Superior Plus Corp. - Management Reports 2022

MANAGEMENT’S DISCUSSION AND ANALYSIS OF 2021 ANNUAL AND FOURTH QUARTER RESULTS FEBRUARY 17, 2022

This Management’s Discussion and Analysis (MD&A) contains information about the performance and financial position of Superior Plus Corp. (Superior) as at and for the years ended 2021 and 2020, as well as forward-looking information about future periods. The information in this MD&A is current to February 17, 2022, and should be read in conjunction with Superior’s audited consolidated financial statements and notes thereto as at and for the years ended December 31, 2021 and 2020.

The accompanying audited consolidated financial statements of Superior were prepared by and are the responsibility of Superior’s management. Superior’s audited consolidated financial statements as at and for the years ended December 31, 2021 and 2020 were prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).

All financial amounts in this MD&A are expressed in millions of Canadian dollars except where otherwise noted. All tables are for the year ended December 31 of the period indicated, unless otherwise stated. This MD&A includes forward-looking statements and assumptions. See “Forward-Looking Information” for more details.

Overview of Superior

Superior is a distributor and marketer of propane and distillates and related products and services. Superior holds 99.9% of Superior Plus LP (Superior LP), a limited partnership formed between Superior General Partner Inc. (Superior GP) as general partner and Superior as limited partner. Superior owns 100% of the shares of Superior GP and Superior GP holds 0.1% of Superior LP. The cash flow of Superior is solely dependent on the results of Superior LP and is derived from the allocation of Superior LP’s income to Superior by means of partnership allocations.

Superior, through its ownership of Superior LP and Superior GP, has two operating segments: U.S. Propane Distribution, and Canadian Propane Distribution. The U.S. Propane Distribution segment distributes propane gas and liquid fuels primarily in the Eastern United States, as well as the Midwest and California. The Canadian Propane Distribution segment includes the Canadian retail propane distribution business and the wholesale natural gas liquid marketing businesses with operations located in Canada and California. The previously disclosed Specialty Chemicals segment has been divested, see the Basis of Presentation and Divestiture section below for further details.

Non-GAAP Financial Measures

Throughout the MD&A, Superior has used the following terms that are not defined under International Financial Reporting Standards (IFRS), but are used by management to evaluate the performance of Superior and its businesses: adjusted operating cash flow (AOCF), AOCF before transaction, restructuring and other costs, earnings before interest, taxes, depreciation and amortization (EBITDA) from operations, Adjusted EBITDA, Operating Costs, Interest expense, Net Debt, Leverage Ratio, Interest Expense, Pro Forma Adjusted EBITDA and Adjusted Gross Profit. These measures may also be used by investors, financial institutions and credit rating agencies to assess Superior’s performance and ability to service debt. Non-GAAP financial measures do not have standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Securities regulations require that Non-GAAP and other financial measures are clearly defined, explained and certain of these measures are reconciled to their most directly comparable measure presented in the (primary) financial statements. Except as otherwise indicated, these Non-GAAP financial measures are calculated and disclosed on a consistent basis from period to period. Specific items may only be relevant in certain periods.

The intent of using Non-GAAP financial measures is to provide additional useful information to investors and analysts; the measures do not have standardized meaning under IFRS. The measures should not, therefore, be considered in isolation or used in substitute for measures of performance prepared in accordance with IFRS. Other issuers may calculate Non-GAAP financial measures differently. See “Non-GAAP Financial Measures” for more information about these measures.

Superior Plus Corp.

Forward-Looking Information

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

Forward-looking information in this document includes: future financial position, consolidated and business segment outlooks, 2022 Adjusted EBITDA guidance range, the duration and anticipated impact of the COVID-19 pandemic, estimates of the impact COVID-19 may have on our operations, the markets for our products and our financial results, expected Leverage ratio, business strategy and objectives, development plans and programs, organic growth, weather, economic activity in Western Canada, product pricing and sourcing, volumes and pricing, wholesale propane market fundamentals, exchange rates, expected synergies from acquisitions, expected seasonality of demand, the anticipated closing of Kamps Propane Inc., High Country Propane, Inc., Pick Up Propane, Inc., Kiva Energy, Inc., Competitive Capital, Inc. and Propane Construction and Meter Services (collectively, “Kamps”) and the associated timing, commercial demand recovery in the second half of 2022, long-term incentive plan accrual estimates, estimated net financial impact of the Cyber security incident and future economic conditions.

Forward-looking information is provided for the purpose of providing information about management’s expectations and plans about the future and may not be appropriate for other purposes. Forward-looking information herein is based on various assumptions and expectations that Superior believes are reasonable in the circumstances. No assurance can be given that these assumptions and expectations will prove to be correct. Those assumptions and expectations are based on information currently available to Superior, including information obtained from third party industry analysts and other third-party sources, and the historic performance of Superior’s businesses. Such assumptions include the acquisition of Kamps closing in the second quarter of 2022 in accordance with the terms of the agreement, anticipated financial performance, current business and economic trends, the amount of future dividends paid by Superior, business prospects, utilization of tax basis, regulatory developments, currency, exchange and interest rates, future commodity prices relating to the oil and gas industry, future oil rig activity levels, trading data, cost estimates, our ability to obtain financing on acceptable terms, expected life of facilities and statements regarding net working capital and capital expenditure requirements of Superior or Superior LP, the assumptions set forth under the “Financial Outlook” sections in this MD&A. The forward-looking information is also subject to the risks and uncertainties set forth below.

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

When relying on Superior’s forward-looking information to make decisions with respect to Superior, investors and others should carefully consider the preceding factors, other uncertainties and potential events. Any forward-looking information is provided as of the date of this document and, except as required by law, neither Superior nor Superior

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LP undertakes to update or revise such information to reflect new information, subsequent or otherwise. For the reasons set forth above, investors should not place undue reliance on forward-looking information.

Basis of Presentation and Divestiture

On April 9, 2021 (the “closing date”) Superior completed the previously announced sale of its Specialty Chemicals business for total consideration of $725.0 million (the “Transaction”). Superior received $600.0 million in cash proceeds less working capital and other adjustments of $17.0 million and $125.0 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 October 9, 2026.

The Transaction purchase price is subject to adjustment based on the average EBITDA of the business, excluding the impact of IFRS 16 (the “average EBITDA”), for the three consecutive twelve-month periods following the closing date. The Transaction purchase price may be adjusted through the issuance of an additional note from either Superior or the Specialty Chemicals business. If the average EBITDA is higher than $115 million, the buyer will issue an additional note to Superior. The amount of the additional note will be the difference between the average EBITDA and $115 million, multiplied by 4.5, up to a maximum of $100 million, including accumulated interest. The additional note will bear interest at the same rate as the Vendor Note and interest will accrue from the closing date. If the average EBITDA is lower than $100 million, an additional note will be issued by Superior to the Specialty Chemicals business. The amount of the additional note will be the difference between the average EBITDA and $100 million, multiplied by 4.5, up to a maximum of $100 million, including accumulated interest. The additional note will bear interest at the same rate as the Vendor Note and interest will accrue from the closing date.

Superior now presents the results of operations from this business as discontinued operations, (see Note 3 in the audited consolidated financial statements). The Specialty Chemicals segment operated as a distinct segment, and has no impact on the operations of the Energy Distribution segments. This MD&A reflects the results of continuing operations, unless otherwise noted.

Superior Plus Corp.

FINANCIAL OVERVIEW - GAAP FINANCIAL INFORMATION

Consolidated Statement of Net Earnings

Consolidated Statement of Net Earnings	Consolidated Statement of Net Earnings
Year Ended December 31 (millions ofCanadiandollars, except pershare amounts) 2021 2020(i)
	Revenue 2,392.6 1,806.9 Cost of sales(includesproducts and services) (1,479.9) (893.2)
	Grossprofit 912.7 913.7
	Expenses Selling, distribution and administrative costs ("SD&A") (804.8) (737.1) Finance expense (155.0) (98.5) Gains (loss) on derivatives and foreign currency translation of borrowings 70.0 49.0
	(889.8) (786.6)
	Earnings before income taxes 22.9 127.1 Income tax expense (5.7) (64.3)
	Net earnings from continuing operations 17.2 62.8 Net earnings from discontinued operations, net of tax expense 189.5 24.0
	Net earnings 206.7 86.8
	Net earnings from continuing operations attributable to: Superior (6.6) 51.1 Non-controlling interest 23.8 11.7
	Net earnings per share from continuing operations attributable to Superior Basic and diluted (0.04) 0.29 Net earnings per share attributable to Superior Basic and diluted 0.99 0.43 Cash flows from operating activities 232.0 360.2 Cash flows from operating activities, per share(2) 1.13 1.90

(1) The comparative figures have been restated to conform with the current year’s presentation, see Basis of Presentation.

(2) The weighted average number of shares outstanding for the year ended December 31, 2021 was 206.0 million December 31, 2020 was 189.7 million). The weighted average number of shares assumes the exchange of the preferred shares into common shares. There were no other dilutive instruments for the year ended, December 31, 2021 and 2020.

Non-GAAP Financial Information

The following summary contains Non-GAAP financial information. The intent of this Non-GAAP financial information is to provide additional useful information to investors and analysts as they exclude non-cash items and expenses related to acquisitions. These measures do not have standardized meanings under IFRS and should not be considered in isolation or used in substitute for measures of performance prepared in accordance with IFRS. Other issuers may calculate Non-GAAP financial measures differently. See “Non-GAAP Financial Measures” on page 42 for more information about these measures.

Superior Plus Corp.

Summary of AOCF

Summary of AOCF
	Year Ended
	December 31
(millions of dollars except per share amounts)	2021	2020(1)
US Propane Distribution Adjusted EBITDA(2)	226.2	206.9
Canadian Propane Distribution Adjusted EBITDA(2)	183.7	195.0
EBITDA from operations(2)	409.9	401.9
Corporate operating costs(2)	(24.1)	(20.5)
Realized gains (losses) on foreigncurrencyhedging contracts (3)	12.6	(2.0)
Adjusted EBITDA(2)	398.4	379.4
Interest expense(4)	(76.1)	(91.8)
Adjusted currentincome tax(expense)recovery (2) (4)	(1.2)	4.6
AOCF before transaction, restructuring and other costs(2)	321.1	292.2
Transaction,restructuring and othercosts (5)	(28.9)	(23.6)
AOCF(2)	292.2	268.6
AOCF per share before transaction, restructuring and other costs(5)(6)	$1.56	$1.54
AOCF per share(6)	$1.42	$1.42
Dividends declaredper common share	$0.72	$0.72

(1) The comparative figures have been restated to conform with the current year’s presentation, see Basis of Presentation.

(2) These amounts are Non-GAAP financial measures, see “Non-GAAP financial measures and reconciliations” on page 42 for more information.

(3) Realized gains (losses) on foreign currency hedging contracts are reconciled to gains (losses) on derivatives and foreign currency translation of borrowings, see “Non-GAAP financial measures and reconciliations” on page 42 for more information.

(4) Interest expense is the sum of interest on borrowings and interest on lease liability. Current income tax expense (recovery) forms part of the total income tax expense (recovery), see Note 21 of the audited consolidated financial statements as at and for the year ended December 31, 2021 and 2020. Adjusted current income tax (expense) recovery is the current income tax expense adjusted by an $85.0 million recovery representing the impact of reporting the divestiture as a discontinued operation, see Note 19.

(5) Transaction, restructuring and other costs are related to acquisition activities and the restructuring and integration of acquisitions. See “Transaction, restructuring and other Costs” for further details. These expenses are included in SD&A and are disclosed in Note 21 of the audited consolidated financial statements as at and for the year ended December 31, 2021 and 2020.

(6) The weighted average number of shares outstanding for the year ended December 31, 2021 was 206.0 million (year ended December 31, 2020 was 189.7 million). The weighted average number of shares assumes the exchange of the preferred shares into common shares. There were no other dilutive instruments for the year ended December 31, 2021 and 2020.

Superior Plus Corp.

AOCF Reconciled to Cash Flows from Operating Activities[ (1) ]

AOCF Reconciled to Cash Flows from Operating Activities(1)
	Year Ended
	December 31
(millions of dollars)	2021	2020
Cash flows from operating activities	232.0	360.2
Non-cash interest expense, loss on redemption, net of interest on vendor note(2)	78.9	6.7
Changes in non-cash operating working capital	60.6	0.2
Income taxes paid	15.2	11.6
Interest paid	90.7	99.0
Adjusted current income tax (expense) recovery(2) (3)	(1.2)	4.6
Finance expenserecognizedin net earnings	(155.0)	(98.5)
	321.2	383.8
Lessresults of AOCF from Discontinued operations (4)	(29.0)	(115.2)
AOCF(1)	292.2	268.6

(1) AOCF is a Non-GAAP measure. See “Non-GAAP financial measures and reconciliations” on page 42 for more information.

(2) This information is provided in Note 21 of the audited consolidated financial statements as at and for the year ended December 31, 2021.

(3) Adjusted current income tax (expense) recovery is the current income tax expense adjusted by an $85.0 million recovery representing the impact of reporting the divestiture as a discontinued operation, see Note 19.

(4) AOCF from discontinued operations is the sum of revenue, cost of sales and SD&A, see Note 3 of the audited consolidated financial statements as at and for the year ended December 31, 2021. SD&A has been adjusted for loss on disposal of assets of $0.5 million (2020 - $2.3 million).

RECENTLY COMPLETED AND ANNOUNCED ACQUISITIONS

On January 26, 2021 Superior acquired 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$17.7 million (CDN $22.4 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 $7.5 million.

On February 11, 2021, Superior acquired the assets and shares of an Ontario retail propane distribution company, operating under the tradename Highlands Propane (“Highlands”) for a total consideration of $15.0 million.

On June 16, 2021 a wholly-owned subsidiary of Superior acquired the assets of a retail propane distribution company based in South Carolina, operating under the tradename, Freeman Gas and Electric Co., Inc. (“Freeman”) for an aggregate purchase price of approximately US$170.4 million (CDN $209.2 million) before adjustments for working capital.

On July 7, 2021, a wholly-owned subsidiary of Superior acquired the assets of a retail propane distribution company based in North Carolina, operating under the tradename, Williams Energy Group (“Williams Energy”) for an aggregate purchase price of approximately US$38.8 million (CDN $48.4 million).

On July 14, 2021, Superior announced that one of its wholly owned subsidiaries entered into an agreement to acquire the equity interest of Kamps Propane Inc., High Country Propane, Inc., Pick Up Propane, Inc., Kiva Energy, Inc., Competitive Capital, Inc. and Propane Construction and Meter Services (“collectively, Kamps”) for an aggregate purchase price of approximately US $240 million (CDN $299 million) before adjustments for working capital. As a result of a second request from the United States Federal Trade Commission review, Superior expects this may delay the closing, until the second quarter of 2022.

On December 21, 2021, a wholly-owned subsidiary of Superior acquired the assets of a retail propane distribution company based in Michigan, operating under the tradename Hopkins Propane (“Hopkins”) for a total consideration

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of approximately US$16.2 million (CDN $20.9 million) before adjustments for working capital. In addition, a whollyowned subsidiary of Superior acquired the assets of a retail propane distribution company based in Waynesville, North Carolina operating under the tradename Mountain Energy Gas (“Mountain Energy”) for a total consideration of approximately US$2.0 million (CDN $2.6 million) before adjustments for working capital.

Annual Financial Results Compared to the Prior Year

The net earnings from continuing operations for the year ended December 31, 2021 was $17.2 million, compared to $62.8 million in the prior year. The decrease from the prior year is primarily due to higher SD&A and finance expense partially offset by higher gains on derivatives and foreign currency translation of borrowings and lower income tax expense. Basic and diluted earnings (loss) per share from continuing operations attributable to Superior was $(0.04) per share a decrease of $0.33 from $0.29 per share in the prior year. The decrease is due to the above reasons, and the impact of the treatment of the non-controlling interest on earnings (loss) per share.

Net earnings from discontinued operations of $189.5 million for the year ended December 31, 2021 increased by $165.5 million from $24.0 million in the prior year. The increase was primarily due to recording a realized gain on the disposal of the Specialty Chemical segment compared to a year of operations in the prior year.

Revenue for the year ended December 31, 2021 was $2,392.6 million, an increase of $585.7 million or 32% from the prior year due to higher revenue in both the Canadian Propane Distribution (“Canadian Propane”) and U.S. Propane Distribution (“U.S. Propane”) segments. Canadian Propane revenue for the year ended December 31, 2021 was $1,244.3 million, an increase of $319.3 million or 35% due primarily to higher wholesale propane prices. U.S. Propane revenue for the year ended December 31, 2021 was $1,178.0 million, an increase $278.6 million or 31% due to acquisitions completed in the current and prior year and higher wholesale propane prices, partially offset by the impact of the stronger Canadian dollar on U.S. denominated sales. Due to the nature of Superior’s operating model, the impact of commodity price volatility is passed on to the customer.

Consolidated gross profit was $912.7 million, a decrease of $1.0 million from $913.7 million in the prior year primarily due to lower Canadian Propane gross profit, partially offset by higher U.S. Propane gross profit. Canadian gross profit decreased primarily due to weaker wholesale propane market fundamentals within the supply portfolio management business and was partially offset by an increase in sales of carbon offset credits. U.S. Propane Distribution gross profit increased primarily due to the impact of completed acquisitions in the current and prior year and colder weather in the first quarter partially offset by the impact of the stronger Canadian dollar on the translation of U.S. denominated gross profit. For U.S. Propane and Canadian Propane gross profit, realized gains and losses related to Superior’s commodity risk management are not included in gross profit. These realized gains and losses are reported as part of gains and losses on derivatives and foreign currency translation of borrowings.

SD&A was $804.8 million for the year ended December 31, 2021, an increase of $67.7 million or 9% from the prior year, primarily due to an increase in U.S. Propane SD&A and to a lesser extent Canadian Propane and Corporate SD&A. U.S. Propane SD&A costs were $476.2 million, an increase of $48.4 million or 11% from $427.80 million in the prior year primarily due to the impact of completed acquisitions and to a lesser extent increased incentive plan costs and insurance costs partially offset by the impact of the stronger Canadian dollar on the translation of U.S. denominated SD&A. Canadian Propane SD&A costs were $292.7 million an increase of $13.2 million or 5% from $279.5 million in the prior year was due to the reduction in the benefit from the CEWS program recorded in the current year compared to the prior year, higher transaction costs and to a lesser extent higher incentive plan costs. Corporate SD&A costs were $35.9 million, an increase of $6.1 million or 20% from $29.8 million in the prior year primarily due to higher incentive plan costs related to share price appreciation and to a lesser extent higher transaction costs.

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Finance expense for the year ended December 31, 2021 was $155.0 million, an increase of $56.5 million or 57% from $98.5 million in the prior year. The increase is primarily due to early call premiums and non-cash financing expenses related to the redemption of the US$350 million, $400 million and $370 million senior unsecured notes partially offset by lower interest expenses. Interest expenses decreased due to lower average debt balances, lower average interest rates and to a lesser extent recording interest earned on the Vendor Note, net of finance expense. Average debt balances were lower as the net proceeds from the divestiture of Specialty Chemicals in April 2021 were used to pay down debt prior to the completion of acquisitions in the past seven months.

Gains on derivative and foreign currency translation of borrowings consists of unrealized gains (losses) on derivative financial instruments and foreign currency translation of borrowings, net of realized gains (losses) on derivative financial instruments and realized gains (losses) on settlement of U.S. denominated borrowings. The gain on derivatives and foreign currency translation of borrowings was $70.0 million for the year ended December 31, 2021, an increase of $21.0 million compared to a gain of $49.0 million in the prior year. The increase was mainly related to changes in market prices of commodities, timing of maturities of underlying financial instruments and changes in foreign exchange rates relative to amounts hedged. For additional details, refer to Note 18 of the 2021 audited consolidated financial statements.

Total income tax expense of $5.7 million was $58.6 million lower than the prior year’s expense of $64.3 million. Current income tax recovery was $83.8 million, an increase of $79.2 million from the prior year recovery of $4.6 million. The increase is primarily due to the presentation of the impact of reporting the divestiture as a discontinued operation. This was more than offset by a deferred income tax expense of $89.5 million, an increase of $20.6 million from the prior year expense of $68.9 million primarily due to the utilization of tax pools to shelter the gain on the divestiture.

Annual Non-GAAP Financial Results Compared to the Prior Year

Adjusted EBITDA for the year ended December 31, 2021 was $398.4 million, an increase of $19.0 million or 5% compared to the prior year Adjusted EBITDA of $379.4 million. The increase is primarily due to a realized gain on foreign currency hedging contracts in the current year compared to a loss in the prior year, and to a lesser extent higher EBITDA from operations, partially offset by higher corporate costs. Superior realized gains on foreign currency hedging contracts of $12.6 million compared to a loss of $2.0 million in the prior year due to the impact of the stronger Canadian dollar compared to the average hedge rate. EBITDA from operations increased $8.0 million or 2% compared to the prior year primarily due to higher U.S. Propane Adjusted EBITDA partially offset by lower Canadian Propane Adjusted EBITDA. U.S. Propane Adjusted EBITDA was $226.2 million, an increase of $19.3 million or 9% primarily due to the impact of acquisitions completed during the year, partially offset by the impact of the stronger Canadian dollar on the translation of U.S. denominated EBITDA. Canadian Propane Adjusted EBITDA was $183.7 million, a decrease of $11.3 million or 6% primarily due to weaker propane wholesale market differentials compared to the prior year and a lower benefit from the CEWS program compared to the prior year partially offset by the increased sales of carbon offset credits. Corporate administrative costs were $24.0 million compared to $20.5 million in the prior year. The increase is primarily due to higher incentive plan costs than in the prior year due to the appreciation in Superior’s share price earlier in 2021.

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AOCF before transaction, restructuring and other costs for the year ended December 31, 2021 was $321.1 million, an increase of $28.9 million or 10% from the prior year AOCF before transaction, restructuring and other costs of $292.2 million. The increase from the prior year is primarily due to higher Adjusted EBITDA discussed above, and lower interest expense partially offset by higher current taxes. Interest expense decreased by $15.7 million or 17% primarily to due to lower average debt balances and lower average interest rates. Current income tax expense increased by $5.8 million primarily due to the impact of the presentation of discontinued operations. For purposes of determining AOCF the current tax charge associated with the divestiture was removed, see Note 19 of the audited consolidated financial statements as at and for the year ended December 31, 2021. AOCF per share before transaction, restructuring and other costs assuming conversion of preferred shares was $1.56 per share, an increase of $0.02 per share or 1% from the prior year to date results of $1.54 per share primarily due to the higher AOCF before transaction, restructuring and other costs discussed above partially offset by the increase in weighted average shares outstanding. Weighted average shares outstanding were higher than the prior comparable period due to the issuance of preferred shares to Brookfield Asset Management (the “Preferred Shares”) that are reflected on an as converted basis.

AOCF for the year ended December 31, 2021 was $292.2 million, an increase of $23.6 million or 9% from the prior year AOCF of $268.6 million due to the increased AOCF before transaction, restructuring and other costs discussed above, partially offset by higher transaction, restructuring and other costs. AOCF per share for year ended December 31, 2021 was $1.42 per share assuming conversion of the preferred shares, which was consistent with from the prior year quarter results. Transaction, restructuring and other costs for the year ended December 31, 2021 was $28.9 million, an increase of $5.3 million from prior year of $23.6 million.

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RESULTS OF SUPERIOR’S OPERATING SEGMENTS

Superior’s operating segments consists of U.S. Propane and Canadian Propane.

U.S. PROPANE DISTRIBUTION

U.S. Propane Distribution’s operating results:

U.S. PROPANEDISTRIBUTION U.S. Propane Distribution’s operating results:
	Year Ended
	December 31
(millions of dollars)	2021	2020
Revenue	1,178.0	899.4
Cost ofSales	(650.4)	(385.5)
Gross profit	527.6	513.9
Realized gains (losses) onderivativesrelated to commodityrisk management (2)	35.5	(14.6)
Adjusted gross profit(1)	563.1	499.3
Selling, distribution and administrative costs	(476.2)	(427.8)
Add back (deduct):
Amortization and depreciation included in selling, distribution and administrative costs(3)	125.5	118.5
Transaction, restructuring and other costs(3)	13.6	14.4
Loss ondisposalofassets and other(3)	0.2	2.5
Operating costs(1)	(336.9)	(292.4)
Adjusted EBITDA(1)	226.2	206.9
Add back (deduct):
Loss on disposal of assets and other(3)	(0.2)	(2.5)
Transaction, restructuring and other costs(3)	(13.6)	(14.4)
Amortization and depreciation included in selling, distribution and administrative costs	(125.5)	(118.5)
Unrealized gains on derivative financial instruments(2)	18.1	26.2
Finance expense (3)	(5.2)	(5.2)
Earnings before income tax	99.8	92.5

(1) Adjusted Gross Profit, Adjusted EBITDA and Operating Costs are Non-GAAP financial measures. See “Non-GAAP financial measures and reconciliations” on page 42 for more information.

(2) Realized gains (losses) on derivatives related to commodity risk management are reconciled to Gains (losses) on derivatives and foreign currency translation of borrowings, see “Non-GAAP financial measures and reconciliations” on page 42 for more information.

(3) The sum of the above amounts and the balances included in the Canadian Propane and the corporate segments are included in SD&A and are disclosed in Note 21 or Note 29 of the audited consolidated financial statements as at and for the year ended December 31, 2021 and 2020.

Revenue for the year ended December 31, 2021 was $1,178.0 million, an increase of $278.6 million from the prior year primarily due to the impact of acquisitions completed in the current and prior year and to a lesser extent higher wholesale propane prices, partially offset by the impact of the stronger Canadian dollar on the translation of U.S. denominated revenue. Wholesale supply prices were higher than the prior year due to wholesale propane market fundamentals and an increase in average West Texas Intermediate (“WTI”) crude oil prices and higher propane exports, compared to the prior year. WTI crude oil prices increased in 2021 as increasing COVID-19 vaccination rates, loosening pandemic-related restrictions, and a growing economy resulted in global petroleum demand.

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U.S. Propane Adjusted Gross Profit

U.S. Propane Adjusted Gross Profit
	Year Ended
	December 31
(millions of dollars)	2021	2020
Propane distribution(1)	504.1	494.2
Realized gain(loss) onderivativesrelated to commodityrisk management (1)	35.5	(14.6)
Adjusted gross profit related to propane distribution	539.6	479.6
Otherservices (1)	23.5	19.7
Adjustedgrossprofit(2)	563.1	499.3

(1) The sum of propane distribution and other services agrees to segment disclosure in the annual consolidated financial statements. Realized gains (losses) are derivatives related to commodity risk management and are reconciled to Gains (losses) on derivatives and foreign currency translation of borrowings, see “Non-GAAP financial measures and reconciliations” on page 42 for more information.

(2) Adjusted gross profit from operations is a Non-GAAP financial measure. See “Non-GAAP financial measures and reconciliations” on page 42 for more information.

Adjusted gross profit related to propane distribution for the year ended December 31, 2021 was $539.6 million, an increase $60.0 million or 13% from the prior year primarily due to higher sales volumes partially offset by the impact of the stronger Canadian dollar on the translation of U.S. denominated gross profit.

Total sales volumes were 1,327 million litres, an increase of 174 million litres or 15% primarily due to the impact of acquisitions completed in the current and prior year. Average weather, as measured by degree days, across markets where U.S. propane operates for 2021 was 1% colder than the prior year and 4% warmer than the five-year average. Residential sales volumes increased by 87 million litres or 14% from the prior year due primarily to the impact of acquisitions completed in the past twelve months. Commercial volumes increased by 91 million litres or 19% compared to the prior year primarily due to the impact of acquisitions completed in the current and prior year, and to a lesser extent the impact of reduced COVID-19 restrictions on commercial customers. Wholesale volumes decreased by 4 million litres or 14% due to customer attrition, partially offset by the impact of acquisitions completed in the current and prior years.

U.S. Propane average sales margins were 40.7 cents per litre, a decrease of 0.9 cents from 41.6 cents per litre in the prior year primarily due to the impact of the stronger Canadian dollar on the translation of U.S. denominated gross profit partially offset by the impact of focusing on higher margin propane customers.

Other services gross profit primarily includes equipment, installation, repair and maintenance charges. Other services gross profit was $23.5 million, an increase of 19% over the prior year primarily due to the acquisitions completed in the current and prior year, partially offset by a strategic shift to focus on higher margin activities.

Superior Plus Corp.

U.S. Propane Distribution Sales Volumes

End-Use Application [(][1][)(2)]

U.S. Propane Distribution Sales Volumes End-Use Application (1)(2)
		Year Ended
	December 31
(millions of litres)	2021	2020
Residential	724	637
Commercial	578	487
Wholesale	25	29
Total	1,327	1,153

U.S. Propane Distribution Sales Volumes Volumes by Region[ (1)]

U.S. Propane Distribution Sales Volumes *Volumes by Region (1)*
		Year Ended
	December 31
(millions of litres)	2021	2020
Northeast	1,030	927
Southeast	175	105
Midwest	84	87
West	38	34
Total	1,327	1,153

(1) Includes heating oil, propane, diesel and gasoline sold in over twenty-two states in the following regions: Northeast region consists of Maine, New Hampshire, Vermont, Massachusetts, Connecticut, Rhode Island, New York, Pennsylvania, New Jersey, Delaware, Maryland, Virginia; Southeast region consists of North Carolina, South Carolina, Georgia, Tennessee, Florida, Alabama; Midwest region consists of Ohio, Michigan, Minnesota; West region consists primarily of California.

(2) Comparative figures have been reclassified to conform the current period presentation.

Operating Costs and Selling, Distribution and Administrative Costs

Operating costs were $336.9 million, an increase of $44.5 million or 15% over the prior year primarily due to the impact of acquisitions, and to a lesser extent higher incentive costs, partially offset by the impact of the stronger Canadian dollar on the translation of U.S. denominated operating costs and cost-saving initiatives.

SD&A includes amortization, depreciation and transaction, restructuring and other costs whereas operating costs exclude these expenses and is used in the determination of Adjusted EBITDA. SD&A costs were $476.2 million, an increase of $48.4 million or 11% over the prior year. The increase is consistent with operating costs and includes higher depreciation and amortization as a result of a higher asset base associated with acquisitions completed and is partially offset by slightly lower transaction, restructuring and other costs.

Earnings

Earnings before tax of $99.8 million, an increase of $7.3 million over the prior year was primarily due to higher gains on derivatives and to a lesser extent higher gross profit, partially offset by higher SD&A costs as described above.

Financial Outlook

U.S. Propane Adjusted EBITDA in 2022 is anticipated to be higher than 2021. The increase is due to the full year contribution from acquisitions completed in the current year, the assumption of normal weather, organic growth in excess of inflation, the realization of additional synergies, and cost-saving initiatives, and the expected contribution from the Kamps acquisition that is expected to close in the second quarter of 2022, partially offset by the impact of the stronger Canadian dollar on the translation of U.S. denominated EBITDA and the impact of inflationary pressures on operating costs. Average weather for 2022 in the Eastern U.S. and California, as measured by degree days, is anticipated to be consistent with the five-year average.

In addition to the significant assumptions referred to above, refer to “Forward-Looking Information” and “Risk Factors to Superior” for a detailed review of significant business risks affecting the Propane Distribution businesses.

Superior Plus Corp.

CANADIAN PROPANE DISTRIBUTION

Canadian Propane Distribution’s operating results:


	Year Ended
	December 31
(millions of dollars)	2021	2020
Revenue	1,244.3	925.0
Cost ofSales	(859.2)	(525.2)
Gross profit	385.1	399.8
Realized gains (losses) onderivativesrelated to commodityrisk management (2)	12.8	(1.0)
Adjusted gross profit(1)	397.9	398.8
Selling, distribution and administrative costs	(292.7)	(279.5)
Add back (deduct):
Amortization and depreciation included in selling, distribution and administrative costs(4)	74.9	74.2
Transaction, restructuring and other costs(2)	4.2	0.4
Loss (gain) ondisposalofassets and other(2)	(0.6)	1.1
Operating costs(1)	(214.2)	(203.8)
Adjusted EBITDA(1)	183.7	195.0
Add back (deduct):
Gain (loss) on disposal of assets and other(3)	0.6	(1.1)
Transaction, restructuring and other costs(3)	(4.2)	(0.4)
Amortization and depreciation included in selling, distribution and administrative costs(3)	(74.9)	(74.2)
Unrealized gains (losses) on derivative financial instruments(2)	(1.5)	8.3
Finance expense(3)	(4.0)	(4.4)
Earnings before income tax	99.7	123.2

(1) Adjusted Gross Profit, Adjusted EBITDA and Operating Costs are Non-GAAP financial measures. See “Non-GAAP financial measures and reconciliations” on page 42 for more information.

(2) Realized gains (losses) are derivatives related to commodity risk management and are reconciled to Gains (losses) on derivatives and foreign currency translation of borrowings, see “Non-GAAP financial measures and reconciliations” on page 42 for more information.

(3) The sum of the above amounts and the balances included in the Canadian Propane and the corporate segments are included in SD&A and are disclosed in Note 21 or Note 29 of the audited consolidated financial statements as at and for the year ended December 31, 2021 and 2020.

Revenue for the year ended December 31, 2021 was $1,244.3 million, an increase of $319.3 million from the prior year primarily due to higher wholesale propane prices which are passed through to the customer, and to a lesser extent higher sales volumes. Wholesale propane prices were higher than the prior year due to wholesale propane market fundamentals and an increase in average West Texas Intermediate (“WTI”) crude oil prices and higher propane exports, compared to the prior year. WTI crude oil prices increased in 2021 as increasing COVID-19 vaccination rates, loosening pandemic-related restrictions, and a growing economy resulted in global petroleum demand rising faster than petroleum supply.

Superior Plus Corp.

Canadian Propane Adjusted Gross Profit

Canadian Propane Adjusted Gross Profit	Canadian Propane Adjusted Gross Profit
Year Ended December 31 (millions of dollars) 2021 2020
(millions of dollars)	2021 2020
Propane distribution(1) 368.9 383.9
Realized gains (losses) onderivativesrelated to commodityrisk management 12.8 (1.0)
Adjusted gross profit related to propane distribution 381.7 382.9 Otherservices 16.2 15.9
Adjustedgrossprofit(1) 397.9 398.8

(2) Adjusted gross profit from operations is a Non-GAAP financial measure. See “Non-GAAP financial measures and reconciliations” on page 42 for more information.

Adjusted gross profit related to propane distribution for the year ended December 31, 2021 was $381.7 million, a decrease of $1.2 million, from the prior year primarily due to weaker wholesale propane market fundamentals compared to the prior year, partially offset by higher carbon offset credit sales, and to a lesser extent higher sales volumes.

Total sales volumes were 2,104 million litres, an increase of 66 million litres or 3%, primarily due to increased wholesale volumes. Average weather across Canada for the year ended December 31, 2021, as measured by degree days was 4% warmer than the prior year and 5% warmer than the five-year average. Residential sales volumes increased by 9 million litres or 5% due to the impact of acquisitions completed in the year and was partially offset by warmer weather. Commercial sales volumes decreased by 11 million litres or 1% due primarily to the impact of COVID-19 and continued weak economic conditions in Western Canada. Wholesale propane volumes increased by 68 million litres or 7% compared to the prior year due to reduced COVID-19 restrictions, and to a lesser extent sales and marketing efforts to grow third-party wholesale propane sales.

Average propane sales margins were 18.1 cents per litre, a decrease of 0.7 cents from 18.8 cents per litre in the prior year due primarily to weaker wholesale propane market fundamentals, partially offset by the sale of carbon offset credits.

Other services gross profit primarily includes equipment rental, installation, repair and maintenance and customer minimum use charges. Other services gross profit was $16.2 million, which is consistent with the prior year gross profit of $15.9 million.

Superior Plus Corp.

Canadian Propane Distribution Sales Volumes - Volumes by End Use Application

Canadian Propane Distribution Sales Volumes *Volumes by End-Use Application*
		Year Ended
	December 31
(millions of litres)	2021	2020
Residential	180	171
Commercial	870	881
Wholesale	1,054	986
	2,104	2,038

(1) Canadian Propane volumes by end user were condensed to be consistent with US Propane Distribution.

Canadian Propane Distribution Sales Volumes

Volumes by Region[ (1)]

Canadian Propane Distribution Sales Volumes *Volumes by Region (1)*
	Year Ended
	December 31
(millions of litres)	2021	2020
Western Canada	676	718
Eastern Canada	516	463
Atlantic Canada	145	135
United States	767	722
Total	2,104	2,038

(1) Regions: Western Canada region consists of British Columbia, Alberta, Saskatchewan, Manitoba, Northwest Ontario, Yukon and Northwest Territories; Eastern Canada region consists of Ontario (except for Northwest Ontario) and Quebec; Atlantic Canada region consists of New Brunswick, Newfoundland & Labrador, Nova Scotia and Prince Edward Island. United States region consists primarily of California, Colorado, Delaware, Illinois, Kansas, Maine, Maryland, Michigan, Minnesota, Montana, Nevada, New Hampshire, New York, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Texas, Utah and Washington.

Operating Costs and Selling, Distribution and Administrative Costs

Operating costs were $214.2 million, an increase of $10.4 million or 5% compared to the prior year. The increase in operating costs was primarily due to the impact of the lower CEWS benefit recorded during the year compared to the prior year, and to a lesser extent higher incentive plan costs and higher volume related costs. Canadian Propane recorded $20.9 million in benefits related to the CEWS program for the year ended December 31, 2021 (2020 - $25.7 million).

SD&A includes amortization, depreciation and transaction, restructuring and other costs whereas operating costs exclude these expenses and is used in the determination of Adjusted EBITDA. SD&A costs were $292.7 million, an increase of $13.2 million or 5% over the prior year. SD&A costs increased for the above reasons, as well as increased transaction, restructuring and other costs related to the acquisitions completed in the year and restructuring activities and to a lesser extent higher depreciation and amortization costs as a result of a higher asset base.

Earnings

Earnings before income tax was $99.7 million, a decrease of $23.5 million over the prior year, for the above reasons and an unrealized loss on derivatives in the current year compared to an unrealized gain in the prior year.

Financial Outlook

Canadian Propane Adjusted EBITDA in 2022 is anticipated to be slightly lower than 2021 as the impact of the loss of the CEWS benefits, reduced sale of carbon credits and the impact of inflation on operating costs is expected to be partially offset by the contribution from the wholesale propane business included in the Kamps acquisition (“Kiva Energy Inc.”) and an increase in commercial volumes. Average weather as measured by degree days is expected to be consistent with the five-year average.

Superior Plus Corp.

CONSOLIDATED CAPITAL EXPENDITURE SUMMARY

Superior classifies its capital expenditures into three main categories: efficiency, process improvement and growthrelated; maintenance capital; and investment in leased assets.

Efficiency, process improvement and growth-related expenditures include expenditures such as the acquisition of new customer equipment to facilitate growth, system upgrades and initiatives to facilitate improvements in customer service. These capital expenditures are discretionary and non-recurring.

Maintenance capital expenditures include required regulatory spending on tank refurbishments, and any other required expenditures related to maintaining operations.

Investment in leased assets generally includes vehicles to support growth and replace aging vehicles, renewing railcar leases in the wholesale business and timing of renewing property leases.

		Year Ended
	December 31
(millions of dollars)	2021	2020 (1)
Efficiency, process improvement and growth-related(2)	47.3	42.5
Maintenance capital(2)	50.4	30.8
	97.7	73.3
Proceeds on disposition of assets	(5.6)	(12.5)
Property, plant and equipment acquired throughacquisition(3)	158.2	134.0
Total net capital expenditures	250.3	194.8
Investmentin leased assetsnet ofproceedsfrom refinanced vehicles (3)	38.2	44.2
Total expenditures including finance leases	288.5	239.0

(1) Comparative figures have been reclassified to exclude the results of the divested Specialty Chemicals segment.

(2) The amounts disclosed in the consolidated statements of cash flows for the year ended December 31, 2021 and 2020 is made up of the sum of these amounts and the cash flows used in investing activities related to discontinued operations.

(3) Property, plant and equipment acquired through acquisitions is disclosed in Note 4 of the annual audited consolidated financial statements. Investment in leased assets net of proceeds from refinanced vehicles is calculated by using the lease additions from continuing operations disclosed in Note 16 and subtracting the proceeds received from vehicle refinancing disclosed in the statements of cash flows included in the annual audited consolidated financial statements.

Efficiency, process improvement and growth-related expenditures were $47.3 million for the year ended December 31, 2021 compared to $42.5 million in the prior year. The increase over the prior year is primarily due to timing of integration activity related to acquisitions.

Maintenance capital expenditures were $50.4 million for the year ended December 31, 2021 compared to $30.8 million in the prior year, and were primarily related to required maintenance capital. The increase is primarily due to timing of expenditures, the impact of acquisitions and the impact from deferring expenditures in the prior year related to capital preserving initiatives in response to the COVID-19 pandemic.

Property, plant and equipment acquired through acquisition is the allocation of fair value to acquired assets.

Superior entered into $38.2 million of leases net of proceeds from refinancing previously acquired vehicles for the year ended December 31, 2021 compared to $44.2 million in the prior year. The decrease is primarily due to timing of renewing property leases and acquiring vehicles under leases. Included in the $38.2 million of leases is approximately $24.9 million related to vehicle leases.

Superior Plus Corp.

Capital expenditures were funded from a combination of operating cash flow and borrowing under the revolving-term bank credit facilities and credit provided through lease liabilities.

CORPORATE OPERATING COSTS AND SD&A

Corporate operating costs for the year ended December 31, 2021 were $24.1 million an increase of $3.6 million or 18% compared to $20.5 million in the prior year. The increase is primarily due to an increase in long-term incentive plan costs compared to the prior year.

Corporate administration costs included in Adjusted EBITDA exclude depreciation, amortization and transaction, restructuring and other costs. Corporate SD&A costs were $35.9 million, an increase of $6.1 million or 20% from $29.8 million in the prior year primarily due to an increase in incentive plan costs and higher transaction, restructuring and other costs.

FINANCE AND INTEREST EXPENSE

Finance expense was $155.0 million, an increase of $56.5 million, compared to $98.5 million in the prior year. The increase is primarily due to $58.6 million in early call premiums and non-cash financing expenses related to the redemption of the US$350 million, $400 million and $370 million senior unsecured notes partially offset by lower average debt balances and, lower average interest rates and to a lesser extent recording interest earned on the Vendor Note, net of finance expense. Debt balances are lower primarily due to using the net proceeds from the divestiture of Specialty Chemical business in April 2021 to pay down debt prior to the completion of acquisitions in the past seven months.

Interest expense included in AOCF excludes interest earned on the Vendor Note, premiums and other losses on the redemption of senior unsecured notes and the unwinding of discounts on decommissioning liabilities and non-cash financing expenses. Interest expense was $76.1 million, a decrease of $15.7 million, compared to $91.8 million in the prior year. The decrease is due to lower average debt balances and lower average interest rates. Debt balances are lower for the reasons noted above and average interest rates are lower as a result of refinancing the senior unsecured notes.

TRANSACTION, RESTRUCTURING AND OTHER COSTS

Superior’s transaction, restructuring and other costs have been categorized together and excluded from segmented results. The table below summarizes these costs:

	Year Ended	Year Ended
	December 31
(millions of dollars except per share amounts)	2021	2020(1)
Total transaction, restructuring and other costs	28.9	23.6

(1) Comparative figures have been reclassified to exclude the results of the divested Specialty Chemicals segment.

For the year ended December 31, 2021, Superior incurred $28.9 million in costs related primarily to the acquisition and integration of tuck-in acquisitions. The costs in the prior year related primarily to the acquisition and integration of acquisitions and the costs related to the sale of the Specialty Chemicals segment.

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. and Luxembourg income tax.

Total income tax expense for the year ended December 31, 2021 was $5.7 million, comprised of $83.8 million in cash income tax recovery and $89.5 million in deferred income tax expense. This compares to a total income tax expense

Superior Plus Corp.

of $64.3 million in the prior year, which consisted of a cash income tax recovery of $4.6 million and a $68.9 million deferred income tax expense.

Cash income tax recovery for the year ended December 31, 2021 was $83.8 million (2020 – $4.6 million), consisting of income tax recovery in Canada of $44.8 million (2020 – $4.1 million), income tax recovery in the U.S. of $41.2 million (2020 – $2.9 million), offset by income tax expense in Luxembourg of $2.2 million (2020 – $2.4 million). Deferred income tax expense for the year ended December 31, 2021 was $89.5 million (2020 – $68.9 million), resulting in a net deferred income tax liability of $90.9 million as at December 31, 2021.

*Canada*	(millions of dollars)
Tax basis	251.3
Non-capital losses	46.2
Capital losses	0.4
Canadian scientific research expenditures	91.4
Investment tax credits	61.9
*United States*
Tax basis	1,266.9
Non-capital losses	235.6

FINANCIAL OUTLOOK

Superior achieved its 2021 Adjusted EBITDA guidance of $398.4 million which was the slightly lower than the midpoint of the guidance range of $390 million to $420 million. Superior is introducing its 2022 Adjusted EBITDA guidance range of $410 million to $450 million. Based on the midpoint of the 2022 Adjusted EBITDA guidance range, this represents an 8% increase compared to 2021 Adjusted EBITDA of $398.4 million. This increase is due to the full year contribution from acquisitions completed in 2021, further realized synergies, the assumption of normal weather, continued organic growth, an increase in commercial sales demand related to a partial COVID recovery, the completion of the Kamps Propane acquisition in the second quarter of 2022 and an assumed COVID recovery in 2022, will be partially offset by the end of the CEWS program and higher corporate costs.

Achieving Superior’s Adjusted EBITDA depends on the operating results of its segments. In addition to the operating results of Superior’s segments, significant assumptions underlying the achievement of Superior’s 2022 guidance are:

Weather for 2022 is expected to be consistent with the average temperature for the last five years based on heating degree days;
Economic growth activity in Canada and the U.S. is expected to increase as a result of further reductions in COVID restrictions;
Superior is expected to continue to attract capital and obtain financing on acceptable terms;
Superior estimates maintenance and non-recurring capital expenditures net of disposals and including vehicle leases to be in the range of $120 million to $140 million in 2022;
Superior is substantively hedged for its estimated U.S. dollar exposure for 2022, and due to the hedge position, a change in the Canadian to U.S, dollar exchange rate for 2022 would not have a material impact to Superior.
The foreign currency exchange rate between the Canadian dollar and U.S. dollar is expected to average $0.80 in 2022 on all unhedged foreign currency transactions;
Financial and physical counterparties are expected to continue fulfilling their obligations to Superior;
Regulatory authorities are not expected to impose any new regulations impacting Superior; and
Canadian and U.S. based current income tax expense are expected to be in the range of $5 million to $15 million for 2022 based on existing statutory income tax rates and the ability to use available tax basis.

U.S. Propane Distribution

Wholesale propane prices are not anticipated to significantly affect demand for propane and related services;
Continue to realize synergies from acquisitions primarily through supply chain efficiencies, margin management improvements and operational expense savings; and

Superior Plus Corp.

Continue to implement cost-saving initiatives related to workforce optimization;
The assumed closing of the Kamps transaction in the second quarter of 2022.

Canadian Propane Distribution

Wholesale propane and natural gas liquid fundamentals related to basis differentials are anticipated to be consistent with 2021;
Wholesale propane prices are not anticipated to significantly affect demand for propane and related services;
Commercial and wholesale volumes are anticipated to be impacted by COVID-19 until all public health restrictions are lifted which is assumed to occur in the second half of 2022;
SD&A expenditures are expected to be higher due to the benefit from CEWS ending and will be partially offset by continuous improvement initiatives; and
The assumed closing of the Kamps transaction in the second quarter of 2022.

In addition to Superior’s significant assumptions detailed above, refer to “Forward-Looking Information”, and for a detailed review of Superior’s significant business risks, refer to “Risk Factors to Superior”. Results may differ from these assumptions.

LIQUIDITY AND CAPITAL RESOURCES

Debt Management Update

Superior is focused on managing both Net debt and its Leverage Ratio. Superior’s Leverage Ratio as at December 31, 2021 was 3.9x, compared to 3.5x at December 31, 2020. The increase in the Leverage Ratio is due primarily to lower pro forma Adjusted EBITDA partially offset by lower Net debt. Pro forma Adjusted EBITDA is lower due to the divestiture of the Specialty Chemical segment, partially offset by the impact of acquisitions completed in 2021. Net debt is lower as proceeds from the sale of Specialty Chemicals were used to repay debt and a decrease in lease liabilities related to the sale of Specialty Chemicals were partially offset by the impact of acquisitions completed in 2021 and the call premiums and financing costs related to the refinancing of senior unsecured notes.

Net Debt, Pro forma Adjusted EBITDA and Leverage Ratio are Non-GAAP measures, see “Non-GAAP financial measures and reconciliations” on page 42.

Borrowing

Superior’s revolving syndicated bank facility (“credit facility”), term loans and lease obligations (collectively “borrowing”) before deferred financing fees from continuing operations were $1,652.9 million as at December 31, 2021, a decrease of $197.7 million from $1,850.6 million as at December 31, 2020. The decrease is primarily due to the net proceeds received related to the sale of the Specialty Chemicals segment, a reduction in leases from the sale of the Specialty Chemicals segment, and to a lesser extent the impact of the stronger Canadian dollar on U.S. denominated debt, partially offset by acquisitions completed in the year.

Superior’s total and available sources of credit are detailed below:

Superior’s total and available sources of credit are	detailed below:
		As at December 31,2021
	Total		Letters of	Amount
(millions of dollars)	Amount	Borrowing	CreditIssued	Available
Revolving term bank credit facilities(1)	750.0	180.2	30.1	539.7
Senior unsecured notes(1)	1,258.2	1,258.2	–	–
Deferred Consideration	40.0	40.0	–	–
Leaseliabilities	174.5	174.5	–	–
Total	2,222.7	1,652.9	30.1	539.7

(1) Revolving term bank credit facilities and term loan balances are presented before deferred financing fees, see Note 15 of the annual audited consolidated financial statements.

Superior Plus Corp.

Net Working Capital

Consolidated net working capital was $11.8 million as at December 31, 2021, a decrease of $10.5 million from $22.3 million as at December 31, 2020. The decrease from December 31, 2020 is primarily due to timing of customer receipts compared to the timing of supplier payments, partially offset by the impact from the sale of the Specialty Chemicals business. Net working capital is defined in the audited consolidated financial statements and notes thereto as at and for the year ended December 31, 2021 and 2020. See Note 29.

Compliance

In accordance with the credit facility, Superior must maintain certain covenants and ratios that represent Non-GAAP financial measures. Superior was in compliance with its lender covenants as at December 31, 2021, and the covenant details are found in the credit facility documents filed in the System for Electronic Document Analysis and Retrieval (“SEDAR”).

Pension Plans

As at December 31, 2021, Superior’s defined benefit pension plans had an estimated net defined benefit going concern surplus of approximately $4.1 million (December 31, 2020 – surplus $3.4 million) and a net pension solvency surplus of approximately $5.0 million (December 31, 2020 – surplus $4.9 million). Funding requirements by applicable pension legislation are based upon going concern and solvency actuarial assumptions. These assumptions differ from the going concern actuarial assumptions found in Superior’s year end audited consolidated financial statements, see Note 17, for additional information.

Contractual Obligations and Other Commitments[(3)]

	Current	2023	2024	2025	2026	2027	Thereafter	Total
Borrowings before deferred financing fees and
discounts(1)	11.4	11.3	6.9	5.7	184.1	0.9	1,258.1	1,478.4
Lease liabilities(1)	44.9	31.0	26.9	20.6	11.5	5.7	33.9	174.5
Non-cancellable, low-value, short-term
leases and leases with variable lease payments(2)	2.7	0.5	0.1	–	–	–	–	3.3
Equity derivative contracts(2)	18.4	–	–	–	–	–	–	18.4
US dollar foreign currency forward sales
contracts(2)	131.8	119.0	42.0	12.0	6.0	–	–	310.8
USD/CAD call options(3)	–	8.5	36.0	–	–	–	–	44.5
Propane, WTI, butane, heating oil
and diesel wholesale purchase and
sale contracts (2)	192.8	31.2	4.3	–	–	–	–	228.3

(1) See Notes 15 and 18 of the December 31, 2021 audited consolidated financial statements.

(2) See note 16 of the December 31, 2021 audited consolidated financial statements. Operating leases comprise Superior’s off-balance-sheet obligations and are contracts that do not meet the definition of a lease under IFRS 16 or are exempt.

(3) Does not include the impact of financial derivatives.

In the normal course of business, Superior is subject to lawsuits and claims. Superior believes the resolution of these matters will not have a material adverse effect, individually or in the aggregate, on Superior’s liquidity, consolidated financial position or results of operations. Superior records costs as they are incurred or when they become determinable.

Superior Plus Corp.

SHAREHOLDERS’ CAPITAL

As at December 31, 2021, the following shares were issued and outstanding:

		Common shares		Preferred shares
	Issued number	Share	Issued number	Equity Attributable to
	(Millions)	capital	(Millions)	NCI
Balance as at December 31, 2020	176.0	$2,350.3	0.3	$330.9
Balance as at December 31, 2021	176.0	$2,350.3	0.3	$328.6

Dividends Declared to Common Shareholders

Dividends declared to Superior’s common shareholders depend on its cash flow from operating activities with consideration for Superior’s changes in working capital requirements, investing activities and financing activities. See “Summary of AOCF” for 2021, above, and “Summary of Cash Flow” for additional details.

Dividends declared to common shareholders for year ended December 31, 2021 were $126.8 million or $0.72 per common share compared to $126.4 million or $0.72 per common share for the prior year. Dividends to shareholders are declared at the discretion of Superior’s Board of Directors.

Superior has a Dividend Reinvestment and Optional Share Purchase Plan (“DRIP”) that was suspended on June 15, 2020. Superior’s DRIP program will remain in place should Superior elect to reactivate the DRIP, subject to regulatory approval, at a future date.

Dividends Declared to Preferred Shareholders

Dividends to preferred shareholders for the year ended December 31 2021 were $23.8 million or $91.5 per preferred shares compared to $11.7 million or $96.35 per preferred shares from prior year.

Superior Plus Corp.

SUMMARY OF CASH FLOW

Superior’s primary sources and uses of cash are detailed below:

Superior’s primary sources and uses of cash are detailed below:
	Year Ended
	December 31
(millions of Canadian dollars)	2021	2020(i)
Cash flows from operatingactivities	232.0	360.2
INVESTING ACTIVITIES
Acquisitions, net of cash acquired	(301.4)	(280.4)
Purchase of property, plant and equipment and intangible assets	(105.1)	(116.3)
Proceeds on disposal of property, plant and equipment	6.8	12.5
Proceeds on divestiture	571.7	–
Cash flows used in investingactivities	172.0	(384.2)
FINANCING ACTIVITIES
Proceeds of revolving term bank credit facilities and other debt	1,567.4	2,319.7
Repayment of revolving term bank credit facilities and other debt	(1,737.5)	(2,474.0)
Principal repayment of lease obligations	(41.9)	(51.9)
Redemption of 7% senior unsecured debentures	(472.3)	–
Redemption of 5.25% senior unsecured debentures	(410.5)	–
Redemption of 5.125% senior unsecured debentures	(384.2)	–
Issuance of 4.5% senior unsecured notes	753.7	–
Issuance of 4.25% senior unsecured debenture	500.0	–
Proceeds from preferred share issuance	–	353.8
Preferred share issuance cost	–	(18.1)
Debt issue costs credit facility	(1.6)	–
Debt issue costs 4.25% senior unsecured note	(8.7)	–
Debt issue costs 4.5% senior unsecured note	(13.3)	–
Proceeds from vehicle refinancing	–	18.6
Dividendspaid to shareholders	(150.7)	(125.6)
Cash flows used in financingactivities	(399.6)	22.5
Net increase in cash and cash equivalents from continuing operations	4.4	(1.5)
Cash and cash equivalents, beginning of the year	24.1	26.5
Effect of translation of foreign currency-denominated cash and cash
equivalents	(0.1)	(0.9)
Cash and cash equivalents, end of theyear	28.4	24.1

Cash flows from operating activities for the year ended December 31, 2021 was $232.0 million, a decrease of $128.2 million, from the prior year. The decrease is primarily a result of changes in non-cash working capital, and the impact of the divestiture of the Specialty Chemicals business, partially offset by lower finance expense.

Cash flows used in investing activities were $172.0 million, a decrease of $556.2 million from the prior year due primarily to the divestiture partially offset by the timing of acquisitions.

Cash flows used in financing activities were $399.6 million, an increase of $422.1 million from the prior year, primarily due to the issuance of preferred shares in the prior year and timing of acquisitions in the current year.

Superior Plus Corp.

FINANCIAL INSTRUMENTS – RISK MANAGEMENT

Derivative and non-financial derivatives are used by Superior to manage its exposure to fluctuations in foreign currency exchange rates, interest rates, share-based compensation and commodity prices. Superior assesses the inherent risks of these instruments by grouping derivative and non-financial derivatives related to the exposures these instruments mitigate. Superior’s policy is not to use 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 derivatives and non-financial derivatives as held for trading.

As at December 31, 2021 Superior has hedged approximately 66% of estimated U.S. dollar exposure for calendar 2022. A summary of the notional amounts of Superior’s U.S. dollar forward contracts and options for the rolling twelve months is provided in the table below. The over exposure in 2021 is temporary resulting from the recent divestiture of the Specialty Chemicals segment and the forward contracts will be settled or extended to outbound years.

	Current	2023	2024	2025	2026	2027	Total
USD-foreign currency forward sales
contracts	131.8	119.0	42.0	12.0	6.0	–	310.8
USD/CAD call options(i)	–	8.5	36.0	–	–	–	44.5
Netaverage externalUS$/CDN$ exchangerate	1.30	1.32	1.31	1.30	1.31	–	1.31

(i)USD/CAD call options expire in December 2023 and 2024 with strikes ranging from 1.28 to 1.47.

For additional details on Superior’s financial instruments, including the amount and classification of gains and losses recorded, summary of fair values, notional balances, effective rates and terms, and significant assumptions used in the calculation of the fair value of Superior’s financial instruments, see Note 18 to the audited consolidated financial statements for the year ended December 31, 2021.

Sensitivity Analysis

Superior’s estimated cash flow sensitivity in 2021 to various changes is provided below:

			AOCF		Net earnings
			Impact		Impact
	Change	% Change	(millions)		(millions)
U.S. Propane Distribution
Change in U.S. propane sales margin	$0.005/litre	1% $	5.8	$	5.8
Change in U.S. propane sales volume	50 million litres	4% $	17.9	$	17.9
Canadian Propane Distribution
Change in Canadian propane sales margin	$0.005/litre	3% $	10.5	$	10.5
Change in Canadian propane sales volume	50 million litres	2% $	7.9	$	7.9
Corporate
Change in CDN$/US$ exchange rate on
US$ denominated debt	$0.01	1% $	(1.1)	$	(7.1)
Change in interest rates	0.50%	24%$	(0.9)	$	(0.9)

Superior Plus Corp.

DISCLOSURE CONTROLS AND PROCEDURES AND INTERNAL CONTROLS OVER FINANCIAL REPORTING

Disclosure controls and procedures (DC&P) are designed by or under the supervision of Superior’s President and Chief Executive Officer (CEO) and the Executive Vice President and Chief Financial Officer (CFO) in order to provide reasonable assurance that all material information relating to Superior is communicated to them by others in the organization as it becomes known and is appropriately disclosed as required under the continuous disclosure requirements of securities legislation and regulation. In essence, these types of controls are related to the quality, reliability and transparency of financial and non-financial information that is filed or submitted under securities legislation and regulation. The CEO and CFO are assisted in this responsibility by a Disclosure Committee, which is composed of senior leadership of Superior. The Disclosure Committee has established procedures so that it becomes aware of any material information affecting Superior in order to evaluate and discuss this information and determine the appropriateness and timing of its public release.

Internal Controls over Financial Reporting (ICFR) are also designed by or under the supervision of Superior's CEO and CFO and effected by Superior's Board of Directors, management and other personnel in order to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that its objectives are met. Due to inherent limitations in all such systems, no evaluation of controls can provide absolute assurance that all control issues within a company have been detected. Accordingly, Superior’s disclosure controls and procedures are designed to provide reasonable, not absolute, assurance that the objectives of the corporation’s disclosure control system are met.

Changes in Internal Controls over Financial Reporting

No changes were made in Superior’s ICFR that have materially affected, or are reasonably likely to materially affect, Superior’s ICFR in the three and twelve months ended December 31, 2021. However, management continues the process of harmonizing and integrating acquired businesses on to Superior’s existing information technology platform.

Effectiveness

An evaluation of the effectiveness of Superior’s DC&P and ICFR was conducted as at December 31, 2021 by and under the supervision of Superior’s management, including the CEO and CFO. Based on this evaluation, the CEO and CFO have concluded that Superior’s DC&P and ICFR were effective at December 31, 2021 with the following exception:

Section 3.3(1) of National Instrument 52-109, Certification of Disclosure in Issuers’ Annual and Interim Filings, states that a company may limit its design of disclosure controls and procedures and internal controls over financial reporting for a business that it acquired not more than 365 days before the end of the financial period to which the certificate relates. Under this section, Superior’s CEO and CFO have limited the scope of the design, and subsequent evaluation, of DC&P and ICFR to exclude controls, policies and procedures of Freeman effective June 16, 2021. Summary financial information pertaining to this acquisition that was included in the audited consolidated financial statements of Superior as at December 31, 2021, is as follows:

Superior Plus Corp.

			For the Year Ended	For the Year Ended
(millions of Canadian dollars)			December 31, 2021
Sales				48.9
Net income for theperiod				10.6
			December 31, 2021
Current assets				3.9
Non-current assets				122.3
Current liabilities				2.9
Non-current liabilities				16.0
*Government Grants*
In response to the impact of COVID-19 on the Canadian economy, the Government			of Canada implemented the
CEWS program from March 15, 2020 to October 23,	2021. 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 as follows:
	Three Months Ended			Years Ended
		December 31		December 31
	2021	2020	2021	2020
Discontinued operations	–	3.5	1.4	7.0
Selling, distribution and administrative costs	–	12.2	21.7	26.3
Total	–	15.7	23.1	33.3

There are no unfulfilled conditions attached to this government assistance. As at December 31, 2021, the amount of $nil million (2020 - $15.7 million) is included in trade and other receivables.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Superior’s audited consolidated financial statements were prepared in accordance with IFRS. The significant accounting policies are described in the audited consolidated financial statements for the year ended December 31, 2021. Certain of these accounting policies, as well as estimates made by management in applying such policies, are recognized as critical because they require management to make subjective or complex judgments about matters that are inherently uncertain. Superior’s critical accounting estimates relate to the allowance for doubtful accounts, employee future benefits, deferred income tax assets and liabilities, the valuation of financial and non-financial derivatives, asset impairments, the purchase price allocation for business combinations and the assessment of potential provision for asset retirement obligations.

Recent Accounting Pronouncements

Certain new standards, interpretations, amendments and improvements to existing standards were issued by the IASB or the International Financial Reporting Interpretations Committee effective for accounting periods beginning on or after January 1, 2021, or latter periods.

Adoption of Interest Rate Benchmark Reform

In August 2020, the IASB finalized the second phase through the issuance of “Interest Rate Benchmark Reform: Phase 2 Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16” (Phase 2 amendments), which addresses the issues that affect financial reporting once the existing rate is replaced with an alternative rate. The Phase 2 amendments are effective and have been adopted on January 1, 2021, and the effects of adoption has no impact on Superior’s audited consolidated financial statements.

Superior Plus Corp.

For financial instruments measured using amortized cost measurement, changes to the basis for determining the contractual cash flows required by interest rate benchmark reform are reflected by adjusting their effective interest rate. No immediate gain or loss is recognized. For lease liabilities where there is a change to the basis for determining the contractual cash flows, as a practical expedient the lease liability is remeasured by discounting the revised lease payments using a discount rate that reflects the change in the interest rate where the change is required by IBOR reform. These expedients are only applicable to changes that are required by interest rate benchmark reform when made on an economically equivalent basis.

Superior does not expect changes related to interest rate benchmark reform to have a material impact to Superior’s results. Superior’s exposure is limited to borrowings with a variable interest rate, see Note 15 of the audited consolidated financial statements as at December 31, 2021.

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. Superior is monitoring and in the process of assessing the impacts of the amendments on the audited 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 audited 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.

Superior Plus Corp.

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 audited consolidated financial statements.

Amendments to IAS 8, Accounting Policies, Changes in Accounting estimates and Errors (“IAS 8”), to introduce a definition of accounting estimates

In February 2021, the IASB issued amendments to IAS 8, in which it introduces a definition of ‘accounting estimates’. The amendments clarify the distinction between changes in accounting estimates and changes in accounting policies and the correction of errors. Also, they clarify how entities use measurement techniques and inputs to develop accounting estimates. The amendments to IAS 8 are effective for annual reporting periods beginning on or after 1 January 2023 and apply to changes in accounting policies and changes in accounting estimates that occur on or after the start of that period. Earlier application is permitted as long as this fact is disclosed. The amendments to IAS 8 are not expected to have a material impact on the audited consolidated financial statements.

Amendments to IAS 1 and IFRS Practice Statement 2, Disclosure of Accounting Policies

In February 2021, the IASB issued amendments to IAS 1 and IFRS Practice Statement 2 Making Materiality Judgements, in which it provides guidance and examples to help entities apply materiality judgements to accounting policy disclosures. The amendments aim to help entities provide accounting policy disclosures that are more useful by replacing the requirement for entities to disclose their ‘significant’ accounting policies with a requirement to disclose their ‘material’ accounting policies and adding guidance on how entities apply the concept of materiality in making decisions about accounting policy disclosures. The amendments to IAS 1 are applicable for annual periods beginning on or after 1 January 2023 with earlier application permitted. Since the amendments to the Practice Statement 2 provide non-mandatory guidance on the application of the definition of material to accounting policy information, an effective date for these amendments is not necessary.

Superior is currently assessing the impact of the amendments to IAS 1 and IFRS Practice Statement 2 to determine the impact they will have on the Superior’s accounting policy disclosures in the audited consolidated financial statements.

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

Superior Plus Corp.

SELECTED FINANCIAL INFORMATION

SELECTEDFINANCIALINFORMATION
(millions of dollars except per share amounts)	2021	2020
GAAP measures:
Total assets	3,560.4	3,829.8
Revenue	2,392.6	1,806.9
Gross profit	912.7	913.7
Net earnings from continuing operations	17.2	62.8
Net earnings from continuing operations per share attributable to
- basic	($0.04)	$0.29
- diluted	($0.04)	$0.29
Cash flows from operating activities	232.0	360.2
Dividends per common share	$0.72	$0.72
Current and long-term borrowing(2)	1,652.9	1,850.6
Non-GAAP financial measures(4):
AOCF	292.2	268.6
AOCF Per share(3)	$1.42	$1.42
AOCF before transaction, restructuring and other costs	321.1	292.2
AOCF Per share before transaction, restructuringand other costs(3)	$1.56	$1.54

(1) Comparative figures have been reclassified to exclude the results of the divested Specialty Chemicals segment. See the audited consolidated financial statements and notes thereto as at and for the year ended December 31, 2021 and 2020.

(2) Current and long-term borrowing before deferred financing fees and debentures including lease liability.

(3) The weighted average number of shares outstanding for the year ended December 31, 2021 was 206.0 million (year ended December 31, 2020 was 189.7 million). The weighted average number of shares assumes the exchange of the preferred shares into common shares. There were no other dilutive instruments for the year ended December 31, 2021 and 2020.

(4) AOCF and AOCF before transaction, restructuring and other costs are “Non-GAAP” financial measures, see page 42 for further information

FOURTH QUARTER RESULTS

Fourth quarter results are not required to be disclosed in the annual audited consolidated financial statements for the year ended December 31, 2021 and 2020. The GAAP and Non-GAAP financial information below can be derived by subtracting the results for the year ended December 31, 2021 and 2020 by the results for the nine months ended September 30, 2021 and 2020 respectively. The results for the nine months ended September 30, 2021 and 2020 can be found on www.sedar.com or http://www.superiorplus.com/investor-relations/financial-reports/.

Superior Plus Corp.

GAAP Financial Measures

Consolidated Statement of Net Earnings

Consolidated Statement of Net Earnings	Consolidated Statement of Net Earnings
Three Months Ended December 31 (millions ofCanadiandollars, except pershare amounts) 2021 2020(i)
	Revenue 824.9 561.9 Cost of sales(includesproducts and services) (543.0) (284.4)
	Grossprofit 281.9 277.5
	Expenses Selling, distribution and administrative costs (221.1) (202.2) Finance expense (17.2) (24.0) Gains (loss) on derivatives and foreign currency translation of borrowings (22.5) 69.4
	(260.8) (156.8)
	Earnings before income taxes 21.1 120.7 Income tax expense (7.3) (32.8)
	Net earnings from continuing operations 13.8 87.9 Net earnings from discontinued operations, net of tax expense 12.4 1.4
	Net earnings 26.2 89.3
	Net earnings from continuing operations attributable to: Superior 7.9 81.6 Non-controlling interest 5.9 6.3
	Earnings per share attributable to Superior Net earnings from continuing operations - basic and diluted 0.04 0.42 Net earnings - basic and diluted 0.12 0.43 Cash flows from operating activities 5.8 70.6 Cash flows from operating activities, per share(1) 0.03 0.34

(1) The comparative figures have been restated to conform with the current year’s presentation, see Basis of Presentation.

(2) The weighted average number of shares outstanding for the year ended December 31, 2021 was 206.0 million December 31, 2020 was 189.7 million). The weighted average number of shares assumes the exchange of the preferred shares into common shares. There were no other dilutive instruments for the year ended, December 31, 2021 and 2020.

Superior Plus Corp.

Non-GAAP Financial Measures

Non-GAAP Financial Measures
	Three Months Ended
	December 31
(millions of dollars except per share amounts)	2021	2020(1)
US Propane Distribution Adjusted EBITDA(2)	79.9	80.4
Canadian Propane Distribution Adjusted EBITDA(2)	63.2	65.6
EBITDA from operations(2)	143.1	146.0
Corporate operating costs(2)	(4.6)	(5.8)
Realized gains on foreigncurrencyhedging contracts (3)	3.7	3.9
Adjusted EBITDA(2)	142.2	144.1
Interest expense(4)	(17.7)	(22.6)
Adjusted currentincome tax recovery (4)	7.1	12.5
AOCF before transaction, restructuring and other costs(2)	131.6	134.0
Transaction,restructuring and othercosts (5)	(8.3)	(8.5)
AOCF(2)	123.3	125.5
AOCF per share before transaction, restructuring and other costs(2)(6)	$0.64	$0.65
AOCF per share(2)(6)	$0.60	$0.61
Dividends declaredper common share	$0.18	$0.18

(1) The comparative figures have been restated to conform with the current year’s presentation, see Basis of Presentation.

(2) These amounts are Non-GAAP financial measures, see “Non-GAAP financial measures and reconciliations” on page 42 for more information.

(4) Interest expense is the sum of interest on borrowings and interest on lease liability. Current income tax expense (recovery) forms part of the total income tax expense (recovery), see Note 21 of the audited consolidated financial statements as at and for the years ended December 31, 2021 and 2020. The 2021 current income tax expense has been adjusted by an $85.0 million recovery representing the impact of reporting the divestiture as a discontinued operation.

(6) The weighted average number of shares outstanding for the three months ended December 31, 2021 was 206.0 million (three months ended December 31, 2020 was 206.0 million). The weighted average number of shares assumes the exchange of the preferred shares into common shares. There were no other dilutive instruments for the year ended December 31, 2021 and 2020.

Fourth Quarter Results Compared to the Prior Year Quarter

The net earnings from continuing operations for the three months ended December 31, 2021 was $13.8 million, a $74.1 million decrease from net earnings of $87.9 million in the prior year quarter. The decrease from the prior year quarter is primarily due to a loss on derivatives and foreign currency translation of borrowings recorded in the current quarter compared to a gain in the prior year quarter, and to a lesser extent higher SD&A costs partially by higher gross profit, lower income tax expense and lower finance expenses.

Revenue for the three months ended December 31, 2021, was $824.9 million, an increase of $263.0 million or 47% from the prior year quarter revenue of $561.9 million due to higher revenue in both the Canadian Propane and U.S. Propane segments. Canadian Propane revenue for the three months ended December 31, 2021 was $438.6 million, an increase of $165.9 million or 61% primarily due to higher wholesale propane prices, and to a lesser extent higher sales volumes. U.S. Propane revenue for the three months ended December 31, 2021 was $396.6 million, an increase of $101.7 million or 34% from the prior year quarter primarily due to higher sales volumes related to acquisitions completed in the last twelve months and higher wholesale propane prices, partially offset by the impact of the stronger Canadian dollar on the translation of U.S. denominated revenues. Due to the nature of Superior’s operating model, the impact of commodity price volatility can be passed on to the customer.

Superior Plus Corp.

Gross profit for the three months ended December 31, 2021 was $281.9 million, an increase of $4.4 million or 2% from $277.5 million in the prior year quarter primarily due to higher U.S. Propane and Canadian Propane gross profit. U.S. Propane gross profit increased primarily due to the increase in sales volumes related to acquisitions partially offset by the impact of the stronger Canadian dollar on the translation of U.S. denominated gross profit. Canadian Propane gross profit increased due to the timing of the sale of carbon offset credits and higher sales volumes. For U.S. Propane and Canadian Propane gross profit realized gains and losses related to Superior’s commodity risk management are not included in gross profit. These realized gains and losses are reported as part of gains and losses on derivatives and foreign currency translation of borrowings.

SD&A costs for the three months ended December 31, 2021 was $221.1 million, an increase of $18.9 million or 9% from the prior year quarter primarily due to increases in SD&A costs in Canadian Propane and U.S. Propane, partially offset by a decrease in corporate SD&A costs. Canadian Propane SD&A costs were $79.5 million for the three months ended December 31, 2021, an increase of $11.4 million or 17% from $68.1 million in the prior year quarter due primarily to the impact of a CEWS recovery recorded in the prior period and not in the current quarter. U.S. Propane SD&A costs were $132.7 million, an increase of $8.3 million from $124.4 million in the prior year quarter primarily due to the impact of acquisitions partially offset by the impact of the stronger Canadian dollar on the translation of U.S. denominated SD&A costs. Corporate SD&A costs were $8.9 million for the three months ended December 31, 2021, a decrease of $0.8 million or 8% from $9.7 million in the prior year quarter primarily due to lower long-term incentive plan costs compared to the prior year quarter.

Finance expense for the three months ended December 31, 2021 was $17.2 million, a decrease of $6.8 million or 28% from $24.0 million in the prior year quarter. The decrease is primarily due to the impact of lower average debt balances and lower average interest rates, and to a lesser extent the interest earned on the Vendor Note that was recorded as a reduction to finance expense. Average debt balances were lower as the net proceeds from the divestiture of the Specialty Chemicals business in the second quarter were used primarily to reduce debt, and were partially offset by acquisitions completed in the past seven months and financed primarily from borrowings under the credit facility.

Gains (losses) on derivative and foreign currency translation of borrowings consists of unrealized gains (losses) on derivative financial instruments and foreign currency translation of borrowings, net of realized gains (losses) on derivative financial instruments. Superior recognized a loss on derivatives and foreign currency translation of borrowings of $22.5 million for the three months ended December 31, 2021 compared to a gain of $69.4 million in the prior year quarter. This is mainly related to changes in market prices of commodities, timing of maturities of underlying financial instruments and foreign exchange rates relative to amounts hedged and U.S. denominated debt.

Total income tax expense of $7.3 million was $25.5 million lower than the prior year’s expense of $32.8 million. Current income tax recovery was $92.1 million, an increase of $79.6 million from the prior year’s recovery of $12.5 million. Deferred income tax expense was $99.4 million, an increase of $54.1 million from the prior year expense of $45.3 million. The changes in the current and deferred income taxes from the prior year quarter were primarily due to the impact of the divestiture and the accounting treatment of reporting the Specialty Chemicals segment as a discontinued operation.

Superior Plus Corp.

Fourth Quarter Non-GAAP Financial Measures Compared to the Prior Year Quarter

Adjusted EBITDA for the three months ended December 31, 2021 was $142.2 million, a decrease of $1.9 million or 1% compared to the prior year quarter of $144.1 million. The decrease is primarily due to lower EBITDA from operations, and to a lesser extent a modestly lower realized gain on foreign currency hedging contracts, partially offset by lower corporate operating costs. EBITDA from operations decreased by $2.9 million or 2% compared to the prior year quarter primarily due to lower Canadian Propane Adjusted EBITDA and modestly lower U.S. Propane Adjusted EBITDA. Canadian Propane Adjusted EBITDA was $63.2 million, a decrease of $2.4 million or 4% compared to the prior year quarter primarily due to higher operating costs, partially offset by higher adjusted gross profit. Operating costs increased due primarily to the impact of a CEWS claim not being recorded in the current period compared to the prior year quarter. Adjusted gross profit increased primarily due to the sale of additional carbon offset credits. U.S. Propane Adjusted EBITDA was $79.9 million, a decrease of $0.5 million compared to the prior year quarter due primarily to the impact of warmer weather, and the impact of the stronger Canadian dollar on the translation of U.S. denominated EBITDA, partially offset by the impact of acquisitions completed in the current and prior year. Corporate administrative costs were $4.6 million, a decrease of $1.2 million from the prior year quarter of $5.8 million primarily due to lower long-term incentive plan costs related to the decrease in the share price in the current quarter. Realized gains on foreign currency hedging contracts were $3.7 million, a decrease of $0.2 million compared to $3.9 million in the prior year quarter due to changes in foreign exchange rates relative to amounts hedged.

AOCF before transaction, restructuring and other costs for the three months ended December 31, 2021 was $131.6 million, a decrease of $2.4 million or 2% from the prior year quarter of $134.0 million. The decrease from the prior year quarter is primarily due to a lower current income tax recovery in the current quarter compared to the prior year quarter and to a lesser extent lower Adjusted EBITDA partially offset by lower interest expense. Current income tax recovery decreased by $5.4 million due primarily to the treatment of the Specialty Chemicals as a discontinued operation and the timing of taking certain tax deductions. For purposes of determining AOCF the current tax charge associated with the divestiture was removed, see Note 19 of the Audited Consolidated Financial Statements as at and for the year ended December 31, 2021. Interest expense decreased primarily due to lower average debt balances, and to a lesser extent the impact of lower average interest rates compared to the prior year quarter. AOCF per share before transaction, restructuring and other costs was $0.64 per share, a decrease of $0.01 per share from the prior year quarter results of $0.65 per share, due to lower AOCF before transaction, restructuring and other costs discussed above.

AOCF for the three months ended December 31, 2021 was $123.3 million, a decrease of $2.2 million or 2% from the prior year quarter AOCF of $125.5 million due to lower AOCF before transaction, restructuring and other costs discussed above partially offset by higher transaction, restructuring and other costs incurred due to timing of acquisitions and integration activity. AOCF per share for the three months ended December 31, 2021 was $$0.60 per share, a decrease of $0.01 per share from the prior year quarter results of $0.61 per share. Transaction, restructuring and other costs for the three months ended December 31, 2021 were $8.3 million, a decrease of $0.2 million from prior year quarter of $8.5 million due to timing of acquisition and integration activity.

Superior Plus Corp.

RESULTS OF SUPERIOR’S OPERATING SEGMENTS

Superior’s operating segments consists of U.S. Propane and Canadian Propane.

U.S. PROPANE DISTRIBUTION

U.S. Propane Distribution’s operating results:

U.S. PROPANEDISTRIBUTION U.S. Propane Distribution’s operating results:
	Three Months Ended
	December 31
(millions of dollars)	2021	2020
Revenue	396.6	294.9
Cost ofSales	(232.7)	(131.4)
Gross profit	163.9	163.5
Realized gains onderivativesrelated to commodityrisk management (2)	12.7	2.6
Adjusted gross profit(1)	176.6	166.1
Selling, distribution and administrative costs	(132.7)	(124.4)
Amortization and depreciation included in selling, distribution and administrative costs(3)	32.3	33.5
Transaction, restructuring and other costs(3)	3.7	4.6
Loss ondisposalofassets (3)	–	0.6
Operating costs(1)	(96.7)	(85.7)
Adjusted EBITDA(1)	79.9	80.4
Loss on disposal of assets(3)	–	(0.6)
Transaction, restructuring and other costs(3)	(3.7)	(4.6)
Amortization and depreciation included in selling, distribution and administrative costs(3)	(32.3)	(33.5)
Unrealized gains (losses) on derivative financial instruments(2)	(28.9)	14.8
Finance expense(3)	(1.4)	(1.0)
Earnings before income tax	13.6	55.5

(1) Adjusted Gross Profit, Adjusted EBITDA and Operating Costs are Non-GAAP financial measures. See “Non-GAAP financial measures reconciliations” on page 42 for more information.

(2) Realized and unrealized gains (losses) are derivatives related to commodity risk management and are reconciled to Gains (losses) on derivatives and foreign currency translation of borrowings, see “Non-GAAP financial measures and reconciliations” on page 42 for more information.

(3) The sum of the above amounts and the balances included in the Canadian Propane and the corporate segments are included in SD&A and are disclosed in Note 21 of the audited consolidated financial statements as at and for the year ended December 31, 2021 and 2020.

Revenue for three months ended December 31, 2021 was $396.6 million, an increase of $101.7 million or 34% from the prior year quarter primarily due to higher wholesale commodity prices that can be passed through to the customer and higher sales volumes, partially offset by the impact of the stronger Canadian dollar on the translation of U.S. denominated revenues. Sales volumes were higher due to the contribution from acquisitions partially offset by the impact of warmer weather compared to the prior year quarter. Wholesale supply prices were higher than the prior year quarter due to wholesale propane market fundamentals and an increase in average West Texas Intermediate (“WTI”) crude oil prices and higher export demand, compared to the prior year.

Superior Plus Corp.

U.S. Propane Adjusted Gross Profit

U.S. Propane Adjusted Gross Profit
	Three Months Ended
	December 31
(millions of dollars)	2021	2020
Propane distribution(1)	156.2	156.2
Realized gainonderivativesrelated to commodityrisk management (1)	12.7	2.6
Adjusted gross profit related to propane distribution	168.9	158.8
Otherservices (1)	7.7	7.3
Adjustedgrossprofit(2)	176.6	166.1

(1) The sum of propane distribution and other services agrees to segment disclosure in the annual consolidated financial statements reduced by the results for the nine months ended September 30, 2021. Realized gains (losses) are derivatives related to commodity risk management and are reconciled to Gains (losses) on derivatives and foreign currency translation of borrowings, see Non-GAAP Financial Measures. (2) Adjusted gross profit from operations is a Non-GAAP financial measure. See “Non-GAAP Financial Measures”.

Adjusted gross profit related to propane distribution for the three months ended December 31, 2021 was $168.9 million an increase of $10.1 million or 6% from the prior year quarter primarily due to the impact of acquisitions completed in the last twelve months, and to a lesser extent higher average unit margins partially offset by the impact of warmer weather compared to the prior year quarter and the impact of the stronger Canadian dollar on the translation of U.S. denominated revenues.

Total sales volumes were 400 million litres, an increase of 14 million litres or 4% from the prior year primarily due to higher commercial sales volumes. Average weather, as measured by degree days, across markets where U.S. propane operates for the fourth quarter was 7% warmer than the prior year quarter and 9% warmer than the five-year average. Residential sales volumes were consistent with the prior year quarter as the increase in sales volumes related to acquisitions was offset by the impact of warmer weather primarily in December. Commercial volumes increased by 15 million litres or 10% compared to the prior year quarter primarily due to the impact of acquisitions completed in the current and prior year, and to a lesser extent the impact of reduced COVID-19 restrictions on commercial customers. Wholesale volumes were slightly less than the prior year quarter.

U.S. Propane average sales margins were 42.2 cents per litre, an increase of 1.1 cent from 41.1 cents per litre in the prior year quarter primarily due to the impact of focusing on higher margin propane customers partially offset by the impact of the stronger Canadian dollar on the translation of U.S. denominated gross profit.

Other services gross profit primarily includes equipment rental, billable repairs and maintenance work, installation fees and customer minimum use charges. Other services gross profit was $7.7 million, an increase of $0.4 million over the prior year quarter primarily due to the impact of acquisitions completed in the past twelve months.

Superior Plus Corp.

U.S. Propane Distribution Sales Volumes End-Use Application

U.S. Propane Distribution Sales Volumes *End-Use Application*
	Three Months Ended
	December 31
(millions of litres)	2021	2020
Residential	224	224
Commercial	170	155
Wholesale	6	7
Total	400	386

U.S. Propane Distribution Sales Volumes Volumes by Region[ (1)]

U.S. Propane Distribution Sales Volumes *Volumes by Region (1)*
	Three Months Ended
	December 31
(millions of litres)	2021	2020
Northeast	290	311
Southeast	74	37
Midwest	25	27
West	11	11
Total	400	386

(1) Includes heating oil, propane, diesel and gasoline sold in over twenty-two states in the following regions: Northeast region consists of Maine, New Hampshire, Vermont, Massachusetts, Connecticut, Rhode Island, New York, Pennsylvania, New Jersey, Delaware, Maryland, Virginia; Southeast region consists of North Carolina, South Carolina, Georgia, Tennessee, Florida, Alabama; Midwest region consists of Ohio, Michigan, Minnesota; West region consists primarily of California

Operating Costs and Selling, Distribution and Administrative Costs

Operating costs were $96.7 million, an increase of $11.0 million or 13% over the prior year quarter primarily due to the impact of acquisitions, partially offset by the impact of the stronger Canadian dollar on the translation of U.S. denominated operating costs.

SD&A includes amortization, depreciation and transaction, restructuring and other costs whereas operating costs exclude these expenses and is used in the determination of Adjusted EBITDA. SD&A costs were $132.7 million, an increase $8.3 million or 7% over the prior year quarter. SD&A costs increased for the above reasons and were partially offset by lower transaction, restructuring and other costs and a loss on disposal of assets in the prior year quarter.

Earnings before tax

Earnings before tax of $13.6 million is a decrease of $41.9 million or 75% over the prior year quarter due to the aforementioned reasons and an unrealized loss on derivative financial instruments compared to a gain in the prior comparable quarter.

Superior Plus Corp.

CANADIAN PROPANE DISTRIBUTION

Canadian Propane Distribution’s operating results:

CANADIAN PROPANE DISTRIBUTION Canadian Propane Distribution’s operating results:
	Three Months Ended
	December 31
(millions of dollars)	2021	2020
Revenue	438.6	272.7
Cost ofSales	(320.6)	(158.7)
Gross profit	118.0	114.0
Realized gains (losses) onderivativesrelated to commodityrisk management (2)	6.1	1.1
Adjusted gross profit (1)	124.1	115.1
Selling, distribution and administrative costs	(79.5)	(68.1)
Add back (deduct):
Amortization and depreciation included in selling, distribution and administrative costs(3)	19.6	18.4
Transaction, restructuring and other costs(3)	0.4	(0.1)
Gain(loss) ondisposalofassets and other(3)	(1.4)	0.3
Operating costs (1)	(60.9)	(49.5)
Adjusted EBITDA(1)	63.2	65.6
Gain (loss) on disposal of assets and other(3)	1.4	(0.3)
Transaction, restructuring and other costs(3)	(0.4)	0.1
Amortization and depreciation included in selling, distribution and administrative costs(3)	(19.6)	(18.4)
Unrealized gains on derivative financial instruments(2)	(15.2)	5.1
Finance expense(3)	(0.9)	(1.0)
Earnings before income tax	28.5	51.1

(1) Adjusted Gross Profit, Adjusted EBITDA and Operating Costs are Non-GAAP financial measures. See “Non-GAAP financial measures and reconciliations” on page 42 for more information.

(2) Realized and unrealized gains (losses) are derivatives related to commodity risk management and are reconciled to Gains (losses) on derivatives and foreign currency translation of borrowings, see “Non-GAAP financial measures and reconciliations” on page 42 for more information.

(3) The sum of the above amounts and the balances included in the Canadian Propane and the corporate segments are included in SD&A and are disclosed in Note 21 of the audited consolidated financial statements as at and for the year ended December 31, 2021 and 2020.

Revenue for three months ended December 31, 2021 was $438.6 million, an increase of $165.9 million or 61% from the prior year quarter primarily due to higher wholesale propane prices, and to a lesser extent higher sales volumes. Wholesale supply prices were higher than the prior year quarter due to wholesale propane market fundamentals and an increase in average West Texas Intermediate (“WTI”) crude oil prices and higher propane exports, compared to the prior year quarter.

Superior Plus Corp.

Canadian Propane Adjusted Gross Profit

Canadian Propane Adjusted Gross Profit
	Three Months Ended
	December 31
(millions of dollars)	2021	2020
Propane distribution(1)	112.7	108.7
Realized gains (losses) onderivativesrelated to commodityrisk management(1)	6.1	1.1
Adjusted gross profit related to propane distribution	118.8	109.8
Otherservices (1)	5.3	5.3
Adjustedgrossprofit(2)	124.1	115.1

(1) The sum of propane distribution and other services agrees to segment disclosure in the annual consolidated financial statements reduced by the results for the nine months ended September 30, 2021. Realized gains (losses) are derivatives related to commodity risk management and are reconciled to Gains (losses) on derivatives and foreign currency translation of borrowings, see “Non-GAAP financial measures” on page 42 for more information.

(2) Adjusted gross profit from operations is a Non-GAAP financial measure. See “Non-GAAP Financial Measures” on page 42.

Adjusted gross profit related to propane distribution for three months ended December 31, 2021 was $118.8 million, an increase of $9.0 million or 8% from the prior year quarter primarily due to increased sales of carbon offset credits and higher sales volumes.

Total sales volumes were 643 million litres, an increase of 35 million litres or 6% compared to the prior year quarter, primarily due to increased demand from wholesale customers as public health measures and restrictions related to COVID-19 were eased. Average weather across Canada for the three months ended December 31, 2021, as measured by degree days was 2% colder than the prior year and 3% warmer than the five-year average. Residential sales volumes were 1 million litres or 2% higher than the prior year quarter due to the acquisitions completed earlier in the year. Commercial sales volumes increased by 8 million litres or 3% due to cold weather in Western Canada and the impact of acquisitions completed earlier in the year. Wholesale propane volumes increased by 26 million litres or 9% compared to the prior year quarter due to reduced COVID-19 restrictions, and to a lesser extent sales and marketing efforts to increase third-party spot-price wholesale propane sales.

Average propane sales margins were 18.5 cents per litre, an increase of 0.4 cents from 18.1 cents per litre in the prior year quarter due primarily to the sale of incremental carbon offset credits.

Superior Plus Corp.

Canadian Propane Distribution Sales Volumes - Volumes by End Use Application[(1) ]

Canadian Propane Distribution Sales Volumes *Volumes by End-Use Application(1)*
	Three Months Ended
	December 31
(millions of litres)	2021	2020
Residential	59	58
Commercial	262	254
Wholesale	322	296
Total	643	608
Canadian Propane Distribution Sales Volumes
*Volumes by Region (1)*
	Three Months Ended
	December 31
(millions of litres)	2021	2020
Western Canada	218	220
Eastern Canada	156	143
Atlantic Canada	41	38
United States	228	207
Total	643	608

Operating Costs and Selling, Distribution and Administrative Costs

Operating costs were $60.9 million, an increase of $11.4 million or 23% compared to the prior year quarter. The increase in operating costs was primarily due to the impact of there being no CEWS benefit recorded during the current quarter and to a lesser extent higher volume related costs.

SD&A includes amortization, depreciation and transaction, restructuring and other costs whereas operating costs exclude these expenses and is used in the determination of Adjusted EBITDA. SD&A costs were $79.5 million, an increase of $11.4 million or 17% from the prior year quarter. SD&A costs increased for the above reasons, partially offset by a loss on disposal of assets compared to a gain on disposal of assets in the prior year quarter. The Canadian Propane segment recorded a total of $nil million related to the CEWS program during the three months ended December 31, 2021 (2020 - $12.0 million).

Earnings before tax

Earnings before income tax of $28.5 million, decreased by $22.6 million or 44% over the prior year quarter, due to a lower unrealized gain on derivative financial instruments as a result of the increased commodity prices and the aforementioned reasons.

CONSOLIDATED CAPITAL EXPENDITURE SUMMARY

Superior classifies its capital expenditures into three main categories: efficiency, process improvement and growthrelated; maintenance capital; and investment in leased assets.

Efficiency, process improvement and growth-related expenditures include expenditures such as the acquisition of new customer equipment to facilitate growth, system upgrades and initiatives to facilitate improvements in customer service. The capital expenditures are discretionary and non-recurring.

Superior Plus Corp.

Maintenance capital expenditures include required regulatory spending on tank refurbishments, replacement of chlorine railcars, replacement of plant equipment and any other required expenditures related to maintaining operations.

Investment in leased assets generally includes vehicles for the Energy Distribution segments to support growth and replace aging vehicles, renewing railcar leases in the Specialty Chemicals segment and the wholesale business and timing of renewing property leases across the entire company.

Superior’s capital expenditures:

Superior’s capital expenditures:
	Three Months
	December 31
(millions of dollars)	2021	2020(1)
Efficiency, process improvement and growth-related(2)	23.4	9.1
Maintenance capital(2)	22.7	9.6
	46.1	18.7
Proceeds on disposition of assets	(3.4)	(4.7)
Property, plant and equipment acquired through acquisition(3)	16.9	41.3
Total net capital expenditures	59.6	55.3
Investment in leased assets net of proceeds from refinanced vehicles(3)	15.5	7.4
Total expenditures including finance leases	75.1	62.7

(1) Comparative figures have been reclassified to exclude the results of the divested Specialty Chemicals segment.

(2) The amounts disclosed in the consolidated statements of cash flows for the year ended December 31, 2021 and 2020 is made up of the sum of these amounts and the cash flows used in investing activities related to discontinued operations.

(3) Property, plant and equipment acquired through acquisitions is disclosed in Note 4 of the annual audited consolidated financial statements. Investment in leased assets net of proceeds from refinanced vehicles is calculated by using the lease additions from continuing operations disclosed in Note 16 and subtracting the proceeds received from vehicle refinancing disclosed in the statements of cash flows included in the annual audited consolidated financial statements.

Efficiency, process improvement and growth-related expenditures were $23.4 million for the three months ended December 31, 2021 compared to $9.1 million in the prior year quarter. The increase over the prior year quarter is primarily due to timing of integration activity.

Maintenance capital expenditures were $22.7 million for the three months ended December 31, 2021 compared to $9.6 million in the prior year quarter, and were primarily related to required maintenance capital. The increase is primarily due to timing of expenditures, the impact of acquisitions and the impact from deferring expenditures in the prior year quarter related to capital preserving initiatives in response to the COVID-19 pandemic.

Property, plant and equipment acquired through acquisition is the allocation of fair value to acquired assets.

Superior entered into $15.5 million of leases net of proceeds from refinancing previously acquired vehicles for the three months ended December 31, 2021 compared to a net investment of $7.4 million in the prior year quarter. The increase is primarily due to timing of renewing property leases and acquiring vehicles leases.

Capital expenditures were funded from a combination of operating cash flow and revolving-term bank credit facilities and credit provided through lease liabilities.

Superior Plus Corp.

CORPORATE OPERATING COSTS AND SD&A

Corporate administrative costs for the three months ended December 31, 2021 were $4.6 million a decrease of $1.2 million or 21% compared to $5.8 million in the prior year quarter. The decrease is primarily due to lower long-term incentive plan costs and to a lesser extent timing of expenses. Corporate operating costs included in Adjusted EBITDA exclude depreciation, amortization and transaction, restructuring and other costs.

Corporate SD&A costs were $8.9 million for the three months ended December 31, 2021, a decrease of $0.8 million or 8% from $9.7 million in the prior year quarter primarily due to the above and lower transaction costs.

FINANCE AND INTEREST EXPENSE

Finance expense was $17.2 million for the three months ended December 31, 2021, a decrease of $6.8 million, compared to $24.0 million in the prior year quarter. The decrease is primarily due to lower average debt balances, and lower interest rates compared to the prior year quarter.

Interest expense included in AOCF excludes interest earned on the Vendor Note, premiums and other losses on the redemption of senior unsecured notes and the unwinding of discounts on decommissioning liabilities and non-cash financing expenses. Interest expense was $17.7 million, a decrease of $4.9 million, compared to $22.6 million in the prior year quarter. The decrease is due to lower average debt balances and lower average interest rates. Debt balances are lower primarily as the net proceeds from the divestiture of Specialty Chemicals in the year was used to pay down debt prior to the completion of acquisitions and average interest rates are lower as a result of refinancing the senior unsecured notes.

TRANSACTION, RESTRUCTURING AND OTHER COSTS

Superior’s transaction, restructuring and other costs have been categorized together and excluded from segmented results. The table below summarizes these costs:

(millions of dollars except per share amounts)	Three Months
	December 31
	2021 2020(1)
Total transaction, restructuring and other costs	8.3 8.5

(1) Comparative figures have been reclassified to exclude the results of the divested Specialty Chemicals segment.

For the three months ended December 31, 2021, Superior incurred $8.3 million in costs related primarily to the acquisition and integration of tuck-in acquisitions and other acquisition activity. The costs in the prior year quarter related primarily to the integration of acquisitions, the strategic review of Specialty Chemicals and tuck-in acquisitions.

Superior Plus Corp.

QUARTERLY FINANCIAL AND OPERATING INFORMATION

IFRS Measures

IFRS Measures
(millions of dollars, except
per share amounts)	Q4 2021	Q32021	Q2 2021	Q1 2021	Q4 2020	Q32020	Q2 2020	Q1 2020
Revenue(1)	824.9	362.6	365.6	839.5	561.9	256.8	305.6	682.6
Gross profit(1)	281.9	132.6	149.1	349.1	277.5	120.7	169.3	346.2
Net earnings (loss) from
continuing operations(1)	13.8	(35.9)	(36.1)	75.4	87.9	(26.1)	(0.1)	1.1
Per share, basic(1)	0.04	(0.24)	(0.24)	0.36	0.42	(0.18)	–	0.01
Per share, diluted(1)	0.04	(0.24)	(0.24)	0.36	0.42	(0.18)	–	0.01
Net workingcapital(deficit) (2)	$11.8	(111.5)	(65.1)	36.9	22.3	(14.9)	(0.8)	144.7

(1) Prior periods have been restated to comply with the current presentation.

(2) Net working capital is comprised of trade and other receivables, prepaid expenses and deposits and inventories, less trade and other payables, contract liabilities, and dividends payable.

Non-GAAP Financial Measures[ (1) ]

(millions of dollars, except
per share amounts)	Q4 2021	Q32021	Q2 2021	Q1 2021	Q4 2020	Q32020	Q2 2020	Q1 2020
Adjusted EBITDA	142.2	13.0	31.6	211.6	144.1	10.8	39.1	185.4
AOCF before transaction,
restructuring
and other costs	131.6	(4.8)	9.0	185.3	134.0	(12.7)	14.5	156.4
Per share, basic	$0.64	(0.02)	0.04	0.90	0.65	(0.06)	0.08	0.89
Per share, diluted	$0.64	(0.02)	0.04	0.90	0.65	(0.06)	0.08	0.89
AOCF	123.3	(11.7)	4.7	175.9	125.5	(17.2)	9.5	150.8
Per share, basic	$0.60	(0.06)	0.02	0.85	0.61	(0.09)	0.05	0.86
Per share,diluted	$0.60	(0.06)	0.02	0.85	0.61	(0.09)	0.05	0.86

(1)Adjusted EBITDA, AOCF before transaction, restructuring and other costs, AOCF and the related per share amounts, are Non-GAAP financial measures, see “ Non-GAAP financial measures and reconciliations” on page 42. Prior periods have been restated to comply with the current presentation.

Fluctuations in Superior’s individual quarterly results is subject to seasonality. Sales typically peak in the first quarter when approximately one-third of annual propane and other refined fuels sales volumes and gross profits are generated due to the demand of heating from end-use customers. They then decline through the second and third quarters, rising seasonally again in the fourth quarter with heating demand. In addition, acquisitions and divestitures may impact quarterly results. For information on acquisitions see Note 4 in the 2021 audited consolidated financial statements.

Superior Plus Corp.

Volumes

	Q4 2021	Q32021	Q2 2021	Q1 2021	Q4 2020	Q32020	Q2 2020	Q1 2020
U.S. propane sales
volumes (millions of
litres)	400	168	212	547	386	155	190	422
Canadian propane sales
volumes (millions of
litres)	643	352	392	717	608	341	360	729
U.S propane sales by end-use application are as follows(1):
(millions of litres)	Q4 2021	Q32021	Q2 2021	Q1 2021	Q4 2020	Q32020	Q2 2020	Q1 2020
Residential	224	61	97	342	224	59	97	257
Commercial	170	103	110	195	155	91	88	153
Wholesale	6	4	5	10	7	5	5	12
Total	400	168	212	547	386	155	190	422

(1) Comparative figures have been reclassified to reflect the current period presentation of end use.

Canadian propane sales by end-use application are as follows[(1)] :

(millions of litres)	Q4 2021	Q32021	Q2 2021	Q1 2021	Q4 2020	Q32020	Q2 2020	Q1 2020
Residential	59	20	27	74	58	20	27	66
Commercial	262	149	170	289	254	150	161	316
Wholesale	322	183	195	354	296	171	172	347
Total	643	352	392	717	608	341	360	729

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS

Throughout the MD&A, Superior has used the following terms that are not defined by IFRS, but are used by management to evaluate the performance of Superior and its business. These measures may also be used by investors, financial institutions and credit rating agencies to assess Superior’s performance and ability to service debt. NonGAAP financial measures do not have standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Securities regulations require that Non-GAAP financial measures be clearly defined, qualified and reconciled to their most comparable IFRS financial measures. Except as otherwise indicated, these Non-GAAP financial measures are calculated and disclosed on a consistent basis from period to period. Specific items may only be relevant in certain periods.

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

Management has included the impact of CEWS in the determination of its Non-GAAP Financial Measures as management believes this benefit forms part of the net impact of COVID-19 on the financial results of Superior. NonGAAP financial measures are identified and defined as follows:

AOCF and AOCF per Share

AOCF is equal to cash flow from operating activities as defined by IFRS, adjusted for changes in non-cash working capital, other expenses, non-cash interest expense, current income taxes and finance costs. Superior may deduct or Superior Plus Corp. 42

include additional items in its calculation of AOCF; these items would generally, but not necessarily, be related to acquiring businesses, integration activities, restructuring provisions and other costs associated with the acquisition and integration of businesses and could distort the analysis of trends in business performance. Excluding these items does not imply they are non-recurring. AOCF and AOCF per share are presented before and after transaction, restructuring and other costs.

AOCF per share before transaction, restructuring and other costs is calculated by dividing AOCF before transaction, restructuring and other costs by the weighted average number of shares outstanding assuming the conversion of preferred shares into common shares. AOCF per share is calculated by dividing AOCF by the weighted average number of shares outstanding.

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

The seasonality of Superior’s individual quarterly results must be assessed in the context of annualized AOCF. Adjustments recorded by Superior as part of its calculation of AOCF include, but are not limited to, the impact of the seasonality of Superior’s businesses, principally the Propane Distribution segments, by adjusting for non-cash working capital items, thereby eliminating the impact of the timing between the recognition and collection/payment of Superior’s revenue and expenses, which can differ significantly from quarter to quarter.

Interest expense

Interest expense included in AOCF is equal to finance expense as defined by IFRS, adjusted for unwinding of discount on debentures, borrowing and decommissioning liabilities and other non-cash items, interest earned on Vendor Note and premiums and other losses on redemption of senior unsecured notes.

Adjusted current tax (expense) recovery

Adjusted current tax (expense) recovery is included in AOCF and is equal to the current tax expense as defined by IFRS, adjusted for a current tax recovery associated with the divestiture, see Note 19. The current tax recovery is a result of the discontinued operations presentation that resulted in a current tax expense being recorded in the results from discontinued operations and a current tax recovery related to continuing operations.

Adjusted EBITDA

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

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

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

EBITDA from operations

EBITDA from operations is defined as the sum of US Propane Adjusted EBITDA and Canadian Propane Adjusted EBITDA. Management uses EBITDA from operations to set targets for Superiors’ operating segments (including annual guidance and variable compensation targets). EBITDA from operations, US Propane Adjusted EBITDA and Canadian Propane Adjusted EBITDA is reconciled to earnings before income taxes.

Superior Plus Corp.

Reconciliation of net earnings to EBITDA, Adjusted EBITDA and AOCF

The below information is derived from Note 21 Supplemental Disclosure of the Consolidated Statements of Net Earnings, Note 29 Reportable Segment Information and Note 19 Income Taxes of the audited consolidated financial statements as at and for the year ended December 31, 2021 and 2020.

	Propane Distribution	Propane Distribution	Results from
For the Year Ended December 31, 2021	U.S.	Canada	operations	Corporate	Total
Earnings (loss) from continuing operations before
income taxes	99.8	99.7	199.5	(176.6)	22.9
Adjusted for:
Amortization and depreciation included in selling,
distribution and administrative costs	125.5	74.9	200.4	0.7	201.1
Finance expense	5.2	4.0	9.2	145.8	155.0
EBITDA	230.5	178.6	409.1	(30.1)	379.0
Loss (gain) on disposal of assets and other	0.2	(0.6)	(0.4)	–	(0.4)
Transaction, restructuring and other costs	13.6	4.2	17.8	11.1	28.9
Unrealized gains (losses) on derivative financial
instruments(1)	(18.1)	1.5	(16.6)	7.5	(9.1)
Adjusted EBITDA	226.2	183.7	409.9	(11.5)	398.4
Adjust for:
Adjusted current income tax expense(2)	–	–	–	(1.2)	(1.2)
Transaction, restructuring and other costs	(13.6)	(4.2)	(17.8)	(11.1)	(28.9)
Interest expense	(3.7)	(4.0)	(7.7)	(68.4)	(76.1)
AOCF	208.9	175.5	384.4	(92.2)	292.2

(1) Unrealized gains (losses) on derivative financial instruments includes the realized foreign exchange gain on the settlement of the US$350 million senior notes, see Note 15.

(2) The 2021 current income tax expense has been adjusted by $85.0 million recovery representing the impact of reporting the divestiture as a discontinued operation, see Note 19.

Superior Plus Corp.

	Propane Distribution	Propane Distribution	Results from
FortheYear EndedDecember31,2020	U.S.	Canada	operations	Corporate	Total
Earnings (loss) from continuing operations before
income taxes	92.5	123.2	215.7	(88.6)	127.1
Adjust for:
Amortization and depreciation included in selling,
distribution and administrative costs	118.5	74.2	192.7	0.6	193.3
Finance expense	5.2	4.4	9.6	88.9	98.5
EBITDA	216.2	201.8	418.0	0.9	418.9
Loss on disposal of assets and other	2.5	1.1	3.6	(0.1)	3.5
Transaction, restructuring and other costs	14.4	0.4	14.8	8.8	23.6
Unrealized losses on derivative financial instruments	(26.2)	(8.3)	(34.5)	(32.1)	(66.6)
Adjusted EBITDA	206.9	195.0	401.9	(22.5)	379.4
Adjust for:
Current income tax recovery	–	–	–	4.6	4.6
Transaction, restructuring and other costs	(14.4)	(0.4)	(14.8)	(8.8)	(23.6)
Interest expense	(3.7)	(4.2)	(7.9)	(83.9)	(91.8)
AOCF	188.8	190.4	379.2	(110.6)	268.6
	Propane Distribution
For the Three Months Ended December 31, 2021			Results from
(1)	U.S.	Canada	operations	Corporate	Total
Earnings (loss) from continuing operations before
income taxes	13.6	28.5	42.1	(21.0)	21.1
Adjust for:
Amortization and depreciation included in selling,
distribution and administrative costs	32.3	19.6	51.9	0.1	52.0
Finance expense	1.4	0.9	2.3	14.9	17.2
EBITDA	47.3	49.0	96.3	(6.0)	90.3
Loss on disposal of assets and other	–	(1.4)	(1.4)	–	(1.4)
Transaction, restructuring and other costs	3.7	0.4	4.1	4.2	8.3
Unrealized gains on derivative financial instruments	28.9	15.2	44.1	0.9	45.0
Adjusted EBITDA	79.9	63.2	143.1	(0.9)	142.2
Adjust for:
Adjusted current income tax recovery	–	–	–	7.1	7.1
Transaction, restructuring and other costs	(3.7)	(0.4)	(4.1)	(4.2)	(8.3)
Interest expense	(1.0)	(1.0)	(2.0)	(15.7)	(17.7)
AOCF	75.2	61.8	137.0	(13.7)	123.3

(1) Amounts for the three months ended December 31, 2021 are derived by subtracting the annual results by the results for the nine months ended September 30, 2021.

Superior Plus Corp.

	Propane Distribution	Propane Distribution	Results from
FortheThreeMonthsEndedDecember31,2020 (1)	U.S.	Canada	operations	Corporate	Total
Earnings from continuing operations before income
taxes	55.5	51.1	106.6	14.1	120.7
Adjust for:
Amortization and depreciation included in selling,
distribution and administrative costs	33.5	18.4	51.9	–	51.9
Finance expense	1.0	1.0	2.0	22.0	24.0
EBITDA	90.0	70.5	160.5	36.1	196.6
Loss on disposal of assets and other	0.6	0.3	0.9	(0.1)	0.8
Transaction, restructuring and other costs	4.6	(0.1)	4.5	4.0	8.5
Unrealized losses on derivative financial instruments	(14.8)	(5.1)	(19.9)	(41.9)	(61.8)
Adjusted EBITDA	80.4	65.6	146.0	(1.9)	144.1
Adjust for:
Current income tax recovery	–	–	–	12.5	12.5
Transaction, restructuring and other costs	(4.6)	0.1	(4.5)	(4.0)	(8.5)
Interest expense	(0.7)	(1.1)	(1.8)	(20.8)	(22.6)
AOCF	75.1	64.6	139.7	(14.2)	125.5

(1) Amounts for the three months ended December 31, 2020 are derived by subtracting the annual results by the results for the nine months ended September 30, 2020.

Adjusted Gross Profit

Adjusted gross profit represents revenue less cost of sales adjusted for realized gains and losses on commodity derivative instruments related to risk management. Managements uses Adjusted Gross Profit to set margin targets and measure results. Unrealized gains and losses on commodity derivative instruments are excluded because of the accounting mis-match that exists as a result of the customer contract not being included in the determination of the fair value for this risk management activity.

Reconciliation of gross profit to adjusted gross profit

Reconciliation of gross profit to adjusted gross profit
	Propane Distribution Total U.S. Canada
For the Year Ended December 31, 2021
Gross Profit	527.6 385.1 912.7 35.5 12.8 48.3
Realized gains onderivativesrelated to commodityrisk management
Adjusted gross profit	563.1 397.9 961.0
	Propane Distribution Total U.S. Canada

FortheYear EndedDecember31,2020
Gross Profit	513.9 399.8 913.7 (14.6) (1.0) (15.6)
Realizedlosses onderivativesrelated to commodityrisk management
Adjustedgrossprofit	499.3	398.8 898.1

Superior Plus Corp.

	Propane Distribution	Propane Distribution
For the Three Months Ended December 31, 2021(1)	U.S.	Canada	Total
Gross Profit	163.9	118.0	281.9
Realized gains onderivativesrelated to commodityrisk management	12.7	6.1	18.8
Adjusted gross profit	176.6	124.1	300.7
(1)Amounts for the three months ended December 31, 2021 are derived by subtracting the annual results by the results for the nine months ended September
30, 2021.
	Propane Distribution
FortheThreeMonthsEndedDecember31,2020(1)	U.S.	Canada	Total
Gross Profit	163.5	114.0	277.5
Realized gains onderivativesrelated to commodityrisk management	2.6	1.1	3.7
Adjustedgrossprofit	166.1	115.1	281.2
(1)Amounts for the three months ended December 31, 2020 are derived by subtracting the annual results by the results for the nine months ended September
30, 2020.

Realized gains (losses) on derivatives related to commodity risk management and foreign currency hedging contracts reconcile to total gains (losses) as follows:

Reconciliation of realized gains (losses) on derivatives to total gains (losses)

	Propane Distribution	Propane Distribution	Results from
For the Three Months Ended December 31,
2021(1)	U.S.	Canada	Operations	Corporate	Total
Realized gains on derivatives related to commodity
risk management	12.7	6.1	18.8	–	18.8
Realized gains on foreign currency hedging
contracts	–	–	–	3.7	3.7
Realized gains (losses) included in AOCF	12.7	6.1	18.8	3.7	22.5
Unrealized losses on derivatives related to
commodity risk management	(29.0)	(15.2)	(44.2)	–	(44.2)
Unrealized losses on foreign currency hedging	–	–	–	(2.0)	(2.0)
Unrealized losses on equity derivative contracts	–	–	–	(0.8)	(0.8)
Unrealized losses on contingent consideration	–	–	–	(0.6)	(0.6)
Unrealized foreign exchange gain on US dollar debt
andleaseliabilities	–	–	–	2.6	2.6
Unrealized gains (losses) excludedin AOCF	(29.0)	(15.2)	(44.2)	(0.8)	(45.0)
Total gains (losses) on derivatives and foreign
currency translation of borrowings	(16.3)	(9.1)	(25.4)	2.9	(22.5)

(1) Amounts for the three months ended December 31, 2021 are derived by subtracting the annual results by the results for the nine months ended September 30, 2021.

Superior Plus Corp.

	Propane Distribution	Propane Distribution	Results from
FortheThreeMonthsEndedDecember31,2020(1)	U.S.	Canada	Operations	Corporate	Total
Realized gains on derivatives related to commodity
risk management	2.6	1.1	3.7	–	3.7
Realized gains on foreign currency hedging
contracts	–	–	–	3.9	3.9
Realized gains (losses) included in AOCF	2.6	1.1	3.7	3.9	7.6
Unrealized gains on derivatives related to
commodity risk management	14.8	5.1	19.9	–	19.9
Unrealized gains on foreign currency hedging
contracts	–	–	–	14.8	14.8
Unrealized gains on equity derivative contracts	–	–	–	0.8	0.8
Unrealized foreign exchange gain on US dollar debt
andleaseliabilities	–	–	–	26.3	26.3
Unrealized gains (losses) excludedin AOCF	14.8	5.1	19.9	41.9	61.8
Total gain on derivatives and foreign currency
translation of borrowings	17.4	6.2	23.6	45.8	69.4
(1)Amounts for the three months ended December 31, 2020 are derived by subtracting the annual results			by the results for the nine months ended		September
30, 2020.
	Propane Distribution		Results from
For the Year Ended December 31, 2021	U.S.	Canada	Operations	Corporate	Total
Realized gains on derivatives related to commodity
risk management	35.5	12.8	48.3	12.6	60.9
Realizedforeignexchange gainonU.S. dollardebt	–	–	–	20.0	20.0
Realized gains (losses) included in AOCF	35.5	12.8	48.3	32.6	80.9
Unrealized gains (losses) on derivatives related to
commodity risk management	18.1	(1.5)	16.6	–	16.6
Unrealized losses on foreign currency hedging	–	–	–	(8.2)	(8.2)
Unrealized gains on equity derivative contracts	–	–	–	0.1	0.1
Unrealized losses on contingent consideration	–	–	–	(0.6)	(0.6)
Unrealized foreign exchange loss on US dollar debt
andleaseliabilities	–	–	–	(18.8)	(18.8)
Unrealized gains (losses) excludedin AOCF	18.1	(1.5)	16.6	(27.5)	(10.9)
Total gains on derivatives and foreign currency
translation of borrowings	53.6	11.3	64.9	5.1	70.0

Superior Plus Corp.

	Propane Distribution	Propane Distribution	Results from
FortheYear EndedDecember31,2020	U.S.	Canada	Operations	Corporate	Total
Realized losses on derivatives related to commodity
risk management	(14.6)	(1.0)	(15.6)	–	(15.6)
Realized losses on foreign currency hedging
contracts	–	–	–	(2.0)	(2.0)
Realized gains (losses) included in AOCF	(14.6)	(1.0)	(15.6)	(2.0)	(17.6)
Unrealized gains on derivatives related to
commodity risk management	26.2	8.3	34.5	–	34.5
Unrealized gains on foreign currency hedging
contracts	–	–	–	19.9	19.9
Unrealized gains on equity derivative contracts	–	–	–	2.9	2.9
Unrealized foreign exchange gain on US dollar debt
andleaseliabilities	–	–	–	9.3	9.3
Unrealized gains (losses) excludedin AOCF	26.2	8.3	34.5	32.1	66.6
Total gains on derivatives and foreign currency
translation of borrowings	11.6	7.3	18.9	30.1	49.0

Operating Costs

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

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

Corporate operating costs include wages and benefits for employees, professional fees and other costs associated with the corporate function. Corporate operating costs are defined as SD&A expenses related to the corporate office adjusted for amortization and depreciation, gains or losses on disposal of assets and transaction, restructuring and other costs.

Reconciliation of SD&A to Operating Costs

Reconciliation of SD&A to Operating Costs

	Propane Distribution		Results from
For the Year Ended December 31, 2021	U.S.	Canada	operations	Corporate	Total
Selling, distribution and administrative expense	476.2	292.7	768.9	35.9	804.8
Amortization and depreciation included in selling,
distribution and administrative costs	(125.5)	(74.9)	(200.4)	(0.7)	(201.1)
Transaction, restructuring and other costs	(13.6)	(4.2)	(17.8)	(11.1)	(28.9)
Loss ondisposalofassets and other	(0.2)	0.6	0.4	–	0.4
Operating Costs	336.9	214.2	551.1	24.1	575.2

Superior Plus Corp.

	Propane Distribution Results from operations Corporate Total U.S. Canada	Propane Distribution Results from operations Corporate Total U.S. Canada	Propane Distribution Results from operations Corporate Total U.S. Canada
FortheYear EndedDecember31,2020
Selling, distribution and administrative expense	427.8 279.5 707.3 29.8 737.1 (118.5) (74.2) (192.7) (0.6) (193.3) (14.4) (0.4) (14.8) (8.8) (23.6) (2.5) (1.1) (3.6) – (3.6)
Amortization and depreciation included in selling, distribution and administrative costs
Transaction, restructuring and other costs
Loss ondisposalofassets and other
OperatingCosts	292.4 203.8 496.2 20.4 516.6
	Propane Distribution Results from operations Corporate Total U.S. Canada

For the Three Months Ended December 31, 2021
Selling, distribution and administrative expense	132.7 79.5 212.2 8.9 221.1 (32.3) (19.6) (51.9) (0.1) (52.0) (3.7) (0.4) (4.1) (4.2) (8.3) – 1.4 1.4 – 1.4
Amortization and depreciation included in selling, distribution and administrative costs
Transaction, restructuring and other costs
Loss ondisposalofassets and other
Operating Costs	96.7 60.9 157.6 4.6 162.2
	Propane Distribution Results from operations Corporate Total U.S. Canada

FortheThreeMonthsEndedDecember31,2020
Selling, distribution and administrative expense	124.4 68.1 192.5 9.7 202.2 (33.5) (18.4) (51.9) – (51.9) (4.6) 0.1 (4.5) (4.0) (8.5) (0.6) (0.3) (0.9) – (0.9)
Amortization and depreciation included in selling, distribution and administrative costs
Transaction, restructuring and other costs
Loss ondisposalofassets and other
OperatingCosts	85.7	49.5 135.2	5.7 140.9

Net Debt, Pro Forma Adjusted EBITDA and Leverage Ratio

Pro Forma Adjusted EBITDA, Net debt and Leverage ratio are Non-GAAP financial measures. Superior uses Pro Forma Adjusted EBITDA and Net debt to calculate its Leverage ratio. This ratio is used by Superior, investors and other users of financial information to assess its ability to service debt.

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

Net Debt is calculated by the sum of borrowings before deferred financing fees and lease liabilities reduced by Superior cash and cash equivalents. Net Debt is used by Superior to calculate its Leverage Ratio.

Leverage ratio is determined by dividing Superior’s Net Debt by their Pro Forma Adjusted EBITDA.

Superior Plus Corp.

Reconciliation of Net debt and Pro Forma Adjusted

tion of Net debt and Pro Forma Adjusted
(in millions)	2021	2020(1)
Current borrowings	11.4	7.1
Current lease liabilities	44.9	53.3
Non-current borrowings	1,444.9	1,554.4
Non-currentleaseliabilities	129.6	213.5
	1,630.8	1,828.3
Add back deferred financing fees and discounts	22.1	22.3
Deduct cashand cashequivalents	(28.4)	(24.1)
Net debt	1,624.5	1,826.5
Adjusted EBITDA for the year ended	398.4	495.9
Pro-forma adjustment	18.4	26.7
Pro-forma Adjusted EBITDA for theyear ended	416.8	522.6
Leverage Ratio	3.9X	3.5X

(1) The comparative figures include the results of the Specialty Chemicals segment and haven’t been restated. Removing the results and reducing the debt for the cash received does not provide a meaningful ratio as the proceeds were used to fund further acquisitions

RISK FACTORS TO SUPERIOR

The risks factors and uncertainties detailed below are a summary of Superior’s assessment of its material risk factors as detailed in Superior’s most recent Annual Information Form (“AIF”) under “Risks associated with our business” which is filed on the Canadian Securities Administrators’ website, www.sedar.com, and on Superior’s website, www.superiorplus.com. The AIF describes some of the most material risks to Superior’s business by type of risk: financial; strategic; operational; and legal.

General risks to Superior are as follow:

Catastrophic Events, Natural Disasters, Severe Weather and Disease

Superior may be negatively impacted to varying degrees by a number of events which are beyond our control, including cyber-attacks, unauthorized access, energy blackouts, pandemics, terrorist attacks, acts of war, earthquakes, hurricanes, tornados, fires, floods, ice storms or other natural or manmade catastrophes. While we engage in emergency preparedness, including business continuity planning, to mitigate risks, such events can evolve very rapidly and their impacts can be difficult to predict. As such, there can be no assurance that in the event of such a catastrophe that our operations and ability to carry on business will not be disrupted. The occurrence of such events may not release us from performing our obligations to third parties. A catastrophic event, including an outbreak of infectious disease, a pandemic or a similar health threat, such as the evolving 2019 Novel Coronavirus outbreak, or fear of any of the foregoing, could adversely impact us by causing operating or supply chain delays and disruptions, labour shortages, expansion project delays and facility shutdowns which could have a negative impact on our ability to conduct our business and increase our costs. In addition, liquidity and volatility, credit availability and market and financial conditions generally could change at any time as a result. Any of these events in isolation or in combination, could have a material negative impact on our financial condition, operating results and cash flows.

Superior Plus Corp.

Cash Dividends to Shareholders are Dependent on the Performance of Superior LP

Superior depends entirely on the operations and assets of Superior LP. Superior’s ability to make dividend payments to its shareholders depends on Superior LP’s ability to make distributions on its outstanding limited partnership units, as well as on the operations and business of Superior LP.

There is no assurance regarding the amount of cash to be distributed by Superior LP or generated by Superior LP and, therefore, there is no assurance regarding funds available for dividends to shareholders. The amount distributed in respect of the limited partnership units will depend on a variety of factors including, without limitation, the performance of Superior LP’s operating businesses, the effect of acquisitions or dispositions on Superior LP, and other factors that may be beyond the control of Superior LP or Superior. In the event significant sustaining capital expenditures are required by Superior LP or the profitability of Superior LP declines, there would be a decrease in the amount of cash available for dividends to shareholders and such decrease could be material.

Superior’s dividend policy and the distribution policy of Superior LP are subject to change at the discretion of the Board of Directors of Superior or the Board of Directors of Superior General Partner Inc., the general partner of Superior LP, as applicable. Superior’s dividend policy and the distribution policy of Superior LP are also limited by contractual agreements including agreements with lenders to Superior and its affiliates and by restrictions under corporate law.

Additional Shares

In the event the Board of Directors of Superior decides to issue additional common shares, preferred shares or securities convertible into common shares, existing shareholders may suffer significant dilution.

Access to Capital

The credit facilities and U.S. notes of Superior LP contain covenants that require Superior LP to meet certain financial tests and that restrict, among other things, the ability of Superior LP to incur additional debt, dispose of assets or pay dividends/distributions in certain circumstances. These restrictions may preclude Superior LP from returning capital or making distributions on the limited partnership units.

The payout by Superior LP of substantially all of its available cash flow means that capital expenditures to fund growth opportunities can only be made in the event that other sources of financing are available. Lack of access to such additional financing could limit the future growth of the business of Superior LP and, over time, have a material adverse effect on the amount of cash available for dividends to shareholders.

To the extent that external sources of capital, including public and private markets, become limited or unavailable, Superior’s and Superior LP’s ability to make the necessary capital investments to maintain or expand the current business and to make necessary principal payments and debenture redemptions under its term credit facilities may be impaired.

Interest Rates

Superior maintains floating interest rate exposure through a combination of floating interest rate borrowing and uses derivative instruments at times, to mitigate this risk. Demand for a significant portion of Propane Distribution’s sales are affected by general economic trends. Generally speaking, when the economy is strong, interest rates increase, as does demand from Superior’s customers, thereby increasing Superior’s sales and its ability to pay higher interest costs. The opposite is also true. In this way, there is a common relationship among economic activity levels, interest rates and Superior’s ability to pay higher or lower rates. Increased interest rates will, however, affect Superior’s borrowing costs, which will have an adverse effect.

Foreign Exchange Risk

A portion of Superior’s net cash flow is denominated in U.S. dollars. Accordingly, fluctuations in the Canadian/U.S. dollar exchange rate can impact profitability. Superior attempts to mitigate this risk with derivative financial instruments.

Superior Plus Corp.

Changes in Legislation and Expected Tax Profile

There can be no assurance that income tax laws, rules or associated regulations applicable to Superior, given the number of jurisdictions in which Superior operates, will not be changed, interpreted or administered in a manner which adversely affects Superior and its shareholders. In addition, there can be no assurance that the tax agencies in the jurisdictions that Superior operates in will agree with how Superior calculates its income for tax purposes or that these various tax agencies referenced herein will not change their administrative practices to the detriment of Superior or its shareholders.

Acquisitions and Divestitures

Superior may not be able to find or buy appropriate acquisition targets on economically acceptable terms. Superior’s acquisition agreements will contain certain representations, warranties and indemnities from the respective vendors subject to certain applicable limitations and thresholds and Superior will conduct due diligence prior to completion of such acquisitions. If, however such representations and warranties are inaccurate or limited in applicability or if any liabilities that are discovered exceed such limits or are not covered by the representations, warranties or indemnities, or the applicable vendors default in their obligations or if certain liabilities are not identified in such agreements, Superior could become liable for any such liabilities which may have an adverse effect on Superior. In addition, there may be liabilities or risks that were not discovered in such due diligence investigations which could have an adverse effect on Superior.

Acquiring complementary businesses is required to optimally execute Superior’s business strategy. Distribution systems, technologies, key personnel or businesses of companies Superior acquires may not be effectively assimilated into its business, or its alliances may not be successful. There is also no assurance regarding the completion of a planned acquisition as Superior may be unable to obtain shareholder approval for a planned acquisition or Superior may be unable to obtain government and regulatory approvals required for a planned acquisition, or required government and/or regulatory approvals may result in delays. There may be penalties associated with not completing a planned acquisition. Superior may not be able to successfully complete certain divestitures on satisfactory terms, if at all. Divestitures may reduce Superior’s total revenue and net earnings by more than the sales price. The terms and conditions, representations, warranties and indemnities, if any, associated with divestiture activity may hold future risks.

As part of the material terms of the Specialty Chemical divestiture, a Vendor Note of $125 million was issued by the buyer. Its principal amount and accrued and unpaid interest are due October 2026. The collectability of the amounts owed to Superior is subject to the going concern of the buyer. As of December 31, 2021, Superior does not have any concerns about the financial strength of the buyer. Superior will continuously monitor the credit risk associated with this Vendor Note. Based on the current valuation, Superior has estimated a liability of $1.4 million related to the contingent consideration included in the divestiture. The fair value has been calculated based on an estimate of the EBITDA during the thirty-six-months subsequent to the divestiture. This estimate is subject to change and will be updated as new information becomes available.

Information Technology and Cyber Security

Superior utilizes a number of information technology systems for the management of its business and the operation of its facilities. The reliability and security of these systems is critical. If the functioning of these systems is interrupted or fails and cannot be restored quickly, or if the technologies are no longer supported, Superior’s ability to operate its facilities and conduct its business could be affected. Superior has continued to mature its approach to technology planning. Superior continually assesses and monitors its cyber security risk. In an effort to mitigate such risks, Superior has employed a fully managed third party cyber security service that deploys industry leading technology, conducted comprehensive employee training and utilizes monitoring software to protect its systems.

Although the technology systems Superior utilizes are intended to be secure and Superior has employed various methods to mitigate cyber risks, there is still a risk that an unauthorized third party could access the systems. Such a security breach could lead to a number of adverse consequences, including but not limited to, the unavailability, disruption or loss of key functions within Superior’s control systems and the unauthorized disclosure, corruption or

Superior Plus Corp.

loss of sensitive company, customer or personal information. Superior attempts to prevent such breaches through the implementation of various technology security measures, segregation of control systems from its general business network, engaging skilled consultants and employees to manage Superior’s technology applications, conducting periodic audits and adopting policies and procedures as appropriate.

As previously announced, on December 12, 2021, Superior was alerted to a ransomware cyber-attack on its information technology systems. Superior temporarily disabled certain information technology systems while it investigated the incident and in order to safely bring such systems back online. Superior immediately engaged thirdparty experts to evaluate the event, implement security counter-measures, and assist with restoration of Superior’s information technology environment. Superior was able to quickly restore operations after the cyber-attack and to continue making deliveries to customers with no material impact to operations, including customer deliveries, service or billings.

During the course of the investigation, which is ongoing, Superior determined that there was unauthorized access to certain employee personal information, and is in the process of identifying affected individuals to notify them as appropriate. Superior has already applied knowledge gathered from the investigation of the event to enhance its cyber security defenses. Superior expects the net financial impact from the incident will not exceed $1.5 million.

Competition

Propane is sold in competition with other energy sources such as natural gas, electricity and fuel oil, some of which are less costly on an energy-equivalent basis. While propane is usually more cost-effective than electricity, electricity is a major competitor in most areas. Fuel oil is also used as a residential, commercial and industrial source of heat and, in general, is less costly on an equivalent-energy basis, although operating efficiencies, environmental and air quality factors help make propane competitive with fuel oil. Except for certain industrial and commercial applications, propane is generally not competitive with natural gas in areas with natural gas service. Other alternative energy sources such as compressed natural gas, methanol and ethanol are available or could be further developed and could have an impact on the future of the propane industry in general and Canadian propane distribution in particular. The trend towards increased conservation measures and technological advances in energy efficiency may have a detrimental effect on propane demand and Canadian Propane Distribution’s sales. Increases in the cost of propane encourage customers to reduce fuel consumption and to invest in more energy efficient equipment, reducing demand. Propane commodity prices are affected by crude oil and natural gas commodity prices.

Automotive propane demand depends on propane pricing, the market’s acceptance of propane conversion options and the availability of infrastructure. Superior Propane has strategic partnerships with companies focused on after-market conversion technologies. This segment has been impacted by the development of more fuel efficient and complicated engines which increase the cost of converting engines to propane and reduce the savings per kilometre driven.

Competition in the U.S. propane distribution business’ markets generally occurs on a local basis between large, fullservice, national marketers and smaller, independent local marketers. Marketers primarily compete based on price and service and tend to operate in close proximity to customers, typically within a 60-kilometer marketing radius from a central depot, in order to minimize delivery costs and provide prompt service.

Volume Variability, Weather Conditions and Economic Demand

Weather, general economic conditions and the volatility in the cost of propane affect propane market volumes. Weather influences the demand for propane, primarily for home and facility heating uses and also for agricultural applications, such as crop drying.

Harsh weather can create conditions that exacerbate demand for propane, impede the transportation and delivery of propane, or restrict the ability of Superior to obtain propane from its suppliers. Such conditions may also increase Superior’s operating costs and may reduce customers demand for propane, any of which may have an adverse effect on Superior. Conversely, low prices tend to make customers less price sensitive and less focused on their consumption volume.

Superior Plus Corp.

Spikes in demand caused by weather or other factors can stress the supply chain and hamper Superior’s ability to obtain additional quantities of propane. Transportation providers (railways and trucking companies) have limited ability to provide resources in times of extreme peak demand. Changes in propane supply costs are normally passed through to customers, but timing lags (between when Superior purchases the propane and when the customer purchases the propane) may result in positive or negative gross margin fluctuations.

For U.S. propane distribution, demand from end-use heating applications is predictable. Weather and general economic conditions, however, affect distillates and propane market volumes. Weather influences the immediate demand, primarily for heating, while longer-term demand declines due to economic conditions as customer’s trend towards conservation and supplement heating with alternative sources such as electricity and to a lesser extent wood pellets and solar energy.

Demand, Supply and Pricing

Superior offers its customers various fixed-price propane and heating oil programs. In order to mitigate the price risk from offering these services, Superior uses its physical inventory position, supplemented by forward commodity transactions with various third parties having terms and volumes substantially the same as its customer’s contracts. In periods of high propane price volatility, the fixed-price programs create exposure to over or under-supply positions as the demand from customers may significantly exceed or fall short of supply procured. In addition, if propane prices decline significantly subsequent to customers signing up for a fixed-price program, there is a risk that customers will default on their commitments. Current unit margins may not be sustainable if market conditions change significantly.

Political uncertainties

Unforeseen political events, legal proceedings or political uncertainty in markets where we own and operate assets, sell or transport our products and may look to for further growth of our businesses may create economic uncertainty or otherwise impact our operations and have a negative impact on our financial performance. An uncertain political environment may arise from frequent changes in governments and related governmental priorities and policies, political conflict or the implementation, or threat, of protectionist measures. In addition, political outcomes in the markets in which we operate may also result in legal uncertainty and potentially divergent national, state and/or provincial laws and regulations, which can contribute to general economic uncertainty. Such uncertainty could cause disruptions to our businesses, including affecting the business of and/or our relationships with our customers and suppliers.

Currently there is uncertainty resulting from the on-going legal proceedings related to the continuing operations of the Line 5 Pipeline in Michigan which we utilize to transport natural gas liquids in our businesses. The Line 5 Pipeline delivers light oil and natural gas liquids to Michigan, Ohio, Ontario and elsewhere. If these proceedings result in a disruption of service, this could have an adverse effect on Superior’s ability to service customer demand and have a negative impact on our financial condition, operating results and cash flows.

Transportation network disruptions

Both of Superior’s business segments rely on rail as a mode of delivering product and/or receiving materials and goods across Canada and the US to service customer demand. Due to the integrated nature of North America’s freight transportation infrastructure, Superior’s operations may be negatively affected by service disruptions with their transportation provider or other transportation links such as railroads that interchange with our transportation provider(s). A significant prolonged service disruption of one or more of these entities could have an adverse effect on Superior’s ability to carry on its business and service customer demand and on our results of operations. Service disruptions can be caused by, but are not limited to, severe weather and natural disasters such as extreme cold or heat, flooding, droughts, fires, hurricanes and earthquakes as well as labour disruptions and political disruptions, which include protests and intentional blockades and acts of terrorism.

Current Economic Conditions

During the first quarter of 2020, the rapid outbreak of the novel strain of the coronavirus, specifically identified as the COVID-19 pandemic, caused governments worldwide to enact emergency measures and restrictions to combat the spread of the virus. These measures and restrictions, which include the implementation of travel bans, mandated

Superior Plus Corp.

and voluntary business closures, self-imposed and mandatory quarantine periods, isolation orders and social distancing, have caused material disruption to businesses globally resulting in an economic slowdown. Governments and central banks have reacted with significant monetary and fiscal interventions designed to stabilize economic conditions. Superior monitors applicable government relief programs to determine if Superior qualifies to participate in them.

COVID-19 has also resulted in a significant decrease on global demand for crude oil. In addition to the impact of COVID-19, production levels during March and April of 2020 by OPEC+ countries, contributed to excess global supply and caused the price of oil to be exceptionally volatile. Propane is a derivative of natural gas processing and oil refining, so continued volatility in the price of oil could lead to disruptions in the supply of propane if the production of oil and natural gas is further curtailed.

The future impact of these events on liquidity, volatility, credit availability and market and financial conditions generally, could change at any time. The duration and ultimate impact on the economy are unknown at this time, and, as a result, it is difficult to estimate the longer-term impact on our operations and the markets for our products. At the current time, we expect an impact to our business as it relates to our customers that operate in industries governments have classified as non-essential and customers required to operate at reduced capacities. During the quarter ended December 31, 2021, the impact of these events caused a decrease in sales volumes and sales prices for our Canadian Propane Distribution operating segment and to a lesser extent our U.S. Propane Distribution operating segment. Management has taken steps to reduce capital and selling, distribution and administrative costs to minimize the impact these events have had on our business. The impact of COVID-19 on the Canadian Propane Distribution segment has been lessened by the CEWS recorded.

Superior’s operating segments provide essential services in all provinces, states and territories in which Superior operates. In response to COVID-19, and in-line with recommendations from local health authorities, enhanced operating procedures and protocols were instituted to protect our employees and customers and to maintain our sites and facilities to even higher levels of cleanliness.

Management is continuing to monitor these situations and may be required to take further actions that may materially alter operations.

Health, Safety and Environment

Superior’s operations are subject to the risks associated with handling, storing and transporting propane in bulk. To mitigate risks, Superior has established a comprehensive environmental, health and safety protection program. It consists of an environmental policy, codes of practice, periodic self-audits, employee training, quarterly and annual reporting and emergency prevention and response.

The U.S. propane distribution business, through a centralized safety and environment management system, ensures that safety practices and regulatory compliance are an important part of its business. The storage and delivery of refined fuels pose the risk of spills which could adversely affect the soil and water of storage facilities and customer properties.

Superior’s fuel distribution businesses are based and operate in Canada and the United States and, as a result, such operations could be affected by changes to laws, rules or policies which could either be more favourable to competing energy sources or increase compliance costs or otherwise negatively affect the operations of Propane Distribution in comparison with such competing energy sources. Any such changes could have an adverse effect on the operations of Propane Distribution.

Employee and Labour Relations

Approximately 3% of the U.S. propane distribution business employees and 19% of Superior’s Canadian propane distribution business employees are unionized. Collective bargaining agreements are renegotiated in the normal course of business. While labour disruptions are not expected, there is always risk associated with the renegotiation process that could have an adverse impact on Superior.

Superior Plus Corp.

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Superior Plus Corp. — Management Reports 2022

42632_rns_2022-02-17_5da67f31-d5ce-4c3f-97aa-ec15375f0b85.pdf

MANAGEMENT’S DISCUSSION AND ANALYSIS OF 2021 ANNUAL AND FOURTH QUARTER RESULTS FEBRUARY 17, 2022

Overview of Superior

Non-GAAP Financial Measures

Forward-Looking Information

Basis of Presentation and Divestiture

FINANCIAL OVERVIEW - GAAP FINANCIAL INFORMATION

Consolidated Statement of Net Earnings

Non-GAAP Financial Information

Summary of AOCF

RECENTLY COMPLETED AND ANNOUNCED ACQUISITIONS

Annual Financial Results Compared to the Prior Year

Annual Non-GAAP Financial Results Compared to the Prior Year

RESULTS OF SUPERIOR’S OPERATING SEGMENTS

U.S. PROPANE DISTRIBUTION

U.S. Propane Distribution’s operating results:

U.S. Propane Adjusted Gross Profit

U.S. Propane Distribution Sales Volumes

End-Use Application [(][1][)(2)]

U.S. Propane Distribution Sales Volumes Volumes by Region[ (1)]

Operating Costs and Selling, Distribution and Administrative Costs

Earnings

Financial Outlook

CANADIAN PROPANE DISTRIBUTION

Canadian Propane Adjusted Gross Profit

Canadian Propane Distribution Sales Volumes - Volumes by End Use Application

Canadian Propane Distribution Sales Volumes

Volumes by Region[ (1)]

Operating Costs and Selling, Distribution and Administrative Costs

Earnings

Financial Outlook

CONSOLIDATED CAPITAL EXPENDITURE SUMMARY

CORPORATE OPERATING COSTS AND SD&A

FINANCE AND INTEREST EXPENSE

TRANSACTION, RESTRUCTURING AND OTHER COSTS

INCOME TAXES

FINANCIAL OUTLOOK

U.S. Propane Distribution

Canadian Propane Distribution

LIQUIDITY AND CAPITAL RESOURCES

Debt Management Update

Borrowing

Net Working Capital

Compliance

Pension Plans

Contractual Obligations and Other Commitments[(3)]

SHAREHOLDERS’ CAPITAL

Dividends Declared to Common Shareholders

Dividends Declared to Preferred Shareholders

SUMMARY OF CASH FLOW

FINANCIAL INSTRUMENTS – RISK MANAGEMENT

Sensitivity Analysis

DISCLOSURE CONTROLS AND PROCEDURES AND INTERNAL CONTROLS OVER FINANCIAL REPORTING

Changes in Internal Controls over Financial Reporting

Effectiveness

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Recent Accounting Pronouncements

Adoption of Interest Rate Benchmark Reform

Reference to the Conceptual Framework - Amendments to IFRS 3

SELECTED FINANCIAL INFORMATION

FOURTH QUARTER RESULTS

GAAP Financial Measures

Consolidated Statement of Net Earnings

Non-GAAP Financial Measures

Fourth Quarter Results Compared to the Prior Year Quarter

Fourth Quarter Non-GAAP Financial Measures Compared to the Prior Year Quarter

RESULTS OF SUPERIOR’S OPERATING SEGMENTS

U.S. PROPANE DISTRIBUTION

U.S. Propane Adjusted Gross Profit

U.S. Propane Distribution Sales Volumes End-Use Application

U.S. Propane Distribution Sales Volumes Volumes by Region[ (1)]

Operating Costs and Selling, Distribution and Administrative Costs

Earnings before tax

CANADIAN PROPANE DISTRIBUTION

Canadian Propane Distribution’s operating results:

Canadian Propane Adjusted Gross Profit

Canadian Propane Distribution Sales Volumes - Volumes by End Use Application[(1) ]

Operating Costs and Selling, Distribution and Administrative Costs

Superior Plus Corp. Management Reports 2022