Thrifty, Albertson's Acquisitions Fuel Tesoro's Retail Division
SAN ANTONIO -- Earnings across the board at Tesoro Corp.'s retail division were up in its fiscal 2013 first quarter thanks to last year's acquisitions of 174 locations from Thrifty Oil Co. and 49 Albertson's Fuel Express gas stations and convenience stores formerly owned by Supervalu Inc.
These acquisitions led the company to report a $17 million retail division profit in the quarter ended March 31, compared to a $4 million loss in the same time period one year ago.
Perhaps even more impressive is that fuel sales volumes increased 18 percent year over year. Also on the rise were same-store fuel sales, which rose 1 percent.
Retail fuel sales in California were especially strong, Tesoro President and CEO Greg Goff noted during the company's earnings call today."The California market improved significantly in the first quarter," he said, without pinpointing a reason why the Golden State was so strong. "And it is looking as good or better so far in the second quarter."
Total fuel sales improved to $449 million in Tesoro's first quarter vs. $379 million in 2012. Fuel margins rose to 20 cents per gallon, a year-over-year increase of 8 cents.
Also on the rise were merchandise sales, which increased $2 million to $50 million. Tesoro's merchandise margin percentage increased slightly to 26 percent.
San Antonio-based Tesoro had 595 convenience stores and gas stations as March 31. Its c-stores and gas stations operate on the West Coast and in Alaska and Hawaii under the Tesoro, USA Gasoline and Shell banners.
During today’s call, Goff reported that the company began the process of ceasing its crude oil refining operations in Hawaii. According to several media reports, Tesoro seeks to sell its 31 c-stores and gas stations in the Aloha State in a corresponding move. Goff did not discuss any such sale during the call.
Companywide, Tesoro earned a profit of $93 million in its first quarter, compared to a profit of $56 million in the same timeframe last year.
"We are pleased with our first-quarter results, which reflect a solid operating performance and continued execution of our strategic plan," the CEO concluded.