Financial Data and Key Metrics Changes - Net income for Q4 2025 was $8.1 million, up from $7.5 million in Q4 2024, representing an increase of approximately 8% [15] - Adjusted EBITDA for Q4 2025 was $36.9 million, compared to $35.4 million in the prior year, reflecting a growth of about 4% [15] - For the full year 2025, net income was $32.7 million, down from $40.2 million in 2024, while adjusted EBITDA increased to $143.5 million from $139.2 million [16] Business Line Data and Key Metrics Changes - In the wholesale segment, fuel contribution increased by 8% to $24 million in Q4 2025, with wholesale gallons rising approximately 4% to 249 million gallons [16] - Fleet fueling segment contributed $15.9 million in Q4 2025, down from $16.3 million in the previous year, with gallons sold totaling 34.9 million [18] - GPMP segment's fuel contribution from related party locations was $10.2 million for Q4 2025, compared to $12.3 million in Q4 2024, with gallons sold decreasing to 204 million [19] Market Data and Key Metrics Changes - The company distributed over 2 billion gallons in the last 12 months, holding a market share of approximately 1% in the fragmented fuel distribution market [7] - The macro environment has seen extraordinary volatility in fuel costs due to events in the Middle East, impacting pricing and margins [8] Company Strategy and Development Direction - The company aims to expand its platform through strategic acquisitions, currently in due diligence for two targets that could add significant gallons to its operations [7] - The focus remains on capital allocation towards accretive projects, including M&A in the wholesale segment and building new cardlock locations [13][14] Management's Comments on Operating Environment and Future Outlook - Management noted that while there could be softness in volume due to rising costs, the business model's cost-plus structure provides margin stability [9] - The company expects to deliver approximately $156 million in adjusted EBITDA and discretionary cash flow of about $110 million for 2026, with an anticipated increase in gallons sold from acquisitions [22][23] Other Important Information - The company declared a dividend of $0.26 per share, consistent with an annual rate of $2 per share, representing an attractive yield [13] - Following the IPO, the company used $206.7 million of net proceeds to reduce debt, enhancing its capital structure and financial flexibility [20][21] Q&A Session Summary Question: Impact of rising fuel costs on business lines - Management explained that 85% of gallons sold are on a cost-plus basis, which mitigates the impact of volatility on margins, with prompt pay discounts providing additional margin benefits [29][30] Question: M&A activity in light of market volatility - Management indicated that while it is too early to assess the full impact of current volatility, they have ongoing acquisition opportunities and are prepared to act if small operators face pressure [33] Question: Margin enhancement details - Management clarified that the margin enhancement is linked to prompt pay discounts, which increase as fuel prices rise, benefiting the overall business [40][41] Question: CapEx outlook for fleet fueling and M&A - Management confirmed that the cost to build new fleet fueling locations remains around $1 million-$2 million, targeting mid- to high-single-digit returns, with ongoing due diligence for M&A opportunities [45]

Financial Data and Key Metrics Changes - Adjusted EBITDA grew 16% year-over-year to $66 million in Q4 2025, reflecting the company's transformation efforts [5][23] - Net income for Q4 was $1.9 million, reversing a net loss of $2.3 million from the prior year [23] - Retail merchandising margin increased by 140 basis points to 34.4% [24] - Same-store merchandise sales were down 3% for Q4 and down 4.1% for the full year 2025 [25][29] - Retail fuel same-store gallons were down 4.1% for Q4 and down 5.4% for the full year 2025 [25][29] Business Line Data and Key Metrics Changes - Retail segment delivered a merchandising margin of 34.4%, an increase of 140 basis points year-over-year [24] - Wholesale fuel contribution increased 8% to $24 million in Q4, with total gallons increasing by 4% to 249 million [26] - Fleet Fueling fuel contribution was $15.9 million for Q4, compared to $16.3 million last year, with gallons totaling 34.9 million [27] Market Data and Key Metrics Changes - The company gained market share in every nicotine category in 2025, with OTP up 4% and energy drinks up 8% [18] - Same-store merchandise sales trends improved through Q4, with mid-single digit growth observed in January and February 2026 [18] Company Strategy and Development Direction - The company is focused on executing its transformation plan, optimizing its retail footprint, and improving cost structure [5][9] - The IPO of ARKO Petroleum Corp. was a major milestone, providing greater transparency and unlocking value for shareholders [7][8] - The dealerization strategy is a key lever in the transformation plan, with 409 conversions completed and additional sites committed [11] Management's Comments on Operating Environment and Future Outlook - Management noted that the consumer remains cautious and value-focused, but execution improvements are driving results [6][19] - The company expects adjusted EBITDA for 2026 to range between $245 million and $265 million, with same-store retail sales expected to improve [30][31] - Management believes there is substantial growth potential in the wholesale fuel distribution market, with only 1% market share currently [10][62] Other Important Information - The company finished 2025 with $305 million in cash, maintaining a strong balance sheet [29] - The leadership team has been strengthened with the appointment of a new CFO, Galagher Jeff, who brings extensive retail experience [19][20] Q&A Session Summary Question: What are the drivers of further improvement in merchandise sales for retail? - Management highlighted execution and marketing initiatives, including the Fueling America campaign, which increased loyalty transactions and customer engagement [36][37] Question: Can you explain the cost of capital for remodels? - The cost of a major remodel is approximately $1 million, while a soft remodel could cost between $400,000 and $700,000 [41][42] Question: Is the pressure in the Midwest still present? - Management confirmed that pressure in the Midwest continues, but noted an increase in customer transactions as fuel prices dropped below $2.50 [52] Question: Do the $3, $4, $5, $6 value meal deals drive merchandise margin expansion? - Promotions are supported by vendors and do not lower margins; they drive customer traffic and increase sales in higher-margin categories [54][55] Question: What is the M&A opportunity for APC now that it has a separate balance sheet? - The company has over $635 million available for acquisition in a fragmented industry, targeting 20 new cardlock locations in 2026 [61][62]

Financial Data and Key Metrics Changes - Adjusted EBITDA for Q3 2025 was $75.2 million, slightly above the midpoint of guidance, compared to $78.8 million in the same period last year, primarily due to softer retail performance [17][18] - Net income for the quarter was $13.5 million, an increase from $9.7 million in the year-ago period [20] - Total general and administrative expenses for the quarter were $40 million, up from $38.6 million year-over-year, driven by a $1.7 million increase in share-based compensation [20] Business Line Data and Key Metrics Changes - Retail segment operating income was approximately $77.5 million, down from $85.1 million year-over-year; same-store merchandise sales, excluding cigarettes, decreased by 0.9% [18] - Wholesale segment operating income increased to $24.1 million from $20.3 million in the prior year, with gallons up approximately 7.5% year-over-year [18][19] - Fleet fueling segment operating income was $12.2 million, slightly down from $12.6 million year-over-year, with total gallons down 1.6% [19] Market Data and Key Metrics Changes - Same-store sales, excluding cigarettes, were nearly flat, representing the best comp performance in the last 18 months [6] - Consumer sentiment data indicates that consumers are feeling stretched, leading to more deliberate shopping behavior and increased price sensitivity [5] Company Strategy and Development Direction - The company is focused on its transformation plan, particularly dealerization, which is expected to deliver a cumulative annualized operating income benefit of more than $20 million once fully scaled [8][9] - The Fueling America's Future campaign and Fast Rewards loyalty platform are central to deepening customer relationships and driving engagement [10] - The company plans to launch a new version of its app by the end of Q1 2026 to enhance customer engagement [11] Management's Comments on Operating Environment and Future Outlook - Management noted that while there are pressures in certain markets, healthier trends are observed in the Northeast, Southeast, and Mid-Atlantic regions [5][6] - The company expects adjusted EBITDA for Q4 2025 to be in the range of $50 million to $60 million, with full-year adjusted EBITDA guidance updated to $233 million to $243 million [21][23] Other Important Information - The company repurchased approximately 935,000 shares in Q3 2025, reflecting confidence in its stock value [16] - The company ended Q3 with $911.6 million in long-term debt and maintained liquidity of approximately $890 million [20] Q&A Session Summary Question: Store remodels and food service opportunities - Management indicated that they are working on increasing the number of stores involved in the remodel program, with plans for an additional 20-25 stores following the initial seven [26] Question: Dealerization performance and same-store sales - Management highlighted that they are targeting stores that do not meet return on investment criteria and are focusing on regions with better performance metrics [29][30] Question: Capital expenditure allocation for projects - Management stated that they are measuring return on investment for each capital project and will focus on those that provide the best returns [41] Question: Mom-and-pop dealers' appetite for conversions - Management clarified that the majority of stores converted to dealers are not lower-margin properties but rather those that do not meet their investment criteria [42] Question: Gross margin sustainability - Management emphasized that margin increases are driven by vendor-supported promotions and believe that the improvements are sustainable moving forward [39]