Sunoco 2013 Annual Report Download - page 43

41
used as a measure in determining our compliance with certain revolving credit facility covenants. However, despite compliance
with our credit facility covenants, there may be contractual, legal, economic or other factors which may prevent us from
satisfying principal and interest obligations with respect to indebtedness and may require us to allocate funds for other
purposes.
During the fourth quarter 2012, we changed our definition of Adjusted EBITDA and DCF to conform to the presentation
utilized by our general partner. During the first quarter 2013, we also changed our measure of segment profit from operating
income to the revised presentation of Adjusted EBITDA. This change did not impact our reportable segments. Prior period
amounts have been recast to conform to current presentation.
The following table reconciles the differences between net income, as determined under GAAP, and Adjusted EBITDA
and DCF.
Successor Predecessor
Three Months
Ended
December 31,
2013
Nine Months
Ended
September 30,
2013
Period from
Acquisition
(October 5,
2012) to
December 31,
2012 (1)
Period from
January 1,
2012 to
October 4,
2012 (1)
Three Months
Ended
December 31,
2011
Nine Months
Ended
September 30,
2011
(in millions) (in millions)
Net Income $ 105 $ 369 $ 142 $ 389 $ 79 $ 243
Interest expense, net 19 58 14 65 26 63
Depreciation and amortization
expense 69 196 63 76 25 61
Impairment charge — — — 9 31 —
Provision for income taxes 7 23 8 24 7 18
Non-cash compensation expense 4 10 2 6 1 5
Unrealized losses/(gains) on
commodity risk management
activities 11 (12) (3) 6 6 (8)
Amortization of excess equity method
investment 1 1 — — — —
Proportionate share of unconsolidated
affiliates’ interest, depreciation and
provision for income taxes 4 16 5 16 4 12
Non-cash accrued liability adjustment (10) — — — — —
Adjustments to commodity hedges
resulting from "push-down"
accounting — — (12) — — —
Adjusted EBITDA 210 661 219 591 179 394
Interest expense, net (19) (58) (14) (65) (26) (63)
Provision for income taxes (7) (23) (8) (24) (7) (18)
Amortization of fair value
adjustments on long-term debt (6) (17) (6) — — —
Distributions versus Adjusted
EBITDA of unconsolidated affiliates (6) (21) (3) (25) (4) (13)
Maintenance capital expenditures (16) (37) (21) (29) (22) (20)
Distributable Cash Flow attributable
to noncontrolling interests (4) (11) (2) (9) (2) (8)
Contributions attributable to
acquisition from affiliate 3 6 — — — —
Distributable Cash Flow $ 155 $ 500 $ 165 $ 439 $ 118 $ 272
(1) The effective date of the acquisition for accounting and reporting purposes was deemed to be October 1, 2012. The activity from
October 1, 2012 through October 4, 2012 was not material in relation to our financial position, results of operations or cash flows.
Analysis of Consolidated Operating Results
Net income attributable to Sunoco Logistics Partners L.P. ("net income attributable to SXL") was $102 and $139 million
for the fourth quarter 2013 and the period from October 5, 2012 to December 31, 2012, respectively. The $37 million decrease
was driven by decreased operating performance from the Crude Oil Acquisition and Marketing and Refined Products Pipelines
segments, increased depreciation expense and the absence of $12 million of adjustments on commodity hedges that were
recognized in connection with push-down accounting. These decreases were partially offset by improved operating