CrossAmerica Makes 'Significant Progress' on Class of Trade Optimization Efforts
ALLENTOWN, Pa. — Closing out a challenging 2024, CrossAmerica Partners LP is heading into a new fiscal year with a continued focus on optimizing its portfolio by converting certain controlled sites from existing classes of trade to company-operated retail or commission sites.
"We made significant progress on our strategic goal of converting sites to our retail class of trade, while also successfully divesting select locations to strengthen our long-term financial and competitive position," Charles Nifong, CrossAmerica's president and CEO, said during the company's recent fourth-quarter and full-year 2024 earnings call.
In the fourth quarter, the partnership was up 69 company-operated retail sites vs. the year-ago period. The increase was primarily driven by the completed conversion of Applegreen lease locations to company-operated retail sites in the spring of 2023. Commission agent site count increased by 30 sites vs. the fourth quarter of 2023, and increased by four sites vs. the third quarter of 2024. In total, CrossAmerica increased its overall retail site count by 99 sites for the three-month period ended Dec. 31, 2024, when compared to the same period of 2023.
"These conversions position our portfolio to generate more profitability over the long term, although they do generate short-term volatility and expense," said Nifong. "Also, we were successful in divesting locations with the greatest volume by dollar amount of divestitures in our history in 2024. These divestitures allowed us to recycle capital and to strengthen our balance sheet."
For the fourth quarter of 2024, the partnership divested 11 sites for $17.3 million in proceeds. For the full year, the partnership divested 30 properties for $36.3 million in proceeds, resulting in a net gain of $23.3 million.
"We were quite active with divestitures in 2024, especially in the back half of the year, as we had indicated on prior calls would be the case," the chief executive said. "We expect that momentum to continue to 2025 as this continues to be an area of focus and effort for us."
Allentown-based CrossAmerica Partners is a wholesale distributor of motor fuels, convenience store operator, and owner and lessee of real estate used in the retail distribution of motor fuels. Its general partner, CrossAmerica GP LLC, is indirectly owned and controlled by entities affiliated with Joseph V. Topper, Jr., the founder of CrossAmerica Partners and a member of the board of the general partner since 2012.
Formed in 2012, CrossAmerica Partners LP is a distributor of branded and unbranded petroleum for motor vehicles in the United States. It distributes fuel to approximately 1,600 locations and owns or leases approximately 1,100 sites. Its geographic footprint covers 34 states.
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