On August 8, 2024, CrossAmerica Partners LP (CAPL, Financial) released its 8-K filing detailing the financial results for the second quarter ended June 30, 2024. CrossAmerica Partners LP is engaged in the wholesale distribution of motor fuel and the ownership and leasing of real estate used in the retail distribution of motor fuel. The company operates through two business segments: Wholesale and Retail.
Key Financial Metrics
CrossAmerica Partners LP reported the following key financial metrics for Q2 2024:
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Net Income | $12.4M | $14.5M |
| Adjusted EBITDA | $42.6M | $42.2M |
| Distributable Cash Flow | $26.1M | $30.4M |
| Gross Profit (Retail Segment) | $76.6M | $66.0M |
| Gross Profit (Wholesale Segment) | $28.1M | $31.7M |
| Leverage Ratio | 4.39x | 4.49x (Q1 2024) |
| Distribution Coverage Ratio (Trailing 12 Months) | 1.32x | 1.68x |
Performance Analysis
CrossAmerica Partners LP's performance in Q2 2024 showed a mixed bag of results. The company reported a net income of $12.4 million, a decrease from $14.5 million in Q2 2023. Adjusted EBITDA saw a slight increase to $42.6 million from $42.2 million in the same period last year. Distributable Cash Flow also declined to $26.1 million from $30.4 million in Q2 2023.
The Retail Segment showed significant improvement with a gross profit of $76.6 million, up from $66.0 million in Q2 2023. This increase was driven by higher motor fuel and merchandise gross profit. The segment sold 143.0 million gallons of retail fuel, a 9% increase compared to Q2 2023. However, same-store motor fuel gallons distributed saw a slight decline of 2%.
Conversely, the Wholesale Segment experienced a decline in gross profit, reporting $28.1 million compared to $31.7 million in Q2 2023. This was primarily due to a 12% decrease in wholesale volume distributed, attributed to the conversion of wholesale locations to retail locations.
Financial Achievements and Challenges
Despite the challenges, CrossAmerica Partners LP managed to maintain a stable financial position. The leverage ratio improved to 4.39 times as of June 30, 2024, compared to 4.49 times as of March 31, 2024. The Distribution Coverage Ratio for the trailing twelve months ended June 30, 2024, was 1.32 times, down from 1.68 times for the comparable period in 2023.
"Our financial results for the second quarter were significantly improved from the first quarter, despite a continued overall soft fuel demand environment," said Charles Nifong, President and CEO of CrossAmerica. "Our results reflect our continued successful execution of our strategy. We realized strong results in our retail segment, with increases in overall gallons, sales, and segment operating income, and we converted an additional 43 sites to the retail segment during the quarter."
Income Statement Highlights
For the second quarter of 2024, CrossAmerica Partners LP reported operating revenues of $1.13 billion, slightly down from $1.15 billion in Q2 2023. Operating expenses increased to $55.8 million from $49.8 million in the same period last year. The company also reported a net gain of $6.5 million from the sale of ten properties.
Balance Sheet and Cash Flow
As of June 30, 2024, CrossAmerica Partners LP had total assets of $1.16 billion and total liabilities of $1.17 billion. The company reported cash and cash equivalents of $5.49 million, up from $4.99 million at the end of 2023. Net cash provided by operating activities was $34.7 million for the first six months of 2024, compared to $47.3 million for the same period in 2023.
Distribution and Liquidity
On July 23, 2024, the Board of Directors declared a quarterly distribution of $0.5250 per limited partner unit attributable to the second quarter of 2024. The distribution will be paid on August 9, 2024, to all unitholders of record as of August 2, 2024. As of June 30, 2024, CrossAmerica had $789.5 million outstanding under its CAPL Credit Facility, with approximately $116.0 million available for future borrowings.
For more detailed information, please refer to the full 8-K filing.
Explore the complete 8-K earnings release (here) from CrossAmerica Partners LP for further details.
