CrossAmerica Partners LP (NYSE:CAPL) Q1 2024 Earnings Call Transcript May 9, 2024

CrossAmerica Partners LP isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).

Operator: Good morning, ladies and gentlemen. And welcome to the CrossAmerica Partners First Quarter 2024 Earnings Conference Call [Operator Instructions]. This call is being recorded on Thursday, May 9 of 2024. I would now like to turn the conference over to Maura Topper, Chief Financial Officer. Please go ahead.

Maura Topper: Thank you, operator. Good morning, and thank you for joining the CrossAmerica Partners first quarter 2024 earnings call. With me today is Charles Nifong, CEO and President. We'll start off the call today with Charles providing some opening comments and an overview of CrossAmerica's operational performance for the quarter, and then I will discuss the financial results. We will then open up the call to questions. Today's call will follow presentation slides that are available as part of the webcast and are posted on the CrossAmerica Web site. Before we begin, I would like to remind everyone that today's call, including the question-and-answer session, may include forward-looking statements regarding expected revenue, future plans, future operational metrics and opportunities and expectations of the organization.

There can be no assurance that management's expectations, beliefs and projections will be achieved or that actual results will not differ from expectations. Please see CrossAmerica's filings with the Securities and Exchange Commission, including annual reports on Form 10-K and quarterly reports on Form 10-Q for a discussion of important factors that could affect our actual results. Forward-looking statements represent the judgment of CrossAmerica's management as of today's date, and the organization disclaims any intent or obligation to update any forward-looking statements. During today's call, we may also provide certain performance measures that do not conform to US generally accepted accounting principles or GAAP. We have provided schedules that reconcile these non-GAAP measures with our reported results on a GAAP basis as part of our earnings press release.

Today's call is being webcast, and a recording of this conference call will be available on the CrossAmerica website for a period of 60 days. With that, I will now turn the call over to Charles.

Charles Nifong: Thank you, Maura. Maura and I appreciate all of you joining us this morning as we review our first quarter results. During today's call, I will go through some of the operating highlights for the first quarter 2024. I will also provide commentary on the market and other updates similar to what I have done on our prior calls. Maura will then review in more detail our financial results. Now if you turn to Slide 4, I will briefly review some of our operating results. For the first quarter of 2024, our wholesale segment gross profit declined 14% to $27 million compared to $31.2 million in the first quarter of 2023. The decrease was driven by a decline in fuel margin, fuel volume and rental income. A significant factor in the overall decline was the conversion of certain lessee dealer sites to company-operated and commission agent sites, which are now accounted for in the retail segment.