EL DORADO -- Murphy USA on Wednesday reported a fourth-quarter profit of $77.5 million, or $2.38 per share, down from $124.8 million, or $3.58 per share, in the fourth quarter of 2017.
Net income for the year was $213.6 million, or $6.48 per share, compared with $245.3 million, or $6.78 per share, in 2017. Operating revenue was $3.5 billion in 2018, compared with $3.4 billion in 2017.
The company cited the effects of a deferred tax benefit and settlement of damages from an oil spill for the drop in profit. The company opened 26 stores last year, while increasing retail gasoline sales and merchandise dollars.
The 2017 fourth quarter included a deferred tax benefit of $88.9 million as a result of the enactment of the Tax Cuts and Jobs Act in December 2017, which increased net income, the company said in a news release. Also, an after-tax amount of $35.3 million from the settlement of damages in the 2010 Deepwater Horizon oil spill was included in net income for 2018.
The results beat analyst predictions for the quarter. Analysts with Zacks Equity Research had estimated fourth-quarter earnings of $1.98 per share.
Murphy USA opened 11 stores in the fourth quarter and reopened 15 stores after razing and rebuilding them on their sites. That raised the total to 26 new stores opening for the year and 27 reopenings of raze-and-rebuild locations. By year's end, Murphy USA's store count was 1,472.
Retail gasoline sales increased in the fourth quarter by 4.8 percent to 1.1 billion gallons while volumes on a same-store sales basis increased 2.1 percent compared with the same quarter in 2017. For the year, retail gas sales increased 2.2 percent to 4.2 billion gallons, while same-store sales volumes fell less than 1 percent.
"We finished 2018 strong, as a favorable fourth quarter fuel margin environment resulted in $411.8 million of annual Adjusted EBITDA, [earnings before interest, taxes, depreciation and amortization] just below the midpoint of our guidance," Andrew Clyde, Murphy USA's president and chief executive officer, said in a statement attached to the company's quarterly report.
"We drove traffic to our stores in the fourth quarter, growing per store volumes and generating the second strongest fourth quarter fuel contribution since our 2013 spinoff. Merchandise capped off an outstanding year, contributing over $400 million of margin in 2018 with line of sight to further improvement in 2019. We are in the early stages of executing several transformative initiatives in 2019, including the national launch of our Murphy Drive Rewards loyalty program early in the second quarter, that will help propel the earnings potential of the company in 2020 and beyond," the statement said.
Shares of Murphy USA fell 15 cents to close Wednesday at $80.57. The report was released after the stock market closed.
The company will host a conference call at 10 a.m. today to discuss the fourth-quarter and 2018 results. The conference call number is (844) 613-1037 and the passcode number is 7176997.
Business on 01/31/2019