Star Group (SGU) Q4 2025 earnings summary

Executive summary

• Fiscal 2025 revenue rose 1.0% year-over-year to $1.8 billion, driven by higher volumes and increased installation/service sales, offsetting lower selling prices from reduced wholesale costs.

• Fiscal 2025 saw an 8% colder year-over-year temperature, driving a 12% increase in heating oil and propane volume, aided by recent acquisitions.

• Net income for fiscal 2025 increased by $38.3 million to $73.5 million, aided by a $32.4 million favorable change in derivative fair value, higher Adjusted EBITDA, and a $3.8 million real estate gain.

• Adjusted EBITDA for fiscal 2025 grew 22.2% to $136.4 million, reflecting improved margins, higher volumes, and acquisition contributions.

• Net customer attrition rose modestly, but internal satisfaction and loss rates improved, with lower real estate activity impacting new customer additions.

Financial highlights

• Fiscal 2025 home heating oil and propane volume rose 11.5% to 282.6 million gallons, driven by acquisitions and colder weather.

• Adjusted EBITDA for fiscal 2025 was $136.4 million, up $24.8 million from the prior year.

• Net income for fiscal 2025 was $73.5 million, compared to $35.2 million in fiscal 2024.

• Product gross profit rose by $57 million (12%) to $525 million, reflecting higher volumes and margins.

• Fourth quarter net loss narrowed by $6.4 million to $28.7 million, mainly due to favorable derivative changes and a real estate gain.

Outlook and guidance

• Focus remains on growing and diversifying through acquisitions, minimizing net attrition, and maximizing installation and service profitability.

• Acquisition pipeline remains active with several tuck-in and standalone opportunities under review.

• Ongoing review of sales and marketing to attract new customers amid low real estate activity and warmer-than-normal weather.

• Plans to continue investing in complementary services and maximizing profitability in fiscal 2026.