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WESTLAKE, Ohio -- TravelCenters of America LLC -- operator of 236 travel plazas under the TravelCenters of America, TA and Petro brands -- suffered a difficult fourth quarter in fiscal 2007, reporting a net loss of $68.9 million, which the company attributed to the slowing U.S. economy, among other related events.
For the fourth quarter ended Dec. 31, 2007, revenue for the company reached $1.8 billion, up from the $1.1 billion seen in the comparable 2006 period, the company stated. Earnings before interest, taxes, depreciation, amortization and rent (EBITDAR) for TravelCenters was $20.3 million in the fourth quarter of 2007, a decrease of $23.5 million compared to the fourth quarter of 2006, the company stated.
Due to the company's acquisition of Petro Stopping Centers in May 2007, its comparable results for various measures were significantly higher, including a 43.7 percent increase in fuel revenue, and a 38.7 percent increase in nonfuel revenue, the company stated.
However, during the fourth quarter, the company's sites saw a 10.7 percent decline in diesel fuel and gasoline sales volumes on a same-site basis and nonfuel revenue decreased $3.1 million, or 1.1 percent, according to the company.
Industry and economic conditions in the fourth quarter of 2007 were difficult, the company said, noting that while diesel fuel prices moderated somewhat and fuel margins improved on a cents-per-gallon basis during the quarter, fuel volume sold on a same-site basis fell due to decreased demand from customers.
In addition, operating results for the fourth quarter were adversely affected by slowing economic growth in the U.S., and particularly within the trucking industry.
TravelCenters stated that reduced demand for trucks -- caused by the slowing housing markets and durable goods orders, a decline in imports due to the depressed value of U.S. currency and the high cost of crude oil -- led to reduced demand for the company's services.
These factors had an adverse effect on TravelCenter's financial results for the quarter, and the company said it expects conditions to continue to affect its operations in 2008.