Sales and other operating revenue (including consumer excise tax) from discontinued operations totaled
$623, $3,562 and $2,450 million for 2009, 2008 and 2007, respectively.
Retail Portfolio Management Program—During the 2007-2009 period, Sunoco generated $207 million of
divestment proceeds related to the sale of 261 sites under a Retail Portfolio Management (“RPM”) program to
selectively reduce the Company’s invested capital in Company-owned or leased retail sites. Most of the sites were
converted to contract dealers or distributors thereby retaining most of the gasoline sales volume attributable to the
divested sites within the Sunoco branded business. During 2009, 2008 and 2007, net gains of $24, $4 and $35
million, respectively ($14, $3 and $21 million after tax, respectively) were recognized as gains on divestments in
other income, net, in the consolidated statements of operations in connection with the RPM program. There are
currently approximately 90 sites in the program, of which approximately 25 are Company-operated locations. These
sites are expected to be divested or converted to contract dealers or distributors primarily over the next two years.
Retail Heating Oil and Propane Distribution Business—In 2009, Sunoco sold its retail heating oil and
propane distribution business for $83 million in cash. In connection with this transaction, Sunoco recognized a
$44 million net gain ($26 million after tax), which includes an $8 million accrual for environmental
indemnification and other exit costs. This gain is recognized as a gain on divestments in other income, net, in the
consolidated statement of operations.
Other Matters
Asset Write-Downs and Other Matters—The following table summarizes information regarding the
provision for asset write-downs and other matters recognized during 2009, 2008 and 2007 (in millions of dollars):
Pretax
Provisions
After-Tax
Provisions
2009
Eagle Point refinery ......................................... $476 $284
Business improvement initiative ............................... 169 100
Other ..................................................... 48 27
$693 $411
2008
Bayport chemical plant ....................................... $ 55 $ 35
Polypropylene business goodwill ............................... 31 19
MTBE litigation insurance recovery ............................. (18) (11)
$68 $43
2007
Haverhill chemical plant production line ......................... $ 13 $ 8
Neville Island terminal facility .................................. 12 7
MTBE litigation settlement .................................... 28 17
$53 $32
74