Dive Brief:
- CrossAmerica Partners credited “strong sales performance” from beer, snacks and other packaged beverage and food categories for its in-store merchandise profit growth during the second quarter, President and CEO Charles Nifong said during the company’s earnings call Tuesday.
- Excluding cigarettes, same-store inside sales were up 8% year over year and margins were up 170 basis points Nifong said. He credited initiatives related to pricing, product sourcing and promotions for the boost.
- The strong performance from beer, snacks and other categories underscore CrossAmerica’s successful period overall, where the company’s entire retail segment saw a 19% — or $10.6 million — increase in year-over-year gross profits.
Dive Insight:
Nifong credited the growth in CrossAmerica’s broader retail segment during the quarter to higher motor fuel and merchandise gross profits, according to the company’s earnings report.
Merchandise gross profit and “other revenue” — items like car wash income and lottery commissions — increased 20% compared to the previous year due to increases in overall store sales, merchandise gross profit percentage and an increase in the number of company-operated sites, according to the report.
Even as CrossAmerica sold six properties for $7.8 million during the quarter, its company-operated store count grew from 253 to 292 locations over the past year, due in part to converting some leased or commissioned sites to company-owned ones.
“Overall, it was a positive quarter for our retail segment as store sales, store margins and retail fuel margins are all up relative to the prior year,” Nifong said during the earnings call.
On the fuel side, the retailer sold 2% more retail fuel gallons last quarter compared to the same period last year, the report noted. This growth was also due to CrossAmerica’s conversion of various lessee dealer sites to company operated locations during the period.
Allentown, Pennsylvania-based CrossAmerica Partners operates 292 convenience stores across 10 states. It also distributes fuel to about 1,700 locations across 34 states.
