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CORPUS CHRISTI, Texas -- Susser Holdings Corp., the parent company of Stripes convenience stores, saw a strong third quarter, mainly on the solid performances of same-store merchandise and gas sales.
According to the company's third-quarter results, same-store merchandise sales increased by 7.4 percent, compared with an increase of 3.4 percent in the third quarter of 2010. Average retail gallons per store per week increased 5.6 percent year-over-year, vs. growth of 3.9 percent a year ago. Overall, net income for the quarter more than doubled to $18.5 million, vs. $9 million in the same quarter last year.
These positive numbers continue the upswing Susser experienced in its second quarter, President and CEO Sam Susser explained during the company's earnings call this morning. He partially credited the economy in the company's home state of Texas.
"The Texas economy continues to outpace the rest of the nation. We feel fortunate to be located here," Susser said. He added that Susser's West Texas stores typically lead the company's numbers, but its South Texas stores came in with strong same-store numbers in the third quarter. "That is a positive sign that the recovery is spreading across the state," he said.
On the fuel side, Susser explained that the company did well both from a volume and margin perspective. He also noted that diesel continues to drive the company's retail gallon sales this year.
He expects Susser's fuel business to continue to perform well on the heels of its acquisition of Dallas/Fort Worth-based Community Fuels of Texas LP's assets in early October. The deal includes fuel supply contacts to 121 dealer locations and fuel supply rights to 24 commercial accounts, as CSNews Online previously reported.
The retailer is also moving forward with its growth plans, opening five new Stripes locations in the third quarter and completing construction of two more so far in the fourth quarter, Susser reported. The new stores are considered "big box," twice the size of the company's legacy stores with two to three times the cash flow, he noted during the earnings call.
Steve DeSutter, president and CEO, Retail, noted that inside sales are averaging $1.6 million per location, with only approximately 19 percent of that figure coming from cigarettes. Packaged beverages, foodservice, beer, snacks and cigarettes continue to do well in the stores, he said. The combination of packaged beverages and foodservice accounts for half of its merchandise gross profit.