Sunoco 2012 Annual Report Download - page 57

income on a pro-rata basis with the common units. In connection with this transaction, the general partner
contributed $2 million to the Partnership to maintain its two percent general partner interest.
In August 2010, we completed a public offering of 6.0 million limited partnership units. Net proceeds of
$143 million were used to finance the purchase of our additional ownership interests in Mid-Valley, West Texas
Gulf and West Shore and to reduce outstanding borrowings under the Operating Partnership’s prior credit
facility. In connection with this offering, the general partner contributed $3 million to the Partnership to maintain
its two percent general partner interest.
Cash Flows and Capital Expenditures
Net cash provided by operating activities for the periods from October 5, 2012 to December 31, 2012, from
January 1, 2012 to October 4, 2012, and for the years ended December 31, 2011 and 2010 was $280, $411,
$430, and $341 million, respectively. Net cash provided by operating activities in the 2012 periods was primarily
the result of net income and non-cash charges for depreciation and amortization totaling $139 million. Net cash
provided by operating activities for 2011 was primarily the result of net income of $322 million. Also
contributing to net cash provided by operating activities for 2011 were non-cash charges for depreciation and
amortization of $86 million and a $42 million charge, which was comprised of a $31 million asset impairment
for crude oil terminal assets which were expected to be negatively impacted by the idling of Sunoco’s
Philadelphia refinery and $11 million for regulatory obligations which would have been incurred if these assets
were permanently idled. These sources were partially offset by a $35 million increase in working capital. The
change in working capital was primarily the result of an increase in accounts receivable and an increase in
refined products and crude oil inventories driven by growth within our acquisition and marketing activities.
These changes were partially offset by increases in accounts payable. Net cash provided by operating activities
for 2010 was primarily the result of net income of $220 million (excluding a $128 million non-cash gain in
connection with the acquisitions of additional interests in Mid-Valley and West Texas Gulf). Also contributing to
net cash provided by operating activities were non-cash charges for depreciation and amortization of $64 million
and a $55 million decrease in working capital. The change in working capital was primarily the result of the
liquidation of contango inventory positions.
Net cash used in investing activities for the periods from October 5, 2012 to December 31, 2012, from
January 1, 2012 to October 4, 2012, and for the years ended December 31, 2011 and 2010 was $139, $224,
$609 and $426 million, respectively. Net cash used in investing activities in the 2012 periods consisted of
expansion capital projects and maintenance capital on our existing assets, partially offset by $11 million of
proceeds received for the sale of the Big Sandy terminal and pipeline assets and the settlement of related
throughput and deficiency contracts. Investing activities in 2011 and 2010 included $396 and $252 million of
acquisitions, respectively, as well as expansion capital projects and maintenance capital on our existing assets.
See “Capital Requirements” below for additional details on our investing activities.
Net cash provided by (used in) financing activities for the periods from October 5, 2012 to December 31,
2012, from January 1, 2012 to October 4, 2012, and for the years ended December 31, 2011 and 2010 was
$(140), $(190), $182 and $85 million, respectively.
Net cash used in financing activities for the period from October 5, 2012 to December 31, 2012 was
primarily attributable to $74 million in distributions paid to the limited partners and the general partner and net
repayments of $40 million under our revolving credit facilities. Net cash used in financing activities for the
period from January 1, 2012 to October 4, 2012 resulted primarily from the $250 million repayment of 7.25
percent Senior Notes in February 2012 and $178 million in distributions paid to limited partners and the general
partner. These uses of cash were partially offset by $179 million of net credit facility borrowings and a $69
million decrease in advances to affiliates.
For the year ended December 31, 2011, the $182 million of cash provided by financing activities was
primarily attributable to $595 million of net proceeds from the issuance of $600 million of Senior Notes. These
55