CORPUS CHRISTI, Texas -- Susser Holdings Corp. has reported fourth-quarter 2006 merchandise sales and total revenues of $88.7 million and $488 million, compared with merchandise sales and total revenues of $80.7 million and $509.1 million in the same quarter of 2005.
The decline in total revenues for the quarter was primarily related to lower retail and wholesale fuel prices as compared to fourth-quarter 2005.
Adjusted earnings before income taxes, depreciation and amortization (EBITDA) for the fourth quarter was $5.9 million, [image-nocss] versus $13.8 million reported and $11.1 million pro forma in the prior year's fourth quarter. Adjusted EBITDA for fourth-quarter 2006 was negatively impacted by an $8.5 million decline in fuel gross profit and positively impacted by an 11.2% increase, or $3.5 million, in nonfuel gross profit, compared to fourth-quarter 2005.
On a reported basis, which reflects the fact that Susser operated under its prior LLC structure for a portion of the fourth quarter before completing its initial public offering on Oct. 24, 2006, the company reported a pre-tax loss of $10.9 million in the quarter, compared with a pre-tax loss of $31.1 million in fourth-quarter 2005. Reported net results in both periods were affected by nonrecurring charges of $7.1 million in 2006 related to the redemption of $50 million of senior notes in November 2006 and $33.4 million in 2005 related to the company's December 2005 recapitalization. After-tax net loss for the quarter was $10.9 million, or 72 cents per diluted share. The company's fourth-quarter tax provision consists of a $9.7 million tax benefit, of which $7.4 million reflects the initial net tax benefit of its deferred tax positions upon conversion from a limited liability company to a taxable corporation on October 24, reduced by a $9.7 million tax valuation allowance.
To show a more meaningful comparison of results under its new capital structure, Susser is providing pro forma results for 2005 and 2006 to reflect the impact of the October 2006 IPO as well as changes Susser made in its capital structure in December 2005. On a pro forma basis, it reported an after-tax loss for fourth-quarter 2006 of $1.8 million, or 11 cents per diluted share, versus an after-tax loss of $10.2 million, or 61 cents per diluted share, for fourth-quarter 2005. Pro forma revenues for both periods were the same as reported revenues.
For the full-year 2006, Susser reported that its merchandise sales increased by 10.9% to $365.3 million, and total revenues increased by 19.5% to $2.3 billion. Pro forma adjusted EBITDA increased by 6.9% to $45.2 million. On a reported basis, the company had a pre-tax loss of $3.7 million in 2006, versus a pre-tax loss of $20.6 million in 2005. Reported net results in both periods were affected by the nonrecurring charges described above. After-tax net loss for the year was $3.7 million, or 35 cents per diluted share. Pro forma net income for the year was $5.9 million, or 35 cents per diluted share, versus a net loss of $7.8 million, or 47 cents per diluted share, a year ago.
We continued to see strong year-over-year growth in merchandise sales and merchandise gross margins during the fourth quarter, and we are especially pleased with the continued growth of our Laredo Taco Co. restaurant business, said Sam L. Susser, Susser Holdings CEO.
As expected, fuel margins declined from the record high levels we saw in the third quarter of 2006, although we still achieved full year fuel margins that were slightly ahead of last year's and consistent with our long-term average, he said. Wholesale volumes were also impacted somewhat by the sale in June 2006 of 25 unattended wholesale fueling stations.
He added, Overall, we're very pleased with our fourth quarter and full year results, and we continue to expect strong operating performance in 2007. We expect EBITDA percentage growth in the mid teens range this year. With the December 2005 recapitalization, the October 2006 IPO, the re-branding to Stripes and the conversion to Valero now behind us, our management team looks forward to focusing its time and energy on growth initiatives going forward.
Merchandise sales from Susser's convenience stores increased by 9.9% overall to $88.7 million and by 6.5% on a same-store basis during fourth-quarter 2006, driven by strong growth in sales from Laredo Taco restaurant operations, along with beer, packaged beverage and snack sales. Merchandise margin was 32.2%up slightly from 31.8% versus the fourth quarter of 2005. Total merchandise gross profit increased 11.3% to $28.6 million.
C-store fuel volumes increased 0.6% to 94.8 million gallons for the quarter, and average volumes sold per store for the quarter decreased 0.37% to 296,465 gallons. Retail gross margin was 9.2 cents per gallon, versus 14.8 cents per gallon in fourth-quarter 2005 and 21 cents per gallon in third-quarter 2006. Retail fuel gross profit declined by 37.5% to $8.7 million primarily due to the lower per-gallon margins.
Wholesale fuel volumes sold to Susser's 367 dealer and other third-party customers declined 4.1% to 110.4 million gallons in the quarter, primarily reflecting the sale in June 2006 of 25 unattended fueling stations.
Wholesale fuel gross margin was 4.5 cents per gallon, versus 7.2 cents per gallon a year ago, and gross profit decreased 40% to $5 million.
Adjusted EBITDA was $5.9 million, versus $13.8 million reported and $11.1 million pro forma in fourth-quarter 2005. Adjusted EBITDA for fourth-quarter of 2006 was impacted primarily by lower fuel margins, along with $3.1 million of additional rent expense related to the December 2005 sale/leaseback transaction.
For the full year ended Dec. 31, 2006, merchandise sales from c-stores increased by 10.9% overall to $365.3 million and by 6.1% on a same-store basis, compared with 2005. Merchandise margin for the year was 32.6%, versus 32.3% in the prior year, and merchandise gross profit was $119.1 million, up 11.9% from 2005.
C-store gasoline volumes increased 7.4% to 395.3 million gallons for the year, and average volumes sold per store increased 4.8% to 1.24 million gallons. Retail gross margin was 13.64 cents per gallon for the year, versus 13.57 cents per gallon in 2005. Retail fuel gross profit increased by 8% to $53.9 million. After credit card expenses, however, which increased by $3.4 million, or 0.72 cents per gallon, fuel margin per gallon was slightly lower than last year, but still consistent with the five-year average.
Wholesale fuel volumes increased 2.1% to 451 million gallons for the year. Wholesale fuel gross margin was 5.55 cents per gallon, versus 5.50 cents per gallon for 2005, and fuel gross profit increased 3% to $25 million.
Adjusted EBITDA for the full year was $45.2 million, versus $54.4 million reported and $42.3 million pro forma for the full year 2005. Pro forma adjusted EBITDA for 2006 was higher as a result of strong merchandise sales and margins, along with increased fuel volumes and margins.
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