“During the third quarter of 2013, we continued to successfully execute on our business strategy. Both fuel gross margin per gallon and EBITDAR increased year over year, and we continue to make progress acquiring new travel center sites and integrating them into our nationwide network.
“Net income this quarter was lower than last year, but this was largely the result of higher depreciation and interest costs in 2013 stemming from recently acquired sites. Our plan is to offset these costs as the operations at these sites are improved and begin to achieve financial results similar to our other travel centers. Also, during the second and third quarters of 2013, TA’s primary competitors engaged in aggressive sales efforts to maintain and grow market share, which negatively impacted our fuel sales volume and fuel gross margin per gallon during the period. These aggressive sales efforts by our competitors appear to have abated somewhat in the third quarter versus the second quarter.”
During the nine months ended September 30, 2013, TA purchased six locations (two of which were previously operated by franchisees of TA) for an aggregate of $27.9 million and made capital investments of $125.7 million, including $39.0 million to improve locations TA purchased during 2011 through 2013.In October 2013, TA completed the acquisitions of two travel center properties for a total of $8.9 million. TA has entered agreements to acquire two other travel centers for a total of $11.6 million. TA expects to complete these acquisitions in the fourth quarter of 2013, but these purchases are subject to conditions and may not occur, may be delayed or the terms may change. TA currently intends to continue its efforts to selectively acquire additional properties. Capital Activity On January 15, 2013, TA sold $110 million of 8.25% Senior Notes due 2028 in a public offering for net proceeds of approximately $105.1 million. During the first nine months of 2013, TA sold to HPT $63.2 million of improvements to sites leased from HPT for increased rent, pursuant to the terms of the lease agreements.
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