Circle K Fuel Brand Reaches More Forecourts Across North America

LAVAL, Quebec — Two years after launching the Circle K fuel brand, Alimentation Couche-Tard Inc. is making progress in bringing it to more forecourts.

In the third quarter of its 2022 fiscal year, the parent company of Circle K rebranded 181 locations to the Circle K fuel brand, bringing the year-to-date total to 381, and total site count with the Circle K fuel brand in North America to 3,200 stores. 

Going hand in hand with the rollout, the retailer is continuing efforts to raise awareness of its proprietary fuel offering, Couche-Tard President and CEO Brian Hannasch said during the company's recent fiscal 2022 third-quarter earnings call. 

"Our Circle K ambassador program kicked off to further support site-level rebrand activity, such as educating the customer about our Circle K fuel brand, our quality guarantee program, and our premium benefits," Hannasch explained. "In the U.S., we've also begun a Win Free Fuel for a Year [contest] — a national campaign — and we will have 144 winners of free fuel for a year by the end of the fiscal year."

The contest kicked off Feb. 2 and runs through April 25, as Convenience Store News previously reported. To enter, customers must fuel up at a store offering Circle K fuel and provide proof of purchase at winfuel.circlek.com. The limit is one entry per day.

Staying on fuels, Hannasch also reported that Couche-Tard is growing its in-house fuel transport operations. This initiative spans across the company's network. 

"We now have over 1,000 drivers transporting Circle K fuel and we just believe that provides tremendous upside in terms of reliability, but also our flexibility to optimize our fuel sourcing," the chief executive said.

Fuel Category Financials

In its latest quarter, same-store road transportation volume increased by 3.2 percent in the United States, by 3.2 percent in Europe and other regions, and by 7.2 percent in Canada.

On a two-year stack basis, same-store road transportation fuel volume decreased at a compound annual rate of 6.8 percent in the U.S., 3.4 percent in Europe, and 7.4 percent in Canada.

Hannasch, however, pointed out that the category is still feeling pressure from continued work-from-home trends and the resurgence of COVID-19 cases toward the end of the quarter fueled by the surge of the Omicron variant. 

"As societies open and people start to return back to the offices, at least a few days a week, we believe we're continuing to see miles driven increase toward 2019 levels," he added.

Fuel gross margin for the quarter was 39.63 cents per gallon in the U.S., an increase of 8.87 cents per gallon. In Europe and other regions, it was 10.83 cents per liter, a decrease of 53 cents per liter. In Canada, it was CA 11.73 cents per liter, an increase of CA 1.45 cents per liter.

"Fuel margin remained healthy throughout our network, mainly as a result of favorable market conditions and the continued work on the optimization of our supply chain," reported Chief Financial Officer Claude Tessier.

Laval-based Alimentation Couche-Tard operates in 26 countries and territories with more than 14,100 stores, of which approximately 10,800 offer road transportation fuel.

With its well-known Couche-Tard and Circle K banners, it is one of the largest independent convenience store operators in the U.S. and a leader in the c-store industry and road transportation fuel retail in Canada, Scandinavia, the Baltics, as well as in Ireland. The company also has an important presence in Poland and Hong Kong.