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EL DORADO, Ark. — Strong retail fuel margins and merchandise revenues led Murphy USA Inc. to a solid 2015 fiscal first quarter.
Retail fuel margins increased by 3.2 cents per gallon year over year to 10 cents per gallon. Quarterly retail fuel sales also performed well, increasing 5.8 percent year over year to 962.7 million gallons.
On the merchandise front, total non-tobacco sales dollars increased 11.7 percent. Dispensed beverages, alternative snacks and lottery sales were particularly strong, Murphy USA President and CEO Andrew Clyde noted during the company's first-quarter earnings call Tuesday.
Overall, merchandise revenues rose $21.4 million to $524.1 million for Murphy USA's latest quarter ended March 31.
"The first quarter of 2015 got off to a strong start as retail fuel volume and margin momentum carried over from the fourth quarter of last year," said Clyde. "Merchandise sales and margins also remain robust, while low gas prices have led consumers to upgrade their product choices."
On an average per-site monthly (ASPM) basis, merchandise sales decreased 0.5 percent as tobacco product sales fell 2.4 percent year over year, mostly offset by a 6.7-percent increase in non-tobacco sales. Quarterly merchandise margin dollars were flat overall on an ASPM basis, with tobacco margin dollars down 2.1 percent, offset by an increase in non-tobacco margin dollars of 3.2 percent.
Despite tobacco continuing to be a drag on in-store sales and margins, Clyde stressed this negative trend is beginning to decelerate. The CEO said he feels "very good" overall about Murphy USA's merchandise segment.
A QUIET QUARTER
During Murphy USA's 2015 first quarter, the retailer opened just five new stores — considered a quiet quarter for new builds, but expected on a seasonal basis.
Thus far in the second quarter, the El Dorado-based company has opened three additional stores, and now operates a total of 1,271 convenience stores, 1,062 of which operate under the Murphy USA brand and 209 under the Murphy Express banner.
Murphy USA currently has 16 stores under construction and plans to complete several store refreshes in its second quarter.
Companywide, Murphy USA achieved a net profit of $22.9 million in its fiscal first quarter, compared to a $9.6-million profit in the year-ago period.
"We were very pleased with our first-quarter results," concluded Clyde. "We were even more pleased with the execution."