Delek US' Foodservice Strategy Pays Off
BRENTWOOD, Tenn. -- Placing an emphasis on foodservice has clearly paid off for Delek US Holdings Inc. Foodservice sales at the company's convenience stores increased dramatically to the tune of 24 percent during the company's 2012 fiscal first quarter, compared to the same time period in 2011, CFO Mark Cox reported during an investor conference call this morning.
Overall, same-store merchandise sales at Delek US Holdings' convenience store division also jumped 7.6 percent during its 2012 fiscal first quarter vs. the year-ago period. The operator of MAPCO Express, MAPCO Mart, East Coast, Fast Food and Fuel, Favorite Markets, Delta Express and Discount Food Mart stores cited three reasons for the same-store sales increase: improved foodservice sales; an unusually warm winter in its markets; and "increased sales in nearly all merchandise categories."
Delek US' retail division, as a whole, posted a profit of $7.3 million in its latest quarter vs. a gain of $6.5 million during 2011's fiscal first quarter.
"We had a strong performance from retail," said Cox. "All areas [of that division] performed well. It was our 11th consecutive quarter of same-store sales increases."
On the negative side of the ledger, Delek US' merchandise margin dropped to 29.4 percent, compared to the 30.8-percent figure attained in the prior-year period. The company blamed cigarette manufacturers' new retail pricing programs for the decrease.
As of March 31, Delek US operated 375 locations, slightly down from 404 units on March 31, 2011.
Companywide, Delek US achieved a net profit of $46.2 million in its first quarter, compared to a gain of $16.9 million last year. The refining segment accounted for 90 percent of the profit, said Cox.
"It was the best quarter in our company's history," Delek US President and CEO Uzi Yemin added during the conference call.