EL DORADO, Ark. — Just two months after closing on its acquisition of the QuickChek convenience-store chain, executives at Murphy USA report they “could not be more pleased” with the addition.
The retailer and fuel supplier reported significant boosts in in-store sales from the 156 stores added to its rolls Jan. 29. Of $148 million in merchandise sales contributed to Murphy USA's earnings in the first quarter of 2021, which ended March 31, $36 million came from the QuickCheck stores, which Murphy USA operates as a wholly owned subsidiary. Of that, $15 million came from food and beverages, according to the earnings report released April 29, showing where the company could grow sales in its legacy Murphy Express c-stores.
“We have a lot of opportunity for growth and improvement in [the foodservice] category in the core Murphy business," said President and CEO Andrew Clyde during an earnings conference call April 29. “But we are already seeing early benefits as we focus our efforts on supply-chain optimization, better store-level execution of existing food and beverage platforms and new product assortment efforts that will positively impact this category in the coming quarters.”
While seeking money-saving synergies between the two companies through the integration process, Clyde says he and his team are “taking care not to dilute the unique value and distinct capabilities of the QuickChek brand.” However, he anticipates opportunities in three basic areas: leveraging scale, sharing best practices and accelerating critical strategy initiatives.
“We could not be more pleased with the QuickChek acquisition, and our initial integration efforts have validated the value creation opportunity,” he said.
Overall for the quarter, Murphy USA reported:
- Net income of $55.3 million compared to net income of $89.3 million in Q1 2020.
- Total fuel contribution including renewable identification numbers (RINs) of 22.5 cents per gallon, no change from the prior-year period.
- Total retail gallons decreased 4.2% in first-quarter 2021 compared to the previous year, while volumes on a same-store sales basis decreased 10.1%.
- Merchandise contribution dollars increased 38.1% to $148.4 million compared to the prior-year quarter, on average unit margins of 17.8% in the current quarter, driven in part by the acquisition of QuickChek.
- The QuickChek acquisition increased the store count by 156, and the company opened one new Murphy Express store. There are two new Murphy Express sites, 12 raze-and-rebuild Murphy USA sites and four QuickChek sites currently under construction.
“The new year started off with tremendous momentum as first-quarter results underscore the strength of our core business alongside the realities of our industry post-COVID 19,” Clyde said. “Fuel margins showed remarkable resilience as product prices rose approximately 55 cents during the quarter and continued to demonstrate the higher breakeven economics of independent retailers.
“As we lap the initial impact of COVID-19, we are maintaining market share in critical categories like fuel and tobacco while generating higher growth from the core non-tobacco business.”
- Murphy USA ranked No. 6 on a 2021 update of CSP’s 2020 Top 202 ranking of c-store chains by size. QuickChek was No. 44 in 2020.
Murphy USA Inc., El Dorado, Ark., is a retailer of gasoline and convenience merchandise with nearly 1,650 stores primarily in the U.S. Southwest, Southeast, Midwest and Northeast.