Mr. Allan MacDonald reports

SUPERIOR PLUS ANNOUNCES STRONG SECOND QUARTER RESULTS AND INCREASES 2023 ADJUSTED EBITDA GUIDANCE

Superior Plus Corp. today released its second quarter results for the period ended June 30, 2023. Unless otherwise expressed, all financial figures are expressed in Canadian dollars.

• Superior is increasing its 2023 pro forma adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) guidance to a range of $630-million to $670-million, with a midpoint of $650-million, from a range of $620-million to $660-million. The 2023 pro forma adjusted EBITDA guidance includes the expected full 12 months of Certarus Ltd.'s 2023 adjusted EBITDA in the range of $185-million to $195-million.
• The midpoint of Superior's 2023 pro forma adjusted EBITDA guidance range of $650-million represents a 44-per-cent increase compared with Superior's 2022 adjusted EBITDA of $450-million.
• On May 31, 2023, Superior completed the transformational acquisition of Certarus, adding an industry leader in high-demand, low-carbon energy distribution for CNG, RNG and hydrogen.
• Superior's second quarter pro forma adjusted EBITDA of $69.0-million was a $43.4-million increase from the prior-year quarter.
• Net earnings of $107.3-million for the first six months of 2023 compared with net earnings of $56.0-million in the first six months of 2022. Superior had a net loss of $(39.8)-million in the second quarter compared with a net loss of $(85.0)-million in the prior-year quarter. Certarus had net earnings of $1.0-million in the second quarter compared with net earnings of $13.3-million in the prior-year quarter.
• Certarus achieved record second quarter pro forma adjusted EBITDA of $41.5-million, a $15.2-million or about 58-per-cent increase from the prior-year quarter.
• Superior's net debt to adjusted EBITDA leverage was 3.6 times as at June 30, 2023, significantly lower than March 31, 2023.

"Superior delivered a strong second quarter driven by the contribution from the Certarus acquisition and solid operating results from the propane businesses. The Certarus team continued to produce significant year-over-year adjusted EBITDA growth, and we are excited about growing the North American leader in on-road distribution of compressed natural gas (CNG), renewable natural gas (RNG) and hydrogen," said Allan MacDonald, president and chief executive officer (CEO) of Superior. "Our propane distribution businesses continued to deliver good results in a seasonally lower quarter due to disciplined margin management and cost-saving initiatives."

Second quarter and year-to-date highlights

• Net earnings of $107.3-million for the first six months of 2023 compared with net earnings of $56.0-million in the first six months of 2022, a $51.3-million increase due to higher gross profit and a gain on derivatives and foreign currency translation of borrowings compared with a modest loss in the prior year, partially offset by higher selling, distribution and administrative expenses (SD&A), higher finance expense, and income tax expense. Net loss of $(39.8)-million in the second quarter compared with a net loss of $(85.0)-million in the prior-year quarter driven by higher gross profit related to lower wholesale commodity costs and a gain on derivatives and foreign currency translations of borrowings compared with a loss in the prior-year quarter, partially offset by higher SD&A expenses, lower revenue related to wholesale commodity costs, and higher finance expense.
• Basic and diluted earnings per share attributable to Superior in the first six months of 2023 was 45 cents per share, compared with 23 cents per share in the prior-year quarter due to higher net earnings, partially offset by the impact of the higher number of weighted average shares outstanding related to the issued shares for the Certarus acquisition. Basic and diluted loss per share attributable to Superior in the second quarter was (21 cents) per share, compared with (46 cents) per share in the prior-year quarter due to a lower net loss, partially offset by the impact of the higher number of weighted average shares outstanding.
• Pro forma adjusted EBITDA for the second quarter was $69.0-million, an increase of $43.4-million compared with the prior-year quarter as a result of higher EBITDA from operations, partially offset by higher corporate costs. EBITDA from operations increased primarily due to contribution from Certarus and higher adjusted EBITDA in the propane distribution businesses. Superior is including the pro forma adjusted EBITDA impact of the Certarus acquisition as the full economic benefit of Certarus's 2023 adjusted EBITDA prior to the close of the Certarus acquisition was retained in the business.
• Adjusted EBITDA for the second quarter was $40.1-million, an increase of $14.5-million compared with the prior-year quarter as a result of higher EBITDA from operations, partially offset by higher corporate costs.
• Certarus pro forma adjusted EBITDA for the second quarter was $41.5-million, an increase of $15.2-million from the prior-year quarter of $26.3-million driven by higher average mobile storage units (MSUs), improved pricing and utilization of MSUs, and lower cost of sales related to natural gas prices. Certarus adjusted EBITDA from the date of the close of the acquisition on May 31, 2023, was $12.6-million.
• Corporate costs for the second quarter were $10.5-million compared with $6.0-million in the prior-year quarter due to higher insurance costs, CEO transition costs, the impact of inflationary pressures and higher long-term incentive plan costs related to the change in the share price in the prior-year quarter. Superior realized a gain on foreign currency hedging contracts of $400,000, modestly higher than $300,000 in the prior-year quarter.
• Superior's leverage ratio for the trailing 12 months (TTM) ended June 30, 2023, improved to 3.6 times and is expected to remain within Superior's targeted range for the remainder of 2023.

Quarterly dividend

• Superior is declaring a quarterly common share dividend of 18 cents per share, payable to shareholders of record as of Sept. 30, 2023. The common share dividend will be payable on Oct. 16, 2023.

Normal course issuer bid

• On Oct. 11, 2022, the TSX accepted Superior's notice of intention to establish a new NCIB. The NCIB permits the purchase of up to 10.1 million of Superior's common shares, representing approximately 5 per cent of the issued and outstanding common shares as of Sept. 30, 2022, by way of normal course purchases effected through the facilities of the TSX and/or alternative Canadian trading systems.
• During the second quarter, Superior repurchased and cancelled 10,100 shares.
• Since June 30, 2023, Superior repurchased and cancelled 513,000 shares.

MD&A and financial statements

Superior's MD&A (management discussion and analysis), the unaudited consolidated financial statements and the notes to the unaudited consolidated financial statements as at and for the quarter ended June 30, 2023, provide a detailed explanation of Superior's operating results. These documents are available on-line on Superior's website at Superior Plus Financial Reports and on SEDAR under Superior's profile at SEDAR+.

2023 second quarter conference call

A conference call and webcast to discuss the 2023 second quarter financial results will be held at 2 p.m. ET on Thursday, Aug. 3, 2023. The webcast will be available for replay on Superior's website under the events section.

About Superior Plus Corp.

Superior is a leading North American distributor of propane, compressed natural gas (CNG), renewable energy, and related products and services, servicing approximately 936,500 customer locations in the United States and Canada. Through its primary businesses, propane distribution and CNG, RNG (renewable natural gas) and hydrogen distribution, Superior safely delivers clean-burning fuels to residential, commercial, utility, agricultural and industrial customers not connected to a pipeline. By displacing more carbon-intensive fuels, Superior is a leader in the energy transition and helping customers lower operating costs and improve environmental performance.

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