Financial Analysis

10) Business Combinations During fiscal 2025, the Company acquired three propane businesses and one heating oil business for approximately $ 80.5 million in cash. The gross purchase price was allocated $ 38.7 million to intangible assets, $ 17.7 million to goodwill, $ 25.2 million to fixed assets and reduced by $ 1.1 million of negative working capital. The acquired companies operating results are included in the Companys consolidated financial statements starting on their respective acquisition date, and are not material to the Companys financial condition, results of operations, or cash flows. During fiscal 2025, the Company acquired certain intangible and fixed assets for $ 7.7 million and sold certain assets for cash proceeds of $ 0.3 million. During fiscal 2024, the Company acquired one propane business and four heating oil businesses for approximately $ 49.4 million in cash. The gross purchase price was allocated $ 40.4 million to intangible assets, $ 13.7 million to goodwill, $ 4.9 million to fixed assets and reduced by $ 9.6 million of negative working capital. The acquired companies operating results are included in the Companys consolidated financial statements starting on their respective acquisition date, and are not material to the Companys financial condition, results of operations, or cash flows. During fiscal 2023, the Company acquired one propane business and two heating oil businesses for approximately $ 19.8 million in cash. The gross purchase price was all …

BusinessCombinationDisclosureTextBlock · excerpt; the full note is in the filing

18) Commitments and Contingencies The Companys operations are subject to the operating hazards and risks normally incidental to handling, storing and transporting and otherwise providing for use by consumers hazardous liquids such as home heating oil and propane. In the ordinary course of business, the Company is a defendant in various legal proceedings and litigation. The Company records a liability when it is probable that a loss has been incurred and the amount is reasonably estimable. We do not believe these matters, when considered individually or in the aggregate, could reasonably be expected to have a material adverse effect on the Companys results of operations, financial position or liquidity. The Company maintains insurance policies with insurers in amounts and with coverages and deductibles we believe are reasonable and prudent. However, the Company cannot assure that this insurance will be adequate to protect it from all material expenses related to current and potential future claims, legal proceedings and litigation, as certain types of claims may be excluded from our insurance coverage. If we incur substantial liability and the damages are not covered by insurance, or are in excess of policy limits, or if we incur liability at a time when we are not able to obtain liability insurance, then our business, results of operations and financial condition could be materially adversely affected. …

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"13) Long-Term Debt and Bank Facility Borrowings The Company's debt is as follows September 30, (in thousands): 2025 2024 Carrying Carrying Amount Fair Value (a) Amount Fair Value (a) Revolving Credit Facility Borrowings $ $ $ 5 $ 5 Senior Secured Term Loan (b) 188,118 189,000 208,811 210,000 Total debt $ 188,118 $ 189,000 $ 208,816 $ 210,005 Total short-term portion of debt $ 21,000 $ 21,000 $ 21,005 $ 21,005 Total long-term portion of debt $ 167,118 $ 168,000 $ 187,811 $ 189,000 (a) The face amount of the Companys variable rate long-term debt approximates fair value. (b) Carrying amounts are net of unamortized debt issuance costs of $ 0.9 million as of September 30, 2025 and $ 1.2 million as of September 30, 2024. On September 27, 2024, the Company refinanced its five-year term loan and the revolving credit facility with the execution of the seventh amended and restated revolving credit facility agreement (the credit agreement) with a bank syndicate comprised of ten participants, which enables the Company to borrow up to $ 400 million ($ 475 million during the heating season of December through April of each year) on a revolving credit facility for working capital purposes (subject to certain borrowing base limitations and coverage ratios), provides for a $ 210 million five-year senior secured term loan (Term Loan), allows for the issuance of up to $ 25 million in letters of credit, and has a maturity date of September 27, 2029 . The Company can increase the revolving credi …

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The following disaggregates our revenue by major sources for the years ended September 30, 2025, 2024 and 2023: Years Ended September 30, (in thousands) 2025 2024 2023 Petroleum Products: Home heating oil and propane $ 1,119,777 $ 1,081,985 $ 1,202,194 Motor fuel and other petroleum products 317,824 366,807 448,547 Total petroleum products 1,437,601 1,448,792 1,650,741 Installations and Services: Equipment installations 135,149 123,493 114,756 Equipment maintenance service contracts 136,042 129,478 126,887 Billable call services 75,626 64,336 60,478 Total installations and services 346,817 317,307 302,121 Total Sales $ 1,784,418 $ 1,766,099 $ 1,952,862

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11) Goodwill and Other Intangible Assets Goodwill A summary of changes in the Companys goodwill during the fiscal years ended September 30, 2025 and 2024 are as follows (in thousands): Balance as of September 30, 2023 $ 262,103 Fiscal year 2024 business combinations 13,726 Balance as of September 30, 2024 275,829 Fiscal year 2025 business combinations 17,715 Other ( 194 ) Balance as of September 30, 2025 $ 293,350 Intangibles, net Intangible assets subject to amortization consist of the following (in thousands): September 30, 2025 2024 Gross Gross Carrying Accum. Carrying Accum. Amount Amortization Net Amount Amortization Net Customer lists $ 493,431 $ 391,702 $ 101,729 $ 452,340 $ 373,860 $ 78,480 Trade names and other intangibles 52,028 28,865 23,163 46,895 26,663 20,232 Total $ 545,459 $ 420,567 $ 124,892 $ 499,235 $ 400,523 $ 98,712 Amortization expense for intangible assets was $ 20.0 million, $ 18.0 million, and $ 18.6 million, for the fiscal years ended September 30, 2025, 2024, and 2023, respectively. Total estimated annual amortization expense related to intangible assets subject to amortization, for the year ending September 30, 2026 and the four succeeding fiscal years ending September 30, is as follows (in thousands): Amount 2026 $ 18,761 2027 $ 18,061 2028 $ 15,916 2029 $ 14,533 2030 $ 12,618 …

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15) Income Taxes On December 22, 2017, the Tax Cuts and Jobs Act (the Tax Reform Act) was enacted into law. The Tax Reform Act allows for the full depreciation, in the year acquired, for certain fixed assets purchased between September 28, 2017 and December 31, 2023. On July 4, 2025, the One Big Beautiful Bill Act was signed into law in the U.S., which contains several changes to corporate taxation including changes to depreciation deductions, deductions for interest expense and reinstating 100% bonus depreciation on fixed assets acquired and placed in service after January 19, 2025. Income tax expense is comprised of the following for the indicated periods (in thousands): Years Ended September 30, 2025 2024 2023 Current: Federal $ 13,613 $ 11,964 $ 9,902 State 7,267 5,356 4,583 Deferred Federal 6,824 ( 2,719 ) ( 843 ) State 1,703 ( 1,270 ) 342 $ 29,407 $ 13,331 $ 13,984 The provision for income taxes differs from income taxes computed at the Federal statutory rate as a result of the following (in thousands): Years Ended September 30, 2025 2024 2023 Income from continuing operations before taxes $ 102,902 $ 48,554 $ 45,929 Provision for income taxes: Tax at Federal statutory rate $ 21,609 $ 10,196 $ 9,645 State taxes net of federal benefit 7,357 3,145 3,401 Permanent differences 355 286 520 Expiration of State NOL 1,931 2,160 Change in valuation allowance ( 1,965 ) ( 2,328 ) 252 Other 120 ( 128 ) 166 $ 29,407 $ 13,331 $ 13,984 The components of the net deferred taxes for the …

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16) Leases The Company has entered into certain operating leases for office space, vehicles and other equipment with lease terms between one to twenty two years , expiring between 2025 and 2046 . Some of the Companys real estate property lease agreements have options to extend the leases for up to ten years . A summary of total lease costs and other information is comprised of the following for the indicated periods: Years Ended September 30, (in thousands) 2025 2024 2023 Lease cost: Operating lease cost $ 27,840 $ 25,294 $ 23,637 Short-term lease cost 622 754 818 Variable lease cost 5,673 6,153 5,598 Total lease cost $ 34,135 $ 32,201 $ 30,053 Other information: Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 28,262 $ 25,504 $ 23,622 Right-of-use assets obtained in exchange for new operating lease liabilities $ 23,887 $ 20,619 $ 15,994 Weighted-average remaining lease term operating leases 5.4 years 5.3 years 5.6 years Weighted-average discount rate operating leases 6.6 % 6.3 % 5.9 % Maturities of noncancelable operating lease liabilities as of September 30, 2025 are as follows: September 30, (in thousands) 2025 2026 $ 25,820 2027 23,597 2028 19,789 2029 16,182 2030 12,987 Thereafter 17,610 Total undiscounted lease payments 115,985 Less imputed interest ( 18,845 ) Total lease liabilities $ 97,140 …

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Recently Adopted Accounting Pronouncements In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which is intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The disclosure requirements included in ASU No. 2023-07 are required for all public entities, including entities with a single reportable segment. We have adopted this standard for our fiscal year 2025 annual financial statements and interim financial statements thereafter and have applied this standard retrospectively for all prior periods presented in the financial statements. (See Note 20 Segment Reporting). …

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14) Employee Benefit Plans Defined Contribution Plans The Company has 401(k) and other defined contribution plans that cover eligible non-union and union employees, and makes employer contributions to these plans, subject to IRS limitations. The Companys 401(k) plan provides for each participant to contribute from 0 % to 60 % of compensation, subject to IRS limitations. The Companys aggregate contributions to the 401(k) plans during fiscal 2025, 2024, and 2023, were $ 8.9 million, $ 8.5 million, and $ 8.5 million, respectively. The Companys aggregate contribution to the other defined contribution plans for fiscal years 2025, 2024, and 2023, were $ 0.5 million, $ 0.5 million, and $ 0.5 million respectively. Management Incentive Compensation Plan The Company has a Management Incentive Compensation Plan (the Plan). The long-term compensation structure is intended to align the employees performance with the long-term performance of our unitholders. Under the Plan, certain named employees who participate shall be entitled to receive a pro rata share of an amount in cash equal to: 50 % of the distributions (Incentive Distributions) of Available Cash in excess of the minimum quarterly distribution of $ 0.0675 per unit otherwise distributable to Kestrel Heat pursuant to the Company Agreement on account of its general partner units; and 50 % of the cash proceeds (the Gains Interest) which Kestrel Heat shall receive from the sale of its general partner units (as defined in the Partners …

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3) Revenue Recognition The following disaggregates our revenue by major sources for the years ended September 30, 2025, 2024 and 2023: Years Ended September 30, (in thousands) 2025 2024 2023 Petroleum Products: Home heating oil and propane $ 1,119,777 $ 1,081,985 $ 1,202,194 Motor fuel and other petroleum products 317,824 366,807 448,547 Total petroleum products 1,437,601 1,448,792 1,650,741 Installations and Services: Equipment installations 135,149 123,493 114,756 Equipment maintenance service contracts 136,042 129,478 126,887 Billable call services 75,626 64,336 60,478 Total installations and services 346,817 317,307 302,121 Total Sales $ 1,784,418 $ 1,766,099 $ 1,952,862 Performance Obligations Petroleum product revenues consist of home heating oil and propane as well as diesel fuel and gasoline. Revenues from petroleum products are recognized at the time of delivery to the customer when control is passed from the Company to the customer. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring control of the petroleum products. Approximately 93 % of our full service residential and commercial home heating oil and propane customers automatically receive deliveries based on prevailing weather conditions. We offer several pricing alternatives to our residential home heating oil customers, including a variable price (market based) option and a price-protected option, the latter of which either sets the maximum price or a fixed pric …

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20) Segment Reporting The Company operates as a single operating and reportable segment, which is managed on a consolidated basis. Revenues are primarily derived from the sale of petroleum products, heating and air conditioning equipment, and related repair, maintenance, and other services. See Note 3 Revenue Recognition for additional information. The Companys Chief Operating Decision Maker (CODM) is its Chief Executive Officer (CEO) . The CODM makes key operating decisions and evaluates financial performance based on Adjusted EBITDA, defined as earnings from continuing operations before net interest expense, income taxes, depreciation and amortization, (increase) decrease in the fair value of derivatives, other income (loss), net, multiemployer pension plan withdrawal charge, gain or loss on debt redemption, goodwill impairment, and other non-cash and non-operating charges). The CODM reviews net income and Adjusted EBITDA on a monthly basis to monitor performance, compare actual results to budgets and forecasts, and assess overall operating effectiveness. The CODM also monitors significant expenses, including: cost of product, cost of installations and service, general and administrative expenses as well as components of delivery and branch expenses. Because the Company has only one reportable segment, the amounts reported in the consolidated financial statements also represent the segment information, including total assets. The following table sets forth our segment finan …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

2) Summary of Significant Accounting Policies Basis of Presentation The Consolidated Financial Statements include the accounts of Star Group, L.P. and its subsidiaries. All material intercompany items and transactions have been eliminated in consolidation. Comprehensive Income Comprehensive income is comprised of Net income and Other comprehensive income. Other comprehensive income (loss) consists of the unrealized gain amortization on the Companys pension plan obligation for its frozen defined benefit pension plan, unrealized gain on available-for-sale investments, unrealized loss on interest rate hedges and the corresponding tax effects. Use of Estimates The preparation of financial statements in accordance with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Revenue Recognition Refer to Note 3 Revenue Recognition for revenue recognition accounting policies. Sales of petroleum products are recognized at the time of delivery to the customer and sales of heating and air conditioning equipment are recognized upon completion of installation. Revenue from repairs, maintenance and other services are recognized upon completion of the service. Payments rece …

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22) Subsequent Events Quarterly Distribution Declared In October 2025, we declared a quarterly distribution of $ 0.1850 per unit, or $ 0.74 per unit on an annualized basis, on all Common Units with respect to the fourth quarter of fiscal 2025, paid on November 5, 2025 , to holders of record on October 27, 2025 . The amount of distributions in excess of the minimum quarterly distribution of $ 0.0675 , were distributed in accordance with our Partnership Agreement, subject to management incentive compensation plan. As a result, $ 6.1 million was paid to the Common Unit holders, $ 0.4 million to the General Partner unit holders (including $ 0.4 million of incentive distribution as provided in our Partnership Agreement) and $ 0.4 million to management pursuant to the management incentive compensation plan which provides for certain members of management to receive incentive distributions that would otherwise be payable to the General Partner. Common Units Repurchased and Retired In October and November 2025, in accordance with the Repurchase Plan, the Company repurchased and retired approximately 0.3 million Common Units at an average price paid of $ 11.86 per unit.

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