Suburban Propane Partners, L.P. Declares Quarterly Distribution of $0.325 per Common Unit

Rhea-AI Summary

Suburban Propane Partners, L.P. (NYSE:SPH) declared a quarterly distribution of $0.325 per Common Unit for the three months ended December 30, 2023, with an annualized rate of $1.30 per Common Unit. The distribution is payable on February 13, 2024, to Common Unitholders of record as of February 6, 2024. The press release also provides important information for foreign investors regarding federal income tax withholding.

Insights

Financial Analyst

The declaration of a quarterly distribution by Suburban Propane Partners, L.P. (SPH) represents a tangible return on investment for common unitholders. The distribution rate of $0.325 per Common Unit, resulting in an annualized rate of $1.30, is a critical figure for current and potential investors. It is essential to compare this yield to the industry average and assess it against the company's historical distribution rates to gauge the attractiveness of the stock. Additionally, the stability and sustainability of these payments are often scrutinized, as they can be indicative of the company's financial health and operational efficiency.

Investors should also consider the tax implications of these distributions, especially since the company has specified that 100% of its distributions to foreign investors are subject to federal income tax withholding at the highest applicable effective tax rate. This could potentially affect the net income for foreign investors and might influence their investment decisions.

Tax Expert

From a taxation standpoint, the notice provided by Suburban Propane Partners, L.P. is significant for both brokers and foreign investors. The company's adherence to Treasury Regulation Section 1.1446-4(b) entails that brokers and nominees act as withholding agents, a responsibility that requires due diligence to ensure compliance with U.S. tax laws. The tax withholding at the highest effective rate on distributions to foreign investors could deter international investment, depending on the tax treaties between the United States and investors' countries of residence.

Furthermore, the indication that 100% of the distribution is in excess of cumulative net income is noteworthy. This suggests that the distribution might not be entirely covered by the net income, potentially implying a return of capital or distributions from other sources, which could have different tax implications for investors.

WHIPPANY, N.J., Jan. 25, 2024 /PRNewswire/ -- Suburban Propane Partners, L.P. (NYSE:SPH), today announced that its Board of Supervisors declared a quarterly distribution of $0.325 per Common Unit for the three months ended December 30, 2023. This quarterly distribution rate equates to an annualized rate of $1.30 per Common Unit. The distribution is payable on February 13, 2024 to Common Unitholders of record as of February 6, 2024.

This press release serves as qualified notice to brokers and nominees as provided for under Treasury Regulation Section 1.1446-4(b). Please note that 100% of Suburban Propane Partners, LP's distributions to foreign investors are attributable to income that is effectively connected with a United States trade or business. Accordingly, all of Suburban Propane Partners, LP's distributions to foreign investors are subject to federal income tax withholding at the highest applicable effective tax rate without exception. Regarding the amount realized pursuant to 1.1446(f)-4(c)(2)(iii), 100% of the distribution is in excess of cumulative net income. Brokers and nominees are treated as withholding agents responsible for withholding distributions received by them on behalf of foreign investors.

About Suburban Propane Partners, L.P.
Suburban Propane Partners, L.P. ("Suburban Propane") is a publicly traded master limited partnership listed on the New York Stock Exchange. Headquartered in Whippany, New Jersey, Suburban Propane has been in the customer service business since 1928 and is a nationwide distributor of propane, renewable propane, fuel oil and related products and services, as well as a marketer of natural gas and electricity and an investor in low carbon fuel alternatives, servicing the energy needs of approximately 1 million residential, commercial, governmental, industrial and agricultural customers through approximately 700 locations across 42 states. Suburban Propane is supported by three core pillars: (1) Suburban Commitment – showcasing Suburban Propane's 95-year legacy, and ongoing commitment to the highest standards for dependability, flexibility, and reliability that underscores Suburban Propane's commitment to excellence in customer service; (2) SuburbanCares – highlighting continued dedication to giving back to local communities across the Suburban Propane's national footprint and (3) Go Green with Suburban Propane - promoting the clean burning and versatile nature of propane and renewable propane as a bridge to a green energy future and developing the next generation of renewable energy. For additional information on Suburban Propane, please visit www.suburbanpropane.com. 

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SOURCE Suburban Propane Partners, L.P.

FAQ

What is the quarterly distribution declared by Suburban Propane Partners, L.P. (NYSE:SPH)?

The quarterly distribution declared is $0.325 per Common Unit for the three months ended December 30, 2023.

When is the distribution payable to Common Unitholders of Suburban Propane Partners, L.P. (NYSE:SPH)?

The distribution is payable on February 13, 2024, to Common Unitholders of record as of February 6, 2024.

What is the annualized rate of the distribution for Suburban Propane Partners, L.P. (NYSE:SPH)?

The annualized rate of the distribution is $1.30 per Common Unit.

How are foreign investors affected by the distribution of Suburban Propane Partners, L.P. (NYSE:SPH)?

All distributions to foreign investors are subject to federal income tax withholding at the highest applicable effective tax rate without exception.