Murphy USA Profits Slip

Murphy USA reported lower earnings and revenues in its second quarter as the stand-alone gas and merchandise retailer saw higher wholesale gas prices which, in turn, pinched pump margins.

El Dorado-based Murphy USA reported net income of $9.6 million on revenues of $4.16 billion compared to profits of $22 million on sales of $4.36 billion in the previous year’s first quarter.

The company said its profits were helped by the performance of its remaining ethanol plant in Hereford, Texas. The plant turned a $1.2 million profit compared to a loss of $2.9 million one year ago.

“During the first quarter of the year, we generated significant operating cash flows by running our fuel supply chain leaner,” said President and CEO Andrew Clyde. “We used a portion of this available cash to make an early payment of $15 million on our term loan at the end of the quarter and paid off the remaining $55 million subsequent to quarter end.”

Other financial highlights of the quarter included:

• Retail fuel volumes on an average per store month (APSM) basis were up 0.1% year-over-year in the current quarter despite a challenging wholesale price environment;
• Growth of non-tobacco merchandise sales on an average per store month (APSM) basis of 5.3% for the current quarter with gross margin dollars from non-tobacco merchandise on an APSM basis increasing 10.0% for the current quarter;
• The addition of 11 stores in the quarter with an additional six sites opened since quarter end; and
• Thirteen sites are currently under construction and plans for an additional 49 stores are planned by the end of the year.

Murphy USA shares (NYSE: MUSA) closed trading at $44.98 on Monday (May 5). The company’s stock has traded between $36.12 and $46.91 during the past 12 months.