TA Petro Overview of SVC Leases and Financial Upside
Calculation of EBITDA and Adjusted EBITDA
($ in millions)
Calculation of EBITDA
Net Income (Loss), as Reported
Less: Income (Loss) from discontinued operations, net of taxes.
Income (Loss) from Continuing Operations
(Less) add: (Benefit) provision for income taxes
Add: Depreciation and amortization expense
Add: Interest expense, net
EBITDA
Year Ended
December 31, 2019
December 31, 2018
Last Twelve Months
Ended September
30,
2020
Three Months
Ended June 30,
2019
2020
Three Months
Ended September 30,
2019
2020
($120)
$33
$35
$1
$2
$2
$9
118
--
($3)
$33
$35
$1
$2
$2
$9
(2)
4
6
(0)
0.5
(1)
1
མཻ མ
83
100
117
29
28
29
$108
$166
$188
$31
252
23
28
24
32
7
7
7
7
$38
$32
$50
Calculation of Adjusted EBITDA from EBITDA
EBITDA
Add: Reorganization costs(1)
Add: Costs of SVC transactions (2)
Less: Loyalty award expiration (3)
Add: Field employee bonus expense(4)
Add: Executive officer retirement agreement expenses (5)
Less: Comdata legal reimbursements, net of expenses (6)
Less: Federal biodiesel blenders' tax credit (7)
$108
༅ | ཏྱཾ | | | € ®
Add: Impairment of operating lease assets()
Adjusted EBITDA
$79
$166 $
188
--
4
0.5
(3)
43
(70)
(91)
1
$94
$108
$31
$38
$32
$50
4
$31
2
1
(8)
$37
$32
(10)
1
$41
(1) On April 30, 2020, TA commenced a company-wide Reorganization Plan. During the nine months ended September 30, 2020, TA recognized $4.3 million of costs related to the Reorganization Plan, which were included in selling, general and administrative
expense in TA's consolidated statements of operations and comprehensive income (loss).
(2)
In January 2019, TA and SVC amended their leases and completed certain other related transactions. During the nine months ended September 30, 2019, TA incurred $0.5 million of expenses associated with these transactions. These expenses were
included in selling, general and administrative expense in TA's consolidated statements of operations and comprehensive income (loss).
(3) During the nine months ended September 30, 2019, TA introduced a new customer loyalty program, UltraONE 2.0. As a result of introducing the new customer loyalty program, certain loyalty awards earned under the program now expire in 10 days for all
loyalty members. This update resulted in the immediate expiration of certain loyalty awards upon adoption of the new customer loyalty program, generating $2.9 million of additional revenue during the nine months ended September 30, 2019, $2.8 million of
which was recognized as fuel revenues and $0.1 million as nonfuel revenues in TA's consolidated statements of operations and comprehensive income (loss).
(4) In March and April 2020, TA paid cash bonuses to certain employees who continued to work at its locations during the COVID-19 pandemic. These bonuses resulted in additional compensation expense of $3.8 million for the nine months ended September 30,
2020, which were included in site level operating expense in TA's consolidated statements of operations and comprehensive income (loss).
(5) TA agreed to accelerate the vesting of previously granted stock awards and make cash payments as part of TA's retirement and separation agreements with certain former executive officers. The accelerations and cash payments resulted in additional
compensation expense of $2.1 million for the nine months ended September 30, 2020, which were included in selling, general and administrative expense in TA's consolidated statements of operations and comprehensive income (loss).
(6) On April 9, 2018, the Court of Chancery of the State of Delaware entered its final order and judgment with respect to TA's litigation with Comdata Inc., or Comdata, or the Order. Pursuant to the Order, Comdata was required to, among other things, reimburse
TA for attorneys' fees and costs, together with interest, in the amount of $10.7 million, which TA collected in April 2018. In addition, during the year ended December 31, 2018, TA incurred $0.1 million of legal fees in its litigation with Comdata. The legal
reimbursements and expenses were included in selling, general and administrative expense in TA' consolidated statements of operations and comprehensive income (loss).
(7) In December 2019, the U.S. government retroactively reinstated the federal biodiesel blenders' tax credit for 2018 and 2019, as well as approved the federal biodiesel blenders' tax credit through 2022. As a result, TA recognized $9.6 million and $20.8 million
for the three and nine months ended September 30, 2020, respectively, which were recognized as a reduction to fuel cost of goods sold in TA's consolidated statements of operations and comprehensive income (loss).
(8) During the three and nine months September 30, 2020, TA recognized $1.3 million of impairment charges to operating lease assets related to certain standalone QSL restaurants. The impairment charge was recognized in real estate rent expense in TA's
consolidated statements of operations and comprehensive income (loss).
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28
Stopping Centers
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