Sale of Hess' Retail Division Still on Track
NEW YORK -- Hess Corp. completed six of its 10 stated goals this year in an effort to become a pure-play exploration and production (E&P) company. One the four goals not completed is the selling of the company's 1,714 gas stations and convenience stores.
However, the divestiture of the retail division "is well underway," said CEO John Hess during the company's 2013 fiscal third-quarter earnings call this morning. The executive made similar comments on July 31, when Hess announced its fiscal second-quarter earnings.
The CEO would not elaborate on which convenience store retailer would buy the assets. But as Convenience Store News previously reported, Marathon Petroleum Corp. -- parent of Speedway LLC -- has been mentioned as a possible suitor.
"Hess has very good looking assets," Marathon Petroleum CEO Gary Heminger stated on April 30.
A spinoff of the retail division, similar to the process recently taken by Valero Energy Corp. and Murphy Oil Corp., is also a possibility, the company noted during the call. Valero spinoff CST Brands Inc. and Murphy spinoff Murphy USA Inc. both began trading as separate entities earlier this year.
As for earnings, Hess' discontinued operations division, under which retail, energy marketing and energy trading is housed, earned a net profit of $54 million in the third quarter, which ended Sept. 30. That is slightly higher than the $53 million the company earned in its 2012 third quarter.
Companywide, Hess achieved a net profit of $420 million in its latest quarter, compared to a $557 million profit in the year-ago period. Civil unrest in Libya was cited as the top reason for lower earnings.
"We are pleased in the progress we have made in our conversion to an E&P company," Hess concluded.