Superior Plus Corp. Announces Annual and Fourth Quarter 2020 Results and 2021 Adjusted EBITDA Guidance as a Pure-play Energy Distribution Company

TORONTO--(BUSINESS WIRE)--Superior Plus Corp. (“Superior”) (TSX:SPB) announced today the financial and operating results for the fourth quarter ended December 31, 2020. Unless otherwise expressed, all financial figures are expressed in Canadian dollars.

• Superior’s Full-year 2020 Adjusted EBITDA, including Specialty Chemicals was $495.9 million
• Superior’s Full-year 2020 Adjusted EBITDA, excluding Specialty Chemicals was $379.4 million
• Superior is introducing its 2021 Adjusted EBITDA guidance range as a pure-play Energy Distribution company of $370 million to $410 million
• Based on the midpoint of the 2021 Adjusted EBITDA guidance range, this is a 3% increase compared to 2020

“I would like to thank the Superior team for delivering strong operational results in the fourth quarter and 2020,” said Luc Desjardins, President and Chief Executive Officer. “Our businesses continue to demonstrate resiliency and our team has executed on cost-saving initiatives in response to the challenging market environments. We achieved the midpoint of our 2020 Adjusted EBITDA guidance range of $475 million to $515 million despite the negative impact from the COVID-19 pandemic, warmer weather and the impact from reduced oil and gas drilling activity in North America.”

“I am also proud of our team’s ability to execute on corporate development activities during the pandemic, including our three recent propane acquisitions and the recently announced sale of our Specialty Chemicals business,” added Desjardins. “We have positioned ourselves well to accelerate our growth through acquisition strategy in the Energy Distribution business, and I am confident we will continue to grow the business and build shareholder value as we move forward as a pure-play Energy Distribution business.”

Financial Highlights

• Fourth quarter Adjusted EBITDA of $169.8 million, a $6.9 million or 4% decrease over the prior year quarter primarily due to lower EBITDA from operations, partially offset by a realized gain on foreign currency hedging contracts compared to a realized loss in the prior year quarter and lower corporate costs.
• Fourth quarter EBITDA from Operations of $171.7 million, a $16.1 million or an 9% decrease from the prior year quarter primarily due to lower results from Specialty Chemicals and Canadian propane distribution (“Canadian Propane”), partially offset by higher results from U.S. propane distribution (“U.S. Propane”) Please see below for further discussion on the fourth quarter EBITDA from Operations by business.
• Full-year 2020 Adjusted EBITDA of $495.9 million, a $28.6 million or a 5% decrease from the prior year primarily due to lower EBITDA from operations, partially offset by lower corporate costs and realized losses on foreign currency hedging contracts.
• Full-year 2020 EBITDA from operations of $518.4 million, a $43.7 million or an 8% decrease from the prior year primarily due to lower results from Specialty Chemicals and modestly lower results from U.S. Propane and Canadian Propane.
• Fourth quarter AOCF before transaction and other costs was $145.3 million, a $0.3 million increase compared to the prior year quarter primarily due to lower cash taxes and interest expense, partially offset by lower Adjusted EBITDA. AOCF before transaction and other costs per share was $0.71, $0.12 lower than the prior year quarter for the same reasons and an increase in weighted average shares outstanding. Weighted average shares outstanding increased primarily due to the impact of including the preferred shares on an as-converted basis and shares issued through the Dividend Reinvestment and Optional Share Repurchase Plan.
• Full-year 2020 AOCF before transaction and other costs was $386.5 million, a $19.7 million or 5% decrease compared to the prior year quarter primarily due to lower Adjusted EBITDA, partially offset by lower interest expense and cash tax expense. AOCF before transaction and other costs per share was $2.04, $0.28 lower than the prior year quarter for the same reasons and an increase in weighted average shares outstanding. Weighted average shares outstanding increased primarily due to the impact of including the preferred shares on an as-converted basis and shares issued through the Dividend Reinvestment and Optional Share Repurchase Plan.
• Fourth quarter net earnings were $89.3 million, an increase of $14.7 million compared to the prior year quarter primarily due to higher gains on derivatives and foreign currency translation of borrowings recorded in the current quarter and lower finance expense, partially offset by lower gross profit, higher income tax expense and higher selling, distribution and administrative costs.
• Full-year 2020 net earnings were $86.8 million, a decrease of $55.8 million compared to the prior year quarter primarily due to lower gross profit and higher income tax expense, partially offset by higher gains on derivatives and foreign currency translation of borrowings recorded in 2020 and lower selling, distribution and administrative expenses.

Business Highlights

• U.S. Propane EBITDA from operations for the fourth quarter was $80.4 million, an increase of $2.2 million or 3% compared to the prior year quarter primarily due to the incremental contribution from the tuck-in acquisitions completed in the past 12 months and higher average unit margins, partially offset by higher operating costs related to incremental costs from acquisitions. Total sales volumes increased by 25 million litres or 7% primarily due to the incremental volumes from acquisitions, partially offset by the impact of COVID-19 on commercial customers and a decline in low-margin commercial distillate volumes related to sales and marketing initiatives, and the impact of warmer weather. Average weather, as measured by degree days, across markets where U.S. propane operates for the fourth quarter of 2020 was 9% warmer than the prior year quarter and 3% warmer than the five-year average. Average sales margin for the fourth quarter was 41.2 cents per litre compared to 40.7 cents per litre in the prior year quarter primarily due to customer mix, partially offset by the impact of the stronger Canadian dollar on the translation of U.S. denominated gross profit. Operating costs were $85.7 million, an increase of $9.2 million or 12% compared to the prior year quarter primarily due to incremental costs from acquisitions, partially offset by reduced costs related to workforce optimization initiatives, cost reductions related to COVID-19, realized synergies from acquisitions and the impact of the stronger Canadian dollar on the translation of U.S. denominated expenses.
• Canadian Propane EBITDA from operations for the fourth quarter was $65.6 million, a decrease of $10.0 million or 13% compared to the prior year quarter primarily due to lower sales volumes, partially offset by lower operating costs. Total sales volumes were 608 million litres, a decrease of 145 million litres or 19%, primarily due to reduced oilfield drilling activity in Western Canada, the impact of COVID-19 on commercial customers operating at reduced capacity and the impact of warmer weather, partially offset by higher reseller volumes related to recreational propane use. Average weather across Canada for the fourth quarter of 2020, as measured by degree days was 6% warmer than the prior year and 4% warmer than the five-year average. Average propane sales margins in the fourth quarter were 18.1 cents per litre, consistent with the prior year quarter as weaker wholesale market fundamentals were offset by customer mix and sales and marketing initiatives. Operating costs were $49.5 million, a decrease of $16.5 million or 25% primarily due to lower employee-related expenses related to lower delivered volumes, including the impact of the Canadian Emergency Wage Subsidy (“CEWS”), and cost-saving initiatives. In the fourth quarter, Canadian Propane recorded a $12.0 million benefit related to the CEWS.
• Specialty Chemicals EBITDA from operations for the fourth quarter was $25.7 million, a decrease of $8.3 million or 24% compared to the prior year quarter primarily due to lower adjusted gross profit, partially offset by lower operating costs. Adjusted gross profit decreased $10.9 million primarily due to lower chlor-alkali sales prices and lower sodium chlorate sales volumes and modestly lower sodium chlorate sales prices related to the impact of the stronger Canadian dollar on U.S. denominated sales. Chlor-alkali sales prices were lower primarily due to weaker hydrochloric and caustic soda market fundamentals. Sodium chlorate sales volumes were lower primarily due to weaker printing and writing paper demand and the impact of customer mill outages, including curtailments related to COVID-19. Operating costs were $29.4 million, a $2.6 million decrease primarily due to lower freight costs related to lower sales volumes and the impact of the CEWS benefit. In the fourth quarter, Specialty Chemicals recorded a $3.4 million benefit related to the CEWS, which positively impacted cost of goods sold and operating costs.
• Superior’s corporate operating costs for the fourth quarter were $5.8 million, a decrease of $1.7 million compared to the prior year quarter primarily due to lower long-term incentive plan costs related to the Superior’s share price and the modest impact from the CEWS benefit. In the fourth quarter, Superior recorded a $0.3 million benefit related to the CEWS, which impacted the corporate operating costs.

Financial Overview
	Three Months Ended			Years Ended
	December 31			December 31
(millions of dollars, except per share amounts)		2020	2019		2020	2019
Revenue		703.9	821.0		2,394.3	2,852.9
Gross Profit		320.4	366.0		1,105.7	1,213.0
Net earnings		89.3	74.6		86.8	142.6
Net earnings attributable to common shareholders		83.0	74.6		75.1	142.6
Net earnings attributable to non-controlling interest		6.3	–		11.7	–
Net earnings per share, basic and diluted ^(1)		$0.43	$0.43		$0.43	$0.82
EBITDA from operations ^(2)		171.7	187.8		518.4	562.1
Adjusted EBITDA ^(2)		169.8	176.7		495.9	524.5
Cash flows from operating activities		70.6	108.3		360.2	423.2
Cash flows from operating activities per share ^(1)		$0.34	$0.62		$1.90	$2.42
AOCF before transaction and other costs ^(2)(3)		145.3	145.0		386.5	406.2
AOCF before transaction and other costs per share ^(1)(2)(3)		$0.71	$0.83		$2.04	$2.32
AOCF ^(2)		136.8	139.4		361.4	376.3
AOCF per share ^(1)(2)		$0.66	$0.80		$1.91	$2.15
Cash dividends declared, for common shares		31.7	31.4		126.4	125.9
Cash dividends declared per common share		$0.18	$0.18		$0.72	$0.72

1. The weighted average number of shares outstanding for the three months and twelve ended December 31, 2020 is 206.0 million and 189.7 million, respectively (December 31, 2019 –174.9 million and 174.9 million). The weighted average number of shares assumes the conversion of the preferred shares into common shares in 2020. There were no other dilutive instruments with respect to AOCF per share and AOCF before transaction and other costs per share for the three and twelve ended December 31, 2020 and 2019.
2. EBITDA from operations, Adjusted EBITDA and AOCF are non-GAAP measures. Refer to “Non-GAAP Financial Measures” for further details and the Fourth Quarter Management Discussion & Analysis (“MD&A”) for reconciliations.
3. Transaction and other costs for the three months ended December 31, 2020 and 2019 are related to acquisition activity and the integration of acquisitions. See “Transaction and Other Costs” for further details.

Segmented Information
			Three Months Ended			Years Ended
			December 31			December 31
	(millions of dollars)			2020	2019		2020	2019
	EBITDA from operations^(1)
		U.S. Propane Distribution		80.4	78.2		206.9	209.4
		Canadian Propane Distribution		65.6	75.6		195.0	200.8
		Specialty Chemicals		25.7	34.0		116.5	151.9
				171.7	187.8		518.4	562.1

1. See “Non-GAAP Financial Measures”.
   
   

Business Development and Acquisition Update

On October 15, 2020, Superior acquired all of the equity interests of a Southern California propane distribution company, operating under the tradename, Central Coast Propane (“Central Coast”), for total consideration of approximately US$12.9 million (CDN $17.1 million). The purchase price was paid primarily with cash from Superior’s credit facility. Central Coast is a retail distributor delivering approximately 5.0 million litres of propane to approximately 2,800 residential and commercial customers in Southern California.

On October 27, 2020, Superior acquired the assets of a retail propane distribution company, operating under the tradename, Petro SE Propane (“Southern Propane and Mountain Gas”), for total consideration of approximately US$6.1 million (CDN $8.0 million). The purchase price was paid primarily with cash from Superior’s credit facility. Petro is a retail distributor delivering propane in North Carolina, South Carolina, Georgia and Tennessee.

On January 26, 2021 Superior announced the acquisition of the assets of a retail propane and distillate distribution company, operating in Massachusetts under the tradename Holden Oil (“Holden”) for total consideration of US$17.8 million (CDN $22.7 million). Founded in 1924, Holden is an established independent retail energy distributor serving approximately 8,750 residential and commercial customers in the U.S. Northeast.

On February 1, 2021 Superior acquired a 100% equity interest of a retail propane distribution company, operating in Quebec under the tradename Miller Propane (“Miller”) for a total consideration of $7.5 million. Miller is a well-established retail propane distributor in the Mont-Tremblant area with annual volumes of approximately 4 million litres and 5,600 residential and commercial customers.

On February 11, 2021, Superior acquired the assets of an Ontario retail propane distribution company, operating under the tradename Highlands Propane (“Highlands”) for a total consideration of approximately $13.9 million. Highland is a primarily residential propane distributor based in Fenelon Falls, Ontario, and delivers approximately 13 million litres of propane annually.

Sale of Specialty Chemicals

On February 18, 2021, Superior entered into a definitive agreement to sell its Specialty Chemicals business for total consideration of $725.0 million (the “Transaction”). Under the terms of the Transaction, Superior will receive $600 million in cash proceeds and $125 million in the form of a 6% unsecured note (“Vendor Note”). The principal amount of the Vendor Note and accrued and unpaid interest are due 5 ½ years from the date the Transaction closes.

The purchase price is subject to adjustment based on the average EBITDA from operations of the business, excluding the impact of IFRS 16, for the three consecutive twelve-month periods following the closing date (the “Average EBITDA”). If the average EBITDA is higher than $115M the purchase price will be increased by multiplying the difference by 4.5 and the seller will issue an additional note to Superior, up to a maximum of $100 million, inclusive of accumulated interest from the close of the transaction. If the Average EBITDA is lower than $100M, the purchase price will be decreased by multiplying the difference by 4.5 and a note will be issued to the seller up to a maximum of $100 million, inclusive of accumulated interest from the close of the transaction. The additional note will bear interest at the same rate as the Vendor Note and interest will accrue from the closing date.

2021 Adjusted EBITDA Guidance

Superior’s 2021 Adjusted EBITDA guidance range is $370 million to $410 million. Based on the midpoint of the 2021 Adjusted EBITDA guidance range, this is a 10% increase compared to the full-year 2020 pro forma Adjusted EBITDA of $353.9 million. The full-year 2020 pro forma Adjusted EBITDA excludes the results of Specialty Chemicals and the $25.8 million received related to the CEWS program. The increase is primarily due to higher expected U.S. Propane EBITDA from operations, partially offset by lower expected Canadian Propane EBITDA from operations. Key assumptions related to the 2021 Adjusted EBITDA guidance are:

• EBITDA from operations in 2021 for Canadian Propane Distribution is anticipated to decrease compared to 2020 as the impact of the CEWS benefit in 2021 is expected to be significantly lower, wholesale propane market fundamentals are expected to be weaker, the impact of COVID-19 is expected to negatively impact commercial sales volumes and commercial sales volume trends in Western Canada are expected to be consistent with 2020, partially offset by lower volume-related costs, and cost savings initiatives. Average weather in Canada, as measured by degree days, is anticipated to be consistent with the five-year average.
• EBITDA from operations in 2021 for U.S. Propane is anticipated to be higher than 2020 primarily due to the full year contribution from tuck-in acquisitions completed in 2020, increased demand related to expectations weather will be consistent with the five-year average, cost saving initiatives and to a lesser extent a recovery in commercial demand as the economy recovers from the impact of COVID-19. Average weather in areas where we operate, as measured by degree days, is anticipated to be consistent with the five-year average.

Total Debt and Leverage

Superior remains focused on managing Total Debt and its Total Debt to Adjusted EBITDA leverage ratio. Superior’s Total Debt to Adjusted EBITDA leverage ratio for the trailing twelve months was 3.5x as at December 31, 2020, compared to 3.4x at September 30, 2020 and 3.7x December 31, 2019. The decrease in the leverage ratio from September 30, 2020 and December 31, 2019 was primarily due to lower debt, partially offset by higher Pro Forma Adjusted EBITDA related to acquisitions made during the trailing-twelve months.

Superior’s Total Debt as at December 31, 2020, was $1,850.6 million, a decrease of $1.6 million from September 30, 2020 and $105.5 million from December 31, 2019. The decrease from the prior year end was primarily due to the proceeds from the Brookfield Investment, which were used to reduce the credit facility, partially offset by the acquisition of Rymes, Champagne and Central Coast, which were funded primarily using the credit facility.

Superior is well within its covenants under its credit facility agreement and unsecured note indentures. Superior also had available liquidity of $365.8 million available under the credit facility as at December 31, 2020.

Superior’s long-term Total Debt to Adjusted EBITDA target range is 3.0x to 3.5x.

MD&A and Financial Statements

Superior’s MD&A, the audited Consolidated Financial Statements and the Notes to the audited Consolidated Financial Statements for the years ended December 31, 2020 provide a detailed explanation of Superior’s operating results. These documents are available online at Superior’s website at www.superiorplus.com under the Investor Relations section and on SEDAR under Superior’s profile at www.sedar.com.

2020 Fourth Quarter Conference Call

Superior will be conducting a conference call and webcast for investors, analysts, brokers and media representatives to discuss the Fourth Quarter Results at 10:30 a.m. EST on Friday, February 19, 2021. To participate in the call, dial: 1-844-389-8661. Internet users can listen to the call live, or as an archived call on Superior’s website at www.superiorplus.com under the Events section.

Non-GAAP Financial Measures

Throughout the fourth quarter earnings release, Superior has used the following terms that are not defined by International Financial Reporting Standards (“Non-GAAP Financial Measures”), but are used by management to evaluate the performance of Superior and its business: AOCF before and after transaction and other costs, earnings before interest, taxes, depreciation and amortization (“EBITDA”) from operations, Adjusted EBITDA, operating costs, Total Debt to Adjusted EBITDA leverage ratio and Pro Forma Adjusted EBITDA. These measures may also be used by investors, financial institutions and credit rating agencies to assess Superior’s performance and ability to service debt. Non-GAAP financial measures do not have standardized meanings prescribed by GAAP and are therefore unlikely to be comparable to similar measures presented by other companies. Securities regulations require that Non-GAAP financial measures are clearly defined, qualified and reconciled to their most comparable GAAP financial measures. Except as otherwise indicated, these Non-GAAP financial measures are calculated and disclosed on a consistent basis from period to period. Specific items may only be relevant in certain periods. See “Non-GAAP Financial Measures” in the MD&A for a discussion of Non-GAAP financial measures and certain reconciliations to GAAP financial measures.

The intent of Non-GAAP financial measures is to provide additional useful information to investors and analysts, and the measures do not have any standardized meaning under IFRS. The measures should not, therefore, be considered in isolation or used in substitute for measures of performance prepared in accordance with IFRS. Other issuers may calculate Non-GAAP financial measures differently. Investors should be cautioned that AOCF, EBITDA from operations, Adjusted EBITDA and Credit Facility EBITDA should not be construed as alternatives to net earnings, cash flow from operating activities or other measures of financial results determined in accordance with GAAP as an indicator of Superior’s performance. Non-GAAP financial measures are identified and defined as follows:

Adjusted Operating Cash Flow and Adjusted Operating Cash Flow per Share

AOCF is equal to cash flow from operating activities as defined by IFRS, adjusted for changes in non-cash working capital, other expenses, non-cash interest expense, current income taxes and finance costs. Superior may deduct or include additional items in its calculation of AOCF; these items would generally, but not necessarily, be infrequent in nature and could distort the analysis of trends in business performance. Excluding these items does not imply they are non-recurring. AOCF and AOCF per share are presented before and after transaction and other costs.

AOCF per share before transaction and other costs is calculated by dividing AOCF before transaction and other costs by the weighted average number of shares outstanding. AOCF per share is calculated by dividing AOCF by the weighted average number of shares outstanding.

AOCF is a performance measure used by management and investors to evaluate Superior’s ongoing performance of its businesses and ability to generate cash flow. AOCF represents cash flow generated by Superior that is available for, but not necessarily limited to, changes in working capital requirements, investing activities and financing activities of Superior.

The seasonality of Superior’s individual quarterly results must be assessed in the context of annualized AOCF. Adjustments recorded by Superior as part of its calculation of AOCF include, but are not limited to, the impact of the seasonality of Superior’s businesses, principally the Energy Distribution segment, by adjusting for non-cash working capital items, thereby eliminating the impact of the timing between the recognition and collection/payment of Superior’s revenues and expenses, which can differ significantly from quarter to quarter. AOCF is reconciled to cash flow from operating activities. Please refer to the Financial Overview section of the MD&A for the reconciliation.

EBITDA from operations

EBITDA from operations is defined as Adjusted EBITDA excluding costs that are not considered representative of Superior’s underlying core operating performance, including gains and losses on foreign currency hedging contracts, corporate costs and transaction and other costs. Management uses EBITDA from operations to set targets for Superior (including annual guidance and variable compensation targets). EBITDA from operations is reconciled to net earnings before income taxes. Please refer to the Results of Operating Segments in the MD&A for the reconciliations.

Average EBITDA

Average EBITDA is defined as the average EBITDA from operations of the Specialty Chemicals business for the three years following the closing date of the Transaction.

Adjusted EBITDA

Adjusted EBITDA represents earnings before interest, taxes, depreciation, amortization, losses (gains) on disposal of assets, finance expense, restructuring costs, transaction and other costs, and unrealized gains (losses) on derivative financial instruments. Adjusted EBITDA is used by Superior and investors to assess its consolidated results and ability to service debt. Adjusted EBITDA is reconciled to net earnings before income taxes.

Adjusted EBITDA is a significant performance measure used by management and investors to evaluate Superior’s ongoing performance of its businesses. Adjusted EBITDA is also used as one component in determining short-term incentive compensation for certain management employees.

The seasonality of Superior’s individual quarterly results must be assessed in the context of annualized Adjusted EBITDA.

Total Debt to Adjusted EBITDA Leverage Ratio and Pro Forma Adjusted EBITDA

Adjusted EBITDA for the Total Debt to Adjusted EBITDA Leverage Ratio is defined as Adjusted EBITDA calculated on a 12-month trailing basis giving pro forma effect to acquisitions and dispositions adjusted to the first day of the calculation period (“Pro Forma Adjusted EBITDA”). Pro Forma Adjusted EBITDA is used by Superior to calculate its Total Debt to Adjusted EBITDA Leverage Ratio.

To calculate the Total Debt to Adjusted EBITDA Leverage Ratio divide the sum of borrowings before deferred financing fees and lease liabilities by Pro Forma Adjusted EBITDA. Total Debt to Adjusted EBITDA Leverage Ratio is used by Superior and investors to assess its ability to service debt.

Operating costs

Operating costs include wages and benefits for employees, drivers, service and administrative labour, fleet maintenance and operating costs, freight and distribution expenses excluded from cost of sales, along with the costs associated with owning and maintaining land, buildings and equipment, such as rent, repairs and maintenance, environmental, utilities, insurance and property tax costs. Operating costs exclude gains or losses on disposal of assets, depreciation and amortization and non-recurring expenses, such as transaction, restructuring and integration costs.

Operating costs are defined as SD&A expenses adjusted for amortization and depreciation, gains or losses on disposal of assets and transaction, restructuring and other costs.

Forward Looking Information

Certain information included herein is forward-looking information within the meaning of applicable Canadian securities laws. Forward-looking information may include statements regarding the objectives, business strategies to achieve those objectives, expected financial results (including those in the area of risk management), economic or market conditions, and the outlook of or involving Superior, Superior LP and its businesses. Such information is typically identified by words such as “anticipate”, “believe”, “continue”, “estimate”, “expect”, “plan”, “forecast”, “future”, “outlook, “guidance”, “may”, “project”, “should”, “strategy”, “target”, “will” or similar expressions suggesting future outcomes.

Forward-looking information in this document includes: future financial position, consolidated and business segment outlooks, expected Adjusted EBITDA, the anticipated closing of the Transaction, the duration and anticipated impact of the COVID-19 pandemic and the expected economic recession, estimates of the impact COVID-19 may have on our operations, the markets for our products and our financial results, anticipated impact from the weaker Canadian dollar, business strategy and objectives, development plans and programs, organic growth, weather, economic activity in Western Canada, product pricing and sourcing, wholesale propane market fundamentals, exchange rates, expected seasonality of demand, and future economic conditions.

Forward-looking information is provided for the purpose of providing information about management’s expectations and plans about the future and may not be appropriate for other purposes. Forward-looking information herein is based on various assumptions and expectations that Superior believes are reasonable in the circumstances. No assurance can be given that these assumptions and expectations will prove to be correct. Those assumptions and expectations are based on information currently available to Superior, including information obtained from third party industry analysts and other third party sources, and the historic performance of Superior’s businesses. Such assumptions include anticipated financial performance, current business and economic trends, the amount of future dividends paid by Superior, business prospects, utilization of tax basis, regulatory developments, currency, exchange and interest rates, future commodity prices relating to the oil and gas industry, future oil rig activity levels, trading data, cost estimates, our ability to obtain financing on acceptable terms, expected life of facilities and statements regarding net working capital and capital expenditure requirements of Superior or Superior LP, the assumptions set forth under the “Financial Outlook” sections of our MD&A. The forward looking information is also subject to the risks and uncertainties set forth below.

By its very nature, forward-looking information involves numerous assumptions, risks and uncertainties, both general and specific. Should one or more of these risks and uncertainties materialize or should underlying assumptions prove incorrect, as many important factors are beyond our control, Superior’s or Superior LP’s actual performance and financial results may vary materially from those estimates and intentions contemplated, expressed or implied in the forward-looking information. These risks and uncertainties include incorrect assessments of value when making acquisitions, increases in debt service charges, the loss of key personnel, the anticipated impact of the COVID-19 pandemic and the expected economic recession, fluctuations in foreign currency and exchange rates, inadequate insurance coverage, liability for cash taxes, counterparty risk, compliance with environmental laws and regulations, reduced customer demand, operational risks involving our facilities, force majeure, labour relations matters, our ability to access external sources of debt and equity capital, and the risks identified in (i) our MD&A under the heading “Risk Factors” and (ii) Superior’s most recent Annual Information Form. The preceding list of assumptions, risks and uncertainties is not exhaustive.

When relying on our forward-looking information to make decisions with respect to Superior, investors and others should carefully consider the preceding factors, other uncertainties and potential events. Any forward-looking information is provided as of the date of this document and, except as required by law, neither Superior nor Superior LP undertakes to update or revise such information to reflect new information, subsequent or otherwise. For the reasons set forth above, investors should not place undue reliance on forward-looking information.