Superior Plus Corp. — Annual Report 2021

Feb 19, 2021

Management's Responsibility for Financial Statements

The accompanying consolidated financial statements of Superior Plus Corp. (Superior) are the responsibility of management and have been approved by the Board of Directors.

The consolidated financial statements were prepared by management in accordance with International Financial Reporting Standards and include certain estimates that are based on management's best judgments. Actual results may differ from these estimates and judgments. Management has ensured that the consolidated financial statements are presented fairly in all material respects.

Management has developed and maintains a system of internal controls to provide reasonable assurance that Superior's assets are safeguarded, transactions are accurately recorded, and the financial statements report Superior's operating and financial results in a timely manner. Financial information presented elsewhere in this annual report has been prepared on a basis consistent with that in the consolidated financial statements.

The Board of Directors of Superior is responsible for reviewing and approving the consolidated financial statements and, primarily through its Audit Committee, ensures that management fulfills its responsibilities for financial reporting. The Audit Committee meets with management and Superior's external auditor, to discuss internal controls over the financial reporting process, auditing matters and financial reporting issues, to satisfy itself that each party is properly discharging its responsibilities and to review the consolidated financial statements. The Audit Committee reports its findings to the Board of Directors for approval of the consolidated financial statements for issuance to the shareholders. The Audit Committee also considers, for review by the Board of Directors and approval by the shareholders, the engagement or re-appointment of the external auditor.

The consolidated financial statements have been audited by Ernst & Young LLP, who were appointed at Superior's last annual meeting.

(s) "Luc Desjardins" (s) "Beth Summers"

Luc Desjardins Beth Summers Superior Plus Corp. Superior Plus Corp.

Toronto, Ontario February 18, 2021

President and Chief Executive Officer Executive Vice-President and Chief Financial Officer

Independent auditor's report

To the Shareholders and the Board of Directors of Superior Plus Corp.

Opinion

We have audited the accompanying consolidated financial statements of Superior Plus Corp. and its subsidiaries (the Group), which comprise the consolidated balance sheets as at December 31, 2020 and 2019, and the consolidated statements of changes in equity, consolidated statements of net earnings and total comprehensive earnings, and consolidated statements of cash flows for the years then ended, and the notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2020 and 2019, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with International Financial Reporting Standards ["IFRS"].

Basis for opinion

We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the consolidated financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the consolidated financial statements in Canada, and we have fulfilled our ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. For each matter below, our description of how our audit addressed the matter is provided in that context.

We have fulfilled the responsibilities described in the Auditor's responsibilities for the audit of the consolidated financial statements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the consolidated financial statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying consolidated financial statements.

Key audit matter	How our audit addressed the key audit matter
Assessment of impairment of goodwill
As detailed in Note 9 Goodwill of the consolidated	To test the estimated recoverable amount of the
financial statements, the Group has \$1,152.8 million of	CGUs, our audit procedures included, among
goodwill as at December 31, 2020. For purposes of	others, assessing methodologies and the
impairment testing, goodwill is allocated to each of	significant assumptions and underlying data used
Superior's cash generating units ("CGUs"). CGUs to	by the Group in its analysis. To assess the
which goodwill have been allocated are tested for	reliability of earnings forecasts and terminal
impairment annually or more frequently upon indication	growth rates used in the estimation of the
of impairment, in accordance with IAS 36 Impairment of	recoverable amount we performed the following
Assets. Recoverable amount estimates are determined	procedures, among others:
using an income approach or a market approach. As
detailed in Note 9 of the consolidated financial

statements, the Group did not recognize any goodwill impairment for the year ended December 31, 2020.	- Compared financial performance and growth rates implicit in current forecasts to historical results;
Auditing the Group's annual goodwill impairment tests was complex, given the degree of judgment and subjectivity in evaluating the Group's estimates and assumptions in determining the recoverable amount of the CGUs established using the income approach. Significant assumptions included earnings forecasts, terminal growth rate estimates, and discount rates, which are affected by expectations about future performance as well as market and economic conditions.	- Compared historical forecasts to actual financial performance to assess the completeness and accuracy of Group's forecasts and to evaluate the ability of the CGUs to achieve the forecasted cashflows; - Considered other factors relevant to comparability of historical actual results, such as experienced heating degree days, and the impact of significant acquisitions or disposals; - Involved our valuation specialists to compare forecasted growth rates relative to comparable industry participants; - Involved our valuation specialists to perform sensitivity analyses on growth rates implicit within the earnings forecasts and terminal growth rates to evaluate the impact on the recoverable amount.
	We involved our valuation specialists to assess the Group's model, valuation methodology applied, and the various inputs utilized in determining the discount rate by referencing current industry, economic, and comparable Group information, Group and cash-flow specific risk premiums. We also involved our valuation specialists to assess the overall reasonableness of the recoverable amounts estimated by comparing and reconciling the Group's estimated recoverable amounts against the Group's market capitalization.
	We also assessed the adequacy of the Group's disclosures included in Note 9 of the consolidated financial statements.
Acquisitions
As detailed in Note 3 Acquisitions of the consolidated financial statements, on an ongoing basis the Group executes acquisitions and accounts for them using the acquisition method in accordance with IFRS 3 Business Combinations. Acquisitions either occurring in the current period or for which the accounting was finalized in the current period represent a total of \$335.8 million	To assess the existence and ownership of property, plant and equipment acquired, we compared to third-party data including signed fuel delivery data, tax assessment records and registration statements. To test the Group's estimated fair valuation of
worth of consideration transferred. The Group applies valuation techniques to determine the acquisition date fair value of property, plant, and equipment and customer relationship intangible assets. The measurement period	property, plant and equipment and customer relationship intangible assets, we performed the following procedures, among others:
for acquisitions ends as soon as the Group receives the information it was seeking about facts and circumstances that existed as of the acquisition date or learns that more	- Assessed the competence, capabilities, and objectivity of the third-party valuators, when engaged by the Group;

information is not obtainable. As disclosed by the Group, the purchase price allocation for several acquisitions is are considered preliminary.	- Evaluated customer attrition estimates as compared to historical attrition rates experienced at comparable operations owned by the Group;
Auditing significant acquisitions was complex due to the subjective nature of estimating the fair values of certain identified assets. The fair value of property, plant and equipment is determined in reference to subjective inputs including replacement cost quotations, market data, and estimated remaining useful lives. The fair value of customer relationship intangible assets is determined in reference to subjective inputs including estimated	- Involved our valuation specialists to assess the valuation methodology applied to estimate customer relationship intangible assets, and the various inputs utilized to determine the attrition rate and discount rate by referencing current industry, economic, and comparable Group information as well as Group and cash-flow specific risk premiums.
customer attrition, discount rates, projected period, projected revenues and forecasted gross profit.	- Performed a sensitivity analysis on the discount rate and attrition rate to evaluate its impact on the fair value ascribed.
The determination of the existence and ownership of property, plant and equipment acquired is complex due to the highly decentralized nature of these assets (e.g. trucks, storage tanks). As a result, significant judgement and specialized skills were required to assess Group's conclusions.	- Involved our valuation specialists to evaluate the Group's fair value estimate models for property, plant and equipment, and to evaluate the useful life estimates against third-party studies.
	We evaluated the adequacy and completeness of the disclosure included in Note 3 of the consolidated financial statements based on the IFRS requirements.

Other information

Management is responsible for the other information. The other information comprises:

• Management's Discussion and Analysis
• The information, other than the consolidated financial statements and our auditor's report thereon, in the Annual Report

Our opinion on the consolidated financial statements does not cover the other information and will not express any form of assurance conclusion thereon.

In connection with our audit of the consolidated financial statements, our responsibility is to read the other information, and in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.

We obtained Management's Discussion & Analysis prior to the date of this auditor's report. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact in this auditor's report. We have nothing to report in this regard.

The Annual Report is expected to be made available to us after the date of the auditor's report. If, based on the work we will perform on this other information, we conclude there is a material misstatement of other information, we are required to report that fact to those charged with governance.

Responsibilities of management and those charged with governance for the consolidated financial statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with IFRSs, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Group's financial reporting process.

Auditor's responsibilities for the audit of the consolidated financial statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group's internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
• Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure, and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partner on the audit resulting in this independent auditor's report is Tracy Brennan.

Toronto, Canada Chartered Professional Accountants February 18, 2021 Licensed Public Accountants

Superior Plus Corp. Consolidated Balance Sheets

		As at December 31	As at December 31
(millions of Canadian dollars)	Note	2020	2019
Assets
Current Assets
Cash and cash equivalents		24.1	26.5
Trade and other receivables	4	312.9	329.2
Prepaids and deposits	5	45.5	57.1
Inventories	6	124.0	116.2
Other current financial assets	17	43.7	5.4
Total Current Assets		550.2	534.4
Non-current Assets
Property, plant and equipment	3, 7	1,647.8	1,575.6
Intangible assets	3, 8	425.4	388.8
Goodwill	3, 9	1,152.8	1,080.9
Notes, finance lease receivables and other investments		1.1	2.8
Employee future benefits	16	7.5	12.0
Deferred tax assets	18	28.3	41.2
Other non-current financial assets	17	13.2	2.3
Total Non-current Assets		3,276.1	3,103.6
Total Assets		3,826.3	3,638.0
Liabilities and Equity
Current Liabilities
Trade and other payables	11	428.3	424.0
Contract liabilities	12	19.1	18.1
Lease liabilities	15	53.3	52.4
Borrowings	14	7.1	10.1
Dividends payable		12.6	10.5
Other current financial liabilities	17	11.1	23.7
Total Current Liabilities		531.5	538.8
Non-current Liabilities
Lease liabilities	15	213.5	182.0
Borrowings	14	1,554.4	1,684.3
Other liabilities	13	14.5	29.7
Provisions	10	126.4	112.9
Employee future benefits	16	29.0	21.2
Deferred tax liabilities	18	75.3	28.5
Other non-current financial liabilities	17	1.6	1.6
Total Non-current Liabilities		2,014.7	2,060.2
Total Liabilities		2,546.2	2,599.0
Equity
Capital		2,350.3	2,339.9
Deficit		(1,475.6)	(1,406.2)
Accumulated other comprehensive earnings		74.5	105.3
Non-controlling interest		330.9
Total Equity	19	1,280.1	1,039.0
Total Liabilities and Equity		3,826.3	3,638.0

Superior Plus Corp. Consolidated Statements of Changes in Equity

	Share	Capital Contributed	Total		Accumulated Other Comprehensive	Non controlling Interest
(millions of Canadian dollars)	(Note 19)	Surplus	Capital	Deficit	Earnings	(Note 19)	Total
As at January 1, 2020	2,338.7	1.2	2,339.9	(1,406.2)	105.3	–	1,039.0
Net earnings for the year	–	–	–	75.1	–	11.7	86.8
Unrealized foreign currency loss
on translation of foreign operations	–	–	–	–	(21.9)	(22.9)	(44.8)
Actuarial defined-benefit loss	–	–	–	–	(12.1)	–	(12.1)
Income tax recovery on other
comprehensive loss	–	–	–	–	3.2	–	3.2
Total comprehensive earnings (loss)	–	–	–	75.1	(30.8)	(11.2)	33.1
Common shares issued under dividend
reinvestment plan	10.4	–	10.4	–	–	–	10.4
Preferred shares issued by a subsidiary
and issuance costs incurred	–	–	–	(18.1)	–	353.8	335.7
Dividends and dividend equivalent
declared to common shareholders	–	–	–	(126.4)	–	–	(126.4)
Dividends to non-controlling	–	–	–	–	–	(11.7)	(11.7)
interest shareholders
As at December 31, 2020	2,349.1	1.2	2,350.3	(1,475.6)	74.5	330.9	1,280.1
As at January 1, 2019	2,338.7	1.2	2,339.9	(1,422.9)	171.9	–	1,088.9
Net earnings for the year	–	–	–	142.6	–	–	142.6
Unrealized foreign currency loss on
translation of foreign operations	–	–	–	–	(74.9)	–	(74.9)
Transfer of derivative losses from
accumulated other
comprehensive earnings	–	–	–	–	7.1	–	7.1
Actuarial defined-benefit gain	–	–	–	–	1.6	–	1.6
Income tax recovery on other
comprehensive loss	–	–	–	–	(0.4)	–	(0.4)
Total comprehensive earnings (loss)	–	–	–	142.6	(66.6)	–	76.0
Dividends and dividend equivalent
declared to shareholders	–	–	–	(125.9)	–	–	(125.9)
As at December 31, 2019	2,338.7	1.2	2,339.9	(1,406.2)	105.3	–	1,039.0

Superior Plus Corp. Consolidated Statements of Net Earnings and Total Comprehensive Earnings

			Years Ended
			December 31
(millions of Canadian dollars, except per share amounts)	Note	2020	2019
Revenue	20, 23	2,394.3	2,852.9
Cost of sales (includes products and services)	20	(1,288.6)	(1,639.9)
Gross profit		1,105.7	1,213.0
Expenses
Selling, distribution and administrative costs	20,21	(890.2)	(948.3)
Finance expense	20	(106.5)	(114.3)
Gains on derivatives and foreign currency translation of borrowings	17, 20	49.7	17.2
		(947.0)	(1,045.4)
Earnings before income taxes	20	158.7	167.6
Income tax expense	18	(71.9)	(25.0)
Net earnings		86.8	142.6
Net earnings attributable to:
Superior		75.1	142.6
Non-controlling interest		11.7	–
Net earnings per share attributable to Superior, basic and diluted		\$0.43	\$0.82
Other comprehensive loss
Items that may be reclassified subsequently to net earnings
Unrealized foreign currency loss on translation of foreign operations		(44.8)	(74.9)
Transfer of derivative losses from accumulated other comprehensive earnings		–	7.1
Items that will not be reclassified to net earnings
Actuarial defined-benefit loss		(12.1)	1.6
Income tax recovery on other comprehensive loss		3.2	(0.4)
Other comprehensive loss for the year		(53.7)	(66.6)
Total comprehensive earnings for the year		33.1	76.0
Total comprehensive earnings for the year attributable to:
Superior		44.3	76.0
Non-controlling interest		(11.2)	–

(i) The comparative figures have been restated to conform with the current year's presentation.

Superior Plus Corp. Consolidated Statements of Cash Flows

			Years Ended
			December 31
(millions of Canadian dollars)	Note	2020	2019
OPERATING ACTIVITIES
Net earnings for the year		86.8	142.6
Adjustments for:
Depreciation included in selling, distribution and administrative costs	7	121.1	108.5
Depreciation of right-of-use assets included in selling, distribution and
administrative costs	7	39.1	35.7
Depreciation included in cost of sales	7	42.8	44.9
Amortization of intangible assets included in selling, distribution and
administrative costs	8	64.1	63.5
Loss on disposal of assets, impairments and other		5.9	18.4
Unrealized gain on financial and non-financial derivatives and foreign
currency translation	17	(67.3)	(58.3)
Finance expense recognized in net earnings		106.5	114.3
Income tax expense recognized in net earnings	18	71.9	25.0
Changes in non-cash operating working capital and other	25	(0.1)	43.7
Net cash flows from operating activities before income taxes and interest paid		470.8	538.3
Income taxes paid		(11.6)	(8.4)
Interest paid		(99.0)	(106.7)
Cash flows from operating activities		360.2	423.2
INVESTING ACTIVITIES
Acquisitions, net of cash acquired	3	(280.4)	(60.1)
Purchase of property, plant and equipment and intangible assets	28	(116.3)	(135.9)
Proceeds on disposal of property, plant and equipment		12.5	7.1
Cash flows used in investing activities		(384.2)	(188.9)
FINANCING ACTIVITIES
Proceeds of revolving term bank credit facilities and other debt		2,319.7	2,417.0
Repayment of revolving term bank credit facilities and other debt		(2,474.0)	(2,480.4)
Proceeds from preferred share issuance		353.8	–
Preferred share issuance costs		(18.1)	–
Proceeds received from vehicle refinancing		18.6	–
Principal repayment of lease obligations		(51.9)	(41.5)
Debt issuance costs		–	(0.6)
Dividends paid to shareholders		(125.6)	(125.9)
Cash flows (used in) from financing activities		22.5	(231.4)
Net increase (decrease) in cash and cash equivalents		(1.5)	2.9
Cash and cash equivalents, beginning of the year		26.5	23.9
Effect of translation of foreign currency-denominated cash and cash
equivalents		(0.9)	(0.3)
Cash and cash equivalents, end of the year		24.1	26.5

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Tabular amounts in millions of Canadian dollars, except per share amounts. Tables labelled "2020" and "2019" are as at and for the year ended December 31).

1. ORGANIZATION

Superior Plus Corp. ("Superior" or the "Company") is a diversified business corporation, incorporated under the Canada Business Corporations Act. The registered office is located at Suite 401, 200 Wellington Street West, Toronto, Ontario. Superior's investment in Superior Plus LP is financed by share capital. Superior is a publicly traded company with its common shares trading on the Toronto Stock Exchange under the exchange symbol SPB.

These consolidated financial statements were authorized for issue by the Board of Directors on February 18, 2021.

Reportable Operating Segments

Superior operates three reportable operating segments: Canadian Propane Distribution, United States ("U.S.") Propane Distribution and Specialty Chemicals. The Canadian Propane Distribution segment includes the Canadian retail business and wholesale business with operations in Canada and California. The U.S. Propane Distribution segment distributes propane gas and liquid fuels along the Eastern U.S., and into the Midwest and California. Specialty Chemicals is a leading global supplier of sodium chlorate and technology to the pulp and paper industry and a regional supplier of chlor-alkali products in the U.S. Midwest and Western Canada.

References to Energy Distribution in the notes below refers to both Canadian Propane Distribution and U.S. Propane Distribution because of the inherent similarities of the businesses.

2. BASIS OF PRESENTATION

(a) Preparation of Consolidated Financial Statements

The accompanying consolidated financial statements were prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB"). The consolidated financial statements were prepared on a going concern basis.

The consolidated financial statements were prepared on the historical cost basis, except for the revaluation of certain financial instruments and incorporate the accounts of Superior and its subsidiaries. Subsidiaries are all entities over which Superior has the power to govern the financial and operating policies, generally accompanying a shareholding of more than one-half of the voting rights. The results of subsidiaries are included in Superior's consolidated statements of net earnings and total comprehensive earnings from date of acquisition, or in the case of disposals, up to the effective date of disposal. Where Superior's interest is less than 100 percent, the interest attributable to outside shareholders is reflected in non-controlling interest ("NCI"). A subsidiary of Superior has outstanding cumulative preference shares that are classified as equity and are held by non-controlling interest. Superior computes its share of net earnings after deducting for the dividend entitlement on these NCI on preference shares. The NCI is translated using exchange rates prevailing at the end of each reporting period with the foreign exchange translation included in other comprehensive loss for the year.

All transactions and balances between Superior and Superior's subsidiaries are eliminated upon consolidation. The assets and liabilities of Superior's foreign operations are translated using exchange rates prevailing at the end of each reporting period. Income and expense items are translated at the average exchange rates for the year. Exchange differences are recognized in other comprehensive loss for the year.

If Superior loses control over a subsidiary, it derecognises the related assets (including goodwill), liabilities, noncontrolling interest and other components of equity, while any resultant gain or loss is recognised in profit or loss. Any investment retained is recognised at fair value.

(b) Significant Accounting Policies

Cash and Cash Equivalents

Cash and cash equivalents include cash and highly liquid short-term investments which, on the date of acquisition, have a term to maturity of three months or less. For the purpose of the consolidated statements of cash flows, cash and cash equivalents consist of cash and short-term deposits, as defined above, net of outstanding bank overdrafts as they are considered an integral part of the Company's cash management. As at December 31, 2020, cash equivalents amounted to \$7.1 million with a maturity of less than 30 days (December 31, 2019 – \$4.5 million).

Inventories

Energy Distribution

Inventories are valued at the lower of cost and net realizable value. Costs of inventories are determined either on a weighted average cost or first-in, first-out basis. The net realizable value of inventory is based on estimated selling price in the ordinary course of business less the estimated costs necessary to complete the sale.

Specialty Chemicals

Inventories are valued at the lower of cost and net realizable value. The cost of chemical inventories is determined on a first-in, first-out basis. Stores and supply inventories are costed on a weighted average basis. The net realizable value of inventory is based on estimated selling price in the ordinary course of business less the estimated costs necessary to complete the sale. In the case of manufactured inventories, cost includes an appropriate share of production overhead based on normal operating capacity.

Financial Instruments and Derivative Financial Instruments

Financial assets and financial liabilities, including derivatives, are recognized on the consolidated balance sheets when the Company becomes a party to the financial instrument or derivative contract.

Classification

The Company classifies its financial assets and financial liabilities in the following measurement categories; i) those to be measured subsequently at fair value through profit or loss ("FVTPL"); ii) those to be measured subsequently at fair value through other comprehensive loss; and iii) those to be measured at amortized cost. The classification of financial assets depends on the business model for managing the financial assets and the contractual terms of the cash flows. Financial liabilities are classified as those to be measured at amortized cost unless they are designated as those to be measured subsequently at FVTPL. For assets and liabilities measured at fair value, gains and losses are either recorded in profit or loss, or other comprehensive loss.

The Company reclassifies financial assets when and only when its business model for managing those assets changes. Financial liabilities are not reclassified.

For classification of the Company's consolidated financial assets and financial liabilities, refer to Note 17.

Measurement

All financial instruments are required to be measured at fair value on initial recognition, plus, in the case of a financial asset or financial liability not at FVTPL, transaction costs that are directly attributable to the acquisition or issuance of the financial asset or financial liability. Transaction costs of financial assets and financial liabilities carried at FVTPL are expensed in profit or loss. Financial assets with embedded derivatives are considered in their entirety when determining whether their cash flows are solely payment of principal and interest.

Financial assets that are held within a business model whose objective is to collect the contractual cash flows, and that have contractual cash flows that are solely payments of principal and interest on the principal outstanding are generally measured at amortized cost at the end of the subsequent accounting periods. All other financial assets including equity investments are measured at their fair values at the end of subsequent accounting periods, with any changes taken through the consolidated statements of net earnings and total comprehensive earnings. For financial liabilities measured subsequently at FVTPL, changes in fair value due to own credit risk are recorded in other comprehensive loss.

Impairment

The Company recognizes expected credit losses for trade and other receivables based on the simplified approach under IFRS 9. The simplified approach to the recognition of expected losses does not require the Company to track the changes in credit risk; rather, the Company recognizes a loss allowance based on lifetime expected credit losses at each reporting date from the date of the trade receivable.

Evidence of impairment may include indications that a debtor or a group of debtors is experiencing significant financial difficulty, default or delinquency in interest or principal payments, the probability that they will enter bankruptcy or other financial reorganization and where observable data indicates that there is a measurable decrease in the estimated future cash flows, such as changes in arrears or economic conditions that correlate with defaults. Trade receivables are reviewed qualitatively on a case-by-case basis to determine whether they need to be written off.

Expected credit losses are measured as the difference in the present value of the contractual cash flows that are due to the Company under the contract, and the cash flows that the Company expects to receive. The Company assesses all information available, including past due status, credit ratings, the existence of third- party insurance, and forwardlooking macro-economic factors in the measurement of the expected credit losses associated with its financial assets carried at amortized cost.

The Company measures expected credit loss by considering the risk of default over the contract period and incorporates forward-looking information into its measurement.

Derivative Financial Instruments

Superior enters into a variety of derivative and non-financial derivative instruments to manage its exposure to certain financial risks. Such instruments arise from contracts comprising natural gas financial swaps, electricity financial swaps, fixed-price electricity purchase, propane forward purchase and sale, foreign currency forwards, interest rate swaps, and equity hedges. For commodity contracts, if physical delivery is effected based on Superior's expected procurement, sale or usage requirements, the requirements of the so-called "own use exemption" under IFRS 9 are met, which do not represent derivative financial instruments in terms of IFRS 9, but represent pending purchase and sale transactions, which are assessed for possible impending losses in accordance with the requirements of IAS 37, Provisions, Contingent Liabilities and Contingent Assets. If the requirements for the own use exemption are not met (for example, by transactions for short-term optimization), the contracts are recorded as derivatives in accordance with IFRS 9. Further details of derivative and non-financial derivative instruments are disclosed in Note 17.

Derivatives are initially recognized at fair value at the date a derivative contract is entered into and are measured subsequently at FVTPL. The resulting gain or loss is recognized in net earnings. Realized gains and losses on derivatives are recorded as part of other income (loss) which also includes unrealized gains and losses on derivatives. Derivatives embedded in other financial liabilities and non-financial contracts are treated as separate derivatives when their risks and characteristics are not closely related to those of the host contracts and the host contracts are not measured at fair value with changes in fair value recognized in net earnings.

Superior does not formally designate and document economic hedges, in accordance with the requirements of applying hedge accounting under IFRS and, therefore, does not apply hedge accounting.

Classification as Debt or Equity

Debt and equity instruments are classified either as financial liabilities or as equity in accordance with the substance of the contractual arrangement.

Equity Instruments

An equity instrument is any contract that has a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by Superior or its subsidiaries are recorded at the proceeds received, net of direct issuance costs.

Derecognition of Financial Liabilities

Superior derecognizes financial liabilities solely when Superior's obligations are discharged, cancelled or expire.

Financial Guarantees at FVTPL

Financial guarantees are classified as FVTPL when the financial liability is designated as FVTPL upon initial recognition. Financial guarantees at FVTPL are stated at fair value with any resulting gain or loss recognized in net earnings. Fair value is determined in the manner described in Note 17.

Assets held for Sale and Discontinued Operations

Superior classifies assets and disposal groups as held for sale if their carrying amounts will be recovered through a sale transaction rather than through continuing use. Non-current assets classified as held for sale are measured at the lower of their carrying amount and fair value less cost to sell. Costs to sell are incremental costs directly attributable to the disposal of an asset of disposal group, excluding finance costs and income tax expense.

The criteria for held for sale classification is only met when the sale is highly probable and the asset or disposal group is available for immediate sale in its present condition. Actions required to complete the sale should indicate that it is unlikely that significant changes to the sale will be made or that the decision to sell will be withdrawn. Management must be committed to the plan to sell the asset and the sale expected to be completed within one year from the date of the classification.

Property, plant and equipment and intangible assets are not depreciated or amortized once classified as held for sale. Assets and liabilities classified as held for sale are presented separately as current on the balance sheet.

A disposal group is classified as a discontinued operation if it is a component of an entity that has either been disposed of or has been classified as held for sale, it represents a separate major line of business of geographic area of operations and is part of a single coordinated plan to dispose of a separate major line of business or geographic area of operations.

Discontinued operations are excluded from the results of continuing operations and are presented as a single amount as net earnings (loss) from discontinued operations, net of tax in the Statement of Net Earnings (Loss).

Property, Plant and Equipment

Cost

Property, plant and equipment are recorded at cost less accumulated depreciation and impairment losses. Major renewals and improvements that provide future economic benefits and can be reliably measured are capitalized, while repair and maintenance expenses are charged to operations as incurred. Property, plant and equipment in the course of construction are carried at cost less any recognized impairment losses. Cost includes directly attributable expenses, professional fees and, for qualifying assets, borrowing costs capitalized in accordance with Superior's accounting policy. Depreciation of these assets, on the same basis as other property assets, commences when the assets are available for their intended use. Disposals are derecognized at carrying costs less accumulated depreciation and impairment losses, with any resulting gain or loss reflected in net earnings.

Borrowing Costs

Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take substantial time to ready for their intended use or sale, are included in the cost of those assets, until such time as the assets are available for their intended use. All other borrowing costs are recognized in net earnings in the period in which they are incurred.

Depreciation

Depreciation is calculated using the straight-line method, based on the estimated useful life. Land is not depreciated. Depreciation of property in the course of construction commences when the assets are available for their intended use. In the majority of cases, residual value is estimated to be insignificant. Depreciation by class of assets is as follows:

Buildings	15 to 40 years
Leasehold improvements	Over the lease term up to 10 years
Energy Distribution tanks and cylinders	30 years
Energy Distribution truck tank bodies, chassis and other	5 to 15 years
Manufacturing equipment	5 to 40 years
Furniture and fixtures	10 years
Computer equipment	3 years

Useful life, residual values and depreciation methods are reviewed at the end of each annual reporting period, with the effect of any changes in estimate being accounted for on a prospective basis.

Leases

At inception of a contract, the Company assesses whether a contract is, or contains, a lease based on whether the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

Company as a lessee

The Company applies a single recognition and measurement approach for all leases, except for short-term leases and leases of low-value assets. The Company recognizes a right-of-use asset and a lease liability at the lease commencement date, which is defined as the date at which the right-of-use asset is available for use by the Company.

Right-of-use assets

The right-of-use asset is initially measured at cost comprising the following:

• the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date;
• any initial direct costs incurred;
• an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located; and
• less any lease incentives received.

The assets are depreciated to the earlier of the end of the useful life of the right-of-use asset or the lease term using the straight-line method as this most closely reflects the expected pattern of consumption of the future economic benefits.

The lease term includes periods covered by an option to extend if the Company is reasonably certain to exercise that option as defined below.

Lease terms range from:
Office space and buildings	1 to 70 years
Manufacturing equipment	2 to 51 years
Railcars	1 to 11 years
Leased trucks	1 to 11 years

The Company's leases relate to railcars, office space and buildings, trucks and manufacturing equipment. Lease contracts are typically made for periods of 5 to 20 years, but may have extension options. Extension and termination options are included in a number of building and equipment leases across the Company. The majority of extension and termination options held are exercisable only by the Company and not by the respective lessor. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. Superior's obligations under some leases are secured by the lessors' title to the leased assets.

The Company has recorded the right-of-use assets as part of property, plant and equipment.

The right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

Lease liabilities

The lease liability is initially measured at the present value of the following lease payments:

• fixed payments, less any lease incentives receivable;
• variable lease payments that are based on an index or a rate;
• amounts expected to be payable by the lessee under residual value guarantees;
• the exercise price of a purchase option if the lessee is reasonably certain to exercise that option; and
• payments of penalties for terminating the lease, if the lease term reflects the lessee exercising that option.

The lease payments are discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company's incremental borrowing rate. The incremental borrowing rate is the rate of interest the lessee would have to pay to borrow over a similar term with similar security.

After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, if there is a change in the Company's estimate of the amount expected to be payable under a residual value guarantee, or if the Company changes its assessment of whether it will exercise a purchase, extension or termination option. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.

When measuring lease liabilities, the Company discounted lease payments using its incremental borrowing rate for similar collateral and term at the lease commencement date when the interest rate implicit in the lease was not readily determinable. The Company used a single discount rate to a portfolio of leases with reasonably similar characteristics. In addition, the carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the lease payments (e.g., changes to future payments resulting from a change in the rate used to determine such lease payments) or a change in the assessment of an option to purchase the underlying asset.

Short-term leases and leases of low-value assets

The Company applies the short-term lease recognition exemption to its leases for which the lease term ends within 12 months from the commencement date and do not contain a purchase option; and the lease of low-value assets recognition exemption to leases of office equipment that are considered to be low value. Lease payments on shortterm leases and leases of low-value assets are recognized as expense on a straight-line basis over the lease term.

Sale-leasebacks and refinancing of vehicles

From time to time Superior will purchase vehicles and then enter into a financing arrangement or will refinance leases for vehicles. These transactions will result in cash proceeds to Superior and a lease liability to the lessor. Any gains or losses on these transactions are nominal and expensed as incurred.

Intangible Assets

Intangible assets are reported at cost less accumulated amortization and accumulated impairment losses. For intangible assets with a determinate life, amortization is charged on a straight-line basis over their estimated useful lives.

Intangible assets acquired in a business combination are identified and recognized separately from goodwill when they satisfy the recognition criteria. The initial cost of such intangible assets is their fair value at the acquisition date. Subsequent to initial recognition, intangible assets acquired in a business combination are reported at cost less accumulated amortization and accumulated impairment losses, on the same basis as intangible assets acquired separately. Software costs are capitalized for new systems if there are significant enhancements to existing systems. In addition to the cost of software, the capitalized costs include cost of installation and consulting services related to the system implementation or enhancement.

Intangible assets recorded as part of a business combination generally consist of customer relationships, noncompete agreements, royalty agreements, trade names and other intangible assets. The assets are recorded at fair value, which is generally based on the future expected earnings. Software and technology patents are valued based on the cost to acquire these assets.

Useful life, residual values and amortization methods are reviewed at least annually, with the effect of any changes in estimate being accounted for on a prospective basis.

Superior's amortization rates related to its intangible assets are summarized as follows:

Non-compete agreements	Term of the agreements (1 to 15 years)
Royalty agreements	1 to 10 years
Software	1 to 5 years
Technology patents	Approximately 10 years
Customer relationships	5 to 10 years

Trade names have an indefinite useful life since they do not expire. These are recorded at cost, are not amortized and are tested for impairment annually or more frequently should events or changes in circumstances indicate that they might be impaired.

As a result of propane distribution activity in Québec, Nova Scotia and California, Superior is required to purchase sufficient Compliance Instruments to offset its carbon footprint. Costs incurred to acquire these Compliance Instruments are recorded as intangible assets and measured at cost. As the Compliance Instruments do not diminish over time, they are classified as intangible assets with an indefinite life and are not amortized. The assets are subject to impairment testing subsequent to initial recognition. The Compliance Instruments are classified as non-current and reclassified as current at the end of the compliance period. The assets are settled against the corresponding cap and trade liabilities at the end of the compliance period to which they relate.

Impairment of Property, Plant and Equipment, Right-of-use Assets and Intangible Assets

At each consolidated balance sheet date and when circumstances indicate that the carrying value may be impaired, Superior reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss to confirm whether the assets have indeed suffered an impairment loss. If so, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss, if any. Where it is not possible to estimate the recoverable amount of an individual asset, Superior estimates the recoverable amount of the cash-generating unit ("CGU") to which the asset belongs. A CGU is the smallest level of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups.

Recoverable amount is the higher of fair value less costs of disposal ("FVLCOD") and value-in-use.

An impairment loss is recognized if the carrying amount of an asset, CGU or group of CGUs exceeds its recoverable amount. Impairment losses are recognized immediately as a separate line item in the consolidated statements of net earnings and total comprehensive earnings.

A previous impairment, if any, is subsequently assessed for any indication that the impairment has been reduced or no longer exists. An impairment loss is reversed if there has been an increase in the recoverable amount of an asset or CGU over its carrying value. Impairment losses are reversed only to the extent that the asset's or CGU's carrying amount would not exceed the carrying amount that would have been reported if no impairment loss had been recognized.

Business Combinations

All business combinations are accounted for using the acquisition method. The consideration transferred in a business combination is measured at fair value at the acquisition date of the assets given up, the liabilities incurred or assumed and equity instruments issued by Superior in exchange for control of the acquiree. Transaction costs, other than those associated with the issuance of debt or equity securities that Superior incurs in connection with a business combination are expensed as incurred. The acquiree's identifiable assets, liabilities and contingent liabilities that meet the conditions for recognition under IFRS 3, Business Combinations are recognized at their fair value at the acquisition date, except that:

• Deferred tax assets or liabilities and liabilities or assets related to employee benefit arrangements are recognized and measured in accordance with IAS 12, Income Taxes and IAS 19, Employee Benefits, respectively;
• Liabilities or equity instruments related to the replacement by Superior of an acquiree's share-based payment awards are measured in accordance with IFRS 2, Share-based Payment; and
• Assets or disposals that are classified as held for sale in accordance with IFRS 5, Non-current Assets Held for Sale and Discontinued Operations are measured in accordance with that standard.

Contingent liabilities acquired in a business combination are initially measured at fair value at the date of acquisition. At subsequent reporting dates, such contingent liabilities are measured at the amount that would be recognized in accordance with IAS 37, Provisions, Contingent Liabilities and Contingent Assets.

Intangible assets arising on acquisition are recognized at fair value at the date of acquisition. The fair value is based on detailed cash flow models and other metrics depending on the type of intangible asset being recognized.

Goodwill arising on acquisition is recognized as an asset and initially measured at cost, being the excess of the cost of the business combination over Superior's interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognized. If the net amounts assigned to the assets acquired and liabilities assumed exceed the cost of the purchase, then Superior is required to reassess the value of both the cost and net assets acquired and any excess remaining after this reassessment is recognized immediately in net earnings. Goodwill is initially recognized as an asset at cost and is subsequently measured at cost less any accumulated impairment losses.

If the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, Superior will report provisional amounts for the items for which the accounting is incomplete. Those provisional amounts are adjusted during the measurement period (see below), or additional assets or liabilities are recognized, to reflect new information obtained about facts and circumstances at the acquisition date that, if known, would have affected the amounts recognized at that date.

The measurement period is the period from the date of acquisition to the date Superior obtains complete information about facts and circumstances as of the acquisition date, to a maximum of one year.

Goodwill

Goodwill arising in a business combination is recognized as an asset at the date control commences (the acquisition date). Goodwill is not amortized but is reviewed for impairment at least annually, on December 31. For purposes of impairment testing, goodwill is allocated to each of Superior's CGUs expected to benefit from the synergies of the combination. CGUs to which goodwill has been allocated are tested for impairment annually or more frequently upon indication of impairment. If the recoverable amount of the CGU is less than its carrying amount, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit. An impairment loss recognized for goodwill is not reversed in a subsequent period.

On disposal of a group of assets, the attributable amount of goodwill is included in the determination of the net gain or loss on disposal.

Revenue Recognition

Revenue is measured based on the consideration specified in a contract with a customer and excludes amounts collected on behalf of third parties. The Company recognizes revenue when it transfers control over a product or service to a customer, which may occur at a point in time or over a period of time.

The Company generates its revenue through its principal activities, which are separated by reportable segments.

The nature of the goods and services and the timing of satisfaction of performance obligations is as follows:

Energy Distribution

Propane sales contracts include supply of propane along with the loaning of storage tanks, equipment and related servicing and maintenance activities provided by the Company. Revenue from sale of propane is recognized when control of the goods has transferred, being when the goods are delivered to the customer (which occurs when the goods have been shipped to the specific location), the customer has full discretion over the goods, and there is no unfulfilled obligation that could affect the customer's acceptance of the products. Payment terms are generally 30 days from the delivery date. Customers may be required to provide a deposit depending on credit quality. These deposits are recorded as part of contract liabilities and recognized into income over the period that it relates to.

Revenue from loaning of storage tanks and maintenance activities is recognized as the performance obligations are satisfied over time, which is generally in accordance with the terms of the contract. The customer does not control the storage tank during the term of the contract. The customer does not have the right to direct the use of the storage tank, and there is no practical or contractual restriction on the Company's ability to transfer the storage tank to another customer. The Company is able to redirect the storage tank to another customer at little or no additional cost and therefore it has an alternative use to the Company. In many cases, propane sales and the loaning of storage tanks is included under one sales contract. Propane sales prices are consistent based on the customer geography and type and therefore, the residual amount is related to loaning of storage tanks. Customers typically pay for tank rentals annually, semi-annually or on a month-by-month basis. Rental payments received for periods greater than a month are recorded as part of contract liabilities and recognized into income over the period that the payments relate to.

Included in the U.S. Propane Distribution segment is revenue related to the distribution of heating oil and refined fuels in the northeastern U.S. Its products are generally used in home heating, water heating and motor vehicle fuel. Revenue from sale of refined fuels is also recognized when control of the goods has transferred, being when the goods are delivered to the customer (which occurs when the goods have been shipped to the specific location), the customer has full discretion over the goods, and there is no unfulfilled obligation that could affect the customer's acceptance of the products. Payment terms are generally 30 days from the delivery date. Customers may be required to provide a deposit depending on credit quality. These deposits are recorded as part of contract liabilities and applied against customer receivables when required.

Specialty Chemicals

Specialty Chemicals is involved in the distribution of sodium chlorate and environmentally preferred chlorine dioxide technology to the pulp and paper industries as well as a supplier of potassium and chlor- alkali products. Revenue from sale of specialty chemicals is also recognized when control of the goods has transferred, and customer has full discretion over the goods. Payment terms are generally 30 days from the delivery date. Customers may be required to provide a deposit depending on credit quality. These deposits are recorded as part of contract liabilities.

Sales where the Company arranges and charges for freight is considered a separate performance obligation. Consequently, the portion of revenue related to freight is recognized when the goods are delivered to their destination.

Provisions

Provisions are recognized when there is a present legal or constructive obligation as a result of past events, for which it is probable that payment will be required to settle the obligation, and where the amount can be reliably estimated.

The amount is the best estimate of the consideration required to settle the present obligation at the reporting date, considering the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows.

When some or all of the economic benefit required to settle a provision is expected to be recovered from a third party, the receivable is recognized as an asset if it is virtually certain that reimbursement will be received and the receivable can be measured reliably.

Decommissioning Costs

Liabilities for decommissioning costs are recognized when Superior has an obligation to dismantle and remove a facility or an item of plant and to restore the site on which it is located, and when a reliable estimate of that liability can be made. Decommissioning costs are recorded at the present value of expected costs to settle the obligation using estimated cash flows. The cash flows are discounted at a current pre-tax rate that reflects the risks specific to the decommissioning liability. The unwinding of the discount is expensed as incurred and recognized in net earnings as a finance expense. The estimated future costs of decommissioning are reviewed annually and adjusted as appropriate. A corresponding item of property, plant and equipment of an amount equal to the provision is also created. This is subsequently amortized as part of the asset. Changes in the estimated future costs or in the discount rate applied are added to or deducted from the cost of the asset.

Environmental Expenditures and Liabilities

Environmental expenditures that relate to current or future revenues are expensed or capitalized as appropriate. Expenditures that relate to an existing condition caused by past operations and do not contribute to current or future earnings are expensed.

Liabilities for environmental costs are recognized when a cleanup is probable and the associated costs can be reliably estimated. Generally, the timing of recognition of these provisions coincides with the commitment to a formal plan of action or, if earlier, on divestment or on closure of inactive sites. The amount recognized is the best estimate of the expenditure required. When the liability will not be settled for a number of years, the amount recognized is the present value of the estimated future expenditure.

Restructuring

A restructuring provision is recognized when Superior has developed a detailed formal restructuring plan and has raised a valid expectation in those affected that it will carry out the restructuring by starting to implement the plan or announcing its main features to those affected. The measurement of a restructuring provision includes only the direct expenditures arising from the restructuring.

Employee Future Benefits

Superior has a number of defined-benefit and defined-contribution plans providing pension and other postemployment benefits to most of its employees. Superior accrues its obligations under the plans and the related costs, net of plan assets.

Contributions to defined-contribution plans are recognized as an expense when employees have rendered service entitling them to the contributions.

For defined-benefit plans, the cost of providing benefits is determined using the projected unit credit method, with actuarial valuations being carried out at each consolidated balance sheet date. The net obligation for each definedbenefit plan is discounted to determine the present value using the yield at the reporting date on high-quality Canadian corporate bonds. Plan assets are measured at fair value and the difference between the fair value of the plan assets and the present value of the defined-benefit obligation is recognized on the consolidated balance sheets as an asset or liability. Costs charged to the consolidated statements of net earnings and total comprehensive earnings include current service cost, any past service costs, any gains or losses from curtailments and interest on the net defined-benefit asset or liability. Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are recognized in other comprehensive earnings in the period in which they occur.

The defined-benefit obligation recognized in the consolidated balance sheet represents the present value adjusted for unrecognized actuarial gains and losses and unrecognized past service cost, and reduced by the fair value of plan assets. Any asset resulting from this calculation is limited to unrecognized actuarial losses and past service cost, plus the present value of available refunds and reductions in future contributions to the plan.

Government Grants

Government grants are recognized initially at fair value when there is reasonable assurance that it will be received and the Company will comply with the conditions associated with the grant. Government grants related to profit or loss are presented as part of Superior's consolidated statements of net earnings and total comprehensive earnings as a reduction of the related expense.

Income Taxes

Income tax expense represents the sum of current income taxes and deferred income taxes.

Current Income Taxes

Superior's income tax assets and liabilities are based on taxable net earnings for the year. Taxable net earnings differ from net earnings as reported in the consolidated statements of net earnings and total comprehensive earnings because they exclude items of income or expense that are taxable or deductible in other years as well as items that are never taxable or deductible. Superior's liability for current income tax is calculated using tax rates that have been enacted or substantively enacted by the consolidated balance sheet date.

Current income tax relating to items recognized directly in equity are recognized in equity and not in the statement of profit or loss. Management periodically evaluates positions taken in their tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.

Deferred Income Taxes

Deferred income tax is recognized on differences between the carrying amounts of assets and liabilities in the consolidated financial statements and the corresponding tax basis used in the computation of taxable net earnings. Deferred tax assets are generally recognized for all deductible temporary differences to the extent that it is probable that taxable net earnings will be available against which those deductible temporary differences can be utilized. Deferred tax liabilities are recognized for all taxable temporary differences, except for the following:

• When the deferred tax liability arises from the initial recognition of goodwill;
• When an asset or liability in a transaction is not a business combination and, at the time of the transaction, affects neither the accounting net earnings or taxable net earnings; or
• In respect of taxable temporary differences associated with investments in subsidiaries and associates and interests in joint ventures, where the timing of the reversal of the temporary differences can be controlled by Superior and it is unlikely that the temporary differences will be reversed in the foreseeable future.

Deferred tax assets arising from deductible temporary differences associated with such investments and interests are only recognized to the extent that they are expected to be reversed in the foreseeable future and it is probable that there will be sufficient taxable net earnings against which to utilize the benefits of the temporary differences. A deferred tax asset may also be recognized for the benefit expected from unused tax losses available for carry-forward, to the extent that it is probable that future taxable earnings will be available against which the tax losses can be applied.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realized, based on tax rates and laws that have been enacted or substantively enacted by the consolidated balance sheet date. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which Superior expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current liabilities and when they are related to income taxes levied by the same taxation authority and Superior intends to settle its current tax assets and liabilities on a net basis. Also, Superior recognizes any benefit associated with investment tax credits as deferred tax assets to the extent they are expected to be utilized in accordance with IAS 12, Income Taxes.

Uncertain Tax Positions

Superior is subject to taxation in numerous jurisdictions. There are many transactions and calculations during the course of business for which the ultimate tax determination is uncertain. It is possible, however, that at some future date, liabilities in excess of Superior's provisions could result from audits by or litigation with tax authorities. Where changes in facts or circumstances change estimates from the amounts that were initially recorded, such differences will affect the tax provisions in the period in which such determination is made. Management reassesses positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.

Current Tax and Deferred Tax for the Period

Current tax and deferred tax are recognized as an expense in net earnings, except where they relate to amounts recognized outside of net earnings (whether in other comprehensive earnings or directly in equity), in which case the current tax and deferred tax are also recognized outside of net earnings, or where they arise from the initial accounting for a business combination. In the case of a business combination, the tax effect is included in the accounting for the business combination.

Foreign Currencies

The financial statements of each subsidiary of Superior are translated into the currency of the subsidiary's primary economic environment. For the purpose of the consolidated financial statements, the results and balance sheets of each subsidiary are expressed in Canadian dollars, Superior's presentation currency. Transactions are recognized at the rates of exchange prevailing at the transaction date.

At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at the period-end. Non-monetary items that are measured at fair value in a foreign currency shall be translated using the exchange rates at the date when the fair value is measured. Non- monetary items that are measured in terms of historical cost in a foreign currency shall be translated using the exchange rate at the date of the transaction and are not retranslated.

For the purposes of presenting Superior's consolidated financial statements, the assets and liabilities of Superior's foreign operations, namely of Energy Distribution and Specialty Chemicals in the U.S., and of Specialty Chemicals in Chile, are translated using exchange rates prevailing at the end of each reporting period. Income and expense items are translated at the average exchange rates for the period.

Goodwill and fair value measurements of identifiable assets acquired and liabilities assumed through acquisition of a foreign operation are treated as assets and liabilities of the foreign operation and translated at the rate of exchange prevailing at the end of each reporting period. Exchange differences are recognized in other comprehensive loss for the period.

Share-based Payments

Superior has established share-based compensation plans whereby notional restricted shares and/or notional performance shares may be granted to employees. The fair value of these notional shares is estimated using the period-end quoted market price and recorded as an expense with an offsetting amount to accrued liabilities, remeasured at each consolidated balance sheet date. All share-based payments are settled in cash.

(c) Significant Accounting Judgments, Estimates and Assumptions

The preparation of Superior's consolidated financial statements in accordance with IFRS requires management to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses and related disclosure. The estimates and associated assumptions are based on historical experience and various other factors deemed reasonable under the circumstances, the results of which form the basis of making the judgments about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. The areas involving a higher degree of judgment or complexity, or where assumptions and estimates are significant to the consolidated financial statements, are as follows:

Estimates and Assumptions

Fair Value of Derivative and Non-Financial Derivative Instruments

Where the fair values of financial derivatives and non-financial derivatives cannot be derived from active markets, they are determined using valuation techniques including a discounted cash flow model. This requires assumptions concerning the amount and timing of estimated future cash flows and discount rates. Differences between actual values and assumed values will affect net earnings in the period when the difference is determined.

Allowance for Doubtful Accounts

Superior recognizes an allowance for doubtful accounts based on historical customer collection history, general economic indicators and other customer-specific information, all of which require Superior to make certain assumptions. Where the actual collectability of accounts receivable differs from these estimates, such differences will have an impact on net earnings in the period such a determination is made.

Property, Plant and Equipment and Intangible Assets

Capitalized assets, including property, plant and equipment and intangible assets, are amortized over their respective estimated useful lives. All estimates of useful lives are set out in the Significant Accounting Policies above.

Provisions

Provisions have been estimated for decommissioning costs, restructuring and environmental expenditures. The actual costs and timing of future cash flows depend on future events. Any differences between estimates and the actual future liability will be accounted for in the period when such determination is made. Determining decommissioning liabilities requires estimates regarding the useful life of certain operating facilities, the timing and cost of future remediation activities, discount rates and the interpretation and changes to various environmental laws and regulations. Differences between estimates and results will affect Superior's accrual for decommissioning liabilities, with an effect on net earnings. See COVID-19 below for the related impact during the year.

Employee Future Benefits

Superior has a number of defined-benefit pension plans and other benefit plans. The cost of defined-benefit pension plans and the present value of the pension obligation are determined using actuarial valuations. These require assumptions including the determination of the discount rate, future salary increases, mortality rates and future pension increases. Due to the valuation's complexity, its underlying assumptions and long-term nature, a definedbenefit obligation is highly sensitive to changes in the underlying assumptions. See COVID-19 below for the related impact during the year.

Income Tax Assets and Liabilities

Superior recognizes expected tax assets and liabilities based on estimates of current and future taxable net earnings, which may require significant judgment regarding the ultimate tax determination of certain items. If taxable net earnings differ from the estimates, there may be an impact on current and future income tax provisions in the period when the difference is determined.

Asset Impairments

Financial and non-financial assets are subject to impairment reviews based on whether current or future events and circumstances suggest that their recoverable amount may be less than their carrying value. Recoverable amounts are based on a calculation of expected future cash flows, which includes management assumptions and estimates of future performance.

COVID-19

The outbreak of the novel strain of the coronavirus, specifically identified as the COVID-19 pandemic, has caused governments worldwide to enact emergency measures to combat the spread of the virus. These measures, which include the implementation of travel bans, self-imposed quarantine periods and social distancing, have caused material disruption to businesses globally resulting in an economic slowdown. Global equity markets have experienced significant volatility and weakness. Governments and central banks have reacted with significant monetary and fiscal interventions designed to stabilize economic conditions. COVID-19 did not significantly impact the carrying values of the Company's assets and liabilities as at December 31, 2020, except for the employee future benefits, property, plant and equipment and provisions in relation to the decommissioning costs that were affected by lower interest rates as disclosed in Note 10. At this time, given the uncertainty in the developments surrounding COVID-19, it is not possible to reliably estimate the full impact this will have on Superior's financial position and operating results. Certain expenses were eligible under the CEWS program instituted by the Government of Canada. The CEWS program allowed Superior to recover a portion of eligible employee costs incurred earlier in the year. As a result, Superior recorded a subsidy of \$33.3 million as a reduction to expenses, see Note 21. The Government of Canada continues to make amendments to the CEWS program and Superior may be eligible for future claims. Judgments, estimates and assumptions made by management during the preparation of these consolidated financial statements may also change as conditions related to COVID-19 change. Changes in assumptions including, but not limited to, foreign exchange rates, interest rates and commodity prices could impact the measurement of items including derivative and non-derivative instruments, allowance for doubtful accounts, provisions and employee future benefits.

Judgments

Impairment of Property, Plant and Equipment

An impairment evaluation involves consideration of whether there are indicators of impairment. Indicators include but are not limited to: significant underperformance relative to historical or projected operating results, significant changes in the manner in which an asset is used or in Superior's overall business strategy, or significant negative industry or economic trends. In some cases, these events are clear. In many cases, however, there is no clearly identifiable event. Instead, a series of individually insignificant events, some of them only later known, leads to an indication that an asset may be impaired. Management continually monitors Superior's segments, the markets, and the business environment, and makes judgments and assessments about conditions and events in order to conclude whether there may be an impairment.

Income Taxes

Preparation of the consolidated financial statements involves making an estimate of, or provision for, income taxes in each of the jurisdictions in which Superior operates. The process also involves estimating taxes currently payable and taxes expected to be payable or recoverable in future periods, referred to as deferred income taxes. Deferred income taxes result from the effects of temporary differences due to items that are treated differently for tax and accounting purposes. The tax effects of these differences are reflected in the consolidated balance sheet as deferred income tax assets and liabilities. An assessment must also be made to determine the likelihood that Superior's future taxable income will be sufficient to permit the recovery of deferred income tax assets. To the extent that such recovery is not probable, recognized deferred income tax assets must be reduced. Judgment is required in determining the income tax expense (recovery) and recognition of deferred income tax assets and liabilities. Management must also exercise judgment in its assessment of continually changing tax interpretations, regulations and legislation, to ensure deferred income tax assets and liabilities are complete and fairly presented. The effects of differing assessments and applications could be material.

Purchase Price Allocation

All business combinations are accounted for using the acquisition method. This requires management to recognize all identifiable assets, liabilities and contingent liabilities at the acquisition date fair values with a few exceptions. The allocation of the purchase price to property, plant and equipment and intangible assets requires management to exercise judgment when determining the acquisition fair value of each asset and its respective useful life. Consideration paid in a business combination that exceeds the net fair value of assets and liabilities acquired is allocated to goodwill. Goodwill is reviewed for impairment at least annually. As disclosed in Note 3, a number of acquisitions were completed during 2020. Changes in the purchase price allocation could occur during the 12-month period following acquisition. Changes to the fair value of the assets and liabilities acquired could affect the purchase price allocation and the Energy Distribution's net income.

Financial Instruments

The fair value of financial instruments is determined and classified in three categories, which are outlined below and discussed in more detail in Note 17.

Level I

Fair values in Level I are determined using quoted prices in active markets for identical instruments.

Level II

Fair values in Level II are determined using quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and value drivers are observable in active markets.

Level III

Fair values in Level III are determined using valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

The fair value measurement of a financial instrument is included in only one of the three levels, the determination of which is based on the lowest-level input that is significant to the derivation of the fair value. Classification of financial instruments requires management to use judgment in respect of both the determination of fair value and the lowest-level input of significance.

Revenue from Sale of Specialty Chemicals

Chemical sales are sometimes sold with discounts and volume rebates. Revenue from these sales is recognized based on the price specified in the contract, net of the estimated discounts and volume rebates. Accumulated experience is used to estimate and provide for the discounts, using the expected value or most likely method, and revenue is only recognized to the extent that it is highly probable that a significant reversal will not occur. A contract liability is recognized for expected discounts payable to customers in relation to sales made until the end of the reporting period. No element of significant financing component exists.

Revenue from Sale of Propane, Including Storage Tanks

Certain propane supply contracts entered into by the Company include sale of propane along with the loaning of storage tanks and equipment by the Company. Because these contracts include multiple performance obligations, the transaction price must be allocated to the performance obligations.

Management estimates the standalone selling price using the residual approach. The price of propane charged is consistent by geography and customer type, whereas fees and discounts associated with loaning storage tank can vary. Management allocates revenue to the sale of propane based on the consistent price by customer geography and region and the residual amount is applied to loaning the storage tank. Revenue from the sale of propane is recognized when delivered and revenue from storage tanks and equipment is recognized over the contract period.

Determining the Lease Term

In determining the lease term, management considers all facts and circumstances that create an economic incentive to exercise an extension option or not to exercise a termination option. Extension options (or periods after termination options) are only included in the lease term if the lease is reasonably certain to be extended or not terminated. The initial assessment is reviewed if a significant event or a significant change in circumstances occurs that affects this assessment and that it is within the control of the lessee.

(d) Standards Issued But Not Yet Effective

The new and amended standards and interpretations that are issued, but not yet effective, up to the date of issuance of the Company's consolidated financial statements are disclosed below. The Company intends to adopt these new and amended standards and interpretations, if applicable, when they become effective.

The Company has not early adopted any standards, interpretations or amendments that have been issued but are not yet effective.

Amendments to IAS 1, Presentation of Financial Statements ("IAS 1"), to Clarify Requirements for Classifying Liabilities as Current or Non-current

On January 23, 2020, the IASB issued amendments to IAS 1 (the "amendments") to clarify the requirements for classifying liabilities as current or non-current. More specifically:

• The amendments specify that the conditions which exist at the end of the reporting period are those which will be used to determine if a right to defer settlement of a liability exists.
• Management expectations about events after the balance sheet date, for example on whether a covenant will be breached, or whether early settlement will take place, are not relevant.
• The amendments clarify the situations that are considered settlement of a liability.

The new guidance will be effective for annual periods starting on or after January 1, 2023. The amendments are not expected to have a significant impact on the Company's consolidated financial statements.

Amendments to IAS 37, Provisions, Contingent Liabilities and Contingent Assets ("IAS 37"), "Onerous Contracts – Costs of Fulfilling a Contract"

On May 2020, the IASB issued amendments to IAS 37 to specify which costs an entity needs to include when assessing whether a contract is onerous or loss-making.

The amendments to IAS 37 apply a "directly related cost approach". The costs that relate directly to a contract to provide goods or services include both incremental costs (e.g., the costs of direct labour and materials) and an allocation of costs directly related to contract activities (e.g., depreciation of equipment used to fulfil the contract as well as costs of contract management and supervision). General and administrative costs do not relate directly to a contract and are excluded unless they are explicitly chargeable to the counterparty under the contract.

The new guidance will be effective for annual periods starting on or after January 1, 2022 and must be applied prospectively to contracts for which an entity has not yet fulfilled all of its obligations at the beginning of the annual reporting period in which it first applies the amendments (the date of initial application). Earlier application is permitted and must be disclosed. Superior plans to adopt the amendments to IAS 37 beginning January 1, 2022 and the adoption is not expected to have a significant impact on the Company's consolidated financial statements.

Reference to the Conceptual Framework - Amendments to IFRS 3

The Board added an exception to the recognition principle of IFRS 3 to avoid the issue of potential 'day 2' gains or losses arising for liabilities and contingent liabilities that would be within the scope of IAS 37 or IFRIC 21 Levies, if incurred separately. At the same time, the Board decided to clarify existing guidance in IFRS 3 for contingent assets that would not be affected by replacing the reference to the Framework for the Preparation and Presentation of Financial Statements.

The amendments are effective for annual reporting periods beginning on or after 1 January 2022 and apply prospectively. The amendments are not expected to have a significant impact on the Company's consolidated financial statements.

Superior has not early adopted any standard, interpretation or amendment that has been issued but is not yet effective.

3. ACQUISITIONS

Acquisition in 2020				Central	Southern
Purchase Price Allocation	Western	Champagne	Rymes	Coast	Propane
Cash	0.9	-	-	0.2	-
Accounts receivable	0.9	-	2.2	0.2	0.1
Prepaid expenses	0.1	-	-	-	-
Inventories	0.2	0.4	2.3	-	0.1
Property, plant and equipment	8.5	12.5	103.3	2.2	7.5
Other assets	-	-	0.3	-	-
Intangible assets	9.4	10.7	49.4	7.5	1.4
Trade and other payables and contract liabilities	(1.1)	(0.7)	(7.2)	(0.1)	(0.3)
Lease liabilities	(2.3)	(0.8)	(1.3)	(0.3)	(1.0)
Deferred tax liabilities	(2.5)	-	-	(2.4)	-
Net identifiable assets and liabilities	14.1	22.1	149.0	7.3	7.9
Consideration transferred
Fair value of deferred consideration	5.2	-	-	2.0	-
Cash paid on acquisition	24.6	36.4	196.7	15.1	8.0
Total consideration transferred	29.8	36.4	196.7	17.1	8.0
Goodwill arising on acquisition	15.7	14.3	47.8	9.8	0.1

The acquisition costs directly attributable to the following acquisitions were expensed and are included in selling, distribution and administrative costs. The goodwill recognized represents the expected synergies from operations and the intangible assets that do not qualify for separate recognition. Goodwill arising on acquisition is deductible for tax purposes unless otherwise noted and forms part of the U.S. Propane Distribution segment, unless otherwise noted.

Revenue and net earnings for the year ended December 31, 2020, would have increased by \$170.0 million and \$14.9 million respectively, if these acquisitions had occurred on January 1, 2020.

Western Propane Services ("Western")

On January 9, 2020, Superior acquired all the issued and outstanding shares of Western, a Southern California retail propane distribution company for total consideration of \$29.8 million (US\$22.7 million). The acquisition was funded by drawing on Superior's credit facility and deferring \$5.2 million (US\$4.0 million) in payments over the next five years.

Superior has finalized the purchase price allocation. Subsequent to the acquisition date of January 9, 2020, the acquisition contributed revenue and net earnings of \$17.3 million and \$3.1 million respectively, to the U.S. Propane Distribution segment for the year ended December 31, 2020.

The following purchase price allocations are considered preliminary, and as a result, may be adjusted during the 12 month period following the acquisition once all the required information pertaining to the ownership, remaining useful lives and a final count of tanks, cylinders and vehicles is obtained and assessed. Superior has allocated the purchase price to the identified assets and liabilities based on fair value estimates using current information available. The amounts presented are based on their estimated fair value and management expects that any further changes will relate to finalizing the fair value of property, plant and equipment, intangible assets and goodwill. Goodwill related to the Western acquisition is not deductible for tax purposes.

Champagne's Energy ("Champagne")

On August 3, 2020, Superior acquired the assets of a retail propane distribution company, operating under the tradename, Champagne, for total consideration of \$36.4 million (US\$27.2 million).

Superior has revised the estimated purchase price and restated the previously reported estimate. The changes were a reduction to working capital of \$0.6 million, an increase to property, plant and equipment and intangible assets of \$3.9 million and \$1.2 million respectively, recording a lease liability of \$0.8 million, a reduction to the total consideration paid by \$1.6 million and a reduction to goodwill of \$5.3 million.

Subsequent to the acquisition date of August 3, 2020, the acquisition contributed revenue and net earnings of \$9.4 million and \$2.8 million respectively, to the U.S. Propane Distribution segment for the year ended December 31, 2020.

Rymes Propane and Oil ("Rymes")

On September 1, 2020, Superior acquired the assets of a retail propane and heating oil distribution company, operating under the tradename, Rymes, for total consideration of \$196.7 million (US\$150.6 million).

Superior has revised the estimated purchase price and restated the previously reported estimate. The changes were a reduction to working capital of \$1.7 million, an increase to property, plant and equipment of \$27.7 million, a reduction to intangible assets of \$5.3 million, recording a lease liability of \$1.3 million, a reduction to the total consideration paid by \$1.3 million and a reduction to goodwill of \$20.7 million.

Subsequent to the acquisition date of September 1, 2020, the acquisition contributed revenue and net earnings of \$50.3 million and \$14.8 million respectively, to the U.S. Propane Distribution segment for the year ended December 31, 2020.

Central Coast Propane ("Central Coast")

On October 15, 2020, Superior acquired all of the equity interests of a Southern California propane distribution company, operating under the tradename, Central Coast, for total consideration of approximately \$17.1 million (US\$12.9 million). Central Coast is a retail distributor in Southern California. Goodwill related to Central Coast is not deductible for tax purposes.

Subsequent to the acquisition date of October 15, 2020, the acquisition contributed revenue and net earnings of \$1.7 million and \$0.9 million respectively, to the U.S. Propane Distribution segment for the year ended December 31, 2020.

Petro SE Propane ("Southern Propane")

On October 27, 2020, Superior acquired the assets of a retail propane distribution company, operating under the tradename, Southern Propane and Mountain Gas, for total consideration of approximately \$8.0 million (US\$6.1 million). Southern Propane is a retail distributor in North Carolina, South Carolina, Georgia and Tennessee.

Subsequent to the acquisition date of October 27, 2020, the acquisition contributed revenue and net earnings of \$2.6 million and \$0.8 million respectively, to the U.S. Propane Distribution segment for the year ended December 31, 2020.

2019 Purchase Price Allocations	Phelps	Sheldon	Other
Cash		0.8
Accounts receivable	1.9	0.6	1.0
Inventory	0.5	0.3	0.1
Property, plant and equipment	14.4	8.3	9.8
Intangible assets	3.2	6.7	6.4
Accounts payable and accrued liabilities		(0.1)	(0.6)
Contract liabilities	(0.6)
Long-term debt and lease liabilities	(1.5)	(0.5)	(2.1)
Net identifiable assets and liabilities	17.9	16.1	14.6
Consideration transferred
Fair value of deferred consideration	3.1	1.9	3.0
Cash paid on acquisition	21.9	19.2	19.8
Total consideration transferred	25.0	21.1	22.8
Acquisition date fair value of previously held equity interest		4.5
	25.0	25.6	22.8
Goodwill arising on acquisition	7.1	9.5	8.2

Acquisitions in 2019

Revenue and net earnings for the year ended December 31, 2019, would have increased by \$38.8 million and \$7.2 million respectively, if these acquisitions had occurred on January 1, 2019.

Phelps Sungas Inc. and BMK Geneva, Inc. ("Phelps")

On April 1, 2019, Superior closed the acquisition of the propane distribution assets of Phelps Sungas Inc. and BMK Geneva, Inc. ("Phelps"), an independent propane distributor in New York for total consideration of \$25.2 million (US\$18.7 million). The acquisition was funded by drawing on Superior's credit facility and deferring \$3.3 million (US\$2.5 million) in payments over the next five years. In the first quarter of 2020, Superior finalized the purchase price allocation and did not change the previously reported fair values.

Subsequent to the acquisition date of April 1, 2019, the acquisition contributed revenue and net earnings of \$10.1 million and \$0.3 million, respectively, to the U.S. Propane Distribution segment for the year ended December 31, 2019.

Sheldon Gas Company and Sheldon Oil Company ("Sheldon")

On May 2, 2019, Superior closed the acquisition of the shares of Sheldon, an independent propane distributor in Northern California for total consideration of \$21.2 million (US\$15.8 million). The acquisition was funded by drawing on Superior's credit facility and deferring \$2.0 million (US\$1.5 million) in payments over the next three years. Included in the assets acquired was a 51% interest in an entity that Superior acquired the other 49% previously as part of the acquisition of United Pacific Energy.

Subsequent to the acquisition date of May 2, 2019, the acquisition contributed revenue and net earnings of \$4.9 million and \$0.8 million, respectively, to the U.S. Propane Distribution segment for the year ended December 31, 2019.

Other Acquisitions

During the year ended December 31, 2019, the Company closed three other acquisitions for total consideration of \$22.8 million. This consisted of one acquisition in Canada and two acquisitions in the U.S. Goodwill of \$8.2 million forms part of the U.S. Propane Distribution segment.

Subsequent to the acquisition dates, the acquisitions contributed revenue and net earnings of \$0.6 million and \$0.1 million, respectively, to the Canadian Propane Distribution segment and contributed revenue and net earnings of \$0.7 million and \$0.2 million, respectively, to the U.S. Propane Distribution segment for the year ended December 31, 2019.

4. TRADE AND OTHER RECEIVABLES

A summary of trade and other receivables is as follows:

	2020	2019
Trade receivables, net of allowances	270.7	320.7
Accounts receivable – other(1)	42.2	8.5
Trade and other receivables	312.9	329.2

(1)This balance consists of receivables related to CEWS, indirect tax, final settlements related to acquisitions and other miscellaneous balances. The amount of CEWS included in this balance is \$15.7 million, see Note 21.

Pursuant to their respective terms, trade receivables, before the deduction for an allowance for doubtful accounts, are aged as follows:

	2020	2019
Current	225.7	235.2
Past due less than 90 days	50.1	84.5
Past due over 90 days	6.9	10.3
Trade receivables	282.7	330.0

Superior's trade receivables are stated after deducting an allowance of \$12.0 million as at December 31, 2020 (December 31, 2019 – \$9.3 million). The movement in the allowance for doubtful accounts is as follows:

	2020	2019
Allowance for doubtful accounts, January 1	(9.3)	(11.2)
Impairment losses recognized on receivables	(5.3)	(2.5)
Amounts written off during the year as uncollectible	1.5	3.5
Amounts recovered	0.5	0.9
Foreign exchange impact and other	0.6	–
Allowance for doubtful accounts, end of the year	(12.0)	(9.3)

5. PREPAIDS AND DEPOSITS

A summary of prepaids and deposits is as follows:

	2020	2019
Prepaid insurance	17.0	12.9
Tax installments	11.8	7.0
Deposits	1.5	21.1
Leases and licenses	3.6	3.5
Storage and rent	1.1	1.4
Miscellaneous prepaids and other	10.5	11.2
	45.5	57.1

6. INVENTORIES

A summary of inventories is as follows:

	2020	2019
Propane, heating oil and other refined fuels	65.9	55.5
Propane retailing materials, supplies, appliances and other	11.0	13.2
Chemical finished goods and raw materials	27.6	30.2
Chemical stores, supplies and other	19.5	17.3
	124.0	116.2
	2020	2019
Cost of inventories recognized as an expense	1,086.1	1,446.8
Inventory write-downs to (reversals from) cost of sales	2.0	(6.0)

7. PROPERTY, PLANT AND EQUIPMENT

			Specialty Chemicals Plant and	Energy Distribution Retailing	Leasehold
Cost	Land	Buildings	Equipment	Equipment	Improvements	Total
Balance as at December 31, 2018	74.2	299.1	1,039.7	1,212.9	8.6	2,634.5
Initial adoption of IFRS 16 (Note 2) Additions - right-of-use assets	– –	55.8 8.6	112.3 3.9	10.5 24.7	– –	178.6 37.2
Additions - property, plant and equipment	0.2	7.5	39.5	81.1	0.2	128.5
Acquisitions through business
combinations (Note 3)	0.1	2.1	–	30.0	0.3	32.5
Adjustments related to ARO	–	11.5	0.6	–	–	12.1
and provisions
Disposals and other	(1.6)	(1.3)	(2.9)	(17.6)	–	(23.4)
impairment	–	(4.7)	(41.0)	–	–	(45.7)
Net foreign currency exchange
differences and other	0.9	(16.8)	(26.6)	(18.3)	3.6	(57.2)
Balance as at December 31, 2019	73.8	361.8	1,125.5	1,323.3	12.7	2,897.1
Additions - right-of-use assets	–	31.7	6.4	45.5	–	83.6
Additions - property, plant and equipment	1.4	4.4	37.9	58.3	0.4	102.4
Acquisitions through business combinations (Note 3)	8.6	21.3	–	103.2	0.9	134.0
Adjustments related to ARO and provisions	–	12.6	2.1	0.4	–	15.1
Disposals and other	(1.6)	(3.7)	(11.4)	(40.3)	–	(57.0)
Net foreign currency exchange
differences and other	(5.2)	7.6	(11.5)	(49.9)	(1.3)	(60.3)
Balance as at December 31, 2020	77.0	435.7	1,149.0	1,440.5	12.7	3,114.9
Accumulated Depreciation Balance as at December 31, 2018	–	95.3	630.3	462.3	4.8	1,192.7
Depreciation expense - property, plant and equipment	–	12.8	43.6	95.3	0.9	152.6
Depreciation of right-of-use assets	–	11.4	19.7	5.4	–	36.5
Eliminated on disposal of assets	–	(0.9)	(1.6)	(15.3)	–	(17.8)
Impairment	–	(1.9)	(25.0)	–	–	(26.9)
Net foreign currency exchange
differences and other	–	(1.2)	(15.0)	(0.2)	0.8	(15.6)
Balance as at December 31, 2019	–	115.5	652.0	547.5	6.5	1,321.5
Depreciation expense - property, plant and equipment	–	13.1	40.3	102.2	1.4	157.0
Depreciation of right-of-use assets	–	12.5	20.0	13.3	0.2	46.0
Eliminated on disposal of assets	–	(2.9)	(7.8)	(29.4)	–	(40.1)
Net foreign currency exchange
differences and other	–	(4.4)	(7.5)	(3.9)	(1.5)	(17.3)
Balance as at December 31, 2020	–	133.8	697.0	629.7	6.6	1,467.1
Carrying Amount As at December 31, 2019	73.8	246.3	473.5	775.8	6.2	1,575.6
As at December 31, 2020	77.0	301.9	452.0	810.8	6.1	1,647.8

The carrying amounts of the right-of-use assets included in the above are as follows:

			Specialty Chemicals Plant and	Energy Distribution Retailing	Leasehold
Carrying Amount	Land	Buildings	Equipment	Equipment	Improvements	Total
As at December 31, 2019	–	57.6	93.7	92.6	–	243.9
As at December 31, 2020	–	80.8	78.5	113.2	–	272.5

Included in the above right-of-use assets table, are vehicle and other fleet leases of \$94.8 million as at December 31, 2020 (December 31, 2019 – \$72.7 million).

Depreciation per cost category:

	2020	2019
Selling, distribution and administrative costs
Property, plant and equipment	121.1	108.5
Right-of-use asset	39.1	35.7
Cost of sales
Property, plant and equipment	42.3	44.1
Right-of-use asset	0.5	0.8
Total Depreciation	203.0	189.1

Superior evaluated the property, plant and equipment as at December 31, 2020 and 2019 for indicators of impairment and no impairment was identified. Therefore, the carrying value was not adjusted. See Note 9 for further details on testing of property, plant and equipment impairment in CGUs. In the prior year, the Specialty Chemicals segment recorded a \$17.5 million-dollar impairment charge as a result of closing its sodium chlorate manufacturing facility in Saskatoon, Saskatchewan.

8. INTANGIBLE ASSETS

	Customer	Cap and Trade Emissions Units	Energy Distribution Trademarks, Non-Compete, Patents and	Specialty Chemicals Royalty Assets and
Cost Balance as at December 31, 2018	Relationships 358.3	Purchased 5.3	Software 140.5	Patents 7.7	Total 511.8
Acquisitions through business combinations (Note 3)	15.9	–	0.4	–	16.3
Additions acquired separately	–	10.4	7.4	–	17.8
Reclassifications	10.0	–	(10.0)	–	–
Net foreign currency exchange differences and other	(0.5)	–	(14.5)	(0.4)	(15.4)
Balance as at December 31, 2019	383.7	15.7	123.8	7.3	530.5
Acquisitions through business combinations (Note 3)	78.4	–	–	–	78.4
Additions acquired separately	–	7.4	13.9	–	21.3
Reclassifications	–	–	5.3	–	5.3
Net foreign currency exchange differences and other	(4.7)	(0.1)	(2.4)	(0.2)	(7.4)
Balance as at December 31, 2020	457.4	23.0	140.6	7.1	628.1
Accumulated Amortization
Balance as at December 31, 2018	2.6	–	77.9	1.1	81.6
Amortization expense	52.1	–	10.3	1.1	63.5
Net foreign currency exchange differences and other	2.1	–	(5.4)	(0.1)	(3.4)
Balance as at December 31, 2019	56.8	–	82.8	2.1	141.7
Amortization expense	56.7	–	6.3	1.1	64.1
Net foreign currency exchange differences and other	(1.0)	–	(2.1)	–	(3.1)
Balance as at December 31, 2020	112.5	–	87.0	3.2	202.7
Carrying value
As at December 31, 2019	326.9	15.7	41.0	5.2	388.8
As at December 31, 2020	344.9	23.0	53.6	3.9	425.4

Superior evaluated intangible assets as at December 31, 2020 and 2019 for indicators of impairment and the Company did not identify any impairment. Therefore, the carrying value was not adjusted for the current year.

During the year, the Company invested \$13.9 million (2019 – \$7.4 million) in new software systems and enhancements to existing systems. These additions include the cost of the software, the installation and consulting services relating to the enhancements and implementation of these systems.

9. GOODWILL

	2020	2019
Balance, beginning of the year	1,080.9	1,094.2
Additional amounts recognized from business combinations during the year (Note 3)	87.7	24.8
Effect of foreign currency differences	(15.8)	(38.1)
Balance, end of the year	1,152.8	1,080.9

Goodwill is a result of a number of previous business combinations and is generally attributable to anticipated synergies expected and other intangible assets that are not required to be separately identified. Goodwill by definition has an indefinite life and, therefore, is not amortized.

Impairment of Property, Plant and Equipment, Goodwill and Intangible Assets

Goodwill is subject to impairment tests at least annually. For purposes of impairment testing, Superior assesses goodwill at the CGU level.

The carrying amount of goodwill as at December 31 was allocated to the segments as follows:

	2020	2019
U.S. Propane Distribution	808.4	736.0
Canadian Propane Distribution	343.4	343.9
Specialty Chemicals	1.0	1.0
	1,152.8	1,080.9

Superior conducts assessments for indicators of impairment on a quarterly basis and performs a detailed impairment assessment at least annually. As at December 31, 2020 and 2019, an impairment test was performed for all CGUs with allocated goodwill and no impairment was identified.

The recoverable amount of each CGU for Energy Distribution, which includes property, plant and equipment and intangible assets, was based on its value in use and was determined by estimating the future cash flows that would be generated from the continuing use of the CGU, incorporating the following assumptions:

Basis on which recoverable amount was determined

The recoverable amount for each CGU is determined using a detailed cash flow model which is based on evidence from an internal budget approved by the Board of Directors. Management's internal budgets are based on past experience and are adjusted to reflect market trends and economic conditions.

Key rates used in calculation of recoverable amount

Growth rate to perpetuity

The first five years of cash flow projections used in the model are based on management's internal budgets and projections after five years are extrapolated using growth rates in line with historical long-term growth rates. The long-term growth rate used in determining the recoverable amount for each CGU is 2.0% (2019 – 2.0%). Cash flow projections exclude any costs related to expansions through acquisitions and other related initiatives.

Discount rates

Cash flows in the model are discounted using a discount rate specific to each CGU which is adjusted based on risk assessments for each CGU. Discount rates reflect the current market assessments of the time value of money and are derived from the CGU's weighted average cost of capital and are adjusted for tax. The after-tax discount rates used in determining the recoverable amount for the CGUs range from 8.7% to 9.3% (2019 – 9.4% to 10%).

Inflation rates

Inflation rates used in the cash flow model are based on a blend of a number of publicly available inflation forecasts. The inflation rate used in determining the recoverable amount for each CGU in 2020 is 2.0% (2019 – 2.0%).

Key assumptions

In determining the recoverable amount of each CGU, business, market and industry factors were considered.

The recoverable amount for Specialty Chemicals was based on its FVLCOD. The FVLCOD was based on the transaction disclosed in Note 30 and was determined that there was no impairment.

10. PROVISIONS

A summary of provisions is as follows:

	Restructuring	Decommissioning	Other	Total
Balance as at December 31, 2018	6.2	96.4	8.9	111.5
Additions	4.2	3.3	—	7.5
Utilization	(4.5)	(1.1)	—	(5.6)
Amounts reversed during the year	(1.1)	(0.2)	(1.6)	(2.9)
Unwinding of discount	0.1	1.5	—	1.6
Impact of change in discount rate	—	8.8	—	8.8
Net foreign currency exchange difference	—	(0.3)	—	(0.3)
Balance as at December 31, 2019	4.9	108.4	7.2	120.5
Additions	1.8	2.1	–	3.9
Utilization	(4.1)	(0.6)	(1.7)	(6.4)
Amounts reversed during the period	(0.3)	(1.1)	–	(1.4)
Unwinding of discount	–	1.5	–	1.5
Impact of change in discount rate	–	15.1	–	15.1
Net foreign currency exchange difference	–	(2.5)	-	(2.5)
Balance as at December 31, 2020	2.3	122.9	5.5	130.7
			2020	2019
Current (Note 11)			4.3	7.6
Non-current			126.4	112.9
			130.7	120.5

Restructuring

Provisions for restructuring are recorded in provisions, except for the current portion, which is recorded in trade and other payables. As at December 31, 2020, the current portion of restructuring costs was \$ 2.3 million (2019 – \$4.9 million).

Decommissioning

The provisions are on a discounted basis and are based on existing technologies at current prices or long-term price assumptions, depending on the expected timing of the activity.

Specialty Chemicals

Superior makes full provision for the future cost of decommissioning Specialty Chemicals' chemical facilities. As at December 31, 2020, the discount rate used in Superior's calculation was 1.2% (2019 – 1.8%). Superior estimates the total undiscounted expenditures required to settle its decommissioning liabilities to be approximately \$152.6 million (2019 – \$154.3 million), which will be paid over the next 40 years. While Superior's provision for decommissioning costs is based on the best estimate of future costs and the economic lives of the chemical facilities, the amount and timing of these costs is uncertain.

U.S. Propane Distribution

Superior records a provision for the future costs of decommissioning certain assets associated with the Energy Distribution segment. Superior estimates the total undiscounted expenditures required to settle its decommissioning liabilities to be approximately \$8.8 million as at December 31, 2020 (2019 – \$4.7 million) which will be paid over the next 15 years. The discount rate of 1.2% as at December 31, 2020 (2019 – 1.8%) was used to calculate the present value of the estimated cash flows.

Other

Environmental

Provisions for environmental remediation are made when a cleanup is probable and the amount of the obligation can be reliably estimated. Generally, this coincides with the commitment to a formal plan or, if earlier, on divestment or closure of inactive sites. Superior estimates the total undiscounted expenditures required to settle its environmental expenditures to be approximately \$2.9 million as at December 31, 2020, (2019 – \$2.9 million) which will be paid over the next year. The provision for environmental expenditures has been estimated using existing technology at current prices. No discount rate has been applied as the liability is to be settled within 12 months. The extent and cost of future remediation programs are inherently difficult to estimate. They depend on the scale of any possible contamination, the timing and extent of corrective actions, and Superior's share of the liability.

Supply contract

As part of a prior acquisition, Superior was required to enter into a five-year supply agreement with the seller. The supply agreement was for terms that were unfavourable to Superior based on current supply arrangements under contract. As a result, Superior has recorded a provision with a balance of \$2.6 million as at December 31, 2020, (2019 – \$4.3 million) related to this contract. The supply agreement ends March 31, 2022.

Other claims

Superior is subject to various claims and potential claims in the normal course of business, but the Company does not expect the ultimate settlement of any of these to have a material effect on its financial results. The outcomes of all the proceedings and claims against Superior are subject to future resolution that includes the uncertainties of litigation. It is not possible for Superior to predict the result or magnitude of the claims due to the various factors and uncertainties involved in the legal process. Based on information currently known to Superior, it is not probable that the ultimate resolution of any proceedings and claims, individually or in total, will have a material effect on the consolidated statements of net earnings and total comprehensive earnings or consolidated balance sheets. If it becomes probable that Superior is liable, Superior will record a provision in the period the change in probability occurs, and the resulting impact could be material to the consolidated statements of net earnings and total comprehensive earnings or consolidated balance sheets.

11. TRADE AND OTHER PAYABLES

A summary of trade and other payables is as follows:

	2020	2019
Trade payables	281.9	307.1
Provisions (Note 10)	4.3	7.6
Accrued liabilities and other payables	111.8	92.5
Current taxes payable	15.2	11.1
Share-based payments, current portion	15.1	5.7
Trade and other payables	428.3	424.0

The average credit period on purchases by Superior is 28.2 days (2019 – 38 days). No interest is charged on the trade payables up to 10 days (2019 – 10 days) from the date of the invoice. Thereafter, interest is charged at a rate of up to 18.0% (2019 – 18.0%) per annum on the balance. Superior's financial risk management policies ensure that payables are normally paid within the pre-agreed credit terms.

12. CONTRACT LIABILITIES

	2020	2019
Balance, beginning of the year	18.1	23.9
Acquisitions	(0.1)	0.5
Additions during the year	56.6	34.7
Recognized in net earnings	(55.0)	(39.7)
Foreign exchange impact	(0.5)	(1.3)
Balance, end of the year	19.1	18.1

The Company does not generally receive deposits for periods longer than 12 months in advance of performing the related service.

13. OTHER LIABILITIES

A summary of other liabilities is as follows:

	2020	2019
Quebec cap and trade payable	–	7.8
California cap and trade payable	3.8	7.2
Nova Scotia cap and trade payable	1.1	0.4
Share-based payments and others	8.4	14.3
Long term other payables	1.2
Other liabilities	14.5	29.7

Superior operates in California, Nova Scotia, and Quebec, and is required to participate in the respective government cap and trade programs, which requires Superior to settle any liability with compliance instruments at the end of each compliance period. Intangible assets are recorded when compliance instruments are purchased, and cap and trade liabilities are recorded upon the import of propane. These are included in the consolidated statements of cash flows net of the liability that has been accrued related to cap and trade as part of changes in non-cash working capital. The Quebec cap and trade liability of \$11.1M is included into trade payables.

14. BORROWINGS

A summary of borrowings is as follows:

	Year of	Effective Interest
	Maturity	Rate	2020	2019
Revolving Term Bank Credit Facilities (1)
Bankers' Acceptances ("BA")	2024	Floating BA rate plus 1.70%	225.0	5.0
Canadian Prime Rate Loan (Prime and Swing line)	2024	Prime rate plus 0.70%	7.1	14.9
LIBOR Loans (US\$75.0 million;		Floating LIBOR
2019 – US\$332.0 million)	2024	rate plus 1.70%	95.4	431.3
U.S. Base Rate Loans (Prime and Swing line)		U.S. Prime rate
(US\$12.6 million; 2019 – US\$14.0 million)	2024	plus 0.70%	16.1	18.1
			343.6	469.3
Other Debt
Accounts receivable factoring program(2)		Floating BA plus 1.625%	–	3.9
Deferred consideration and other	2020–2026	1.74%-8.74%	24.8	23.8
			24.8	27.7
Senior Unsecured Notes
Senior unsecured notes(3)	2024	5.25%	400.0	400.0
Senior unsecured notes(4)	2025	5.125%	370.0	370.0
Senior unsecured notes(5)	2026	7.000%	445.4	454.7
			1,215.4	1,224.7
Total borrowings before deferred financing fees			1,583.8	1,721.7
Deferred financing fees and discounts			(22.3)	(27.3)
Total borrowings before current maturities			1,561.5	1,694.4
Current maturities			(7.1)	(10.1)
Total non-current borrowings			1,554.4	1,684.3

(1) As at December 31, 2020, Superior had \$40.6 million of outstanding letters of credit (December 31, 2019 – \$31.3 million) and \$289.0 million of outstanding financial guarantees on behalf of its businesses (December 31, 2019 – \$241.0 million). The fair value of Superior's revolving term bank credit facilities, other debt, letters of credit, and financial guarantees approximates their carrying value as a result of the market-based interest rates and the short-term nature of the underlying debt instruments. On May 8, 2019, Superior extended and restated its syndicated credit facility with 10 lenders, with no material changes to the financial covenants and extended its maturity to May 8, 2024. The credit facilities are secured by substantially all of the assets of Superior. The lender commitments remain at \$750.0 million and can be expanded further to \$1,050.0 million on condition that no event of default has occurred and lender consent is provided.

(2) Superior had a Master Receivables Purchase Agreement with a financial institution that expired and was settled in May 2020.

(3) These senior unsecured notes were issued at par value and mature on February 27, 2024. The senior unsecured notes contain certain early redemption options under which Superior has the option to redeem all or a portion of the senior unsecured notes at various redemption prices, which include the principal plus accrued and unpaid interest, if any, to the application redemption date. Interest is payable semi-annually on February 27 and August 27, and commenced August 27, 2017. The fair value of the senior unsecured notes is \$413.5 million (December 31, 2019 – \$410.0 million), based on prevailing market prices.

(4) These senior unsecured notes contain certain early redemption options under which Superior has the option to redeem all or a portion of the senior unsecured notes at various redemption prices, which include the principal plus accrued and unpaid interest, if any, to the application redemption date. The fair value of the senior unsecured notes is \$386.9 million (December 31, 2019 – \$374.9 million), based on prevailing market prices.

(5) These US\$350 million senior unsecured notes contain certain early redemption options under which Superior has the option to redeem all or a portion of the senior unsecured notes at various redemption prices, which include the principal plus accrued and unpaid interest, if any, to the application redemption date. The fair value of the senior unsecured notes is \$476.8 million (December 31, 2019 – \$489.0 million), based on prevailing market prices. During the year ended December 31, 2020, foreign exchange translation gain amounted to \$9.3 million (2019 – \$22.7 million foreign exchange translation gain), see Note 17.

Repayment requirements of borrowings before deferred financing fees are as follows:

Current maturities	7.1
2021–2022	7.2
2022–2023	5.7
2023–2024	746.6
2024–2025	371.8
2025–2026	445.4
Total	1,583.8

15. LEASING ARRANGEMENTS

The lease liabilities by operating segment are as follows:

	Propane Distribution		Specialty
	Canada	U.S.	Chemicals	Corporate	Total
IFRS 16 Initial adoption	34.6	12.5	129.8	1.7	178.6
Reclassification from previously recognized finance lease liabilities	33.9	29.9	–	–	63.8
Lease liabilities assumed as part of a business combination	0.5	3.1	–	–	3.6
Additions	17.2	10.8	9.2	–	37.2
Finance expense on lease liabilities	3.8	2.5	6.9	0.1	13.3
Lease payments	(16.8)	(11.6)	(26.1)	(0.3)	(54.8)
Impact of changes in foreign exchange rates and other	(0.5)	(0.9)	(5.9)	–	(7.3)
Lease liabilities as at December 31, 2019	72.7	46.3	113.9	1.5	234.4
Lease liabilities assumed as part of a business
combination	–	5.7	–	–	5.7
Additions	20.6	42.2	20.8	–	83.6
Finance expense on lease liabilities	4.1	3.6	6.5	0.1	14.3
Lease payments	(20.9)	(18.5)	(26.5)	(0.3)	(66.2)
Impact of changes in foreign exchange rates and other	-	(2.4)	(2.6)	–	(5.0)
Lease liabilities as at December 31, 2020	76.5	76.9	112.1	1.3	266.8
				2020	2019
Current portion of lease liabilities				53.3	52.4
Non-current portion of lease liabilities				213.5	182.0
Total lease liabilities				266.8	234.4

Included in the above lease liabilities, as at December 31, 2020, are vehicle and other fleet lease obligations of \$85.7 million (2019 – \$73.0 million). The assets related to the vehicle and fleet lease obligations are included in right-ofuse assets included in property, plant and equipment, Note 7.

During the year ended December 31, 2020, the discount rate applied was 3.5% to 5.6%(2019 – 5.4% to 8.3%).

The present value of lease payments are as follows:

	Minimum Rental Payments		Present Value of Minimum
				Rental Payments
	2020	2019	2020	2019
Not later than one year	62.4	60.5	53.3	52.4
Later than one year and not later than five years	176.5	150.4	147.3	120.6
Later than five years	97.2	91.5	66.2	61.4
Less: future finance charges	(69.3)	(68.0)	–	–
Present value of minimum rental payments	266.8	234.4	266.8	234.4

Future minimum lease payments under non-cancellable, low-value, short-term leases and leases with variable lease payments as at December 31 are summarized below.

	2020	2019
Not later than one year	3.6	2.1
Later than one year and not later than five years	3.8	0.4
	7.4	2.5

16. EMPLOYEE FUTURE BENEFITS

The most recent actuarial valuations of plan assets and the present value of the defined-benefit obligation were carried out on December 31, 2020. The present value of the defined-benefit obligation, and the related current and past service costs, were measured using the projected unit credit method, which is the same as that applied in calculating the accrued defined-benefit obligation recognized in the consolidated balance sheets.

The principal assumptions used for the purpose of the actuarial valuation were as follows:

	Defined-benefit Plans		Other Benefit Plans
	2020	2019	2020	2019
Average discount rate	2.4%	3.0%	1.8%	2.8%
Expected rate of compensation increase	3.0%	3.0%	3.0%	3.0%
Mortality rate(i)	95%–112%	95%–112%	97%–109%	97%–109%

(i) 2014 Canadian Private Sector Pensioners' Mortality Table combined with mortality improvement scale MI-2017.

Canadian Propane Distribution and Specialty Chemicals have defined-benefit and defined-contribution pension plans (the "Plans") covering most employees. The benefits provided under the plans are based on the individual employee's years of service and the highest average earnings for a specified number of consecutive years. The objective of the Plans when managing their net assets available for benefits, which represent the capital of the Plans, is to provide members with the retirement benefits prescribed in the Plans. Aside from a minor move of the Plan assets into real estate during the last quarter of 2020, the rest of the management objectives, policies and procedures are unchanged since 2019. The Plan assets are managed by the Human Resources and Compensation Committee of the Board of Directors on behalf of beneficiaries. The Human Resources and Compensation Committee of the Board of Directors retains independent managers and advisors.

Information about Superior's defined-benefit and other post-retirement benefit plans as at December 31, 2020 and 2019 in aggregate is as follows:

Recognized net (asset) liability arising from defined-benefit obligation

	Canadian Propane Distribution Pension Benefit Plans	Specialty Chemicals Pension Benefit Plans	Other Benefit Plans
Balance as at December 31, 2020
Present value of defined-benefit obligations	33.9	156.4	22.7
Fair value of plan assets	(40.8)	(150.7)	–
Net (asset) liability arising from defined-benefit obligation	(6.9)	5.7	22.7
Balance as at December 31, 2019
Present value of defined-benefit obligations	35.3	142.5	21.2
Fair value of plan assets	(41.1)	(148.7)	–
Net (asset) liability arising from defined-benefit obligation	(5.8)	(6.2)	21.2

Movements in defined-benefit obligations and plan assets

	Canadian Propane Distribution Pension Benefit Plans		Specialty Chemicals
	2020	2019	Pension Benefit Plans 2020	2019	Other Benefit Plans 2020	2019
Movement in the present value of the defined-benefit obligation during the year:
Benefit obligation as at January 1	35.3	35.3	142.5	128.6	21.2	19.9
Current service cost	–	–	1.8	1.7	0.4	0.3
Interest cost	1.0	1.3	4.4	4.9	0.6	0.7
Contributions by the plan participants	–	–	0.1	0.1	–	–
Past service cost	–	–	–	0.2	–	–
Actuarial gains (losses)	1.0	2.0	13.6	13.0	1.6	1.6
Benefits paid	(3.4)	(3.3)	(6.0)	(6.0)	(1.1)	(1.3)
Benefit obligation as at December 31	33.9	35.3	156.4	142.5	22.7	21.2
Movement in the fair value of the plan assets during the year:
Fair value of plan assets as at January 1	41.1	40.2	148.7	132.4	–	–
Expected return on plan assets	1.2	1.4	4.5	5.0	–	–
Excess return (shortfall) on plan assets	1.7	2.3	2.4	15.9	–	–
Contributions by the employer	0.3	0.5	1.5	1.6	1.1	1.3
Contributions by plan participants	–	–	0.1	0.1	–	–
Benefits paid	(3.4)	(3.3)	(6.0)	(6.0)	(1.1)	(1.3)
Administration expenses	(0.1)	–	(0.4)	(0.3)	–	–
Fair value of plan assets as at December 31	40.8	41.1	150.7	148.7	–	–
Funded status – plan surplus (deficit)
Net asset (obligation) arising from defined-benefit obligation	6.9	5.8	(5.7)	6.2	(22.7)	(21.2)
Non-current net benefit asset (obligation)	6.9	5.8	(5.7)	6.2	(22.7)	(21.2)

The accrued net pension asset related to the Canadian Propane Distribution pension benefit plan on December 31, 2020 was \$6.9 million (December 31, 2019 – \$5.8 million), and the expense for 2020 was nil (2019 – nil). The accrued net pension obligation related to the Specialty Chemicals pension benefit plan on December 31, 2020 was \$5.7 million (2019 – pension asset was \$6.2 million), and the expense for 2020 was \$2.1 million (2019 – \$2.0 million).

The accrued net benefit obligation related to the total other benefit plans of Canadian Propane Distribution and Specialty Chemicals on December 31, 2020 was \$22.7 million (2019 – \$21.2 million), and the expense for 2020 was \$1.0 million (2019 – \$1.0 million). Amounts recognized in net earnings in respect of these defined-benefit plans are as follows for the years ended December 31:

	2020	2019
Service cost
Current service cost	2.2	2.0
Administrative expense	0.6	0.3
Past service cost	–	0.2
Net interest expense	0.3	0.5
Components of defined-benefit costs recognized in net earnings (loss)	3.1	3.0

The service cost, administrative expense and net interest expense related to Canadian Propane Distribution and Specialty Chemicals on December 31, 2020 was \$3.1 million (2019 – \$3.0 million) and is included in selling, distribution and administrative costs.

The remeasurement of the net defined-benefit liability is included in other comprehensive earnings. The amounts recognized in accumulated other comprehensive earnings in respect of these benefit plans are as follows:

	2020	2019
Actuarial defined-benefit losses (before income taxes)	(12.2)	1.6
Cumulative actuarial losses (before income taxes)	(12.5)	(0.3)
Remeasurement on the net benefit obligation:	2020	2019
Cumulative actuarial gains (before income taxes), beginning of the year	(0.3)	(1.9)
Actuarial asset experience gain	4.0	18.2
Actuarial loss arising from changes in financial assumptions	(16.6)	(16.6)
Actuarial gain arising from changes in experience adjustments	0.4	–
Cumulative actuarial losses (before income taxes), end of the year	(12.5)	(0.3)

Significant actuarial assumptions for the determination of the accrued defined-benefit obligation are discount rate, compensation increase, mortality scale and trend rate. The sensitivity analyses below have been determined based on reasonably possible changes of the respective assumptions occurring as at December 31, 2020, while holding all other assumptions constant.

Discount Rate

A 1% change in the discount rate would result in a change to the accrued defined-benefit obligation related to Canadian Propane Distribution of \$3.5 million as at December 31, 2020 (2019 – \$3.5 million) and a change to the current service expense of \$0.1 million as at December 31, 2020 (2019 – \$0.1 million). A 1% change in the discount rate would result in a change to the accrued defined-benefit obligation related to Specialty Chemicals of \$26.1 million as at December 31, 2020 (2019 – \$23.0 million) and a change to the current service expense of \$0.7 million at December 31, 2020 (2019 – \$0.9 million).

Compensation Increase

A 1% change in the salary would result in a change to the accrued defined-benefit obligation related to Canadian Propane Distribution of nil as at December 31, 2020 (2019 – nil) and a change to the current service expense of nil as at December 31, 2020 (2019 – nil). A 1% change in salary would result in a change to the accrued defined-benefit obligation related to Specialty Chemicals of \$2.3 million as at December 31, 2020 (2019 – \$2.5 million) and a change to the current service expense of \$0.2 million as at December 31, 2020 (2019 – \$0.2 million).

Mortality Scale

A 10% change in the mortality scale would result in a change to the accrued defined-benefit obligation related to Canadian Propane Distribution of \$1.8 million as at December 31, 2020 (2019 – \$1.9 million) and a change to the current service expense of \$nil million as at December 31, 2020 (2019 – \$0.1 million). A 10% change in the mortality scale would result in a change to the accrued defined-benefit obligation related to Specialty Chemicals of \$5.0 million as at December 31, 2020 (2019 – \$4.3 million) and a change to the current service expense of \$0.2 million as at December 31, 2020 (2019 – \$0.2 million).

Trend Rate

A 1% change in the trend rate would result in a change to the accrued defined-benefit obligation related to Canadian Propane Distribution of \$0.1 million as at December 31, 2020 (2019 – \$0.4 million) and a change to the current service expense of nil as at December 31, 2020 (2019 – nil). A 1% change in the trend rate would result in a change to the accrued defined-benefit obligation liability related to Specialty Chemicals of \$1.4 million as at December 31, 2020 (December 31, 2019 – \$1.1 million) and a change to the current service expense of \$0.1 million as at December 31, 2020 (2019 – \$0.1 million).

The sensitivity presented above may not be representative of the actual change in the accrued defined-benefit obligation as it is unlikely that the change in assumptions would occur in isolation, as some of the assumptions may be correlated.

There were no changes in the methods or assumptions used in preparing the sensitivity analysis from prior years.

The average duration of the net benefit obligation related to Canadian Propane Distribution is 8.2 years as at December 31, 2020 (2019 – 7.9 years) and related to Specialty Chemicals is 14.6 years as at December 31, 2020 (2019 – 13.9 years).

As at December 31, 2020, Superior expects to make a contribution to the Canadian Propane Distribution Pension Benefit Plans of \$0.8 million and to the Specialty Chemicals Pension Benefit Plans of \$1.7 million during 2021.

The fair values of plan assets as at December 31, 2020, by major asset category, are as follows:

		Canadian Propane Distribution Pension Benefit Plans		Specialty Chemicals Pension Benefit Plans
	Level 2	Percentage	Level 2	Percentage
Canadian equities	4.1	10.0%	12.1	8.0%
Foreign equities	–	0.0%	45.5	30.2%
Fixed income	36.6	89.8%	68.6	45.5%
Real estate	–	0.0%	24.6	16.3%
Total	40.7 –	100%	150.7	100%

The fair values of plan assets as at December 31, 2019, by major asset category, are as follows:

		Canadian Propane Distribution Pension Benefit Plans		Specialty Chemicals Pension Benefit Plans
	Level 2	Percentage	Level 2	Percentage
Canadian equities	4.0	9.7%	38.7	26.0%
Foreign equities	–	–	38.4	25.8%
Fixed income	37.1	90.3%	66.2	44.5%
Real estate	–	–	5.5	3.7%
Total	41.1	100.0%	148.8	100.0%

The actual returns on Canadian Propane Distribution and Specialty Chemicals plan assets during the year ended December 31, 2020 were 7.2% (2019 – 9.4%) and 4.4% (2019 – 15.9%), respectively.

As part of the risk management process, Superior has established a diversification policy, set rate of return objectives, and developed specific investment guidelines.

As at December 31, 2020, the asset-matching strategic choices that are formulated in the actuarial and Superior's Statement of Investment Policies and Procedures ("SIPP") of the total defined-benefit plan assets are:

	Canadian Propane
	Distribution Pension Benefit	Specialty Chemicals Pension
	Plans	Benefit Plans
	Range(i)(ii)	Range(i)(ii)
Canadian equities	2.0%-7.0%	5.0%-11.0%
Global equities	2.0%-7.0%	24.0%-36.0%
Fixed income	89.0%-92.0%	37.0%-57.0%
Real estate	–	9.0%-22.0%

(i) Based on Superior's SIPP.

(ii) Canadian Propane Distribution and Specialty Chemicals' SIPPs do not provide ranges for U.S. and foreign equities; instead, they provide in aggregate ranges classified as global equities.

As at December 31, 2019, the asset-matching strategic choices that are formulated in the actuarial and SIPP of the total defined-benefit plan assets are:

	Canadian Propane Distribution Pension Benefit Plans	Specialty Chemicals Pension Benefit Plans
	Range(i)(ii)	Range(i)(ii)
Canadian equities	2.0%-7.0%	5.0%-11.0%
Global equities	2.0%-7.0%	25.0%-38.0%
Fixed income	89.0%-92.0%	40.0%-58.0%
Real estate	–	10.0%-23.0%

(i) Based on Superior's SIPP.

(ii) Canadian Propane Distribution and Specialty Chemicals' SIPPs do not provide ranges for U.S. and foreign equities; instead, they provide in aggregate ranges classified as global equities.

17. FINANCIAL INSTRUMENTS

IFRS requires disclosure around fair value and specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect Superior's market assumptions. These two types of input create the following fair value hierarchy:

• Level 1 Quoted prices in active markets for identical instruments.
• Level 2 Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets.
• Level 3 Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

The fair value of a financial instrument is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair values are determined by reference to quoted bid or ask prices, as appropriate, in the most advantageous active market for that instrument to which Superior has immediate access (Level 1). Where bid and ask prices are unavailable, Superior uses the closing price of the instrument's most recent transaction. In the absence of an active market, Superior estimates fair values based on prevailing market rates (bid and ask prices, as appropriate) for instruments with similar characteristics and risk profiles or internal or external valuation models, such as discounted cash flow analysis using, to the extent possible, observable market-based inputs (Level 2). Superior uses internally developed methodologies and unobservable inputs to determine the fair value of some financial instruments when required (Level 3).

Fair values determined using valuation models require assumptions concerning the amount and timing of estimated future cash flows and discount rates. In determining those assumptions, Superior looks primarily to available readily observable external market inputs including forecast commodity price curves, interest rate yield curves, currency rates and price and rate volatilities as applicable.

All financial and non-financial derivatives are designated as FVTPL upon their initial recognition.

For items that are recognized at fair value on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by reassessing their classification at the end of each reporting period. During the year ended December 31, 2020, there were no transfers between Level 1 and Level 2 fair value measurements, and no transfers into or out of Level 3 fair value measurements.

		As at December 31, 2020
	Level 1	Level 2	Level 3	Total
Assets
Foreign currency forward contracts, net sale	22.0	–	–	22.0
Equity derivative contract	–	4.4	–	4.4
Propane, WTI, butane, heating oil and diesel wholesale
purchase and sale contracts – Energy Distribution	–	30.5	–	30.5
Total assets	22.0	34.9	–	56.9
Liabilities
Foreign currency options, USD/CAD calls	1.1	–	–	1.1
Foreign currency forward contracts, net sale	1.0	–	–	1.0
Equity derivative contract	–	0.6	–	0.6
Propane, WTI, butane, heating oil and diesel wholesale
purchase and sale contracts – Energy Distribution	–	10.0	–	10.0
Total liabilities	2.1	10.6	–	12.7
Total net assets (liabilities)	19.9	24.3	–	44.2
Current portion of assets	11.6	32.1	–	43.7
Current portion of liabilities	0.9	10.2	–	11.1

			As at December 31, 2019
	Level 1	Level 2	Level 3	Total
Assets
Foreign currency forward contracts, net sale	3.5	–	–	3.5
Equity derivative contract	–	0.9	–	0.9
Propane, WTI, butane, heating oil and diesel wholesale
purchase and sale contracts – Energy Distribution	–	3.3	–	3.3
Total assets	3.5	4.2	–	7.7
Liabilities
Foreign currency forward contracts	3.2	–	–	3.2
Cross-currency interest rate swaps	5.8	–	–	5.8
Propane, WTI, butane, heating oil and diesel wholesale
purchase and sale contracts – Energy Distribution	–	16.3	–	16.3
Total liabilities	9.0	16.3	–	25.3
Total net liabilities	(5.5)	(12.1)	–	(17.6)
Current portion of assets	2.1	3.3	–	5.4
Current portion of liabilities	7.8	15.9	–	23.7

The following table outlines quantitative information about how the fair values of these financial and non-financial assets and liabilities are determined, including valuation techniques and inputs used:

Description	Notional	Term	Effective Rates	Valuation Technique(s) and Key Input(s)
Level 1 fair value hierarchy:
Foreign currency forward
contracts, net sale	US\$346.6	2021–2024	\$1.33	Quoted bid prices in the active market.
Foreign currency options			\$1.40–
USD/CAD calls	US\$42.0	2023-2024	\$1.47	Quoted bid prices in the active market.
Level 2 fair value hierarchy:
Equity derivative contracts	C\$21.1	2020–2022	\$10.29
				Discounted cash flows – Future cash flows
				are estimated based on the share price.
Propane, WTI, butane, heating oil			\$0.48–	Quoted bid prices for similar products in
and diesel wholesale purchase	106.5 USG(ii)	2021–2023	\$1.40	an active market.
and sale contracts – Energy
Distribution

(1) Millions of United States gallons ("USG") purchased.

Superior's realized and unrealized financial instrument gains (losses) for the years ended December 31, 2020 and 2019 are as follows:

			2020			2019
					Unrealized
	Realized	Unrealized		Realized	Gain
Description	Loss	Gain	Total	Loss	(Loss)	Total
Foreign currency forward contracts – net sale and
foreign currency options, USD/CAD calls	(2.0)	19.9	17.9	(11.2)	34.3	23.1
Transfer of derivative losses from accumulated other
comprehensive earnings	–	–	–	–	(7.1)	(7.1)
Cross-currency interest rate swaps	–	–	–	–	(12.8)	(12.8)
Equity derivative contracts	–	2.9	2.9	–	5.1	5.1
Propane, WTI, butane, heating oil and diesel wholesale
purchase and sale contracts – Energy Distribution	(15.6)	34.5	18.9	(29.9)	0.4	(29.5)
Total gains (losses) on financial and non-financial
derivatives	(17.6)	57.3	39.7	(41.1)	19.9	(21.2)
Foreign exchange gain (loss) on U.S. dollar debt
and lease liabilities	–	10.0	10.0	–	38.4	38.4
Total gains (losses)	(17.6)	67.3	49.7	(41.1)	58.3	17.2

Realized and unrealized gains or losses on financial and non-financial derivatives and foreign currency translation gains or losses on the revaluation of Canadian domiciled U.S.-denominated working capital have been classified on the consolidated statements of net earnings and total comprehensive earnings as a component of other income (loss). The following summarizes Superior's classification and measurement of financial assets and liabilities:

	Classification	Measurement
Financial Assets
Cash and cash equivalents	Loans and receivables	Amortized cost
Trade and other receivables	Loans and receivables	Amortized cost
Derivative assets	FVTPL	Fair Value
Notes and finance lease receivable	Loans and receivables	Amortized cost
Financial liabilities
Trade and other payables	Other liabilities	Amortized cost
Dividends payable	Other liabilities	Amortized cost
Borrowings	Other liabilities	Amortized cost
Derivative liabilities	FVTPL	Fair Value

The fair value of cash and cash equivalents, trade and other receivables, notes and finance lease receivable, trade and other payables, dividends payable and revolving term bank credit facilities correspond to the respective carrying amounts due to their short-term nature and/or the interest rate on the asset is commensurate with market interest rates for the type of asset with similar duration and credit risk. The fair value of senior unsecured notes disclosed in Note 14 are determined by quoted market prices (Level 1 fair value hierarchy).

Offsetting of financial instruments

Financial assets and liabilities are offset and the net amount reported on the consolidated balance sheets when Superior currently has a legally enforceable right to set off the recognized amounts and there is an intention to settle on a net basis or realize the asset and settle the liability simultaneously. In the normal course of business, Superior enters into various master netting agreements or other similar arrangements that do not meet the criteria for offsetting, but do, however, still allow for the related amount to be set off in certain circumstances, such as bankruptcy or the termination of contracts. As at December 31, 2020 and 2019, Superior has not recorded any amount against other current and non-current financial liabilities.

Financial Instruments – Risk Management

Market Risk

Financial derivatives and non-financial derivatives are used by Superior to manage its exposure to fluctuations in foreign currency exchange rates, interest rates and commodity prices. Superior assesses the inherent risks of these instruments by grouping financial and non-financial derivatives according to the exposures these instruments mitigate. Superior's policy is not to use financial derivative or non-financial derivative instruments for speculative purposes. Superior does not formally designate its derivatives as hedges and, as a result, Superior does not apply hedge accounting and is required to designate its financial derivatives and non-financial derivatives as held for trading.

Energy Distribution enters into various propane forward purchase and sale agreements to manage the economic exposure of its wholesale customer supply contracts. Energy Distribution monitors its fixed-price propane positions on a daily basis to monitor compliance with established risk management policies. Energy Distribution maintains a substantially balanced fixed-price propane position in relation to its wholesale customer supply commitments.

Superior, on behalf of its operating divisions, enters into foreign currency forward contracts to manage the economic exposure of its operations to movements in foreign currency exchange rates. Energy Distribution contracts a portion of its fixed-price natural gas, and propane purchases and sales in U.S. dollars and enters into forward U.S.-dollar purchase contracts to create an effective Canadian-dollar fixed-price purchase cost. Superior enters into U.S.-dollar forward sales contracts on an ongoing basis to mitigate the impact of foreign exchange fluctuations on sales margins on production from its Canadian plants that is sold in U.S. dollars. Interest expense on Superior's U.S.-dollar debt is also used to mitigate the impact of foreign exchange fluctuations.

Superior manages its overall liquidity risk in relation to its general funding requirements by utilizing a mix of shortterm and long-term debt instruments. Superior reviews its mix of short-term and long-term debt instruments on an ongoing basis to ensure it is able to meet its liquidity requirements.

Credit Risk

Superior utilizes a variety of counterparties in relation to its financial derivative and non-financial derivative instruments in order to mitigate its counterparty risk. Superior assesses the creditworthiness of its significant counterparties at the inception and throughout the term of a contract. Superior is also exposed to customer credit risk. Energy Distribution deals with a large number of small customers, thereby reducing this risk. Energy Distribution actively monitors the creditworthiness of its commercial customers. Specialty Chemicals, due to the nature of its operations, sells its products to a relatively small number of customers. Specialty Chemicals mitigates its customer credit risk by actively monitoring the overall creditworthiness of its customers. Overall, Superior's credit quality is enhanced by its portfolio of customers, which is diversified across geographical (primarily Canada and the U.S.) and end-use (primarily commercial, residential and industrial) markets.

Allowances for doubtful accounts and past due receivables are reviewed by Superior as at each consolidated balance sheet date. Superior updates its estimate of the allowance for doubtful accounts based on the evaluation of the recoverability of trade and other receivables with each customer, taking into account historical collection trends of past due accounts, current economic conditions and future forecasts. Trade and other receivables are written off once it is determined they are uncollectible.

Liquidity Risk

Liquidity risk is the risk that Superior cannot meet a demand for cash or fund an obligation as it comes due. Liquidity risk also includes the risk of not being able to liquidate assets in a timely manner at a reasonable price.

To ensure it is able to react to contingencies and investment opportunities quickly, Superior maintains sources of liquidity at the corporate and subsidiary levels. The main sources of liquidity are cash and other financial assets, the undrawn committed revolving term bank credit facility, equity markets and debenture markets.

Superior is subject to the risks associated with debt financing, including the ability to refinance indebtedness at maturity. Superior believes these risks are mitigated through the use of long-term debt secured by high quality assets, maintaining debt levels that in management's opinion are appropriate, and by diversifying maturities over an extended period. Superior also seeks to include in its agreements terms that protect it from liquidity issues of counterparties that might otherwise affect liquidity.

Equity Price Risk

Equity price risk is the risk of volatility in earnings as a result of volatility in Superior's share price. Superior has equity price risk exposure to shares that it issues under various forms of share-based compensation programs, which affect earnings when outstanding units are revalued at the end of each reporting period. Superior uses equity derivatives to manage volatility derived from its share-based compensation program.

As at December 31, 2020, Superior estimates that a 10% increase in its share price would have resulted in a \$2.5 million increase in earnings due to the revaluation of equity derivative contracts.

Superior's contractual obligations associated with its financial liabilities are as follows:

		12 Months Ended December 31
	Current	2022	2023	2024	2025	2026	Thereafter	Total
Borrowings	7.1	7.2	5.7	746.6	371.8	445.4	–	1,583.8
Lease liabilities	53.3	51.5	39.9	32.4	23.5	11.6	54.6	266.8
Non-cancellable, low-value, short-term
leases and leases with variable lease payments	3.6	2.6	1.1	0.1	–	–	–	7.4
USD-foreign currency forward sales
contracts	187.1	76.5	59.0	24.0	–	–	–	346.6
USD/CAD call options(i)	–	–	6.0	36.0	–	–	–	42.0
Propane, WTI, butane, heating oil
and diesel wholesale purchase and
sale contracts – Energy Distribution	73.8	12.8	5.7	–	–	–	–	92.3

(i)USD/CAD call options expiring in December 2023 with strike prices ranging from \$1.40 to \$1.47 settling in 2024.

Superior's contractual obligations are considered normal-course operating commitments and do not include the impact of mark-to-market fair values on financial and non-financial derivatives. Superior expects to fund these obligations through a combination of cash flows from operations, proceeds on revolving term bank credit facilities and proceeds on the issuance of share capital. Superior's financial instruments' sensitivities are consistent as at December 31, 2020 and 2019.

Superior's financial instruments' sensitivities to changes in foreign currency exchange rates, interest rates and various commodity prices and the resulting impact to net earnings are detailed below:

	2020
Impact to net earnings of a \$0.01 change in the CDN\$ dollar compared to the US\$ dollar	+/- 0.3
Impact to net earnings of a 0.5% change in interest rates	+/- 1.9
Impact to net earnings of a \$0.04/litre change in the price of heating oil	+/- 0.7
Impact to net earnings of a \$0.04/litre change in the price of propane	+/- 3.0

The calculation of Superior's sensitivity to changes in foreign currency exchange rates, interest rates and various commodity prices represent the change in fair value of the financial instrument without consideration of the value of the underlying variable, such as the underlying customer contracts. The recognition of the sensitivities identified above would have affected Superior's unrealized gain or loss on financial instruments and would not have had a material impact on Superior's cash flow from operations.

18. INCOME TAXES

Consistent with prior periods, Superior recognizes a provision for income taxes for its subsidiaries that are subject to current and deferred income taxes, including Canadian, U.S. , Chilean and Luxembourg income taxes.

The income taxes differ from the amount computed by applying the corporate Canadian federal-provincial enacted statutory rate for 2020 of 26.61% (2019 – 26.78%). The statutory rates reflect previously enacted provincial tax rate increases. The reasons for these differences are as follows:

	2020	2019
Net earnings	86.8	142.6
Income tax expense	71.9	25.0
Earnings before taxes	158.7	167.6
Computed income tax expense	42.2	44.9
Changes in effective foreign tax rates	0.2	(0.2)
Changes in future income tax rates	1.7	(0.7)
Non-deductible costs and other	(1.5)	(30.6)
Adjustments in respect of prior years	2.2	4.5
Change in amount of unrecognized asset	23.6	9.6
Other	3.5	(2.5)
Income tax expense	71.9	25.0

Income tax expense (recovery) for the years ended December 31, 2020 and 2019 is comprised of the following:

	2020	2019
Current income tax expense
Current income tax charge	15.7	9.9
Adjustments in respect of prior years	(4.6)	3.2
Total current income tax expense	11.1	13.1
Deferred income tax expense (recovery)
Relating to origination and reversal of temporary differences	28.7	1.3
Relating to changes in tax rates or the imposition of new taxes	1.7	(0.7)
Adjustments in respect of prior years	6.8	1.3
Change in amount of unrecognized asset	23.6	9.6
Other	-	0.4
Total deferred income tax expense	60.8	11.9
Income tax expense	71.9	25.0

Deferred tax for the years ended December 31, 2020 and 2019 is comprised of the following:

		(Credited) Charged to	(Credited) Charged to Other
	Opening	Net	Comprehensi		Exchange	Closing
December 31, 2020	Balance	Earnings	ve Earnings	Acquisitions	Differences	Balance
Property, plant and equipment	(280.0)	(51.3)	–	(5.6)	5.0	(331.9)
Reserves and employee benefits	18.7	(1.2)	3.2	–	(0.1)	20.6
Provisions	29.6	4.4	–	–	(0.3)	33.7
Finance Leases	61.4	9.9	–	0.7	(0.8)	71.2
Borrowing	(7.3)	(0.7)	–	–	(0.2)	(8.2)
Financing fees	6.8	(2.2)	–	–	(0.1)	4.5
Unrealized foreign exchange	4.6	(16.7)	–	–	0.4	(11.7)
Scientific research and	54.8	(2.7)	–	–		52.1
Investment tax credits, net of tax	61.6	(8.7)	–	–		52.9
Non-capital losses	62.9	8.8	–	–	(1.5)	70.2
Other	(0.4)	(0.4)	–	–	0.4	(0.4)
Total	12.7	(60.8)	3.2	(4.9)	2.8	(47.0)

			(Credited)
		(Credited)	Charged to
		Charged to	Other
	Opening	Net Earnings	Comprehensive		Exchange	Closing
December 31, 2019	Balance	(Loss)	Earnings (Loss)	Acquisitions	Differences	Balance
Property, plant and equipment	(319.0)	31.9	–	–	7.1	(280.0)
Reserves and employee benefits	16.1	3.4	(0.4)	–	(0.4)	18.7
Provisions	26.2	4.1	–	–	(0.7)	29.6
Finance leases	17.2	45.5	–	–	(1.3)	61.4
Borrowing	(7.3)	–	–	–	–	(7.3)
Financing fees	11.5	(4.7)	–	–	–	6.8
Unrealized foreign exchange	12.2	(7.6)	–	–	–	4.6
Scientific research and development	61.3	(6.5)	–	–	–	54.8
Investment tax credits, net of tax	64.2	(2.6)	–	–	–	61.6
Non-capital losses	141.3	(75.0)	–	–	(3.4)	62.9
Other	–	(0.4)	–	–	–	(0.4)
Total	23.7	(11.9)	(0.4)	–	1.3	12.7

Deferred taxes reported in the two preceding tables are presented on a functional basis while deferred taxes reported on the consolidated balance sheets are on a legal-entity basis.

The net deferred income tax asset relates to the following tax jurisdictions as at December 31, 2020 and 2019:

	2020	2019
Canada	26.1	39.5
U.S.	(66.7)	(20.1)
Chile	(6.4)	(6.7)
Total net deferred income tax (liability) asset	(47.0)	12.7

As a result of the enactment of new tax legislation, deferred tax assets of approximately \$13.9 million previously recognized at December 31, 2019 were derecognized during the year ended December 31, 2020.

Superior has available to carry forward the following as at December 31, 2020 and 2019:

	2020	2019
Canadian federal and provincial investment tax credits	76.2	84.2
Canadian scientific research expenditures	197.6	214.0
Canadian non-capital losses	44.6	24.4
U.S. non-capital losses	308.0	212.0

The federal and provincial investment tax credits available to reduce future years' taxable income expire as follows:

	Canada
2021	7.1
2022	8.7
2023	14.8
2024	11.3
Thereafter	34.3
Total	76.2

The Canadian scientific research expenditures may be carried forward indefinitely. The Canadian and U.S. noncapital loss carry-forwards are all due to expire beyond 2024.

As at December 31, 2020, Superior had \$85.9 million of tax pools (2019 – \$35.8 million) for which no deferred tax asset was recognized. For all other deferred tax assets, it is probable that the asset will be realized through a combination of future reversals of temporary differences and taxable income.

In Chile, the local tax laws provide that any profits distributed outside of Chile be subject to a 35% tax.

19. TOTAL EQUITY

Superior is authorized to issue an unlimited number of common shares and an unlimited number of preferred shares.

Common Shares

The holders of common shares are entitled to dividends if, as and when, declared by the Board of Directors; to one vote per share at shareholders' meetings; and upon liquidation, dissolution or winding up of Superior to receive pro rata the remaining property and assets of Superior, subject to the rights of any shares having priority over the common shares, of which the Preferred Shares of Superior Plus US Holdings are outstanding. See Preferred Shares issued by a subsidiary further below.

	Issued Number of Common Shares (Millions)	Total Capital Attributable to Common Shareholders	Equity Attributable to Common Shareholders
As at January 1, 2019	174.9	2,339.9	1,088.9
Net earnings for the year	–	–	142.6
Other comprehensive loss	–	–	(66.6)
Dividends and dividend equivalent declared to shareholders	–	–	(125.9)
As at December 31, 2019	174.9	2,339.9	1,039.0
Issuance of common shares	1.1	10.4	10.4
Net loss for the year	–	–	75.1
Other comprehensive loss	–	–	(30.8)
Dividends declared to common shareholders	–	–	(126.4)
Preferred share issuance costs	–	–	(18.1)
As at December 31, 2020	176.0	2,350.3	949.2

During the year ended December 31, 2020, Superior issued 1.1 million shares under its dividend reinvestment plan and optional share purchase program ("DRIP") for total gross proceeds of \$10.4 million, (2019 – nil).

Superior suspended the active operation of its DRIP after payment of the May dividend, paid on June 15, 2020. Shareholders participating in the DRIP began receiving a cash payment for dividends declared during the year ended December 31, 2020. Superior's DRIP program will remain in place should Superior elect to reactivate the DRIP at a future date, subject to regulatory approval.

Preferred Shares of Superior Plus US Holdings

On July 13, 2020, Superior's subsidiary, Superior Plus US Holdings, issued 260,000 Preferred Shares (the "Preferred Shares") by its subsidiary Superior Plus US Holdings for gross proceeds of US\$260 million (C\$353.8 million). The initial proceeds were recorded as a non-controlling interest within equity and the issuance costs of US\$13.4 million (C\$18.1 million) were allocated to Superior's deficit. Superior owns 100% of the common shares of Superior Plus US Holdings and the Preferred Shares are the only other class of share issued.

The Preferred Shares entitle the holders to a cumulative dividend of 7.25% per annum through to the end of Superior's second fiscal quarter in 2027. If dividends are paid on the common shares, Superior is required to pay the dividend in cash on the Preferred Shares, otherwise, the Preferred Share dividends can be paid or accrued at Superior's option. In the event that Superior declares a dividend on its common shares in excess of \$0.06 per month, the holders of the Preferred Shares shall be entitled to an equivalent amount. Superior has the option to redeem all, but not less than all, the Preferred Shares at a date that is seven years after the issue date with not less than 30 days prior written notice to the holders of the Preferred Shares. The preferred shares can be redeemed at US\$1,000 per share plus accrued and unpaid dividends If Superior does not redeem the Preferred Shares, the dividend rate increases by 0.75% per annum for the next four years to a maximum of 10.25%. If the dividends are not paid in cash, the cumulative dividend increases by 1.0% per annum to a maximum of 14.25%.

The Preferred Shares may be exchanged, at the holder's option, into 30 million common shares of Superior ("Common Shares") or at Superior's option, on or after the third anniversary of the issue date if the volume-weighted average price of Superior's common shares during the then preceding 30 consecutive trading day period, converted to U.S. dollars at the applicable exchange rate, must be greater than 145% of the exchange price. On an as-exchanged basis, the investment currently represents approximately 15% of the diluted outstanding Common Shares. The exchange price of the Preferred Shares will be subject to adjustment from time to time in accordance with the terms of the Preferred Shares. These potential adjustments relate primarily to accrued and unpaid dividends, increased or additional dividends to common shareholders, in instances where there is a share split, share consolidation or a reorganization, the participation rate on the dividend reinvestment plan is greater than 35% and if common shares are issued below market value.

Holders of Preferred Shares will be entitled to vote on an as-exchanged basis for all matters on which holders of Superior's Common Shares vote, and to the greatest extent possible, will vote with the holders of Common Shares as a single class.

In the event of any liquidation, winding up or dissolution of Superior, the holders of Preferred Shares are entitled to receive prior, and in preference to, any distribution to the holders of common shares, an amount equal to the greater of a liquidation rate per share of US\$1,400 plus accrued and unpaid dividends or the amount receivable had the preferred shares been converted to common shares immediately prior to the liquidation event. In the event that upon liquidation or dissolution, the assets and funds of Superior are insufficient to permit the payment to the holders of Preferred Shares of the full preferential amounts, then the entire assets and funds of Superior legally available for distribution are to be distributed ratably among the holders of Preferred Shares in proportion to the full preferential amount each is otherwise entitled to receive. After the distributions described above have been paid in full, the remaining assets of Superior available for distribution shall be distributed pro-rata to the holder of common shares.

Dividends declared to preferred shareholders for the year ended December 31, 2020 were US\$8.8 million (C\$11.7 million) or US\$72.50 (C\$96.35) per preferred share per annum.

NCI	Issued Number of Preferred Shares (Millions)	Equity Attributable to NCI
As at December 31, 2019	1 –	–
Issuance of preferred shares	0.3	353.8
Net earnings for the period	–	11.7
Other comprehensive loss	–	(22.9)
Dividends to preferred shareholders	–	(11.7)
As at December 31, 2020	0.3	330.9

Accumulated Other Comprehensive Earnings

	2020	2019
Accumulated other comprehensive earnings
Currency translation adjustment
Balance, beginning of the year	105.6	180.5
Unrealized foreign currency losses on translation of foreign operations	(21.9)	(74.9)
Balance, end of the year	83.7	105.6
Actuarial defined benefits
Balance, beginning of the year	(0.3)	(1.5)
Actuarial defined-benefit gains	(12.1)	1.6
Income tax expense on other comprehensive earnings (loss)	3.2	(0.4)
Balance, end of the year	(9.2)	(0.3)
Accumulated derivative losses
Balance, beginning of the year	–	(7.1)
Transfer of derivative losses from accumulated other comprehensive earnings	–	7.1
Accumulated other comprehensive earnings, end of the year	74.5	105.3

Other Capital Disclosure

Additional Capital Disclosure

Superior's objectives when managing capital are: (i) to maintain a flexible capital structure to preserve its ability to meet its financial obligations, including potential obligations from acquisitions; and (ii) to safeguard its assets while maximizing the growth of its businesses and returns to its shareholders.

In the management of capital, Superior includes shareholders' equity (excluding accumulated other comprehensive earnings), current and long-term borrowing, and convertible unsecured subordinated debentures. Superior manages its capital structure and makes adjustments in light of changes in economic conditions and the nature of the underlying assets. In order to maintain or adjust the capital structure, Superior may adjust the amount of dividends to shareholders, issue additional share capital, conduct additional borrowing or issue convertible unsecured subordinated debentures, or conduct new borrowing or issue convertible unsecured subordinated debentures with different characteristics.

Superior monitors its capital based on the ratio of senior debt outstanding to net earnings before interest, taxes, depreciation, amortization and other non-cash expenses ("EBITDA"), as defined by its revolving term credit facility, and the ratio of total debt outstanding to EBITDA. Superior's reference to EBITDA as defined by its revolving term credit facility may be referred to as compliance EBITDA in its other public reports.

Superior is subject to various financial covenants in its credit facility agreements, including senior debt, total debt to EBITDA ratio and restricted payments tests, which are measured on a quarterly basis. As at December 31, 2020, Superior was in compliance with all of its financial covenants.

Superior's financial objectives and strategy related to managing its capital as described above remained unchanged from the prior year. Superior believes that its debt to EBITDA ratios are within reasonable limits, in light of Superior's size, the nature of its businesses and its capital management objectives.

20. SUPPLEMENTAL DISCLOSURE OF CONDENSED CONSOLIDATED STATEMENTS OF NET EARNINGS AND TOTAL COMPREHENSIVE EARNINGS

	2020	2019
Revenue
Revenue from products	2,280.2	2,704.2
Revenue from the rendering of services	73.5	101.4
Tank and equipment rental	40.6	47.3
	2,394.3	2,852.9
Cost of sales (includes product and services)
Cost of products and services(i) (ii)	(1,245.8)	(1,595.0)
Depreciation included in cost of sales	(42.8)	(44.9)
	(1,288.6)	(1,639.9)
Selling, distribution and administrative costs
Other selling, distribution and administrative costs	(235.7)	(247.0)
Restructuring, transaction and other costs	(25.1)	(29.9)
Employee future benefit expense	(2.3)	(2.1)
Employee costs(ii)	(327.2)	(364.1)
Vehicle operating costs	(60.8)	(68.1)
Facilities maintenance expense	(7.2)	(6.3)
Depreciation of right-of-use assets	(39.1)	(35.7)
Depreciation included in selling, distribution and administrative costs	(121.1)	(108.5)
Amortization of intangible assets	(64.1)	(63.5)
Low value, short-term and variable lease payments	(2.2)	(2.5)
Gain (loss) on disposal of assets	(5.8)	1.5
Impairment of Specialty Chemicals equipment	–	(19.9)
Realized gain (loss) on the translation of U.S.- denominated net working capital	0.4	(2.2)
	(890.2)	(948.3)
Finance expense
Interest on borrowings	(84.0)	(91.9)
Interest on lease liability	(14.3)	(13.3)
Unwinding of discount on decommissioning liabilities and non-cash financing expenses	(8.2)	(9.1)
	(106.5)	(114.3)
Gains (losses) on derivatives and foreign currency translation of borrowings
Realized loss on financial and non-financial derivatives and foreign currency translation	(17.6)	(41.1)
Unrealized gain on financial and non-financial derivatives and foreign currency translation	67.3	58.3
	49.7	17.2
Earnings before income taxes	158.7	167.6
Income tax expense
Current income tax expense	(11.1)	(13.1)
Deferred income tax expense	(60.8)	(11.9)
	(71.9)	(25.0)
Net earnings	86.8	142.6

(i) During the year ended December 31, 2020, the cost of products and services includes low value, short-term and variable lease payments of \$3.9 million (2019 - \$8.0million).

(ii)Expense is shown net of the CEWS subsidy, see Note 21.

21. GOVERNMENT GRANT

In response to COVID-19, the Government of Canada implemented the Canadian Emergency Wage Subsidy ("CEWS") program. The CEWS program offers qualifying organizations government assistance in the form of a payroll subsidy to offset the cost of employees. The payroll subsidy was recognized as an offset to salary expense. For the year ended December 31, 2020 Superior recorded \$28.9 million (2019 – NIL) as a reduction to selling, distribution and administration costs and \$4.4 million (2019 – NIL) as a reduction to cost of sales.

There are no unfulfilled conditions attached to this government assistance. As of December 31, 2020, \$15.7 million is included in trade and other receivables.

22. NET EARNINGS PER SHARE, BASIC AND DILUTED

Net earnings per share	2020	2019
Basic
Net earnings attributable to common shareholders for the year	\$86.8	\$142.6
Less:
Allocation of earnings to preferred shareholders	\$(11.7)	–
Total earnings allocated to common shareholders	\$75.1	\$142.6
Weighted average common shares outstanding (millions)	175.7	174.9
Net earnings per share attributable to
common shareholders	\$0.43	\$0.82
Diluted
Net earnings attributable to common shareholders for the year	\$86.8	\$142.6
Weighted average shares outstanding (millions)
assuming conversion of preferred shares	189.7	174.9
	\$0.46	\$0.82
Net earnings per share attributable to
common shareholders	\$0.43	\$0.82

Superior uses the two-class method to compute net earnings per common share attributable to common shareholders because Superior's preferred shares are participating equity securities. For the purpose of computing earnings per share the preferred shares are considered participating because they contractually entitle the holders to participate in dividends with ordinary shares according to a predetermined formula ( Note 19). The two-class method requires earnings for the period to be allocated between common shares and preferred shares based upon their respective rights to receive distributed and undistributed earnings.

Under the two-class method, the basic and diluted earnings per share are computed as follows:

• a) earnings or loss attributable to Superior's common shareholders is adjusted (earnings reduced and a loss increased) by the amount of dividends declared in the period for each class of shares and by the contractual amount of dividends that must be paid for the period.
• b) the remaining earnings or loss is allocated to Superior's common shares and participating equity instruments to the extent that each instrument shares in earnings as if all of the earnings or loss for the period had been distributed. The total earnings or loss allocated to each class of equity instrument is determined by adding together the amount allocated for dividends and the amount allocated for a participation feature.

c) the total amount of earnings or loss allocated to each class of equity instrument is divided by the weighted-average number of outstanding instruments (and dilutive potential common shares for diluted earnings per share) to which the earnings are allocated to determine the earnings per share for the instrument.

No such adjustment to earnings is made during periods with a net loss, as the holders of the preferred shares have no obligation to fund losses. The two-class equity method is performed on each period presented in reference to that period's earnings or loss. Consequently, the sum of the four quarters' earnings per share data will not necessarily equal the annual earnings per share data.

23. DISAGGREGATION OF REVENUE

Revenue is disaggregated by primary geographical market, type of customer and major product and services lines.

For the Year Ended December 31, 2020				Propane Distribution
	Canada	U.S.	Inter segment	Total
Revenue from sale of products	622.4	1,092.0	(17.5)	1,696.9
Revenue from services	35.5	33.9	–	69.4
Tank and equipment rental	27.2	13.4	–	40.6
Total revenue	685.1	1,139.3	(17.5)	1,806.9
For the Year Ended December 31, 2020				Specialty Chemicals
	Canada	U.S.	Other	Total
Revenue from sale of products	132.2	345.8	105.3	583.3
Revenue from services	3.3	0.6	0.2	4.1
Total revenue	135.5	346.4	105.5	587.4
For the Year Ended December 31, 2019				Propane Distribution
	Canada	U.S.	Inter segment	Total
Revenue from sale of products	790.2	1,249.9	(12.4)	2,027.7
Revenue from services	46.3	50.3	–	96.6
Tank and equipment rental	31.9	15.4	–	47.3
Total revenue	868.4	1,315.6	(12.4)	2,171.6
				Specialty Chemicals
	Canada	U.S.	Other	Total
Revenue from sale of chemicals	158.6	411.6	106.3	676.5
Revenue from services	2.5	2.2	0.1	4.8
Total revenue	161.1	413.8	106.4	681.3

24. SHARE-BASED COMPENSATION

Restricted and Performance Shares

Under Superior's long-term incentive program, restricted shares ("RSs"), performance shares ("PSs") and/or director shares ("DSs") can be granted to directors, senior officers and employees of Superior. All three types of shares entitle the holder to receive cash compensation in relation to the value of a specified number of underlying notional shares. RSs vest evenly over three years from the grant date, except for RSs issued to directors which vest three years from the grant date. Payments are made on the anniversaries of the RSs to the holders entitled to receive them on the basis of a cash payment equal to the value of the underlying notional shares. PSs vest three years from the grant date and their notional value depends on Superior's performance as compared to established benchmarks. DSs vest immediately on the grant date and payments are made to directors once they resign or retire based on the number of notional shares outstanding and the value of the shares on that date. Employee compensation expense for these plans is charged against net earnings or loss over the vesting period of the RSs, PSs, and DSs. The amount payable by Superior in respect of RSs, PSs and DSs changes as a result of dividends and share price movements. The fair value of all the RSs, PSs and DSs is equal to Superior's common share market price and the divisional notional share price if related to a divisional plan. In the event of an employee termination, any unvested shares are forfeited on that date.

For the year ended December 31, 2020, total compensation expense related to RSs, PSs and DSs was \$9.1 million (2019 – \$11.8 million). Exercises during the year ended December 31, 2020 under the long-term incentive plan were completed at a weighted average price of \$12.52 per share (2019 – \$11.69 per share) for RSs, and \$12.52 per share (2019 – \$10.26 per share) for PSs exercised during the year. For the December 31, 2020, the total carrying amount of the liability related to RSs, PSs and DSs was \$23.5million (2019 – \$19.1 million).

The movement in the number of shares under the long-term incentive program was as follows:

	2020				2019
	RSs	PSs	DSs	Total	RSs	PSs	DSs	Total
Opening number of shares	724,214	1,066,909	470,310	2,261,433	623,352			917,625 487,254 2,028,231
Granted	400,893	400,893	92,121	893,907	362,783	362,783	14,253	739,819
Performance factor adjustment and other	–	(176,303)	–	(176,303)	–	184,707	–	184,707
Dividends reinvested	48,286	77,313	36,398	161,997	43,724	66,499	27,521	137,744
Forfeited	(16,199)	(18,496)	(2,630)	(37,325)	(860)		(12,361) (58,718)	(71,939)
Exercised	(351,175)	(170,850)	–	(522,025)	(304,785)	(452,344)	–	(757,129)
Ending number of shares	806,019	1,179,466	596,199	2,581,684		724,214 1,066,909 470,310 2,261,433

Superior entered into equity derivative contracts in order to manage the volatility and costs associated with its sharebased compensation plans. As at December 31, 2020, Superior had outstanding notional values of \$21.1 million (2019 – \$21.8 million) of equity derivative contracts at an average share price of \$10.29 (2019 – \$12.06). See Note 17 for further details.

	2020	2019
Changes in non-cash operating working capital and other
Trade and other receivables, and prepaids and deposits	39.4	26.0
Inventories	(6.8)	49.3
Trade and other payables and other liabilities	(32.7)	(31.6)
	(0.1)	43.7
	2020	2019
Changes in liabilities arising from financing activities
Balance as at January 1	1,928.8	1,853.8
Net proceeds (repayment) of revolving term bank credits and other debt	(154.3)	(63.4)
Non-cash finance expense	5.0	5.8
Deferred acquisition payments	1.0	(0.2)
Lease additions including adoption of IFRS 16, net of repayments	37.4	178.0
Debt issue costs	–	(0.6)
Other, including foreign exchange	10.4	(44.6)
Balance as at December 31	1,828.3	1,928.8

25. SUPPLEMENTAL DISCLOSURE OF NON-CASH OPERATING WORKING CAPITAL CHANGES

26. RELATED-PARTY TRANSACTIONS AND AGREEMENTS

Transactions between Superior and its subsidiaries, which are related parties, have been eliminated on consolidation and are not disclosed in this note.

Remuneration of directors and other key management personnel

The key management personnel of Superior are comprised of executives of Superior and presidents of Superior's business segments. The remuneration paid to directors and other members of key management personnel over the past two years is as follows:

	2020	2019
Short-term employee benefits(i)	6.6	7.9
Other long-term employee benefits	0.1	0.1
Share-based payments	4.5	4.6
	11.2	12.6

(i) Short-term employee benefits paid to directors and other members of key management personnel include salaries and bonuses.

			Common Shares
			Ownership
			Interest
		Country of	(Direct and
Significant Subsidiaries		Organization	Indirect)
SP Reinsurance Company Limited		Bermuda	100%
Superior Plus LP		Canada	100%
Superior Gas Liquids Partnership Superior General Partner Inc.		Canada Canada	100% 100%
Superior International Inc.		Canada	100%
Superior Plus Canada Financing Inc.		Canada	100%
Stittco Utilities NWT Ltd.		Canada	100%
Stittco Utilities Man Ltd.		Canada	100%
Cal-Gas Inc.		Canada	100%
ERCO Worldwide (Canada) Corp.	(1)	Canada	100%
Commercial E Industrial ERCO (Chile) Limitada	(1)	Chile	100%
Superior Luxembourg Sàrl		Luxembourg	100%
Superior Plus US Holdings Inc.	(1)	U.S.	100%
Superior Plus US Financing Inc.	(1)	U.S.	100%
Superior Plus US Capital Corp.	(1)	U.S.	100%
ERCO Worldwide Inc.	(1)	U.S.	100%
ERCO Worldwide (USA) Inc.	(1)	U.S.	100%
International Dioxcide Inc.	(1)	U.S.	100%
Superior Plus Energy Services Inc.	(1)	U.S.	100%
NGL Propane, LLC	(1)	U.S.	100%
Osterman Propane, LLC	(1)	U.S.	100%
Sheldon Gas Company	(1)	U.S.	100%
Sheldon Oil Company	(1)	U.S.	100%
Sheldon United Terminals, LLC	(1)	U.S.	100%
United Liquid Gas Company, Inc.	(1)	U.S.	100%
Central Coast Propane, Inc.	(1)	U.S.	100%
Western Propane Services	(1)	U.S.	100%

(1)As disclosed in Note 19, Superior Plus US Holdings Inc. has issued 260,000 Preferred Shares issued to a third party which are exchangeable into common shares of Superior. If converted these Preferred Shares represent a 15% of the common shares of Superior. Superior Plus US Holdings Inc. owns 100% of the common shares of these entities either directly or indirectly.

28. REPORTABLE SEGMENT INFORMATION

Superior operates three operating segments: Canadian Propane Distribution, U.S. Propane Distribution and Specialty Chemicals. The Canadian Propane Distribution segment includes the Canadian retail business and wholesale business with operations in Canada and California. The U.S. Propane Distribution segment distributes propane gas and liquid fuels along the Eastern U.S., and into the Midwest and California.

Specialty Chemicals is a leading global supplier of sodium chlorate and technology to the pulp and paper industry and a regional supplier of chlor-alkali products in the U.S. Midwest and Western Canada.

Superior's Chief Operating Decision Maker, the President, reviews the operating results, assesses performance, and makes capital allocation decisions with respect to the Canadian Propane Distribution, U.S. Propane Distribution and Specialty Chemicals businesses and the corporate office. Therefore, Superior has presented these as operating segments for financial reporting purposes in accordance with IFRS 8, Operating Segments.

	U.S.	CAD
	Propane	Propane	Specialty		Total	Inter
Year Ended December 31, 2020	Distribution	Distribution	Chemicals	Corporate	Segments	segment	Consolidated
Revenue
External customers	899.4	907.5	587.4	–	2,394.3	–	2,394.3
Inter-segment(i)	–	17.5	–	–	17.5	(17.5)	–
Total revenue	899.4	925.0	587.4	–	2,411.8	(17.5)	2,394.3
Cost of sales (includes products
and services)	(368.0)	(525.2)	(395.4)	–	(1,288.6)	–	(1,288.6)
Inter-segment(i)	(17.5)	–	–		(17.5)	17.5	–
Gross profit	513.9	399.8	192.0	–	1,105.7	–	1,105.7
Expenses
Depreciation included in SD&A	(71.2)	(42.1)	(7.7)	(0.1)	(121.1)	–	(121.1)
Depreciation of right-of-use assets included in SD&A	(5.2)	(11.4)	(22.2)	(0.3)	(39.1)	–	(39.1)
Amortization of intangible assets
included in SD&A	(42.1)	(20.7)	(1.1)	(0.2)	(64.1)	–	(64.1)
SD&A	(309.3)	(205.3)	(122.1)	(29.2)	(665.9)	–	(665.9)
Finance expense	(5.2)	(4.4)	(8.0)	(88.9)	(106.5)	–	(106.5)
Gains (losses) on derivatives and foreign currency translation of
borrowings	11.6	7.3	0.7	30.1	49.7	–	49.7
	(421.4)	(276.6)	(160.4)	(88.6)	(947.0)	–	(947.0)
Earnings (loss) before income	92.5	123.2	31.6	(88.6)	158.7	–	158.7
Income tax expense	–	–	–	(71.9)	(71.9)	–	(71.9)
Net earnings (loss) for the year	92.5	123.2	31.6	(160.5)	86.8	–	86.8

(i) Inter-segment revenues and cost of sales are eliminated upon consolidation and reflected in the 'inter-segment' column.

	U.S.	CAD
	Propane	Propane	Specialty		Total	Inter
Year Ended December 31, 2019	Distribution	Distribution	Chemicals	Corporate	Segments	segment	Consolidated
Revenue
External customers	1,024.1	1,147.5	681.3	–	2,852.9	–	2,852.9
Inter-segment(i)	–	12.4		–	12.4	(12.4)	–
Total revenue	1,024.1	1,159.9	681.3	–	2,865.3	(12.4)	2,852.9
Cost of sales (includes products
and services)	(514.7)	(680.4)	(444.8)	–	(1,639.9)	–	(1,639.9)
Inter-segment(i)		(12.4)		–	(12.4)	12.4	–
Gross profit	509.4	467.1	236.5	–	1,213.0	–	1,213.0
Depreciation included in SD&A	(60.5)	(40.0)	(7.9)	(0.1)	(108.5)	–	(108.5)
Depreciation of right-of-use
assets included in SD&A	(4.9)	(9.1)	(21.4)	(0.3)	(35.7)	–	(35.7)
Amortization of intangible
assets included in SD&A	(39.6)	(22.8)	(1.1)	–	(63.5)	–	(63.5)
SD&A	(308.9)	(243.9)	(153.0)	(34.8)	(740.6)	–	(740.6)
Finance expense	(4.4)	(4.4)	(8.1)	(97.4)	(114.3)	–	(114.3)
Gains (losses) on derivatives
and foreign currency
translation of borrowings	(11.7)	(16.7)	2.9	42.7	17.2	–	17.2
	(430.0)	(336.9)	(188.6)	(89.9)	(1,045.4)	–	(1,045.4)
Earnings (loss) before income	79.4	130.2	47.9	(89.9)	167.6	–	167.6
Income tax expense	–	–	–	(25.0)	(25.0)	–	(25.0)
Net earnings (loss) for the year	79.4	130.2	47.9	(114.9)	142.6	–	142.6

Net Working Capital, Total Assets, Total Liabilities and Purchase of Property, Plant and Equipment

	U.S. Propane Distribution	Canadian Propane Distribution	Specialty Chemicals	Corporate	Total
As at December 31, 2020
Net working capital(i)	(13.6)	14.7	62.4	(41.2)	22.3
Total assets	1,823.2	1,112.2	784.7	106.2	3,826.3
Total liabilities	361.1	266.4	351.5	1,567.2	2,546.2
As at December 31, 2019
Net working capital(i)	(0.4)	42.0	56.9	(48.6)	49.9
Total assets	1,600.2	1,167.7	797.8	72.3	3,638.0
Total liabilities	268.8	295.1	338.8	1,696.3	2,599.0
For the Year Ended December 31, 2020
Purchase of property, plant and equipment and intangible assets	33.3	39.0	43.0	1.0	116.3
For the Year Ended December 31,
Purchase of property, plant and equipment and intangible assets	44.4	50.3	41.2	–	135.9

(i) Net working capital is composed of trade and other receivables, prepaids and deposits, and inventories, less trade and other payables, contract liabilities and dividends payable.

29. GEOGRAPHICAL INFORMATION

				Total
	Canada	U.S.	Other	Consolidated
Revenue for the year ended December 31, 2020	803.1	1,485.7	105.5	2,394.3
Property, plant and equipment as at December 31, 2020	631.3	808.1	33.8	1,473.3
Right-of-use assets as at December 31, 2020	109.4	64.4	0.7	174.5
Intangible assets as at December 31, 2020	151.4	274.0	–	425.4
Goodwill as at December 31, 2020	325.7	827.1	–	1,152.8
Total assets as at December 31, 2020	1,528.2	2,248.1	50.0	3,826.3
Revenue for the year ended December 31, 2019	1,017.1	1,729.4	106.4	2,852.9
Property, plant and equipment as at December 31, 2019	596.9	696.0	38.8	1,331.7
Right-of-use assets as at December 31, 2019	146.0	97.1	0.8	243.9
Intangible assets as at December 31, 2019	152.3	236.5	–	388.8
Goodwill as at December 31, 2019	325.8	755.1	–	1,080.9
Total assets as at December 31, 2019	1,562.3	2,021.5	54.2	3,638.0

30. SUBSEQUENT EVENTS

On January 26, 2021 Superior announced the acquisition of 100% interest in the assets of a retail propane and distillate distribution company, operating in Massachusetts under the tradename Holden Oil ("Holden") for a total consideration of US\$17.8 million.

On February 1, 2021 Superior acquired a 100% equity interests of a retail propane distribution company, operating in Quebec under the tradename Miller Propane ("Miller") for a total consideration of CDN \$7.5 million.

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 CDN \$13.9 million.

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 of the business for the three consecutive twelve-month periods following the closing date. If the average EBITDA, adjusted to remove the impact of IFRS 16, 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 which includes accumulated interest. The note will bear interest at the same rate as the Vendor Note and interest will accrue from the closing date. If the average EBITDA, adjusted to remove the impact of IFRS 16, 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 which includes accumulated interest. The note will bear interest at the same rate as the Vendor Note and interest will accrue from the closing date. As at December 31, 2020, the Specialty Chemicals segment did not meet the definition of assets held for sale and discontinued operations. Subsequent to December 31, 2020 and until the transaction closes, the assets and liabilities of the Specialty Chemical segment will be shown as held for sale on the balance sheet and the segments net earnings (loss), including comparative figures, will be shown as a discontinued operation on the Consolidated Statements of Net Earnings (Loss).