Murphy USA Inc. (NYSE:MUSA), a leading marketer of retail motor
fuel products and convenience merchandise, today announced
financial results for the three and nine months ended
September 30, 2017.
Key Highlights:
- Net income was $67.9 million, or $1.90 per diluted share in Q3
2017 compared to net income of $45.5 million, or $1.16 per diluted
share, in Q3 2016
- Total fuel contribution (retail fuel margin plus product supply
and wholesale ("PS&W") results including RINS) for Q3 2017 was
20.5 cpg compared to 15.4 cpg in Q3 2016
- Total retail gallons declined 5.5% to 1.0 billion gallons for
the network during Q3 2017 while volumes on an average per store
month ("APSM") basis declined 9.5% versus prior year
quarter
- Merchandise contribution dollars grew 2.0% during the quarter
to $97.7 million on average unit margins of 16.1%
- During the quarter, 12 new stores opened, in addition to five
raze-and-rebuild locations. Since quarter end, 10 sites have opened
(including one raze and rebuild) and construction is ongoing as of
today at 23 locations.
- Common shares repurchased during the third quarter were
approximately 1.3 million for $85.7 million at an average price of
$68.07 per share. YTD 2017 common share repurchases total 2.3
million shares for $152.0 million at an average price of $67.47 per
share.
"Third quarter results were impacted by the severity and
devastation wrought by hurricanes Harvey and Irma, yet the
resilience of our people and business model was evident in the
quarterly results," said President and CEO Andrew Clyde. "Our
first priority was to help ensure the safety and well-being of our
employees, who not only persevered during these crises, but
remained eager and engaged to re-open stores for our customers as
soon as possible, as we retained 100% of our store managers and
assistant managers. While per-store metrics were negatively
impacted from both a fuel volume and merchandise perspective, once
prices had reached equilibrium following the refinery shutdowns,
the retreat in wholesale prices contributed to a robust margin
environment in September which helped offset a period of negative
margins as Harvey made landfall.” Clyde concluded, "As we
exit the third quarter, the industry and our business are showing
signs of returning to normalized operations and overcoming
significant logistical challenges throughout the month of September
and into October. Wholesale gasoline and diesel product flows
resumed in both the storm-impacted areas and adjacent regions that
incurred extended fuel supply outages, consumer demand returned,
and the citizens of Texas and Florida began the process of
rebuilding."
Consolidated Results
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
Key Operating Metrics |
2017 |
|
2016 |
|
2017 |
|
2016 |
Net income ($
Millions) |
$67.9 |
|
$45.5 |
|
$120.4 |
|
$177.7 |
Earnings per share
(diluted) |
$1.90 |
|
$1.16 |
|
$3.29 |
|
$4.44 |
Adjusted EBITDA ($
Millions) |
$147.4 |
|
$105.3 |
|
$306.9 |
|
$296.9 |
Net income, earnings per share and adjusted EBITDA in Q3 2017
were all above prior year levels due to higher total margin
contribution from both fuel and merchandise. Net income and EPS in
the nine-month period ended September 30, 2016 reflect $56.0
million of after-tax gains from the sale of the CAM pipeline system
recorded in the first quarter of 2016.
Fuel
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
Key Operating Metrics |
2017 |
|
2016 |
|
2017 |
|
2016 |
Total retail fuel
contribution ($ Millions) |
$ |
158.9 |
|
|
$ |
149.1 |
|
|
$ |
437.1 |
|
|
$ |
373.1 |
|
Total fuel contribution
(including retail, PS&W and RINS) (cpg) |
20.5 |
|
|
15.4 |
|
|
16.3 |
|
|
15.4 |
|
Retail fuel volume -
chain (Million gal) |
1,028.7 |
|
|
1,088.2 |
|
|
3,101.6 |
|
|
3,128.7 |
|
Retail fuel volume -
per site (K gal APSM) |
242.8 |
|
|
268.3 |
|
|
246.4 |
|
|
259.7 |
|
Retail fuel margin (cpg
excl credit card fees) |
15.5 |
|
|
13.7 |
|
|
14.1 |
|
|
11.9 |
|
PS&W plus RINs
contribution (cpg) |
5.0 |
|
|
1.7 |
|
|
2.2 |
|
|
3.5 |
|
Total fuel contribution dollars increased 25.7% in Q3 2017 due
primarily to higher retail margins, combined with higher
year-over-year contribution from PS&W plus RINs.
Total retail fuel contribution increased 6.6% during the quarter
despite a 5.5% decrease in total network retail gallons sold,
largely attributable to hurricane-related impacts. PS&W
contribution plus RINs continued to show sequential improvement
since the first quarter of 2017, achieving 5.0 cpg of
retail-equivalent margin.
Merchandise
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
Key Operating Metrics |
2017 |
|
2016 |
|
2017 |
|
2016 |
Total merchandise sales
($ Millions) |
$ |
605.6 |
|
|
$ |
599.0 |
|
|
$ |
1,777.1 |
|
|
$ |
1,750.2 |
|
Total merchandise
contribution ($ Millions) |
$ |
97.7 |
|
|
$ |
95.7 |
|
|
$ |
284.2 |
|
|
$ |
274.3 |
|
Total merchandise sales
($K APSM) |
$ |
142.9 |
|
|
$ |
147.7 |
|
|
$ |
141.2 |
|
|
$ |
145.3 |
|
Merchandise unit margin
(%) |
16.1 |
% |
|
16.0 |
% |
|
16.0 |
% |
|
15.7 |
% |
Tobacco contribution
($K APSM) |
$ |
13.3 |
|
|
$ |
13.7 |
|
|
$ |
13.2 |
|
|
$ |
13.4 |
|
Non-tobacco
contribution ($K APSM) |
$ |
9.8 |
|
|
$ |
9.9 |
|
|
$ |
9.4 |
|
|
$ |
9.4 |
|
Total merchandise
contribution ($K APSM) |
$ |
23.0 |
|
|
$ |
23.6 |
|
|
$ |
22.6 |
|
|
$ |
22.8 |
|
Total merchandise sales increased 1.1% to $605.6
million in the third quarter 2017 from $599.0 million in the
prior year, with margins increasing to 16.1% versus 16.0%,
respectively. On a per-store-month basis, total merchandise
contribution declined 2.3%, largely due to accelerated traffic
declines, which were primarily storm-related, and lower tobacco
contribution.
Other areas
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
Key Operating Metrics |
2017 |
|
2016 |
|
2017 |
|
2016 |
Total station and other
operating expense ($ Millions) |
$ |
130.4 |
|
|
$ |
128.0 |
|
|
$ |
384.6 |
|
|
$ |
369.9 |
|
Station OPEX excl
credit card fees ($K APSM) |
$ |
21.0 |
|
|
$ |
22.2 |
|
|
$ |
20.9 |
|
|
$ |
21.6 |
|
Total SG&A cost ($
Millions) |
$ |
31.5 |
|
|
$ |
30.7 |
|
|
$ |
101.1 |
|
|
$ |
94.5 |
|
Total station and other operating expenses increased $2.4
million for the quarter, reflecting new store additions and
slightly higher payment fees due to higher retail fuel
prices. However, on a per store basis, operating expenses
excluding payment fees declined 5.4%.
Station Openings
Murphy USA opened 12 retail locations in Q3 2017 (not including
five raze and rebuilds), bringing the quarter end store count to
1,423, consisting of 1,154 Murphy USA sites and 269 Murphy Express
sites. A total of 23 stores are currently under construction,
which includes three kiosks undergoing a raze and rebuild which
will return to operation as 1,200 sq. foot stores before year
end. Since September 30, 2017, 10 stores have opened.
Financial Resources
|
As of September 30, |
Key
Metrics |
2017 |
|
2016 |
Cash and cash
equivalents ($ Millions) |
$ |
169.0 |
|
|
$ |
206.7 |
|
Long-term debt ($
Millions) |
$ |
865.0 |
|
|
$ |
638.9 |
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
Key
Metrics |
2017 |
|
2016 |
|
2017 |
|
2016 |
Average shares
outstanding (diluted) (in thousands) |
35,745 |
|
|
39,174 |
|
|
36,579 |
|
|
39,989 |
|
Cash balances on September 30, 2017 totaled $169.0
million. Long-term debt consisted of approximately $492
million in carrying value of 6% senior notes due in 2023, $295
million in carrying value of 5.625% senior notes due in 2027 and
$97 million of term debt less $19 million of current maturities,
which is reflected in current liabilities. Remaining undrawn
borrowing capacity under the ABL was $295 million as of
September 30, 2017.
Common shares repurchased during the current quarter were
approximately 1.3 million for $85.7 million. As of September 30,
2017, there was approximately $25 million remaining under the
previously authorized program of up to $500 million. Upon
completing the existing repurchase program, the Company may elect
to repurchase additional shares utilizing existing available cash
balances if prices are favorable in management's opinion. At
September 30, 2017, the Company had common shares outstanding of
34,796,150.
Earnings Call Information
The Company will host a conference call on November 2,
2017, at 10:00 a.m. Central time to discuss third quarter 2017
results. The conference call number is 1 (844) 613-1037 and
the conference number is 93873089. The earnings and investor
related materials, including reconciliations of any non-GAAP
financial measures to GAAP financial measures and any other
applicable disclosures, will be available on that same day on the
investor section of the Murphy USA website
(http://ir.corporate.murphyusa.com). Approximately one hour
after the conclusion of the conference, the webcast will be
available for replay. Shortly thereafter, a transcript will
be available.
Source: Murphy USA Inc. (NYSE:MUSA)
Forward-Looking Statements
Certain statements in this news release contain or may suggest
“forward-looking” information (as defined in the Private Securities
Litigation Reform Act of 1995) that involve risk and uncertainties,
including, but not limited to anticipated store openings, fuel
margins, merchandise margins, sales of RINs and trends in our
operations. Such statements are based upon the current beliefs and
expectations of the company’s management and are subject to
significant risks and uncertainties. Actual future results may
differ materially from historical results or current expectations
depending upon factors including, but not limited to: our ability
to continue to maintain a good business relationship with Walmart;
successful execution of our growth strategy, including our ability
to realize the anticipated benefits from such growth initiatives,
and the timely completion of construction associated with our newly
planned stores which may be impacted by the financial health of
third parties; our ability to effectively manage our inventory,
disruptions in our supply chain and our ability to control costs;
the impact of severe weather events, such as hurricanes, floods and
earthquakes; the impact of any systems failures, cybersecurity
and/or security breaches, including any security breach that
results in theft, transfer or unauthorized disclosure of customer,
employee or company information or our compliance with information
security and privacy laws and regulations in the event of such an
incident; successful execution of our information technology
strategy; future tobacco or e-cigarette legislation and any other
efforts that make purchasing tobacco products more costly or
difficult could hurt our revenues and impact gross margins;
efficient and proper allocation of our capital resources;
compliance with debt covenants; availability and cost of credit;
and changes in interest rates. Our SEC report, including our Annual
Report on our Form 10-K for the year ended December 31, 2016
contains other information on these and other factors that could
affect our financial results and cause actual results to differ
materially from any forward-looking information we may provide. The
company undertakes no obligation to update or revise any
forward-looking statements to reflect subsequent events, new
information or future circumstances.
Investor Contact: Christian Pikul (870) 875-7683
Director, Investor Relations christian.pikul@murphyusa.com
Cell 870-677-0278 |
Media/ Public Relations Contact: Jerianne Thomas
(870) 875-7770 Director, Corporate Communications
jerianne.thomas@murphyusa.com Cell 870-866-6321 |
Murphy USA Inc. |
Consolidated Statements of Income |
(Unaudited) |
|
|
|
|
|
|
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
(Thousands of dollars
except per share amounts) |
|
2017 |
2016 |
2017 |
2016 |
Operating Revenues |
|
|
|
|
|
Petroleum
product sales (a) |
|
$ |
2,580,985 |
|
$ |
2,394,951 |
|
$ |
7,550,958 |
|
$ |
6,654,970 |
|
Merchandise sales |
|
605,575 |
|
598,968 |
|
1,777,063 |
|
1,750,162 |
|
Other
operating revenues |
|
49,791 |
|
48,819 |
|
119,008 |
|
133,630 |
|
Total operating
revenues |
|
3,236,351 |
|
3,042,738 |
|
9,447,029 |
|
8,538,762 |
|
|
|
|
|
|
|
Operating Expenses |
|
|
|
|
|
Petroleum
product cost of goods sold (a) |
|
2,419,124 |
|
2,275,487 |
|
7,161,632 |
|
6,301,552 |
|
Merchandise cost of goods sold |
|
507,921 |
|
503,266 |
|
1,492,861 |
|
1,475,869 |
|
Station
and other operating expenses |
|
130,375 |
|
127,991 |
|
384,552 |
|
369,910 |
|
Depreciation and amortization |
|
28,989 |
|
25,576 |
|
83,514 |
|
72,747 |
|
Selling,
general and administrative |
|
31,535 |
|
30,726 |
|
101,128 |
|
94,549 |
|
Accretion
of asset retirement obligations |
|
447 |
|
411 |
|
1,335 |
|
1,236 |
|
Total operating
expenses |
|
3,118,391 |
|
2,963,457 |
|
9,225,022 |
|
8,315,863 |
|
|
|
|
|
|
|
Gain (loss) on sale of
assets |
|
(58 |
) |
(335 |
) |
(3,426 |
) |
88,640 |
|
Income from
operations |
|
117,902 |
|
78,946 |
|
218,581 |
|
311,539 |
|
|
|
|
|
|
|
Other income
(expense) |
|
|
|
|
|
Interest
income |
|
466 |
|
144 |
|
831 |
|
474 |
|
Interest
expense |
|
(12,726 |
) |
(10,182 |
) |
(33,868 |
) |
(29,780 |
) |
Other
nonoperating income (expense) |
|
3,034 |
|
2,848 |
|
3,269 |
|
2,966 |
|
Total other income
(expense) |
|
(9,226 |
) |
(7,190 |
) |
(29,768 |
) |
(26,340 |
) |
Income before income
taxes |
|
108,676 |
|
71,756 |
|
188,813 |
|
285,199 |
|
Income tax expense |
|
40,789 |
|
26,265 |
|
68,389 |
|
107,524 |
|
Net
Income |
|
$ |
67,887 |
|
$ |
45,491 |
|
$ |
120,424 |
|
$ |
177,675 |
|
|
|
|
|
|
|
Basic and Diluted
Earnings Per Common Share |
|
|
|
|
|
Basic |
|
$ |
1.92 |
|
$ |
1.17 |
|
$ |
3.32 |
|
$ |
4.47 |
|
Diluted |
|
$ |
1.90 |
|
$ |
1.16 |
|
$ |
3.29 |
|
$ |
4.44 |
|
Weighted-average shares
outstanding (in thousands): |
|
|
|
|
|
Basic |
|
35,423 |
|
38,896 |
|
36,253 |
|
39,719 |
|
Diluted |
|
35,745 |
|
39,174 |
|
36,579 |
|
39,989 |
|
Supplemental
information: |
|
|
|
|
|
(a) Includes excise
taxes of: |
|
$ |
488,790 |
|
$ |
505,814 |
|
$ |
1,473,440 |
|
$ |
1,466,347 |
|
Murphy USA Inc. |
Segment Operating Results |
(Unaudited) |
|
|
|
|
|
|
|
(Thousands of dollars,
except volume per store month, margins and store counts) |
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
Marketing
Segment |
|
2017 |
2016 |
|
2017 |
2016 |
|
|
|
|
|
|
|
Operating Revenues |
|
|
|
|
|
|
Petroleum
product sales |
|
$ |
2,580,985 |
|
$ |
2,394,951 |
|
|
$ |
7,550,958 |
|
$ |
6,654,970 |
|
Merchandise sales |
|
605,575 |
|
598,968 |
|
|
1,777,063 |
|
1,750,162 |
|
Other
operating revenues |
|
49,773 |
|
48,808 |
|
|
118,756 |
|
133,403 |
|
Total operating
revenues |
|
3,236,333 |
|
3,042,727 |
|
|
9,446,777 |
|
8,538,535 |
|
|
|
|
|
|
|
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Petroleum
products cost of goods sold |
|
2,419,124 |
|
2,275,487 |
|
|
7,161,632 |
|
6,301,552 |
|
Merchandise cost of goods sold |
|
507,921 |
|
503,266 |
|
|
1,492,861 |
|
1,475,869 |
|
Station
and other operating expenses |
|
130,371 |
|
127,991 |
|
|
384,548 |
|
369,910 |
|
Depreciation and amortization |
|
27,352 |
|
23,939 |
|
|
78,660 |
|
67,972 |
|
Selling,
general and administrative |
|
31,535 |
|
30,727 |
|
|
101,128 |
|
94,549 |
|
Accretion
of asset retirement obligations |
|
447 |
|
411 |
|
|
1,335 |
|
1,236 |
|
Total operating
expenses |
|
3,116,750 |
|
2,961,821 |
|
|
9,220,164 |
|
8,311,088 |
|
|
|
|
|
|
|
|
Gain (loss) on sale of
assets |
|
(58 |
) |
(336 |
) |
|
(3,426 |
) |
88,640 |
|
Income from
operations |
|
119,525 |
|
80,570 |
|
|
223,187 |
|
316,087 |
|
|
|
|
|
|
|
|
Other income |
|
|
|
|
|
|
Interest
expense |
|
(20 |
) |
(14 |
) |
|
(59 |
) |
(35 |
) |
Other
nonoperating income |
|
2,939 |
|
2,730 |
|
|
3,169 |
|
2,771 |
|
Total other income |
|
2,919 |
|
2,716 |
|
|
3,110 |
|
2,736 |
|
|
|
|
|
|
|
|
Income from continuing
operations |
|
|
|
|
|
|
before
income taxes |
|
122,444 |
|
83,286 |
|
|
226,297 |
|
318,823 |
|
Income tax expense |
|
46,614 |
|
30,531 |
|
|
86,153 |
|
120,201 |
|
Income from continuing
operations |
|
$ |
75,830 |
|
$ |
52,755 |
|
|
$ |
140,144 |
|
$ |
198,622 |
|
|
|
|
|
|
|
|
Total tobacco sales
revenue per store month |
|
$ |
104,432 |
|
$ |
111,898 |
|
|
$ |
103,454 |
|
$ |
109,427 |
|
Total non-tobacco sales
revenue per store month |
|
38,491 |
|
35,763 |
|
|
37,712 |
|
35,837 |
|
Total merchandise sales
revenue per store month |
|
$ |
142,923 |
|
$ |
147,661 |
|
|
$ |
141,166 |
|
$ |
145,264 |
|
|
|
|
|
|
|
|
Store count at end of
period |
|
1,423 |
|
1,364 |
|
|
1,423 |
|
1,364 |
|
|
|
|
|
|
|
|
|
|
|
|
Total store months
during the period |
|
4,237 |
|
4,056 |
|
|
12,588 |
|
12,048 |
|
Same store sales information (compared to APSM metrics)
|
Variance from prior year quarter |
|
Three months ended |
|
September 30, 2017 |
|
SSS |
APSM |
Fuel gallons per
month |
(8.9 |
)% |
(9.5 |
)% |
|
|
|
Merchandise sales |
(2.4 |
)% |
(3.2 |
)% |
Tobacco
sales |
(4.9 |
)% |
(6.7 |
)% |
Non
tobacco sales |
5.4 |
% |
7.6 |
% |
|
|
|
Merchandise margin |
(1.6 |
)% |
(2.3 |
)% |
Tobacco
margin |
(0.7 |
)% |
(3.3 |
)% |
Non
tobacco margin |
(2.8 |
)% |
(0.9 |
)% |
|
Variance from prior year quarter |
|
Nine months ended |
|
September 30, 2017 |
|
SSS |
APSM |
Fuel gallons per
month |
(4.6 |
)% |
(5.1 |
)% |
|
|
|
Merchandise sales |
(1.5 |
)% |
(2.8 |
)% |
Tobacco
sales |
(3.1 |
)% |
(5.5 |
)% |
Non
tobacco sales |
3.5 |
% |
5.2 |
% |
|
|
|
Merchandise margin |
0.2 |
% |
(0.8 |
)% |
Tobacco
margin |
1.1 |
% |
(1.6 |
)% |
Non
tobacco margin |
(1.1 |
)% |
0.3 |
% |
Note
Average Per Store Month (APSM) metric includes all stores open
through the date of the calculation.
Same store sales (SSS) metric includes aggregated individual
store results for all stores open throughout both periods
presented. For all periods presented, the store must have been open
for the entire calendar year to be included in the comparison.
Remodeled stores that remained open or were closed for just a very
brief time (less than a month) during the period being compared
remain in the same store sales calculation. If a store is replaced
either at the same location (raze and rebuild) or relocated to a
new location, it will be excluded from the calculation during the
period it is out of service. New constructed sites do not enter the
calculation until they are open for each full calendar year for the
periods being compared (open by January 1, 2016 for the sites being
compared in the 2017 versus 2016 compared).
Murphy USA Inc. |
Consolidated Balance Sheets |
|
|
|
|
|
(Thousands of
dollars) |
|
September 30, 2017 |
|
December 31, 2016 |
|
|
(unaudited) |
|
|
Assets |
|
|
|
|
Current
assets |
|
|
|
|
Cash and
cash equivalents |
|
$ |
169,014 |
|
|
$ |
153,813 |
|
Accounts
receivable—trade, less allowance for doubtful accounts of $1,094 in
2017 and $1,891 in 2016 |
|
192,443 |
|
|
183,519 |
|
Inventories, at lower of cost or market |
|
200,765 |
|
|
153,351 |
|
Prepaid
expenses and other current assets |
|
13,538 |
|
|
24,871 |
|
Total
current assets |
|
575,760 |
|
|
515,554 |
|
Property,
plant and equipment, at cost less accumulated depreciation and
amortization of $846,212 in 2017 and $780,426 in 2016 |
|
1,659,410 |
|
|
1,532,655 |
|
Other
assets |
|
44,337 |
|
|
40,531 |
|
Total
assets |
|
$ |
2,279,507 |
|
|
$ |
2,088,740 |
|
Liabilities and Stockholders' Equity |
|
|
|
|
Current
liabilities |
|
|
|
|
Current
maturities of long-term debt |
|
$ |
19,719 |
|
|
$ |
40,596 |
|
Trade
accounts payable and accrued liabilities |
|
454,074 |
|
|
473,370 |
|
Income
taxes payable |
|
12,216 |
|
|
594 |
|
Total
current liabilities |
|
486,009 |
|
|
514,560 |
|
|
|
|
|
|
Long-term
debt, including capitalized lease obligations |
|
864,975 |
|
|
629,622 |
|
Deferred
income taxes |
|
222,085 |
|
|
204,656 |
|
Asset
retirement obligations |
|
27,489 |
|
|
26,200 |
|
Deferred
credits and other liabilities |
|
13,856 |
|
|
16,626 |
|
Total
liabilities |
|
1,614,414 |
|
|
1,391,664 |
|
Stockholders'
Equity |
|
|
|
|
Preferred Stock, par
$0.01 (authorized 20,000,000 shares, |
|
|
|
|
none
outstanding) |
|
— |
|
|
— |
|
Common Stock, par $0.01
(authorized 200,000,000 shares, |
|
|
|
|
46,767,164 and 46,767,164 shares issued at |
|
|
|
|
2017 and
2016, respectively) |
|
468 |
|
|
468 |
|
Treasury
stock (11,971,014 and 9,831,196 shares held at |
|
|
|
|
September
30, 2017 and December 31, 2016, respectively) |
|
(753,019 |
) |
|
(608,001 |
) |
Additional
paid in capital (APIC) |
|
547,949 |
|
|
555,338 |
|
Retained
earnings |
|
869,695 |
|
|
749,271 |
|
Total
stockholders' equity |
|
665,093 |
|
|
697,076 |
|
Total
liabilities and stockholders' equity |
|
$ |
2,279,507 |
|
|
$ |
2,088,740 |
|
Murphy USA Inc. |
Consolidated Statement of Cash Flows |
(Unaudited) |
|
|
|
|
|
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
(Thousands of
dollars) |
2017 |
2016 |
2017 |
2016 |
Operating
Activities |
|
|
|
|
Net income |
$ |
67,887 |
|
$ |
45,491 |
|
$ |
120,424 |
|
$ |
177,675 |
|
Adjustments to
reconcile net income to net cash provided by operating
activities |
|
|
|
|
Depreciation and amortization |
28,989 |
|
25,576 |
|
83,514 |
|
72,747 |
|
Deferred
and noncurrent income tax charges (credits) |
4,415 |
|
23,031 |
|
17,429 |
|
37,636 |
|
Accretion
of asset retirement obligations |
447 |
|
411 |
|
1,335 |
|
1,236 |
|
Pretax
(gains) losses from sale of assets |
58 |
|
335 |
|
3,426 |
|
(88,640 |
) |
Net
(increase) decrease in noncash operating working capital |
26,444 |
|
(52,045 |
) |
(58,274 |
) |
5,382 |
|
Other
operating activities - net |
(2,316 |
) |
(1,573 |
) |
(1,488 |
) |
3,792 |
|
Net cash
provided by operating activities |
125,924 |
|
41,226 |
|
166,366 |
|
209,828 |
|
Investing
Activities |
|
|
|
|
Property additions |
(67,382 |
) |
(82,342 |
) |
(201,532 |
) |
(198,911 |
) |
Proceeds from sale of
assets |
(26 |
) |
(1,297 |
) |
689 |
|
85,001 |
|
Changes in restricted
cash |
— |
|
55,142 |
|
— |
|
68,571 |
|
Other investing
activities - net |
(456 |
) |
(13,750 |
) |
(4,599 |
) |
(28,888 |
) |
Net cash
required by investing activities |
(67,864 |
) |
(42,247 |
) |
(205,442 |
) |
(74,227 |
) |
Financing
Activities |
|
|
|
|
Purchase of treasury
stock |
(85,672 |
) |
(45,223 |
) |
(152,009 |
) |
(212,328 |
) |
Borrowings of debt |
— |
|
— |
|
338,750 |
|
200,000 |
|
Repayments of debt |
(233 |
) |
(116 |
) |
(126,134 |
) |
(10,281 |
) |
Debt issuance
costs |
(165 |
) |
— |
|
(1,100 |
) |
(3,240 |
) |
Amounts related to
share-based compensation |
(71 |
) |
(1,158 |
) |
(5,230 |
) |
(5,395 |
) |
Net cash
provided by (required by) financing activities |
(86,141 |
) |
(46,497 |
) |
54,277 |
|
(31,244 |
) |
Net increase (decrease)
in cash and cash equivalents |
(28,081 |
) |
(47,518 |
) |
15,201 |
|
104,357 |
|
Cash and cash
equivalents at beginning of period |
197,095 |
|
254,210 |
|
153,813 |
|
102,335 |
|
Cash and cash
equivalents at end of period |
$ |
169,014 |
|
$ |
206,692 |
|
$ |
169,014 |
|
$ |
206,692 |
|
Supplemental Disclosure Regarding Non-GAAP Financial
Information
The following table sets forth the Company’s EBITDA and Adjusted
EBITDA for the three and nine months ended September 30, 2017
and 2016. EBITDA means net income (loss) plus net interest
expense, plus income tax expense, depreciation and amortization,
and Adjusted EBITDA adds back (i) other non-cash items (e.g.,
impairment of properties and accretion of asset retirement
obligations) and (ii) other items that management does not consider
to be meaningful in assessing our operating performance (e.g.,
(income) from discontinued operations, gain (loss) on sale of
assets and other non-operating expense (income)). EBITDA and
Adjusted EBITDA are not measures that are prepared in accordance
with U.S. generally accepted accounting principles (GAAP).
We use Adjusted EBITDA in our operational and financial
decision-making, believing that the measure is useful to eliminate
certain items in order to focus on what we deem to be a more
reliable indicator of ongoing operating performance and our ability
to generate cash flow from operations. Adjusted EBITDA is
also used by many of our investors, research analysts, investment
bankers, and lenders to assess our operating performance. We
believe that the presentation of Adjusted EBITDA provides useful
information to investors because it allows understanding of a key
measure that we evaluate internally when making operating and
strategic decisions, preparing our annual plan, and evaluating our
overall performance. However, non-GAAP measures are not a
substitute for GAAP disclosures, and EBITDA and Adjusted EBITDA may
be prepared differently by us than by other companies using
similarly titled non-GAAP measures.
The reconciliation of net income to EBITDA and Adjusted EBITDA
is as follows:
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
(Thousands of
dollars) |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
67,887 |
|
|
$ |
45,491 |
|
|
$ |
120,424 |
|
|
$ |
177,675 |
|
|
|
|
|
|
|
|
|
|
Income
taxes |
|
40,789 |
|
|
26,265 |
|
|
68,389 |
|
|
107,524 |
|
Interest
expense, net of interest income |
|
12,260 |
|
|
10,038 |
|
|
33,037 |
|
|
29,306 |
|
Depreciation and amortization |
|
28,989 |
|
|
25,576 |
|
|
83,514 |
|
|
72,747 |
|
EBITDA |
|
$ |
149,925 |
|
|
$ |
107,370 |
|
|
$ |
305,364 |
|
|
$ |
387,252 |
|
|
|
|
|
|
|
|
|
|
Accretion
of asset retirement obligations |
|
447 |
|
|
411 |
|
|
1,335 |
|
|
1,236 |
|
(Gain)
loss on sale of assets |
|
58 |
|
|
335 |
|
|
3,426 |
|
|
(88,640 |
) |
Other
nonoperating (income) expense |
|
(3,034 |
) |
|
(2,848 |
) |
|
(3,269 |
) |
|
(2,966 |
) |
Adjusted EBITDA |
|
$ |
147,396 |
|
|
$ |
105,268 |
|
|
$ |
306,856 |
|
|
$ |
296,882 |
|
|
|
|
|
|
|
|
|
|
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