ARKO Corp. Reports Fourth Quarter and Full Year 2024 Results

Core Insights - ARKO Corp. reported a net loss of $2.3 million for Q4 2024, a decline from a net income of $1.1 million in Q4 2023, while the full year net income decreased to $20.8 million from $34.6 million in 2023 [6][29] - The company experienced a decrease in merchandise contribution for Q4 2024, down to $134.9 million from $146.8 million in Q4 2023, attributed to the dealerization program and underperforming stores [9][10] - Retail fuel contribution for Q4 2024 was $100.2 million, down from $109.3 million in the same period last year, with a retail fuel margin of 38.7 cents per gallon compared to 39.2 cents per gallon in Q4 2023 [11][12] Financial Performance - Adjusted EBITDA for Q4 2024 was $56.8 million, a decrease from $61.8 million in Q4 2023, while full year Adjusted EBITDA fell to $248.9 million from $276.3 million [6][29] - Merchandise margin rate increased to 33.0% in Q4 2024 from 32.9% in Q4 2023, and for the full year, it rose to 32.8% from 31.8% [6][10] - Total revenues for Q4 2024 were $1.99 billion, down from $2.23 billion in Q4 2023, with fuel revenue decreasing to $1.56 billion from $1.76 billion [39] Operational Highlights - The company converted 153 retail stores to dealer sites in 2024, with approximately 100 conversions occurring in Q4 2024, expecting an annualized benefit of $8.5 million to operating income [6][10] - Same store fuel gallons sold decreased by 4.4% in Q4 2024, while same store merchandise sales saw a decline of 4.3% [7][11] - The company plans to open four new-to-industry (NTI) stores in 2025, expanding its retail footprint [6][10] Liquidity and Capital Expenditures - As of December 31, 2024, ARKO had total liquidity of approximately $841 million, consisting of $262 million in cash and cash equivalents and $579 million available under lines of credit [23] - Capital expenditures for Q4 2024 were $36.1 million, totaling $113.9 million for the full year [23] Dividend and Share Repurchase - The Board declared a quarterly dividend of $0.03 per share, to be paid on March 21, 2025, to stockholders of record as of March 10, 2025 [24][25]