WARREN, Pa. -- United Refining Co., a regional refiner and marketer of petroleum products announces operating results for the second fiscal quarter and six month period ended Feb. 29, 2008.
The company said that retail product prices have not kept up with increasing crude oil prices. During the quarter, average NYMEX crude oil prices rose 8.5% or $7.27 per barrel, while the average selling price of a gallon of gasoline within its retail system rose only a penny or 0.3%. This has historically been the case in a rapidly rising crude oil market where retail pricing is unable to keep pace [image-nocss] with crude prices, it said.
Operating income for the second quarter ended February 29 decreased $13.1 million from operating income of $4.7 million for the quarter ended Feb. 28, 2007, to an operating loss of $8.4 million. Operating income for the six months increased $16.5 million from income of $4.2 million for the six months ended Feb. 28, 2007, to operating income of $20.7 million.
Net sales for the three months ended Feb. 29, 2008, and Feb. 28, 2007, were $663.7 million and $492.8 million, respectively. This was an increase of $170.9 million or 34.7% over the prior-year period. Retail merchandise sales increased $2.6 million and retail petroleum sales increased $79.8 million for the period, partially due to increased sales volume of 2.4 million gallons. Wholesale sales revenues increased $88.5 million for the quarter ended February 29, compared to the comparable quarter of 2007. Although sales volume increased slightly, the increase in sales revenue was primarily due to a 36% increase in wholesale average sales prices for all wholesale products.
Earnings before interest, taxes, depreciation and amortization (EBITDA) for the three months ended Feb. 29, 2008, decreased $11.1 million to a negative $1.9 million compared to $9.2 million for three months ended Feb. 28, 2007. EBITDA increased $21.1 million for the six months ended Feb. 29, 2008, to $35.3 million from $14.2 million for the six months ended Feb. 29, 2007.
United Refining operates a 70,000-barrels-per-day refinery in Warren, Pa. In addition to its wholesale markets, the company also operates 369 Kwik Fill/Red Apple and Country Fair retail gasoline and convenience stores located primarily in western New York and western Pennsylvania.
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