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Petro Stopping Centers, Giant Industries Report High Quarterly Earnings

EL PASO, Texas -- Travel plaza operators Petro Stopping Centers LP, which has a nationwide network of 37 company-operated and 23 franchised locations, reported record revenue for the second quarter 2004 of $315.8 million, which was $63.8 million higher than the same period in 2003.

The increase was mainly due to higher fuel revenues, as a result of increases in fuel gallons sold and average retail-selling price of fuel, as well as improved non-fuel sales. Earnings before interest, taxes, depreciation and amortization (EBITDA) for the quarter rose $2.2 million, or 19.7 percent, to $13.4 million, while net income increased $968,000 to $3.7 million, due primarily to increased fuel gross profit and improved non-fuel sales, partially offset by increased interest expense. No provision for income taxes is reflected in the company's consolidated financial statements because of its organization as a partnership.

Revenue for the six months ended June 30, 2004, of $601.9 million was 15.1 percent higher than 2003. EBITDA for the six-month period rose 7.3 percent to $22.2 million. The net loss for the period of $3.9 million is primarily due to costs associated with the company's Feb. 9, 2004, refinancing transactions and increased interest expense.

In other news, oil company Giant Industries Inc. reported net earnings of $5 million, or 44 cents per diluted share, for the second quarter ended June 30, 2004, compared to $447,000, or 5 cents per diluted share, for the second quarter ended June 30, 2003. For the first half of 2004, the company reported net earnings of $9.5 million, or 93 cents per diluted share, vs. net earnings of $2.1 million, or 24 cents per diluted share, for the first six months of 2003.

During the second quarter, the company completed its previously announced refinancing plan and issued $150 million of 8 percent senior subordinated notes due 2014 and approximately 3.3 million shares of common stock, raising approximately $58 million. Net proceeds from the offerings were used to refinance the company's outstanding 9 percent senior subordinated notes due 2007 and to retire approximately $51 million of the company's 11 percent senior subordinated notes due 2012. Fees and expenses related to the financing resulted in a net after tax charge of $9.9 million, or approximately 88 cents per share.

Fred Holliger, Giant's chairman and CEO, said, "The first six months of this year have certainly been strong from an earnings perspective. Our net earnings for the second quarter and year-to-date significantly exceeded our financial performance for the same period last year. This performance was even more significant when you consider that it was achieved in spite of the refinancing related charges recognized in this year's second quarter."
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