Randy Palmer – Director-Investor Relations Jeremy Bergeron – President and Chief Executive Officer Evan Smith – Chief Financial Officer.

Aaron Eisenberg – Jeffries Ben Bienvenu – Stephens, Inc. Robert Balsamo – FBR & Company Patrick Wang – Robert W. Baird Mike Gyure – Janney Montgomery.

Welcome to the CrossAmerica Partners Fourth Quarter and Year End 2017 Earnings Call. My name is Jason and I'll be your operator. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. Also please note this conference is being recorded.

I'll now turn the call over to Randy Palmer, Director of Investor Relations. Mr. Palmer, you may begin..

Thank you, operator. Good morning and thank you for joining the CrossAmerica Partners year end and fourth quarter 2017 earnings call. With me today are Jeremy Bergeron, President and CEO; Evan Smith, Chief Financial Officer and other members of our Executive Leadership Team.

Jeremy will provide a brief overview of CrossAmerica's operational performance and an update on current strategic initiatives and then we’ll turn the call over to Evan to discuss the financial results. At the end, we will open-up the call to questions.

I should point out that today's call will follow some presentation slides that we will utilize during this morning's event. These slides are available as part of the webcast and are posted on the CrossAmerica website.

Before we begin, I would like to remind everyone that today's call, including the question-and-answer session, may include forward-looking statements regarding expected revenue, future plans, future operational metrics, and opportunities and expectations of the organization.

There can be no assurance that the management's expectations, beliefs and projections will be achieved or that actual results will not differ from expectations.

Please see CrossAmerica's filings with the Securities and Exchange Commission including annual reports on Form 10-K and quarterly reports on Form 10-Q for a discussion of important factors that could affect our actual results.

Forward-looking statements represent the judgment of CrossAmerica's Management as of today's date and the organization disclaims any intent or obligation to update any forward-looking statements. During today's call, we may also provide certain performance measures that do not conform to U.S. Generally Accepted Accounting Principles or GAAP.

We’ve provided those schedules that reconcile these non-GAAP measures with our reported results on a GAAP basis as part of our earnings press release. Today's call is being webcast and a recording of this conference call will be available on the CrossAmerica website for a period of 60 days.

And with that, I'll now turn the call over to Jeremy Bergeron..

Thank you, Randy. We’ve reported our year-end and fourth quarter 2017 earnings results yesterday afternoon and Evan will go through that detail on a few minutes. But first I wanted to review some of the highlights for our year-end and fourth quarter. Turn to Slide 4, I will provide a brief overview of the partnership at the end of 2017.

As we look over the past twelve months, we continue to distribute over 1 billion gallons of fuel and generate gross rental income of over $85 million. We continue to hold 17.5% interest in CST Fuel Supply, which generates a $0.05 per gallon wholesale fuel margin on approximately 1.7 billion gallons distributed annually within the legacy CST network.

Our operation consists of approximately 1,350 locations, controlling over 70% of these types, including owning the key rights of over 550. As you can see, we have built a significant real estate portfolio within CrossAmerica.

We distribute fuel to over 96% of our properties, currently operates 71 convenient stores in the Upper Midwest market, and collect rent from non-fuel tenants at another 54 sites. On Slide 5, we recap some of our fourth quarter and year-end operating results.

First as you look at the fourth quarter while we experienced a slight decline in volumes distributed, we saw 14% increase in our wholesale fuel margin per gallon, thanks to the improvement in our terms discount on our supplier contracts and our efforts to capture more of the available margin and our rack to retail price dealer contracts.

These efforts results in an 11% increase in our wholesale motor fuel gross profit for the fourth quarter and also made a significant impact for us throughout the year. For the full year, our whole sale margin moved from $0.052 per gallon in 2016 to $0.057 gallons in 2017, driving an increase in our wholesale fuel gross profit of $4.7 million or 9%.

During the quarter, we also saw an increase in our fuel margin per gallon for our 71 company operated sites as an increase from $0.066 in the fourth quarter of 2016 to $0.097 for the same period in 2017 and finally our G&A expenses excluding acquisition related costs declined for both the fourth quarter and full year.

You could see the reduction in our base G&A expenses quarter-over-quarter and year-over-year of over $2 million for the fourth quarter and over $4 million for the full year of 2017.

This is a reflection of the G&A expense synergies we are realizing, thanks to our integration efforts with Circle K as we have outlined previously, in addition to synergies, we have achieved from our prior acquisitions.

We are continuing to focus on managing costs and making reductions where we can as we further integrate our operations with our general partner. If you turn to the next slide, I would like to review some of the other highlights from 2017.

During the summer of 2017, Couche-Tard completed their acquisition of CST that includes the membership interests in CrossAmerica General Partner along with the 21% limited partner interest in all of the incentive distribution rights of the partnership.

In November of 2017, we closed in the joint acquisition of assets from Jet-Pep as we acquired 101 commission operated sites and Circle K acquired fuel terminal associated trucking equipment and 18 other retail sites in Alabama.

This was a great transaction for us as that expanded our presence in the south and was the first strategic acquisition opportunity with our new general partner. In 2017, we grew our adjusted EBITDA of 5% over the full year 2016 and grew our distributions pay by 3% when compared to last year.

As we move to the next slide, Slide 7, our integration of the organization is continuing. We are currently tracking ahead of our synergy target with over $3.5 million of annual savings achieved to date.

As a reminder we targeted 5 million of synergies in the first twelve months following the acquisition of CST by Couche-Tard as well as an additional 5 million synergies within the first three years. Part of this projection of synergies we are beginning to realize as we align the management of our fuel distribution business with that of Circle K.

And as I mentioned earlier, we closed the joint acquisition Jet-Pep late last year and continue to work through the successful integration process as the opportunity to realize synergies from this transaction as well.

In regards to the unwind transaction that we have outlined in the past, we continue to work with our CST on the final details of this initial transaction with the passing of the Tax Cut and Jobs Act. The tax treatment on such a transaction would significantly enough to align [indiscernible] into Couche-Tard’s next fiscal year, which begins May 1.

We're taking advantage of this timing to optimize our asset mix in the transaction following ACT's recent holiday acquisition.

While we are not in a position to detail specific aspects included at this time, the scope is consistent with what we have communicated previously, not just with this transaction, but also with future drop we expect to complete as well.

Moving to the next slide and before I turn it over to Evan, I did want to outline the strategy and objectives that we have as a management team, our board and new general partner are aligned in achieving this year and beyond.

We expect to grow our cash flow and strengthen our business this year to the synergies we expect to achieve our continued cost control efforts and other ways we are strengthening the base business each day. Following the unwind transaction; we expect to benefit from the cash flow improvement as a result of the assets being exchanged.

We will also benefit from the cash flow from the Jet-Pep acquisition and continue to look for other third party acquisition opportunities. In 2017, we were able to achieve and maintain our target leverage ratio between 4 and 4.25 times ending the year at 4.14 times. We will continue to manage our debt to stay within the target range.

While the traditional MLP equity markets continue to be challenged, there were other levers we can pull to provide us with the necessary capital to achieve our goals for the year. We want to be clear with our investors. We will be very prudent and diligent with any equity dilution moving forward.

We have managed through a very difficult time in the market and are in great plain or safe. And while we obviously believe that our units are undervalued, we also understand that investors would like to see a transaction with our general partner to provide clarity and guidance for future growth opportunities.

We're confident that once we execute on that transaction, further integrate within Circle K and continue to manage our business in a cost efficient manner, we have demonstrated our unit price will respond accordingly.

Over the past couple years as we have continued to increase our distribution, we have seen our coverage ratio pull back from our targeted level of 1.1 times ending the year at approximately 1.05.

As we go through 2018, we plan on utilizing our cash flow to improve our coverage ratio and intend to maintain our current per unit distribution level throughout 2018. We will focus on improving the coverage ratio through our prior levels and anticipate reaching a 1.1 times ratio in 2019.

At the time, we will evaluate our long-term coverage ratio target. Once we resume our unit distribution growth, we will also be revisiting our IDR structure with our general partner, which is currently in the 25% splits. So, in summary, we finished the year off well and believe that we positioned ourselves for a good 2018.

We should expect that we will continue our growth strategy by working with our general partner, continue to look for and completing accretive third-party acquisitions, continue to manage our expenses, managing our balance sheet and working toward increasing our coverage ratio as we go through the year. With that I will turn it over to Evan..

Thank you, Jeremy. If you’d please turn to Slide 10, I will review our fourth quarter and year end results of CrossAmerica. Today, we reported adjusted EBITDA of $29 million and distributable cash flow of nearly $22 million for the fourth quarter of 2017.

For the full year of 2017, our adjusted EBITDA was $109 million with distributable cash flow at $81 million.

The partnership paid a distribution of $0.6275 per unit during the fourth quarter of 2017 for a total of over $21 million resulting in a coverage ratio of 1.02 times on a paid basis, our trailing twelve month coverage was 0.97 times on a paid basis.

As Jeremy touched on earlier, the growth in our wholesale business coupled with our management of our expenses had a positive impact on our overall performance for both the quarter and the year. As we have noted in the past, we received prompt paid terms discounts from our suppliers as a percentage of the total invoice on the fuel repurchase.

During the fourth quarter of 2017, average crude oil prices increased 13% as compared to the same period for 2016 resulting in a positive impact on the terms discount that we received from our suppliers. It increased 17% for the full year of 2017, compared to 2016.

On top of this increase, we also saw volatility in crude oil and wholesale fuel prices during the three-month period and full year of 2017, which benefited our dealer-tank wagon prices for those periods.

During the quarter we saw a total benefit of nearly $2 million from a combination of supplier term discounts and the impact of improved dealer-tank wagon pricing. Finally, turning to Slide 11, I wanted to talk briefly about our historical performance.

Have you looked at the first paragraph at the top left side, you can see our wholesale fuel margins on a quarterly basis and how it has ebbed and flowed over the quarters in relation to crude oil prices.

The chart reflects that our margin does have some sensitivity to the price of crude oil, mainly driven by the terms discounts and dealer-tank wagon pricing that I mentioned earlier.

However, have you looked at the graph on the top right side of the slide and the historical adjusted EBITDA movements from $13 million in the first quarter of 2013 to $29 million in the fourth quarter of 2017 and compare that to the movements in the WTI price there's not been a strong correlation between the two.

This has been driven by several factors including successfully completing accretive acquisitions, the adherence stability of fuel margins earned from our fixed price base dealer contracts, our management of costs and a dealerization strategy that has increased our rental income over time.

This growth in rental gross profit is demonstrated on the chart at the bottom left side of the slide. Rent has grown from $26 million in 2013 to $69 million in 2017, providing a more stable, qualifying income stream for the partnership and its unit holders.

In fact, rent gross profit now outpaces fuel gross profit as contributing to our overall cash flow. And while our business has grown substantially over the years, as reflected on the last chart, you can see that we have continued to manage and control our overall expenses as reflected by our G&A reductions over the past three years.

We conducted sizable acquisitions from 2013 through 2015, then starting in 2015, we focused more on tuck in purchases earning with minimal overhead. We also began our dealerization strategy in earnest in 2015 and increased our focus on controlling expenses in the business, which continues now as part of the Circle K.

You should expect that we will continue to manage our costs in this fashion in 2018. In closing, as Jeremy noted earlier in the presentation, we should expect that we will continue to grow our EBITDA while managing our balance sheet in leverage with an overall emphasis on improving our coverage ratio as we move through the year.

With that I will now turn it back over to Jeremy for a few closing remarks..

Thanks Evan. I'm sure by now most of you saw this morning's announcement in regards to the planned leadership transition here at CrossAmerica. As Gerardo Valencia will be joining the team and I'll be stepping down a CEO later this year. Whereas I would like to welcome Gerardo to this terrific organization.

Gerardo brings a wealth of experience and knowledge in wholesale fuels in retail industry with 20 years at BP. I'm excited to see the positive impact that I know he will have on the partnership in growing the business for years to come.

While I'm looking forward to my next challenge of Couche-Tard, I'm excited to be working closely with Gerardo in the coming months as we execute a successful transition. With that we will now open it up for questions..

Thank you. [Operator Instructions] Our first question comes from Chris Mandeville from Jeffries..

Hey guys this is actually Aaron Eisenberg on for Chris. Thanks for taking the questions..

Good morning, Aaron..

So starting off with the announcement from this morning, just curious if the appointment of Gerardo brings in a different approach or if the same strategy should be expected going forward?.

It’s a fair question. Now I think as we mentioned in our prepared remarks earlier, the management team, the Board and its leader are all aligned with the strategy that we've laid out and we don't really expect any change in the overall strategy for the partnership going forward..

Understood. And then secondly given some of the storms we have observed at the beginning of the year could you talk about how volume trends have looked regionally quarter-to-date. I believe hope this has retail volumes down 4.1% year-to-date.

Just kind of curious what you're seeing on that front?.

Sure I mean throughout 2017 there was some weakness in certain parts of the country. I think where we saw things like tax changes. In states like New Jersey we did see a continued weakness throughout 2017. But we also had some markets that are actually up in the samestore basis and perform well like a lot of sites in the Virginia market.

So it really is state by state and region by region. There was a little bit of weakness on the East Coast, but overall I think we're excited about where things are starting to trend here in 2018 as we get started..

Understood, thanks guys. Best of luck in 2018..

Thank you. And next we have Ben Bienvenu from Stephens, Inc..

Hi, thanks good morning. I want to ask about G&A expenses and operating expenses really well managed in this quarter and really all of 2017. And we're hearing a broader backdrop of wage and expense pressure across the convenience store industry and retail more broadly. Synergy seems to be one of the levers that you're pulling to manage those costs.

I’m curious around the base business what are your expectations of how you intend to navigate that more inflationary environment?.

Thanks Ben. Yes I mean that is kind of goes into the nature of our overall business model and kind of why we have focused heavily on the wholesale sector and growing our business with more the dealer operating model rather than the company operating model.

For us as an MLP, what's important for investors we understand is a steady, dependable stream of cash flow that we can grow overtime with being very smart and diligent on acquisitions and growing the business that way.

And as we mentioned or as Evan mentioned on Slide 11, I think, you see with some of the larger transactions we did back in 2014 and 2015, we took on some company operated business as well as some G&A expenses associated with it and really took an effort there in 2015 and over the past two to three years really trying to bring that down.

So I think partnering with Couche-Tard going forward where we can look at acquisitions together and the company operated business sits well with their model and their very experienced way of managing expenses and managing the store combined with our opportunity to grow at the dealer channel. It's a great win for us and our investors.

And we think that certainly is a right strategy in light of all the things you just mentioned..

Great. And then in your comments you alluded to future transactions with Couche-Tard that you be – to the extent that you can discuss it I'm curious should we have an expectation of those transactions involving just the fuel difference, or real estate assets, or some combination thereof depending on for market rates multiples..

Yes I think it's a combination there. I don't think we’re exclusive into one or the other. There's going to be opportunities we know out there, there are going to be deals like we had with the Jet-Pep acquisition in the fourth quarter last year, where it makes sense for both of us to go in and go after an acquisition.

And we have the right home for those assets in each of our two organizations. And then we have other opportunities where it may just be a pure retail play, or just a pure wholesale play. I know we have the support of Couche-Tard to go up to those opportunities within the partnership that fits partnership well, if it’s just for the partnership benefit.

And we look forward to those opportunities as well. So I don't think it's an either or approach. It’s certainly going to eb both in. .

Okay great. Thanks. And best of luck..

Thanks for the appreciating..

Thanks Ben..

Thank you. And next we have Robert Balsamo from FBR & Company..

Good morning, a couple of my questions have been asked. Just on the macro that you kind of expanding on the growth strategy there and could you just give us an update on what you are seeing in the M&A market opportunities for the consolidation.

And then just confirm that you don’t have interesting kind of moving outside the core competencies, we’ve seen some competitors kind of start to branch out, looking for opportunity?.

Sure.

So I mean, the opportunity that we see are really the deals that we’ve done over the past few years, we have focused heavily not just on growing the wholesale distribution channel through our dealer network but also ensuring we get good real estate along the way that support the rental income into the partnership that is certainly good qualified income for investors.

That's allowed us to really grow that part of the business. So we spoken publicly before in terms of the types of multiples we've seen in the business.

We still see those opportunities out there, you have to question about fragmentation and that certainly still is the case and we certainly like our position with Couche-Tard to be in a favorite position to really to go after those opportunities and further grow..

Thank you.

And just a housekeeping you may have mentioned this, what was the $16 million tax benefit, what drove during the quarter?.

This is Evan. Just with reduction of taxes from the Tax Cuts and Jobs Act and it’s really just reducing the deferred tax liabilities. And we could get into some minor detail, but it was noncash items, there is really just a reduction of future tax liabilities that was recognized in the fourth quarter..

Great, thank you very much..

Thank you..

Thanks..

Thank you. Next we have Patrick Wang from Robert W. Baird..

Hey, good morning guys..

Good morning, Pat..

Look at the unwind transaction, you mentioned the potential for cash flow improvement following that assets swap with Circle K.

Should we still assume that initial asset realignment to be modestly accretive as a base case and potentially better as an upside case?.

Sure. So I mean, I can't get into the specifics on this until we actually completed but I would say, as we going through when we are preparing for what they expect in 2018 that is certainly is a base case assumption for us.

That we've spoken before about some of the assets and where the partnership purchased those assets previously and the types of multiples in which we've purchased those assets at from the prior drops. And really the other opportunities to acquire assets in today's market.

And we said the opportunities with Couche-Tard to acquire those types of assets or more can to what's available to us in the third-party market. So if you go out with a base assumption, I think you can assume that we should see some level of betterment overall.

But certainly once we able to detail that out specifically, you'll see that but I think that's a good understanding from a base case..

Okay, that's helpful. That makes sense. And then an unrelated follow-up, it looks like you had a dozen sites held-for-sale at the year end. Could you talk about your expectations around the anticipated timing of these sales and is it reasonable to assume that there more likely to be sold as a package or more as one-offs.

And secondly, whether or not these sites were reporting in disc-ops in Q4?.

Right. So most of those assets held-for-sale have to do with some of the announced divestitures that we are going forward, with related to FTC review of the holiday transaction by Couche-Tard, as well as our Jet-Pep transaction, right.

So we're working closely with the team over Couche-Tard on looking to package those assets and get whatever the best return is on behalf of the partnership. So Evan, I don’t know if you want to comment on the last question..

Yes, those are not in discontinued operations..

Okay, got it. Thanks for that. Thank you both. And congrats, Jeremy on your new role..

Thanks, Pat..

Thanks Pat..

Thank you. [Operator Instructions] Next we have Mike Gyure from Janney Montgomery..

Could you guys talk a little bit about the relationship with CST Fuel Supply, maybe how many locations that apply to kind of volumes that’s still subject to?.

Sure, that is still subject to about 1.7 billion gallons on an annual basis and it was basically CST, what we refer to as their legacy network with over 1,000 stores that they were operating throughout the United States, when the spin occur from them from Valero back in 2013..

Okay.

And then I don't know if you mentioned, did you give any guidance regarding the amount of growth capital, you think you need for 2018?.

We've not provided that guidance yet. Typically our growth capital spend has been relatively minimal and its – I think you can look at the prior years and assume somewhat similar there’s maybe a little bit more of an uptick as we go forward in 2018 with more opportunities, but shouldn’t be anything too dramatically different..

Okay. Thanks very much..

Thanks..

Thanks Mike. Thank you. And we have no further questions in the queue. I will now turn the call back to Randy Palmer for closing comments..

Okay, operator. Thank you very much. That does complete the today’s conference call. We appreciate each of you joining us today. If you do have follow-up questions, please feel free to contact us. Thank you and have a good day..

Thank you, ladies and gentlemen. This concludes today's conference. Thank you for participating and you may now disconnect..