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YEAR-END/FOURTH QUARTER 2015 EARNINGS CONFERENCE CALL

CST BRANDS AND CROSSAMERICA PARTNERS

SPEAKER NOTES FINAL DRAFT

Friday, February 19, 2016 at 8:00 a.m. Central Time

Randy Palmer (Executive Director of Investor Relations)

Thank you, Operator. Good morning and thank you for joining the CST

Brands and CrossAmerica Partners year-end and fourth quarter 2015

earnings call. With me today are Kim Lubel, CST Chairman and CEO, Clay

Killinger, Chief Financial Officer, Hal Adams, President of Retail Operations,

Jeremy Bergeron, President of CrossAmerica Partners, Steven Stellato,

Chief Accounting Officer of CrossAmerica Partners, and other members of

our Executive Leadership Team.

Kim will provide an overview of the CST operational performance for the

year and fourth quarter and current strategic initiatives and then we will

turn the call over to Clay to discuss the CST financial results. Hal will

provide a brief update on our merchandising efforts and then Jeremy will

follow with an overview of the operational and financial performance for

CrossAmerica Partners and, at the end; we will open the call up to

questions for both organizations. I should point out that today’s call will

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follow some presentation slides that our team will utilize during this

morning’s event. These slides are available as part of the webcast and are

posted on the CST Brands’ and CrossAmerica websites.

Before we begin, I would like to remind everyone that today's call, including

the question and answer session, may include forward-looking statements

regarding expected revenue, future plans, future operational metrics, and

opportunities and expectations of the organizations. There can be no

assurance that management's expectations, beliefs, and projections, will be

achieved or that actual results will not differ from expectations. Please see

filings with the Securities and Exchange Commission including Annual

Reports on Form 10-K and Quarterly Reports on Form 10-Q for a discussion

of important factors that could affect our actual results. Forward-looking

statements represent the judgment of the Company’s management as of

today’s date, and the organizations disclaim any intent or obligation to

update any forward-looking statements.

During today's call, we may also provide certain performance measures

that do not conform to U.S. Generally Accepted Accounting Principles, or

GAAP. We've provided schedules that reconcile these non-GAAP measures

with our reported results on a GAAP basis as part of our earnings press

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release. We should also note that the results provided today by CST

represent the business operations of CST on a standalone basis, before the

consolidation of CrossAmerica Partners LP, but include the income

associated with CST owning a percentage of the outstanding common units

and all of the IDRs of CrossAmerica. Full consolidating information is

included in the 2015 Form 10-K, which will enable you to arrive at our

complete consolidated financial results.

Today’s call is being webcast and a recording of this conference call will be

available there for a period of 60 days. With that, I'll now turn the call over

to Kim Lubel.

Kim Lubel (CST Chairman and CEO)

Thanks, Randy. Good morning, everyone, and welcome to our year-end and

fourth quarter 2015 earnings call.

As you turn to slide 4, CST reported full year 2015 gross profits of $1.2

billion, and adjusted EBITDA of $602 million.

These strong results in 2015 were driven by year over year increases in

inside sales and fuel volumes.

As we look back at 2015, CST, along with CrossAmerica, began the year with

a joint purchase of 22 Shell-branded convenience stores from Landmark

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Industries located in the San Antonio and Austin, Texas markets. And

furthering CST’s strategic vision for growth, the Company announced its

largest acquisition to date with the purchase of Flash Foods. The 165

convenience stores located in Georgia and Florida will allow the Company

to continue to grow and bridge the geographic gap between its existing

retail networks. The transaction closed just a few weeks ago and

integration and synergy capture initiatives are well underway.

During the year, CST completed two fuel drop transactions and one real

estate drop transaction with CrossAmerica. By the end of 2015,

CrossAmerica held 17.5 percent of CST Fuel Supply, and CST owned 18.7

percent of total CrossAmerica units.

The Company’s focus on organic growth also continued in 2015 with the

opening of 31 new stores in the U.S. and 11 in Canada. Currently, the

Company expects to open a total of 45 to 50 new stores in the U.S.,

including two in Georgia, and 10 to 15 new stores in Canada during 2016.

These new stores provide a much larger footprint that accommodates

broader merchandise categories and food offerings, as well as an expanded

fuel island.

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As we noted during our last earnings call, our fuels business remains very

important to our profitability and we continue to work to maximize fuel

gross profit dollars, our primary focus however is on improving our inside

store performance across our network. For the full year 2015, merchandise

and services contributed $577 million in gross profits to our results, a more

than 6 percent increase over 2014. Our U.S. merchandise and services

same store sales increased 3 percent for the year and our Canada segment

merchandise and services same store sales, presented in Canadian dollars,

increased 5 percent.

Hal will touch on some of our merchandising efforts and share some of our

early results later on in the presentation. However, I did want to point out

that there are photos of several of our store initiatives that include our

recently introduced made-to-order food and grocery programs and our

rebranding efforts in our appendix.

With our 2020 Vision that we provided on our last call, we noted that we

are focused on three key growth planks: organic growth, inside store

growth, and acquisition growth.

We believe these are important areas to focus on to grow the company in

the coming years. In addition to these growth planks, we continue to look

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for other opportunities to increase shareholder value. We plan on

continuing to refine our operational platform, including our made-to-order

food and grocery programs, and will continue our efforts to lift our overall

sales and margins.

In conjunction with our recently announced organizational changes, there

will be an added focus on expenses and cost control initiatives throughout

the year both in operations as well as in our new store construction

program.

Finally, as I have mentioned on previous calls, we will work to leverage our

acquisitions, including implementing acquired best practices across our

system and seeking out synergies.

With that, I will turn the call over to Clay, to review the CST fourth quarter

financial results.

Clay Killinger (Chief Financial Officer)

Thanks Kim.

I will provide a brief overview of the fourth quarter results for CST and then

turn it over to Hal to discuss our retail operations.

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Today, CST reported net income of $25 million or $0.34 per share for the

fourth quarter of 2015. This compares to net income of $94 million or

$1.21 per share for the fourth quarter of 2014. For both periods, we had

certain one-time expenses that included asset impairment charges,

acquisition expenses, legal expenses, professional fees and tax effects on

cash repatriation, as outlined in our earnings release. The after-tax income

effect of these items was approximately $16 million for the fourth quarter

of 2015 and approximately $15 million for the fourth quarter of 2014.

Excluding these items, our earnings would have been $42 million or 55

cents per share for the fourth quarter of 2015 compared to $79 million or

$1.02 per share for the fourth quarter of 2014.

As I discuss our fourth quarter CST highlights in more detail, I will be

referring to slides for our U.S. and Canadian segment operating results. We

have provided slides for the full-year operating results as well. In regards to

CST’s U.S. segment, if you turn to slide 6, fourth quarter 2015 net motor

fuel gross profit decreased by $70 million or 44 percent when compared to

the fourth quarter of 2014. The year-over-year decline was attributable to

near record fourth quarter margins in 2014, resulting from the rapid decline

in crude oil prices experienced in the fourth quarter 2014. Although crude

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oil declined in the fourth quarter 2015, the volatility of crude oil prices was

lower than in the comparable quarter.

We experienced a decrease in the average “cents per gallon” fuel margin,

net of credit card fees, of 13 cents per gallon between the periods. For our

core stores, our U.S. motor fuel gallons sold, per site per day, increased by

approximately 1 percent quarter versus quarter.

Moving to Merchandise and Services, I want to point out that beginning

with this quarter’s results; we are now combining our Other Services

revenues and gross profit with merchandising revenues and gross profit.

This revised presentation of merchandise and services gross profit and our

associated margin percentage was done to be more comparable to our

peers. We have included a schedule on our website that recasts our

merchandise and services margins and per site per day numbers, by

quarter, for 2014 and 2015.

Our gross profit from Merchandise and Services increased $7 million or 6

percent in the fourth quarter of 2015 when compared to the same period

in 2014.

This increase reflects the impacts of our “New to Industry” stores, period

versus period, along with our Nice N Easy and Landmark stores we

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acquired. The comparable fourth quarter 2014 Merchandise and Services

gross profit includes approximately $3 million of income from credit card

fee settlements, so the impact of our NTIs and acquisitions is even greater

than our reported results indicate.

Turning to the next slide for our Canadian segment results, please keep in

mind that our reported results have been significantly impacted by the

devaluation of the Canadian dollar, which I will discuss in a moment.

Fourth quarter motor fuel gross profit decreased by $6 million or 10

percent. The “cents per gallon” fuel margin, net of credit card fees, was

approximately 22 cents for the fourth quarter of 2015 compared to 24

cents for the comparable period in 2014. As we have stated in the past,

crude oil price changes affect our Canadian margins more moderately.

Our motor fuel gallons sold declined 3 percent for the quarter, in part a

reflection of a weakening of the Canadian economy. Our reduced fuel

margin and resulting motor fuel gross profit was also affected by the

Canadian dollar devaluations over the comparable periods. For additional

comparative purposes, results on this slide are also provided in percentage

change in Canadian dollars.

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Our reported gross profit from our Merchandise and Services sales and our

Other category declined $3 million for the fourth quarter of 2015 compared

to 2014. Again, primarily attributable to foreign currency exchange.

Assuming a constant value for the Canadian dollar, our Merchandise and

Services gross profit would have increased by $3 million, or almost 12

percent.

The exchange rate for the U.S. dollar relative to the Canadian dollar

averaged approximately 75 cents for the fourth quarter of 2015 versus

approximately 88 cents for the comparable period in 2014. This represents

a devaluation of approximately 15 percent between the comparable

periods. Overall, excluding the effects of foreign currency translation, our

gross profit for our Canadian segment for the fourth quarter of 2015 would

have been up over $7 million when compared to the fourth quarter of

2014.

Flipping over to slide 10, I’ll now make a few comments about CST’s

financial position. At the end of the year, we had $313 million of cash and

$247 million of that cash is held in Canada. Subsequent to year end, we

repatriated $185 million back to the U.S. and our reported total debt is just

over $1 billion.

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Subsequent to year end, we increased our revolver capacity to $500 million

and drew down just over $300 million to fund a portion of our Flash Foods

acquisition. These revolver draws are expected to be reduced upon

receiving proceeds from our California real estate sales as part of our

previously announced tax efficient 1031 exchange process. As of

yesterday, we had approximately $144 million available under our credit

facility.

In regards to our capital spending, capital expenditures for the full year of

2015 totaled $360 million. Much of this went towards our NTI builds and

land bank aggregating $249 million.

During the fourth quarter, we completed 22 new stores in the U.S. and 9 in

Canada. For the full year 2015, we completed 31 stores in the U.S. and 11

in Canada.

Turning to slide 11, as we look at our 2016 spending plans, we currently

estimate that we will spend between $450 and $500 million for CST related

capital expenditures. The bulk of the estimated spend is our NTI builds and

land bank, which will be 45 to 50 new sites in the U.S. and 10 to 15 new

sites in Canada. Included in the estimate is sustaining capital expenditures,

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which includes remodels, renovations and rebranding, and is expected to

be between $140 and $160 million.

On this slide, we also provide some guidance for the first quarter. I will not

go through all of the detail, but did want to note the following: we are

expecting an increase in our operating expenses over fourth quarter and

previous year levels, primarily driven by the addition of Flash Foods and the

full quarter impact of 31 NTIs opened in the fourth quarter of 2015. We

have included a slide in the appendix that quantifies these increases in

operating expenses over our fourth quarter levels.

Our general and administrative expenses are expected to be at the same

level as last year’s first quarter expenses. Finally, included in the appendix

of our slide presentation we have a schedule that presents the economics

associated with our NTIs on a “same store basis” or those NTI stores that

have been open 2 years or more. The slide also presents our total

investment in these sites. While a few sites located in the South Texas

Eagle Ford shale area did impact our merchandise and services gross profits

year-over-year, as we have stated in the past, these “mature” NTIs are

generating at or greater than 15 percent cash flow returns.

With that, I will turn the call over to Hal.

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Hal Adams (President of CST Retail Operations)

Thanks Clay. As Kim has mentioned in the past, one of our same store

growth initiatives is our grocery expansion project, which is currently in 100

stores. Based on the success of this project and the needs of our customers

for grocery fill-in items to compliment their milk, bread and egg purchases,

we will have expanded this to another 100 stores by year-end.

We have also implemented our refreshed Corner Store image in eleven

legacy stores in South San Antonio. This pilot, which includes an advertising

component, will be monitored for the next few months. We will use our

learnings to make the necessary changes before we roll the project out

more broadly, which could include up to 300 stores in the second half of

this year. This is the first phase of our three year process.

If you turn to slide 13, I wanted to briefly discuss the initial success of our

made-to-order food program that we have transferred from Nice N Easy in

New York. If you look at the charts from left to right; you can see the

impact the program had on the sales mix in the store. This slide shows,

that while the results are early, the program has quickly moved the higher

margin food mix in these stores to more than 30 percent of sales. We are

currently planning to add this food program to at least 20 additional NTIs in

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our 2016 growth program. And finally, I wanted to note that with our

newly announced organization changes and alignment of our marketing

and operation teams, we will have a heightened focus on operational costs

as we roll-out these additional marketing programs.

With that, I will turn in over to Jeremy.

Jeremy Bergeron (President of CrossAmerica Partners)

Thank you, Hal. If you would please turn to slide 15, I would like to touch

on our overall fourth quarter and full year results at CrossAmerica. Today

we reported a very strong fourth quarter, with Adjusted EBITDA of $25

million, up 74 percent compared to last year. For the full year of 2015,

Adjusted EBITDA was $90 million, reflecting an increase of 47 percent. Our

DCF per unit increased 48 percent during the quarter and 8 percent for the

year.

As we look at how each of our segments contributed on the next slide, you

will see that, thanks to the fuel volume and rental income growth achieved

from our acquisitions, our wholesale segment grew Adjusted EBITDA by

26% for the year. This is despite the reduction in our terms discounts due to

wholesale gasoline prices averaging over 70 cents below last year.

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While our Retail Segment EBITDA declined during the quarter due to a

thinner rack-to-retail margin, we experienced a significant increase during

the year reflecting the contributions of the Erickson and OneStop chains, as

we continue to integrate those operations. It is also worth noting that in

2015, we converted 77 company operated stores to lessee dealer accounts.

As we have said, a key part of our long-term strategy to stabilize cash flow

for our unitholders is to find lessee dealers to operate our locations. By

doing this, we maintain wholesale supply to these sites and are exchanging

non-qualifying retail fuel and merchandise margins for qualifying rental

income and lower operating expenses. This focus on expenses and the

success of this strategy is evident on the next several slides.

On slide 17, we have detailed a chart to demonstrate the differences

between the performance of this quarter, compared to the comparable

period last year. As noted previously, we are experiencing a significant

contribution from our recent acquisitions, which also includes the CST fuel

supply and real estate drops completed in 2015. Other changes include the

impact to our terms discounts that I mentioned earlier. Finally, as I was just

mentioning, you can see that despite all of the growth we have undertaken

in 2015, we were able to reduce our overall G&A and operating expenses to

our base business in the quarter compared to last year.

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As we turn to the next slide, this chart compares our performance in the

fourth quarter when compared to the third quarter of this year. It

demonstrates the inherent seasonality we have previously discussed in our

business, as the fourth and first quarters are our seasonably weaker

periods of our operation because of the reduction in motor fuel

consumption. In addition, you can see the declining impact of Supplier

Terms Discounts.

The final waterfall chart on slide 19, demonstrates the differences between

the performance of 2015, compared to 2014. Once again, you can see the

contribution of our acquisitions, the nearly $9 million impact from supplier

terms discounts due to the declining cost of crude, and further

demonstration of our commitment on expenses, which were kept flat year

over year on our base business.

Going to slide 20, throughout this presentation, we have discussed our

exposure as it relates to terms discounts, but I wanted to highlight our

financial performance over the past two years in the face of this rapidly

declining crude oil and finished products market. We have significantly

grown cash flow and distributions for our unitholders, with a continued

focus on maintaining a healthy coverage ratio. Unlike many other MLPs, our

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sustaining capital expenditures are minimal and the contractual

commitments we have on volume are actually helped by a lower crude

environment, as the lower price at the pump supports overall fuel demand.

We continue to manage our growth to minimize volatility, as the majority

of the volume we have acquired over the past two years is not associated

with terms discounts. The good news is that we have absorbed the $70 per

barrel decline in crude prices and continue to demonstrate growth and

prudent cost control. We are well positioned to enjoy whatever upside

returns to the crude market, whenever that occurs.

Going to slide 21, I wanted to provide a review of our most recently

announced third party acquisition of the 31 Holiday Stationstores from SSG

Corporation. 28 of the sites are located in Wisconsin and 3 are located in

Minnesota, while 27 of them are owned fee simple sites.

This was an attractive acquisition for us, as we were not only able to obtain

a quality set of assets, and partner with a strong regional brand like

Holiday, but it further solidifies our presence in the Minnesota and

Wisconsin markets, allowing us to leverage our local team to help manage

these stores and recognize synergies even faster. We expect this

transaction to close later this quarter.

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On the last slide, we announced on February 1st that the board of the

directors of the General Partner declared the distribution of 59.25 cents per

unit related to our fourth quarter results. This is a 1.5 cent per unit, or 2.6

percent, increase over the third quarter of 2015. We grew distributions per

unit 8.1 percent in 2015 over 2014 and expect to continue that growth

trend in 2016.

We currently expect the rate of CrossAmerica’s distribution per unit

attributable to 2016; will be between 5 to 7 percent over 2015 levels. And,

continue to target a long-term distribution coverage ratio at or above 1.1

times. Because of the limited volatility and low level of capital expenditure

needs, we certainly feel like this is a comfortable range for us to feel

confident in maintaining our future distribution commitments. We ended

the year with coverage of 1.08 times.

We understand that we are in a different market than what MLPs

experienced over the prior several years. It is extremely important for us to

be good stewards of our investor’s capital by being very selective with

whatever growth opportunities we have before us. At the end of 2015, we

had approximately $100 million of available capital on our revolver, an

increasing cash flow stream thanks to our recent acquisitions that should

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expand our revolver availability, quality real estate assets that we can

monetize if we feel we can get a better return by investing those proceeds

into higher return projects, and an established, experienced team to take

advantage of those acquisition and integration market opportunities. As

evident by our most recent acquisition announcement, we continue to see

attractive third-party acquisition opportunities. We have a long runway of

available drops from our supportive sponsor at CST and look forward to

completing more of those acquisitions this year, but as we have said

before, we are going to be opportunistic with third party acquisitions and

judicious with how we deploy our capital and grow the business.

We recognize that it is very important that we execute on our strategy with

the Partnership’s current capital structure. We are confident in our ability

to deliver on these commitments to grow distributions, further reduce

volatility, lower expenses, sustain a strong balance sheet and maintain a

healthy coverage ratio without having to raise additional equity.

With that, we will now open it up for questions.

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Randy Palmer (Executive Director of Investor Relations)

Okay. That completes today's conference call. We appreciate each of you

joining us today. If you have follow-up questions, please feel free to contact

us. Thank you.