Global Partners LP GLP is set to release first-quarter results on May 8. The current Zacks Consensus Estimate for the to-be-reported quarter is a profit of 10 cents per unit on revenues of $5.2 billion.

Let’s delve into the factors that might have influenced the vertically integrated energy partnership’s results in the March quarter. But it’s worth taking a look at GLP’s previous-quarter performance first.

Highlights of Q4 Earnings & Surprise History

In the last reported quarter, the Waltham, MA-based gasoline station and convenience store operator beat the consensus mark on the strong performance of its Gasoline Distribution and Station Operations (“GDSO”) unit. GLP had reported net income per unit of $1.41, outperforming the Zacks Consensus Estimate of 96 cents. Revenues of $4.4 billion generated by the firm also came in 0.4% above the Zacks Consensus Estimate.

Global Partners beat the Zacks Consensus Estimate for earnings in two of the last four quarters and missed in the other two, resulting in an earnings surprise of 5.9%, on average. This is depicted in the graph below:

 

Global Partners LP Price and EPS Surprise

Global Partners LP price-eps-surprise | Global Partners LP Quote

 

Trend in Estimate Revision

The Zacks Consensus Estimate for the first-quarter bottom line has remained unchanged in the past seven days. The estimated figure indicates an 85.7% decline year over year. The Zacks Consensus Estimate for revenues, meanwhile, suggests a 29.5% decrease from the year-ago period.

Factors to Consider

Global Partners is expected to have been buoyed by continued robust margin across its GDSO business. During the previous three-month period, GLP reported segment margins of $245.4 million, improving from $223.2 million a year ago. The uptrend is likely to have continued in the to-be-reported quarter, with higher contributions from gasoline distribution primarily due to favorable market conditions.

On a further bullish note, a lower expense structure might have provided more support to GLP’s earnings and cash flows. Global Partners’ operating costs in the fourth quarter edged down 1.7% year over year to $116 million. The downward cost trajectory is likely to have continued in the January-March period primarily due to prudent expense management.

However, a decline in the Wholesale unit profit might have played spoilsport. The metric fell 26.6% year over year in the fourth quarter to $51.9 million. The segment profit is set to have taken a hit in the first quarter too, primarily due to lower product margin from distillates and other oils.