CORPUS CHRISTI, Texas -- Susser Holdings Corp. expects to report same-store merchandise sales growth of approximately 2.2% for the second quarter and 3.2% for the first six months of 2013, it said in providing preliminary operating results for the second quarter and first half of 2013.
And it expects to report Susser Holdings Retail average per-store fuel volume growth of approximately 5.5% for the second quarter and 4.9% for the first half of 2013.
"We feel these results are impressive as [Susser] was facing a number of headwinds in Q2 including cooler weather, the Easter shift (the holiday was in Q1 this year vs. Q2 last year) and a tough 8% merchandise comp in Q2 2012--yet still managed to post respectable [same-store sales] growth," said Bonnie Herzog, managing director of beverage, tobacco and convenience store research for Wells Fargo Securities LLC, New York.
"Further, the average per-store fuel volume growth has resulted in [year-to-date] growth of more than 4.9% which is above the company's yearly guidance of 1% to 4% (we are forecasting 5.2% for FY13)," she said.
"Though we remain cautious on fuel margin trends, we believe [Susser's] pre-released [merchandise same-store sales] and average per-store fuel volume growth suggest that Q2 traffic, merchandise and gas consumption trends for other c-store operators may not be as bad as feared," she added.
Susser Holdings opened six new large-format Stripes convenience stores during the second quarter and closed one smaller store. For the full year, the company has opened a total of 10 new stores and closed two. The company currently operates a total of 567 Stripes stores, of which 362 include a restaurant.
It completed a sale-leaseback transaction of two new stores \ on June 17 for a total cost of $8 million. This latest sale by Susser Holdings to Susser Petroleum Partners brings the total number of new-build store sale leasebacks to 20 since the initial public offering of units in the partnership in Sept. 2012 at a cumulative cost, including final cost true-ups, of $81.5 million.
It added 10 new contracted sites in the wholesale segment, and it discontinued six sites in the second quarter for a total of 583 contracted branded sites as of June 30, consisting of 95 consignment locations and 488 other independent branded dealer contracts.
"We believe [Susser] is one of the most compelling growth stories in the c-store industry," Herzog said. "With a top-tier foodservice franchise in Laredo Taco Co. and a concentrated, but underpenetrated, presence in the dynamic and attractive Texas market, we think Susser has some of the best growth prospects in the convenience store industry. We think management runs the business with a long-term perspective and can create significant earnings power that is not reflected in current valuation."
Susser Holdings is a third-generation, family-led business based in Corpus Christi, Texas, that operates approximately 565 c-stores in Texas, New Mexico and Oklahoma under the Stripes banner. Restaurant service is available in approximately 360 of its stores, primarily under the proprietary Laredo Taco Co. brand. Susser Holdings also is majority owner and owns the general partner of Susser Petroleum Partners LP, which distributes 1.5 billion gallons of motor fuel annually to Stripes stores, independently operated consignment locations, c-stores and retail fuel outlets operated by independent operators and other commercial customers in Texas, New Mexico, Oklahoma and Louisiana.
Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.