CST Brands, Inc. (NYSE:CST), one of the largest independent retailers of motor fuels and convenience merchandise in North America, today reported financial results for the third quarter ended September 30, 2013.
“Our company delivered strong year-over-year earnings growth,” said Kim Bowers, Chairman and CEO of CST Brands. “We continue to make great strides as a separate, publicly-traded company, working on key initiatives such as establishing our culture, further developing our brand, and reducing and eliminating the transition services being provided by our former parent company. I am very proud of our hardworking team members across the company that helped produce a very solid quarter.”
Three Months Results
For the three month period ending September 30, 2013, the Company reported net income of $41 million, or $0.55 per diluted share. Included in net income are asset impairment charges of $2 million, net of tax. Excluding these asset impairments, net income would have been $43 million, or $0.57 per diluted share. Net income was $24 million, or $0.31 per diluted share, for the comparable period in 2012.
Revenues totaled $3.3 billion for the third quarter of 2013 compared to $3.4 billion for the same period of 2012. Motor fuel revenues in the U.S. segment declined $47 million, driven by a 1% decline in both of the Company’s per gallon average motor fuel selling price and in motor fuel gallons sold. Motor fuel revenues declined $28 million in our Canada retail segment, primarily from a 2% decline in the Company’s motor fuel gallons sold primarily as a result of fewer average retail sites that sell motor fuel. Also contributing to the overall revenue decline in the Canadian segment was a $55 million impact from foreign currency effects of the Canadian dollar relative to the U.S. dollar.
In the U.S., motor fuel gross margin (cents per gallon), after deducting credit card fees, was $0.16 compared to $0.09 in the third quarter of 2012. The Company experienced historically low motor fuel gross margins in the third quarter of 2012, due primarily to the volatility of crude oil during that period. U.S. merchandise gross margin, net of credit card fees, increased slightly when compared to the third quarter of 2012.