ARKO Corp. Reports Fourth Quarter and Full Year 2024 Results
ARKO Corp reported its Q4 and full year 2024 financial results, showing mixed performance amid challenging macroeconomic conditions. The company posted a Q4 net loss of $2.3 million compared to net income of $1.1 million in the prior year, while full-year net income decreased to $20.8 million from $34.6 million.
Q4 Adjusted EBITDA declined to $56.8 million from $61.8 million, and yearly Adjusted EBITDA decreased to $248.9 million from $276.3 million. The company's merchandise margin rate improved to 33.0% in Q4 and 32.8% for the full year.
As part of its transformation plan, ARKO converted 153 retail stores to dealer sites in 2024, with about 100 stores converted in Q4. The company expects these conversions to generate an annualized benefit of $8.5 million to operating income, with a projected cumulative benefit exceeding $20 million at scale. The Board declared a quarterly dividend of $0.03 per share.
ARKO Corp ha riportato i risultati finanziari del quarto trimestre e dell'intero anno 2024, mostrando una performance mista in un contesto macroeconomico difficile. L'azienda ha registrato una perdita netta di $2,3 milioni nel quarto trimestre, rispetto a un utile netto di $1,1 milioni nell'anno precedente, mentre l'utile netto annuale è diminuito a $20,8 milioni da $34,6 milioni.
L'EBITDA rettificato del quarto trimestre è sceso a $56,8 milioni da $61,8 milioni, e l'EBITDA rettificato annuale è diminuito a $248,9 milioni da $276,3 milioni. Il tasso di margine sui beni dell'azienda è migliorato al 33,0% nel quarto trimestre e al 32,8% per l'intero anno.
Come parte del suo piano di trasformazione, ARKO ha convertito 153 punti vendita al dettaglio in siti di concessionari nel 2024, con circa 100 negozi convertiti nel quarto trimestre. L'azienda prevede che queste conversioni genereranno un beneficio annuale di $8,5 milioni per il reddito operativo, con un beneficio cumulativo previsto che supererà i $20 milioni su larga scala. Il Consiglio ha dichiarato un dividendo trimestrale di $0,03 per azione.
ARKO Corp informó sus resultados financieros del cuarto trimestre y del año completo 2024, mostrando un desempeño mixto en medio de condiciones macroeconómicas desafiantes. La compañía reportó una pérdida neta de $2.3 millones en el cuarto trimestre en comparación con una ganancia neta de $1.1 millones en el año anterior, mientras que la ganancia neta anual disminuyó a $20.8 millones desde $34.6 millones.
El EBITDA ajustado del cuarto trimestre cayó a $56.8 millones desde $61.8 millones, y el EBITDA ajustado anual disminuyó a $248.9 millones desde $276.3 millones. La tasa de margen de mercancías de la compañía mejoró al 33.0% en el cuarto trimestre y al 32.8% para el año completo.
Como parte de su plan de transformación, ARKO convirtió 153 tiendas minoristas en sitios de concesionarios en 2024, con aproximadamente 100 tiendas convertidas en el cuarto trimestre. La compañía espera que estas conversiones generen un beneficio anualizado de $8.5 millones para el ingreso operativo, con un beneficio acumulado proyectado que excederá los $20 millones a gran escala. La Junta declaró un dividendo trimestral de $0.03 por acción.
ARKO Corp는 2024년 4분기 및 연간 재무 결과를 발표하며 어려운 거시 경제 환경 속에서 혼합된 실적을 보였습니다. 회사는 4분기에 230만 달러의 순손실을 기록했으며, 이는 전년의 110만 달러의 순이익에 비해 감소한 수치입니다. 연간 순이익은 3460만 달러에서 2080만 달러로 줄어들었습니다.
4분기 조정 EBITDA는 6180만 달러에서 5680만 달러로 감소했으며, 연간 조정 EBITDA는 2763만 달러에서 2489만 달러로 줄어들었습니다. 회사의 상품 마진 비율은 4분기에 33.0%, 연간으로는 32.8%로 개선되었습니다.
ARKO는 변환 계획의 일환으로 2024년에 153개의 소매점을 딜러 사이트로 전환했으며, 그 중 약 100개의 매장이 4분기에 전환되었습니다. 회사는 이러한 전환이 운영 소득에 연간 850만 달러의 이익을 생성할 것으로 예상하며, 규모에 따라 2000만 달러를 초과하는 누적 이익이 예상됩니다. 이사회는 주당 0.03달러의 분기 배당금을 선언했습니다.
ARKO Corp a publié ses résultats financiers pour le quatrième trimestre et l'année complète 2024, montrant des performances mitigées dans un contexte macroéconomique difficile. L'entreprise a enregistré une perte nette de 2,3 millions de dollars au quatrième trimestre, contre un bénéfice net de 1,1 million de dollars l'année précédente, tandis que le bénéfice net annuel a diminué à 20,8 millions de dollars contre 34,6 millions de dollars.
L'EBITDA ajusté du quatrième trimestre a chuté à 56,8 millions de dollars contre 61,8 millions de dollars, et l'EBITDA ajusté annuel a diminué à 248,9 millions de dollars contre 276,3 millions de dollars. Le taux de marge sur les marchandises de l'entreprise s'est amélioré à 33,0 % au quatrième trimestre et à 32,8 % pour l'année complète.
Dans le cadre de son plan de transformation, ARKO a converti 153 magasins de détail en sites de concessionnaires en 2024, avec environ 100 magasins convertis au quatrième trimestre. L'entreprise s'attend à ce que ces conversions génèrent un bénéfice annualisé de 8,5 millions de dollars pour le revenu d'exploitation, avec un bénéfice cumulé projeté dépassant les 20 millions de dollars à grande échelle. Le Conseil a déclaré un dividende trimestriel de 0,03 $ par action.
ARKO Corp hat seine finanziellen Ergebnisse für das vierte Quartal und das gesamte Jahr 2024 veröffentlicht und zeigt dabei eine gemischte Leistung in einem herausfordernden makroökonomischen Umfeld. Das Unternehmen verzeichnete im vierten Quartal einen Nettoverlust von 2,3 Millionen Dollar im Vergleich zu einem Nettogewinn von 1,1 Millionen Dollar im Vorjahr, während der Nettogewinn für das gesamte Jahr auf 20,8 Millionen Dollar von 34,6 Millionen Dollar gesenkt wurde.
Das bereinigte EBITDA im vierten Quartal sank auf 56,8 Millionen Dollar von 61,8 Millionen Dollar, und das jährliche bereinigte EBITDA fiel auf 248,9 Millionen Dollar von 276,3 Millionen Dollar. Die Warenmargenrate des Unternehmens verbesserte sich im vierten Quartal auf 33,0% und auf 32,8% für das gesamte Jahr.
Im Rahmen seines Transformationsplans hat ARKO 2024 insgesamt 153 Einzelhandelsgeschäfte in Händlerstandorte umgewandelt, wobei etwa 100 Geschäfte im vierten Quartal umgewandelt wurden. Das Unternehmen erwartet, dass diese Umwandlungen einen jährlichen Nutzen von 8,5 Millionen Dollar für das Betriebsergebnis generieren werden, mit einem voraussichtlichen kumulierten Nutzen von über 20 Millionen Dollar in großem Maßstab. Der Vorstand erklärte eine vierteljährliche Dividende von 0,03 Dollar pro Aktie.
- Merchandise margin rate increased to 33.0% in Q4 and 32.8% for full year
- Store conversions expected to yield $20M+ annualized operating income benefit at scale
- Full year retail fuel margin increased to 39.6 cents per gallon from 38.8 cents
- Expanded NTI store pipeline to eight locations
- Strong liquidity position of $841M as of December 31, 2024
- Q4 net loss of $2.3M vs. $1.1M profit year ago
- Full year net income declined 39.9% to $20.8M
- Q4 Adjusted EBITDA decreased 8.1% to $56.8M
- Full year Adjusted EBITDA fell 9.9% to $248.9M
- Q4 merchandise contribution declined 8.1% to $134.9M
Insights
ARKO's Q4 and full-year 2024 results reveal a company executing a strategic pivot while managing industry-wide pressures. The company reported
The centerpiece of ARKO's transformation strategy is its accelerating dealerization program, which converted 153 company-operated stores to dealer sites in 2024. This initiative represents a fundamental shift in capital allocation and operational focus. By converting underperforming locations, ARKO expects to generate over
Despite lower overall contribution dollars, ARKO's improved merchandise margin rate (increased to
ARKO's balance sheet shows
The 2025 guidance of
ARKO's 2024 results reflect a company executing a fundamental business model pivot in response to changing convenience retail economics. The accelerated dealerization program—converting 153 company-operated stores to dealer sites in 2024 with another 100 planned by Q1 2025—represents a strategic recognition that certain locations deliver superior returns under a wholesale/real estate model versus direct operations.
This transformation addresses a critical industry-wide challenge: labor-intensive retail operations with thin margins versus asset-light wholesale distribution with more predictable returns. The
The improvement in merchandise margin rate to
ARKO's parallel development of eight new-to-industry stores signals a "fewer but better" approach to company operations. This quality-over-quantity strategy allows concentrated investment in locations with superior return profiles while divesting underperformers.
The company's mention of "a more aggressive value offer at the pump" suggests recognition that fuel price competition may intensify in 2025. This, combined with the
The transformation positions ARKO to emerge with a more focused, higher-quality retail footprint complemented by a growing wholesale business with more stable cash flows—potentially creating a more resilient business model through economic cycles.
RICHMOND, Va., Feb. 26, 2025 (GLOBE NEWSWIRE) -- ARKO Corp. (Nasdaq: ARKO) (“ARKO” or the “Company”), a Fortune 500 company and one of the largest convenience store operators in the United States, today announced financial results for the fourth quarter and the full year ended December 31, 2024.
Fourth Quarter and Full Year 2024 Key Highlights (vs. Year-Ago Period)1,2
- Net loss for the quarter was
$2.3 million compared to net income of$1.1 million . For the year, net income was$20.8 million compared to$34.6 million . - Adjusted EBITDA for the quarter was
$56.8 million compared to$61.8 million . For the year, Adjusted EBITDA was$248.9 million compared to$276.3 million . - Merchandise margin rate for the quarter increased to
33.0% compared to32.9% . For the year, merchandise margin rate increased to32.8% compared to31.8% . - Merchandise contribution for the quarter was
$134.9 million compared to$146.8 million ; more than half of the merchandise contribution decline for the quarter was associated with the Company’s accretive dealerization program. For the year, merchandise contribution was$579.6 million compared to$585.1 million . - Retail fuel margin for the quarter was 38.7 cents per gallon compared to 39.2 cents per gallon, resulting from macroeconomically-driven lower fuel prices and reduced price volatility. For the year, retail fuel margin increased to 39.6 cents per gallon compared to 38.8 cents per gallon.
- Retail fuel contribution for the quarter was
$100.2 million compared to$109.3 million . For the year, retail fuel contribution was$428.2 million compared to$435.3 million .
Other Key Highlights
- As part of the Company’s developing transformation plan, the Company converted 153 retail stores to dealer sites during the year ended December 31, 2024, including approximately 100 stores converted in the fourth quarter of 2024. The Company expects to convert a meaningful number of additional stores throughout 2025, including another approximately 100 retail stores by the end of the first quarter of 2025. The stores converted to dealer locations in 2024 are expected to produce an annualized benefit to combined wholesale segment and retail segment operating income of approximately
$8.5 million . The Company now expects that, at scale, its channel optimization will yield a cumulative annualized benefit of operating income in excess of$20 million . This channel optimization is also expected to enable the Company to better focus and prioritize future investments in its remaining retail stores. - In 2024, the Company expanded its planned pipeline of NTI (new-to-industry) stores to eight, including two stores that opened in 2024 and an additional two stores opened in the first quarter of 2025. The Company expects to open the four remaining NTI locations over the course of 2025.
- The Board declared a quarterly dividend of
$0.03 per share of common stock to be paid on March 21, 2025 to stockholders of record as of March 10, 2025.
1 See Use of Non-GAAP Measures below.
2 All figures for fuel costs, fuel contribution and fuel margin per gallon exclude the estimated fixed margin or fixed fee paid to the Company’s wholesale fuel distribution subsidiary, GPM Petroleum LP (“GPMP”) for the cost of fuel (intercompany charges by GPMP).
“We navigated a challenging macroeconomic environment in 2024, while advancing the development of our multi-year transformation plan," said Arie Kotler, Chairman, President, and CEO of ARKO. “We made progress with our dealerization program by strategically refining our retail footprint, strengthening merchandising initiatives, and enhancing customer engagement through value-driven promotions for in-store merchandise and, more recently, a more aggressive value offer at the pump. Our focus on operational efficiencies and the dealerization program allowed us to manage through industry-wide headwinds while making strategic investments in high-growth areas, such as food service and other tobacco products to meet evolving customer preferences.”
Mr. Kotler continued: “Looking ahead to 2025, we remain committed to driving sustainable long-term growth and value creation for our stakeholders. We plan to strengthen our competitiveness by continuing to invest in higher-growth categories, delivering further value to our customers and further optimizing our store portfolio. We are acutely focused on delivering innovative, value-driven solutions that enhance the customer experience while maximizing profitability and expanding revenue opportunities.”
Fourth Quarter and Full Year 2024 Segment Highlights
Retail
| For the Three Months Ended December 31, | For the Year Ended December 31, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| (in thousands) | |||||||||||||||
| Fuel gallons sold | 258,856 | 279,035 | 1,080,990 | 1,122,321 | |||||||||||
| Same store fuel gallons sold decrease (%) 1 | (4.4 | %) | (7.5 | %) | (6.1 | %) | (5.3 | %) | |||||||
| Fuel contribution 2 | $ | 100,212 | $ | 109,336 | $ | 428,216 | $ | 435,322 | |||||||
| Fuel margin, cents per gallon 3 | 38.7 | 39.2 | 39.6 | 38.8 | |||||||||||
| Same store fuel contribution 1,2 | $ | 96,830 | $ | 104,262 | $ | 403,503 | $ | 422,090 | |||||||
| Same store merchandise sales (decrease) increase (%) 1 | (4.3 | %) | (2.8 | %) | (5.4 | %) | 0.4 | % | |||||||
| Same store merchandise sales excluding cigarettes (decrease) increase (%) 1 | (2.1 | %) | (1.8 | %) | (3.8 | %) | 2.5 | % | |||||||
| Merchandise revenue | $ | 408,826 | $ | 446,727 | $ | 1,767,345 | $ | 1,838,001 | |||||||
| Merchandise contribution 4 | $ | 134,873 | $ | 146,773 | $ | 579,569 | $ | 585,122 | |||||||
| Merchandise margin 5 | 33.0 | % | 32.9 | % | 32.8 | % | 31.8 | % | |||||||
| Same store merchandise contribution 1,4 | $ | 129,376 | $ | 135,532 | $ | 543,368 | $ | 560,321 | |||||||
| Same store site operating expenses 1 | $ | 179,302 | $ | 181,527 | $ | 736,727 | $ | 737,158 | |||||||
| 1 Same store is a common metric used in the convenience store industry. The Company considers a store a same store beginning in the first quarter in which the store had a full quarter of activity in the prior year. Refer to Use of Non-GAAP Measures below for discussion of this measure. | |||||||||||||||
| 2 Calculated as fuel revenue less fuel costs; excludes the estimated fixed margin or fixed fee paid to GPMP for the cost of fuel. | |||||||||||||||
| 3 Calculated as fuel contribution divided by fuel gallons sold. | |||||||||||||||
| 4 Calculated as merchandise revenue less merchandise costs. | |||||||||||||||
| 5 Calculated as merchandise contribution divided by merchandise revenue. | |||||||||||||||
Merchandise contribution for the fourth quarter of 2024 decreased
For the year ended December 31, 2024, merchandise contribution decreased
For the fourth quarter of 2024, retail fuel contribution decreased
For the year ended December 31, 2024, fuel contribution decreased
Wholesale
| For the Three Months Ended December 31, | For the Year Ended December 31, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| (in thousands) | |||||||||||||||
| Fuel gallons sold – fuel supply locations | 201,317 | 199,861 | 794,796 | 801,260 | |||||||||||
| Fuel gallons sold – consignment agent locations | 38,563 | 40,144 | 154,560 | 168,005 | |||||||||||
| Fuel contribution 1 – fuel supply locations | $ | 12,004 | $ | 11,499 | $ | 47,930 | $ | 48,396 | |||||||
| Fuel contribution 1 – consignment agent locations | $ | 10,270 | $ | 10,101 | $ | 42,420 | $ | 44,512 | |||||||
| Fuel margin, cents per gallon 2 – fuel supply locations | 6.0 | 5.8 | 6.0 | 6.0 | |||||||||||
| Fuel margin, cents per gallon 2 – consignment agent locations | 26.6 | 25.2 | 27.4 | 26.5 | |||||||||||
| 1 Calculated as fuel revenue less fuel costs; excludes the estimated fixed margin or fixed fee paid to GPMP for the cost of fuel. | |||||||||||||||
| 2 Calculated as fuel contribution divided by fuel gallons sold. | |||||||||||||||
Fuel contribution was approximately
For the year ended December 31, 2024, wholesale operating income increased
Fleet Fueling
| For the Three Months Ended December 31, | For the Year Ended December 31, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| (in thousands) | |||||||||||||||
| Fuel gallons sold – proprietary cardlock locations | 32,888 | 33,285 | 136,104 | 130,995 | |||||||||||
| Fuel gallons sold – third-party cardlock locations | 3,239 | 3,201 | 12,814 | 9,832 | |||||||||||
| Fuel contribution 1 – proprietary cardlock locations | $ | 15,823 | $ | 13,146 | $ | 62,612 | $ | 54,685 | |||||||
| Fuel contribution 1 – third-party cardlock locations | $ | 509 | $ | 245 | $ | 1,677 | $ | 1,215 | |||||||
| Fuel margin, cents per gallon 2 – proprietary cardlock locations | 48.1 | 39.5 | 46.0 | 41.7 | |||||||||||
| Fuel margin, cents per gallon 2 – third-party cardlock locations | 15.8 | 7.6 | 13.1 | 12.4 | |||||||||||
| 1 Calculated as fuel revenue less fuel costs; excludes the estimated fixed fee paid to GPMP for the cost of fuel. | |||||||||||||||
| 2 Calculated as fuel contribution divided by fuel gallons sold. | |||||||||||||||
For the fourth quarter of 2024, fuel contribution increased by
For the year ended December 31, 2024, fuel contribution increased by
Site Operating Expenses
For the quarter ended December 31, 2024, convenience store operating expenses decreased
For the year ended December 31, 2024, convenience store operating expenses increased
Liquidity and Capital Expenditures
As of December 31, 2024, the Company’s total liquidity was approximately
Quarterly Dividend and Share Repurchase Program
The Company’s ability to return cash to its stockholders through its cash dividend program and share repurchase program is consistent with its capital allocation framework and reflects the Company’s confidence in the strength of its cash generation ability and strong financial position.
The Board declared a quarterly dividend of
There was approximately
Company-Operated Retail Store Count and Segment Update
The following tables present certain information regarding changes in the retail, wholesale and fleet fueling segments for the periods presented:
| For the Three Months Ended December 31, | For the Year Ended December 31, | ||||||||||||||
| Retail Segment | 2024 | 2023 | 2024 | 2023 | |||||||||||
| Number of sites at beginning of period | 1,491 | 1,552 | 1,543 | 1,404 | |||||||||||
| Acquired sites | — | — | 21 | 166 | |||||||||||
| Newly opened or reopened sites | 1 | — | 3 | 4 | |||||||||||
| Company-controlled sites converted to | |||||||||||||||
| consignment or fuel supply locations, net | (102 | ) | (3 | ) | (153 | ) | (16 | ) | |||||||
| Sites closed, divested or converted to rentals | (1 | ) | (6 | ) | (25 | ) | (15 | ) | |||||||
| Number of sites at end of period | 1,389 | 1,543 | 1,389 | 1,543 | |||||||||||
| For the Three Months Ended December 31, | For the Year Ended December 31, | ||||||||||||||
| Wholesale Segment 1 | 2024 | 2023 | 2024 | 2023 | |||||||||||
| Number of sites at beginning of period | 1,832 | 1,825 | 1,825 | 1,674 | |||||||||||
| Acquired sites | — | — | — | 190 | |||||||||||
| Newly opened or reopened sites 2 | 9 | 25 | 39 | 83 | |||||||||||
| Consignment or fuel supply locations converted | |||||||||||||||
| from Company-controlled or fleet fueling sites, net | 102 | 2 | 153 | 15 | |||||||||||
| Closed or divested sites | (21 | ) | (27 | ) | (95 | ) | (137 | ) | |||||||
| Number of sites at end of period | 1,922 | 1,825 | 1,922 | 1,825 | |||||||||||
| 1 Excludes bulk and spot purchasers. | |||||||||||||||
| 2 Includes all signed fuel supply agreements irrespective of fuel distribution commencement date. | |||||||||||||||
| For the Three Months Ended December 31, | For the Year Ended December 31, | ||||||||||||||
| Fleet Fueling Segment | 2024 | 2023 | 2024 | 2023 | |||||||||||
| Number of sites at beginning of period | 281 | 295 | 298 | 183 | |||||||||||
| Acquired sites | — | — | — | 111 | |||||||||||
| Newly opened or reopened sites | — | 2 | 1 | 6 | |||||||||||
| Fleet fueling locations converted | |||||||||||||||
| from fuel supply locations, net | — | 1 | — | 1 | |||||||||||
| Closed or divested sites | (1 | ) | — | (19 | ) | (3 | ) | ||||||||
| Number of sites at end of period | 280 | 298 | 280 | 298 | |||||||||||
First Quarter and Full Year 2025 Guidance
The Company currently expects first quarter 2025 Adjusted EBITDA to range between
The Company is not providing guidance on net income at this time due to the volatility of certain required inputs that are not available without unreasonable efforts, including future fair value adjustments associated with its stock price, as well as depreciation and amortization related to its capital allocation as part of its focus on accelerating organic growth.
Conference Call and Webcast Details
The Company will host a conference call today, February 26, 2025, to discuss these results at 5:00 p.m. Eastern Time. Investors and analysts interested in participating in the live call can dial 877-605-1792 or 201-689-8728.
A simultaneous, live webcast will also be available on the Investor Relations section of the Company’s website at https://www.arkocorp.com/news-events/ir-calendar. The webcast will be archived for 30 days.
About ARKO Corp.
ARKO Corp. (Nasdaq: ARKO) is a Fortune 500 company that owns
Forward-Looking Statements
This document includes certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may address, among other things, the Company’s expected financial and operational results and the related assumptions underlying its expected results. These forward-looking statements are distinguished by use of words such as “accretive,” “anticipate,” “aim,” “believe,” “continue,” “could,” “estimate,” “expect,” “guidance,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “will,” “would” and the negative of these terms, and similar references to future periods. These statements are based on management’s current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from these expectations due to, among other things, changes in economic, business and market conditions; the Company’s ability to maintain the listing of its common stock and warrants on the Nasdaq Stock Market; changes in its strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects and plans; expansion plans and opportunities; changes in the markets in which it competes; changes in applicable laws or regulations, including those relating to environmental matters; market conditions and global and economic factors beyond its control; and the outcome of any known or unknown litigation and regulatory proceedings. Detailed information about these factors and additional important factors can be found in the documents that the Company files with the Securities and Exchange Commission, such as Form 10-K, Form 10-Q and Form 8-K. Forward-looking statements speak only as of the date the statements were made. The Company does not undertake an obligation to update forward-looking information, except to the extent required by applicable law.
Use of Non-GAAP Measures
The Company discloses certain measures on a “same store basis,” which is a non-GAAP measure. Information disclosed on a “same store basis” excludes the results of any store that is not a “same store” for the applicable period. A store is considered a same store beginning in the first quarter in which the store had a full quarter of activity in the prior year. The Company believes that this information provides greater comparability regarding its ongoing operating performance. Neither this measure nor those described below should be considered an alternative to measurements presented in accordance with generally accepted accounting principles in the United States (“GAAP”).
The Company defines EBITDA as net income before net interest expense, income taxes, depreciation and amortization. Adjusted EBITDA further adjusts EBITDA by excluding the gain or loss on disposal of assets, impairment charges, acquisition and divestiture costs, share-based compensation expense, other non-cash items, and other unusual or non-recurring charges. Both EBITDA and Adjusted EBITDA are non-GAAP financial measures.
The Company uses EBITDA and Adjusted EBITDA for operational and financial decision-making and believe these measures are useful in evaluating its performance because they eliminate certain items that it does not consider indicators of its operating performance. EBITDA and Adjusted EBITDA are also used by many of its investors, securities analysts, and other interested parties in evaluating its operational and financial performance across reporting periods. The Company believes that the presentation of EBITDA and Adjusted EBITDA provides useful information to investors by allowing an understanding of key measures that it uses internally for operational decision-making, budgeting, evaluating acquisition targets, and assessing its operating performance.
EBITDA and Adjusted EBITDA are not recognized terms under GAAP and should not be considered as a substitute for net income or any other financial measure presented in accordance with GAAP. These measures have limitations as analytical tools and should not be considered in isolation or as substitutes for analysis of its results as reported under GAAP. The Company strongly encourages investors to review its financial statements and publicly filed reports in their entirety and not to rely on any single financial measure.
Because non-GAAP financial measures are not standardized, same store measures, EBITDA and Adjusted EBITDA, as defined by the Company, may not be comparable to similarly titled measures reported by other companies. It therefore may not be possible to compare the Company’s use of these non-GAAP financial measures with those used by other companies.
Company Contact
Jordan Mann
ARKO Corp.
investors@gpminvestments.com
Investor Contact
Sean Mansouri, CFA
Elevate IR
(720) 330-2829
ARKO@elevate-ir.com
| Consolidated Statements of Operations | |||||||||||||||
| For the Three Months Ended December 31, | For the Year Ended December 31, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| (in thousands) | |||||||||||||||
| Revenues: | |||||||||||||||
| Fuel revenue | $ | 1,556,185 | $ | 1,759,216 | $ | 6,858,919 | $ | 7,464,372 | |||||||
| Merchandise revenue | 408,826 | 446,727 | 1,767,345 | 1,838,001 | |||||||||||
| Other revenues, net | 27,098 | 27,217 | 105,698 | 110,358 | |||||||||||
| Total revenues | 1,992,109 | 2,233,160 | 8,731,962 | 9,412,731 | |||||||||||
| Operating expenses: | |||||||||||||||
| Fuel costs | 1,416,234 | 1,613,230 | 6,271,696 | 6,876,084 | |||||||||||
| Merchandise costs | 273,953 | 299,954 | 1,187,776 | 1,252,879 | |||||||||||
| Site operating expenses | 209,906 | 222,751 | 875,272 | 860,134 | |||||||||||
| General and administrative expenses | 39,690 | 38,102 | 162,920 | 165,294 | |||||||||||
| Depreciation and amortization | 33,989 | 32,648 | 132,414 | 127,597 | |||||||||||
| Total operating expenses | 1,973,772 | 2,206,685 | 8,630,078 | 9,281,988 | |||||||||||
| Other expenses, net | 3,962 | 1,168 | 7,858 | 12,729 | |||||||||||
| Operating income | 14,375 | 25,307 | 94,026 | 118,014 | |||||||||||
| Interest and other financial income | 4,229 | 2,197 | 30,591 | 20,273 | |||||||||||
| Interest and other financial expenses | (23,942 | ) | (25,099 | ) | (97,752 | ) | (91,516 | ) | |||||||
| (Loss) income before income taxes | (5,338 | ) | 2,405 | 26,865 | 46,771 | ||||||||||
| Income tax benefit (expense) | 2,995 | (1,317 | ) | (6,144 | ) | (12,166 | ) | ||||||||
| Income (loss) from equity investment | 45 | 38 | 124 | (39 | ) | ||||||||||
| Net (loss) income | $ | (2,298 | ) | $ | 1,126 | $ | 20,845 | $ | 34,566 | ||||||
| Less: Net income attributable to non-controlling interests | — | 48 | — | 197 | |||||||||||
| Net (loss) income attributable to ARKO Corp. | $ | (2,298 | ) | $ | 1,078 | $ | 20,845 | $ | 34,369 | ||||||
| Series A redeemable preferred stock dividends | (1,445 | ) | (1,449 | ) | (5,750 | ) | (5,750 | ) | |||||||
| Net (loss) income attributable to common shareholders | $ | (3,743 | ) | $ | (371 | ) | $ | 15,095 | $ | 28,619 | |||||
| Net (loss) income per share attributable to common shareholders - basic | $ | (0.03 | ) | $ | (0.00 | ) | $ | 0.13 | $ | 0.24 | |||||
| Net (loss) income per share attributable to common shareholders - diluted | $ | (0.03 | ) | $ | (0.00 | ) | $ | 0.13 | $ | 0.24 | |||||
| Weighted average shares outstanding: | |||||||||||||||
| Basic | 115,771 | 116,638 | 116,139 | 118,782 | |||||||||||
| Diluted | 115,771 | 116,638 | 116,949 | 119,605 | |||||||||||
| Consolidated Balance Sheets | |||||||
| December 31, 2024 | December 31, 2023 | ||||||
| (in thousands) | |||||||
| Assets | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 261,758 | $ | 218,120 | |||
| Restricted cash | 30,650 | 23,301 | |||||
| Short-term investments | 5,330 | 3,892 | |||||
| Trade receivables, net | 95,832 | 134,735 | |||||
| Inventory | 231,225 | 250,593 | |||||
| Other current assets | 97,413 | 118,472 | |||||
| Total current assets | 722,208 | 749,113 | |||||
| Non-current assets: | |||||||
| Property and equipment, net | 747,548 | 742,610 | |||||
| Right-of-use assets under operating leases | 1,386,244 | 1,384,693 | |||||
| Right-of-use assets under financing leases, net | 157,999 | 162,668 | |||||
| Goodwill | 299,973 | 292,173 | |||||
| Intangible assets, net | 182,355 | 214,552 | |||||
| Equity investment | 3,009 | 2,885 | |||||
| Deferred tax asset | 67,689 | 52,293 | |||||
| Other non-current assets | 53,633 | 49,377 | |||||
| Total assets | $ | 3,620,658 | $ | 3,650,364 | |||
| Liabilities | |||||||
| Current liabilities: | |||||||
| Long-term debt, current portion | $ | 12,944 | $ | 16,792 | |||
| Accounts payable | 190,212 | 213,657 | |||||
| Other current liabilities | 159,239 | 179,536 | |||||
| Operating leases, current portion | 71,580 | 67,053 | |||||
| Financing leases, current portion | 11,515 | 9,186 | |||||
| Total current liabilities | 445,490 | 486,224 | |||||
| Non-current liabilities: | |||||||
| Long-term debt, net | 868,055 | 828,647 | |||||
| Asset retirement obligation | 87,375 | 84,710 | |||||
| Operating leases | 1,408,293 | 1,395,032 | |||||
| Financing leases | 211,051 | 213,032 | |||||
| Other non-current liabilities | 223,528 | 266,602 | |||||
| Total liabilities | 3,243,792 | 3,274,247 | |||||
| Series A redeemable preferred stock | 100,000 | 100,000 | |||||
| Shareholders' equity: | |||||||
| Common stock | 12 | 12 | |||||
| Treasury stock | (106,123 | ) | (74,134 | ) | |||
| Additional paid-in capital | 276,681 | 245,007 | |||||
| Accumulated other comprehensive income | 9,119 | 9,119 | |||||
| Retained earnings | 97,177 | 96,097 | |||||
| Total shareholders' equity | 276,866 | 276,101 | |||||
| Non-controlling interest | — | 16 | |||||
| Total equity | 276,866 | 276,117 | |||||
| Total liabilities, redeemable preferred stock and equity | $ | 3,620,658 | $ | 3,650,364 | |||
| Consolidated Statements of Cash Flows | |||||||||||||||
| For the Three Months Ended December 31, | For the Year Ended December 31, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| (in thousands) | |||||||||||||||
| Cash flows from operating activities: | |||||||||||||||
| Net (loss) income | $ | (2,298 | ) | $ | 1,126 | $ | 20,845 | $ | 34,566 | ||||||
| Adjustments to reconcile net (loss) income to net cash provided by operating activities: | |||||||||||||||
| Depreciation and amortization | 33,989 | 32,648 | 132,414 | 127,597 | |||||||||||
| Deferred income taxes | (9,136 | ) | (652 | ) | (12,796 | ) | (4,680 | ) | |||||||
| Loss on disposal of assets and impairment charges | 1,661 | 660 | 6,798 | 6,203 | |||||||||||
| Foreign currency (gain) loss | (6 | ) | (101 | ) | 35 | 29 | |||||||||
| Gain from issuance of shares as payment of deferred consideration related to business acquisition | — | — | (2,681 | ) | — | ||||||||||
| Gain from settlement related to business acquisition | — | — | (6,356 | ) | — | ||||||||||
| Amortization of deferred financing costs and debt discount | 669 | 661 | 2,669 | 2,518 | |||||||||||
| Amortization of deferred income | (4,351 | ) | (1,840 | ) | (14,477 | ) | (8,142 | ) | |||||||
| Accretion of asset retirement obligation | 661 | 709 | 2,532 | 2,399 | |||||||||||
| Non-cash rent | 3,530 | 3,750 | 14,335 | 14,168 | |||||||||||
| Charges to allowance for credit losses | 112 | 244 | 845 | 1,265 | |||||||||||
| (Income) loss from equity investment | (45 | ) | (38 | ) | (124 | ) | 39 | ||||||||
| Share-based compensation | 4,077 | 1,777 | 12,339 | 15,015 | |||||||||||
| Fair value adjustment of financial assets and liabilities | (222 | ) | 842 | (10,985 | ) | (10,785 | ) | ||||||||
| Other operating activities, net | (627 | ) | 352 | 125 | 2,631 | ||||||||||
| Changes in assets and liabilities: | |||||||||||||||
| Decrease (increase) in trade receivables | 21,946 | 44,550 | 38,058 | (17,937 | ) | ||||||||||
| Decrease (increase) in inventory | 5,262 | 15,373 | 22,689 | (2,013 | ) | ||||||||||
| (Increase) decrease in other assets | (16 | ) | (957 | ) | 13,893 | (29,386 | ) | ||||||||
| Decrease in accounts payable | (18,032 | ) | (35,836 | ) | (24,169 | ) | (6,169 | ) | |||||||
| (Decrease) increase in other current liabilities | (20,664 | ) | (8,002 | ) | (2,820 | ) | 990 | ||||||||
| Decrease in asset retirement obligation | (634 | ) | (69 | ) | (917 | ) | (23 | ) | |||||||
| Increase in non-current liabilities | 6,852 | 2,090 | 29,606 | 7,809 | |||||||||||
| Net cash provided by operating activities | 22,728 | 57,287 | 221,858 | 136,094 | |||||||||||
| Cash flows from investing activities: | |||||||||||||||
| Purchase of property and equipment | (36,133 | ) | (35,561 | ) | (113,914 | ) | (111,164 | ) | |||||||
| Purchase of intangible assets | — | — | — | (45 | ) | ||||||||||
| Proceeds from sale of property and equipment | 2,196 | 3,134 | 53,549 | 310,240 | |||||||||||
| Business and asset acquisitions, net of cash | — | 33 | (54,549 | ) | (494,871 | ) | |||||||||
| Prepayment for acquisitions | — | (1,000 | ) | — | (1,000 | ) | |||||||||
| Loans to equity investment, net | 14 | 18 | 56 | 18 | |||||||||||
| Net cash used in investing activities | (33,923 | ) | (33,376 | ) | (114,858 | ) | (296,822 | ) | |||||||
| Cash flows from financing activities: | |||||||||||||||
| Receipt of long-term debt, net | — | 20,810 | 47,556 | 99,643 | |||||||||||
| Repayment of debt | (5,794 | ) | (5,640 | ) | (26,357 | ) | (22,157 | ) | |||||||
| Principal payments on financing leases | (1,360 | ) | (1,260 | ) | (4,940 | ) | (5,497 | ) | |||||||
| Early settlement of deferred consideration related to business acquisition | — | — | (17,155 | ) | — | ||||||||||
| Proceeds from sale-leaseback | — | — | — | 80,397 | |||||||||||
| Payment of Additional Consideration | (3,354 | ) | (3,505 | ) | (3,354 | ) | (3,505 | ) | |||||||
| Payment of Ares Put Option | — | — | — | (9,808 | ) | ||||||||||
| Common stock repurchased | — | (8,495 | ) | (31,989 | ) | (33,694 | ) | ||||||||
| Dividends paid on common stock | (3,473 | ) | (3,497 | ) | (14,015 | ) | (14,272 | ) | |||||||
| Dividends paid on redeemable preferred stock | (1,445 | ) | (1,449 | ) | (5,750 | ) | (5,750 | ) | |||||||
| Net cash (used in) provided by financing activities | (15,426 | ) | (3,036 | ) | (56,004 | ) | 85,357 | ||||||||
| Net (decrease) increase in cash and cash equivalents and restricted cash | (26,621 | ) | 20,875 | 50,996 | (75,371 | ) | |||||||||
| Effect of exchange rate on cash and cash equivalents and restricted cash | 18 | 106 | (9 | ) | 23 | ||||||||||
| Cash and cash equivalents and restricted cash, beginning of period | 319,011 | 220,440 | 241,421 | 316,769 | |||||||||||
| Cash and cash equivalents and restricted cash, end of period | $ | 292,408 | $ | 241,421 | $ | 292,408 | $ | 241,421 | |||||||
Supplemental Disclosure of Non-GAAP Financial Information
| Reconciliation of EBITDA and Adjusted EBITDA | |||||||||||||||
| For the Three Months Ended December 31, | For the Year Ended December 31, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| (in thousands) | |||||||||||||||
| Net (loss) income | $ | (2,298 | ) | $ | 1,126 | $ | 20,845 | $ | 34,566 | ||||||
| Interest and other financing expenses, net | 19,713 | 22,902 | 67,161 | 71,243 | |||||||||||
| Income tax (benefit) expense | (2,995 | ) | 1,317 | 6,144 | 12,166 | ||||||||||
| Depreciation and amortization | 33,989 | 32,648 | 132,414 | 127,597 | |||||||||||
| EBITDA | 48,409 | 57,993 | 226,564 | 245,572 | |||||||||||
| Acquisition and divestiture costs (a) | 1,249 | 1,099 | 5,168 | 9,079 | |||||||||||
| Loss on disposal of assets and impairment charges (b) | 1,661 | 660 | 6,798 | 6,203 | |||||||||||
| Share-based compensation expense (c) | 4,077 | 1,777 | 12,339 | 15,015 | |||||||||||
| (Income) loss from equity investment (d) | (45 | ) | (38 | ) | (124 | ) | 39 | ||||||||
| Fuel and franchise taxes received in arrears (e) | — | — | (1,427 | ) | — | ||||||||||
| Adjustment to contingent consideration (f) | 978 | 68 | (20 | ) | (604 | ) | |||||||||
| Other (g) | 519 | 230 | (438 | ) | 956 | ||||||||||
| Adjusted EBITDA | $ | 56,848 | $ | 61,789 | $ | 248,860 | $ | 276,260 | |||||||
| Additional information | |||||||||||||||
| Non-cash rent expense (h) | 3,530 | 3,750 | 14,335 | 14,168 | |||||||||||
| (a) Eliminates costs incurred that are directly attributable to business acquisitions and divestitures (including conversion of retail stores to dealer sites) and salaries of employees whose primary job function is to execute the Company's acquisition and divestiture strategy and facilitate integration of acquired operations. | |||||||||||||||
| (b) Eliminates the non-cash loss from the sale or disposal of property and equipment, the loss recognized upon the sale of related leased assets, and impairment charges on property and equipment and right-of-use assets related to closed and non-performing sites. | |||||||||||||||
| (c) Eliminates non-cash share-based compensation expense related to the equity incentive program in place to incentivize, retain, and motivate employees, certain non-employees and members of the Board. | |||||||||||||||
| (d) Eliminates the Company's share of (income) loss attributable to its unconsolidated equity investment. | |||||||||||||||
| (e) Eliminates the receipt of historical fuel and franchise tax amounts for multiple prior periods. | |||||||||||||||
| (f) Eliminates fair value adjustments to the contingent consideration owed to the seller for the 2020 Empire acquisition. | |||||||||||||||
| (g) Eliminates other unusual or non-recurring items that the Company does not consider to be meaningful in assessing operating performance. | |||||||||||||||
| (h) Non-cash rent expense reflects the extent to which GAAP rent expense recognized exceeded (or was less than) cash rent payments. GAAP rent expense varies depending on the terms of the Company's lease portfolio. For newer leases, rent expense recognized typically exceeds cash rent payments, whereas, for more mature leases, rent expense recognized is typically less than cash rent payments. | |||||||||||||||
Supplemental Disclosures of Segment Information
Retail Segment
| For the Three Months Ended December 31, | For the Year Ended December 31, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| (in thousands) | |||||||||||||||
| Revenues: | |||||||||||||||
| Fuel revenue | $ | 779,352 | $ | 913,534 | $ | 3,509,935 | $ | 3,858,777 | |||||||
| Merchandise revenue | 408,826 | 446,727 | 1,767,345 | 1,838,001 | |||||||||||
| Other revenues, net | 15,768 | 17,104 | 65,264 | 74,406 | |||||||||||
| Total revenues | 1,203,946 | 1,377,365 | 5,342,544 | 5,771,184 | |||||||||||
| Operating expenses: | |||||||||||||||
| Fuel costs 1 | 679,140 | 804,198 | 3,081,719 | 3,423,455 | |||||||||||
| Merchandise costs | 273,953 | 299,954 | 1,187,776 | 1,252,879 | |||||||||||
| Site operating expenses | 187,981 | 200,952 | 790,645 | 779,448 | |||||||||||
| Total operating expenses | 1,141,074 | 1,305,104 | 5,060,140 | 5,455,782 | |||||||||||
| Operating income | $ | 62,872 | $ | 72,261 | $ | 282,404 | $ | 315,402 | |||||||
| 1 Excludes the estimated fixed margin or fixed fee paid to GPMP for the cost of fuel. | |||||||||||||||
The table below shows financial information and certain key metrics of the SpeedyQ acquisition in the Retail Segment for which there is no comparable information for any of the prior periods.
| For the Three Months Ended December 31, 2024 | For the Year Ended December 31, 2024 | ||||||
| SpeedyQ 1 | |||||||
| (in thousands) | |||||||
| Date of Acquisition: | April 9, 2024 | ||||||
| Revenues: | |||||||
| Fuel revenue | $ | 11,359 | $ | 38,937 | |||
| Merchandise revenue | 6,469 | 20,719 | |||||
| Other revenues, net | 311 | 809 | |||||
| Total revenues | 18,139 | 60,465 | |||||
| Operating expenses: | |||||||
| Fuel costs 2 | 9,580 | 33,455 | |||||
| Merchandise costs | 4,473 | 14,709 | |||||
| Site operating expenses | 3,373 | 9,760 | |||||
| Total operating expenses | 17,426 | 57,924 | |||||
| Operating income | $ | 713 | $ | 2,541 | |||
| Fuel gallons sold | 3,768 | 11,865 | |||||
| Fuel contribution 3 | $ | 1,779 | $ | 5,482 | |||
| Merchandise contribution 4 | $ | 1,996 | $ | 6,010 | |||
| Merchandise margin 5 | 30.9 | % | 29.0 | % | |||
| 1 Acquisition of seven Speedy's retail stores. | |||||||
| 2 Excludes the estimated fixed margin paid to GPMP for the cost of fuel. | |||||||
| 3 Calculated as fuel revenue less fuel costs. | |||||||
| 4 Calculated as merchandise revenue less merchandise costs. | |||||||
| 5 Calculated as merchandise contribution divided by merchandise revenue. | |||||||
Wholesale Segment
| For the Three Months Ended December 31, | For the Year Ended December 31, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| (in thousands) | |||||||||||||||
| Revenues: | |||||||||||||||
| Fuel revenue | $ | 652,016 | $ | 700,026 | $ | 2,799,869 | $ | 3,039,904 | |||||||
| Other revenues, net | 8,681 | 6,909 | 29,140 | 25,775 | |||||||||||
| Total revenues | 660,697 | 706,935 | 2,829,009 | 3,065,679 | |||||||||||
| Operating expenses: | |||||||||||||||
| Fuel costs 1 | 629,742 | 678,426 | 2,709,519 | 2,946,996 | |||||||||||
| Site operating expenses | 10,997 | 10,400 | 39,679 | 39,703 | |||||||||||
| Total operating expenses | 640,739 | 688,826 | 2,749,198 | 2,986,699 | |||||||||||
| Operating income | $ | 19,958 | $ | 18,109 | $ | 79,811 | $ | 78,980 | |||||||
| 1 Excludes the estimated fixed margin or fixed fee paid to GPMP for the cost of fuel. | |||||||||||||||
Fleet Fueling Segment
| For the Three Months Ended December 31, | For the Year Ended December 31, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| (in thousands) | |||||||||||||||
| Revenues: | |||||||||||||||
| Fuel revenue | $ | 117,196 | $ | 136,801 | $ | 515,462 | $ | 530,937 | |||||||
| Other revenues, net | 2,131 | 2,616 | 9,135 | 7,818 | |||||||||||
| Total revenues | 119,327 | 139,417 | 524,597 | 538,755 | |||||||||||
| Operating expenses: | |||||||||||||||
| Fuel costs 1 | 100,864 | 123,410 | 451,173 | 475,037 | |||||||||||
| Site operating expenses | 6,056 | 6,259 | 24,917 | 22,298 | |||||||||||
| Total operating expenses | 106,920 | 129,669 | 476,090 | 497,335 | |||||||||||
| Operating income | $ | 12,407 | $ | 9,748 | $ | 48,507 | $ | 41,420 | |||||||
| 1 Excludes the estimated fixed fee paid to GPMP for the cost of fuel. | |||||||||||||||
FAQ
What was ARKO's net income performance in Q4 and full year 2024?
How many retail stores did ARKO convert to dealer sites in 2024?
What is the expected financial benefit of ARKO's dealerization program?
What were ARKO's fuel margins in Q4 2024 compared to Q4 2023?
What is ARKO's guidance for Q1 and full year 2025?
