Print Page | Close Window
SEC Filings
S-4/A
SUSSER HOLDINGS CORP filed this Form S-4/A on 08/16/2016
Entire Document
 << Previous Page | Next Page >>


Table of Contents
Index to Financial Statements

PHILADELPHIA ENERGY SOLUTIONS LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(in thousands, except unit and volume data)

 

The Company entered into an intermediation agreement with J.P. Morgan Ventures Energy Corporation (JPMVEC) on September 8, 2012, and sold refined products to JPMVEC under this agreement. On a daily basis, PES LLC sold the production of refined products and blendstocks from the Philadelphia refining complex as they were produced, delivered to the storage tanks, and legal title passed to JPMVEC. These transactions occurred at the daily market price for the respective products.

On October 7, 2014, JPMVEC assigned the intermediation agreement to Merrill Lynch Commodities (MLC). Under this agreement, the Company receives upfront cash payments for daily production sold to MLC through intermediation but prior to final sale to the customer. The upfront payments are deferred and classified as deferred revenue on the consolidated balance sheets, until title has passed to the ultimate customer.

For further discussion of the above, see note 4, Intermediation Agreements.

Revenues from the Company’s intermediation agreements are reported on a gross basis in the consolidated statements of operations and comprehensive income (loss) as the Company is considered a principal in these agreements.

The Company may also purchase refined products from MLC under the intermediation agreement and sell the related products at its rack operation. The initial sale of refined products under the intermediation agreement and the subsequent buy-back of refined products for sale at the rack operation are considered to be made in contemplation of each other and, accordingly, are recorded net in the consolidated statements of operations and comprehensive income (loss) and do not result in the recognition of a sale. Revenue from sales of refined products at the rack operation are recorded upon transfer of title to the ultimate customer.

The Company may also purchase refined products and sell the related refined products through the intermediation agreement. The Company acts as a principal in these transactions, taking title to the products and records revenue for the gross amount of the sales transactions, and records costs of purchases as a component of cost of sales in the consolidated statements of operations and comprehensive income (loss).

The Company may also enter into refined product buy/sell arrangements, which involve linked purchases and sales related to refined product sales contracts. The Company acts as an agent in these transactions, not taking title to the products and includes these transactions on a net basis in net sales in the consolidated statements of operations and comprehensive income (loss).

Excise taxes on sales of refined products that are collected from customers and remitted to various governmental agencies are reported on a net basis in the consolidated statements of operations and comprehensive income (loss).

Depreciation, Amortization, and Retirements

Plant and equipment are depreciated on a straight-line basis over their estimated useful lives of 30 years for buildings and from 4 to 35 years for machinery and equipment.

Gains and losses on the disposal of fixed assets are reflected in the consolidated statements of operations and comprehensive income (loss) in the period in which the item is disposed.

As part of the contribution of assets from Sunoco on September 8, 2012, the Company received the right to utilize underground storage caverns at Sunoco’s Marcus Hook terminal at no cost for three years. The intangible asset was amortized on a straight-line basis over the three-year free rent period.

 

F-27

 << Previous Page | Next Page >>