Murphy USA (MUSA) Q3 2024 earnings summary

Executive summary

• Q3 2024 net income was $149.2 million ($7.20 per diluted share) on $5.2 billion in revenue, down from $167.7 million ($7.69 per share) on $5.8 billion in Q3 2023, mainly due to lower fuel contribution and higher expenses, partially offset by higher merchandise contributions and lower tax expense.

• Adjusted EBITDA for Q3 2024 was $285.6 million, a decrease from $306.0 million in Q3 2023.

• Delivered strong Q3 results in core categories, with value-focused consumer positioning and robust organic growth setting up for Q4 and 2025 expansion.

• Outperformed in non-discretionary categories, especially fuel and nicotine, with market share gains and double-digit growth in oral nicotine.

• QuickChek faced QSR competition but saw improvement in coffee and sandwich promotions.

Financial highlights

• Q3 2024 revenues decreased 9.6% year-over-year, primarily due to a 10.9% drop in retail fuel sales prices, partially offset by a 2.0% increase in fuel volumes and 2.5% growth in merchandise sales.

• Retail fuel volumes increased 2.0% year-over-year; retail fuel margin per gallon up 11.2% to 31.9 cpg.

• Non-nicotine merchandise sales and margin grew 2.7% and 4.8%, respectively; total merchandise contribution up 2.4% to $216.8 million.

• QuickChek fuel volumes up 2.9% and fuel margin dollars up 9.2% in the Northeast.

• Cash flow from operations for the nine months ended September 30, 2024 was $598.9 million, up 17.2% year-over-year.

Outlook and guidance

• Full-year 2024 capital expenditures are expected to range from $500 million to $525 million, with $400–$415 million for retail growth and $65–$70 million for maintenance.

• SG&A guidance reduced to $240M-$250M due to cost control and targeted investments.

• Expecting 30-35 new stores and over 40 Raze and Rebuilds in 2024, with a sustainable run rate of 50 new stores per year targeted.

• Fuel margins expected to remain in the $0.30-$0.32 per gallon range in a stable market.

• Ongoing effective tax rate is estimated between 24% and 26% for the remainder of 2024.