US: Lower fuel margins hit The Pantry earnings

A fall in sales and margins from fuel has hit quarterly profits at US c-store retailer The Pantry.

The company booked net income of US$5.9m for its third quarter, which ran to 27 June. A year earlier, The Pantry’s net profit was $14.8m. The retailer said its adjusted EBITDA was down 12.6% at $65.3m.

Revenue dropped 6.8% to $1.99bn on the back of lower fuel sales. Merchandise sales inched up in the quarter. Comparable-store merchandise sales increased 1.3%.

President and CEO Dennis Hatchell said: “I am pleased with the progress we made during the third quarter. Our comparable store merchandise sales growth moved back into positive territory as average sales per customer increased 2.5% compared to the prior year quarter. Additionally, we slowed the rate of decline in retail fuel gallons sold. However, fuel margins were $0.023 per gallon lower than during last year’s third quarter leading to the decline in adjusted EBITDA.”