CEO cites strong performance despite steep fuel volume decline,
Photograph courtesy of Murphy USA
EL DORADO, Ark. — Despite a 25% decline in fuel gallons sold, the sixth-largest convenience-store chain in the United States reported record earnings in second-quarter 2020.
“Murphy USA’s record second-quarter performance once again demonstrated the competitive advantages of our distinctive business model and customer positioning,” President and CEO Andrew Clyde said. “Fuel margins significantly outpaced volume declines due to COVID-19-related demand destruction even as commodity prices rose sharply in May and June. As volume recovers in July to over 90% of prior-year levels reflecting our everyday low-price positioning and more favorable geographies and locations, robust fuel margins continue to generate higher-than-normal fuel contribution for Murphy USA.”
Total retail gallons decreased 25.7% quarter to quarter, while volumes on a same-store sales basis decreased 27.4%. For second-quarter 2020, total fuel contribution, which is retail fuel margin plus product supply and wholesale results including renewable identification numbers (RINs), was 38.3 cents per gallon (CPG) compared to 14.7 CPG in the same period in 2019.
Total fuel contribution dollars increased 93.6%, or $156.9 million, in second-quarter 2020 compared to second-quarter 2019. Retail fuel margins of 31.7 CPG were 136.6% higher than in second-quarter 2019, which helped increase total retail fuel contribution dollars by $116.4 million to $268.8 million.
Retail fuel volumes were lower during the quarter compared to prior-year volumes primarily due to stay-at-home restrictions in the company’s areas of operation, which began lifting in most areas toward the end of the quarter, the El Dorado, Ark.-based company with about 1,500 c-stores in 26 states said. Merchandise contribution dollars grew 12.2% to $118.4 million, compared to $105.5 million in the prior-year quarter.
Watch CSP Daily News for a complete look at Murphy USA’s second-quarter earnings.
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