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Fuel Volume Slumps, But Merchandise Margins Soar
6 Nov
Summary
- Elevated fuel prices squeezed volumes but increased retail fuel margins.
- Merchandise gross profit grew 2%, with margins rising to 30.3%.
- Operating expenses decreased for the fifth consecutive quarter.
CrossAmerica Partners LP reported a decline in third-quarter 2026 financial performance, with net income falling to $8.8 million and Adjusted EBITDA at $38.7 million, a 6% decrease year-over-year. This downturn was primarily attributed to elevated fuel prices pressuring motor fuel volumes across both retail and wholesale segments.
Despite the fuel volume challenges, the partnership achieved growth in merchandise margins, which increased by 140 basis points to 30.3%, contributing to a 2% rise in merchandise gross profit. Operating expenses saw a 2% reduction, marking the fifth consecutive quarter of year-over-year declines.
Management continued its real estate optimization efforts, selling 15 properties for $10.6 million. The company's financial priorities remain focused on generating durable cash flows, managing its leverage ratio, and investing in food-service renovations at company-operated sites to boost inside sales.
Executives noted that September volume trends were stronger than earlier in the quarter, and October results have continued this trend. Approximately one-third of the $5.3 million in sustaining capital expenditures was allocated to environmental compliance.
