Financial Data and Key Metrics Changes - The second quarter results reflect a 3.2% decline in same-store fuel volumes, with July volumes rebounding to 100% of prior year levels [6][14] - Retail fuel margins improved by 50 basis points in 2024, with an 80 basis point year-to-date improvement and an additional 13 basis points from lower credit card fees [11][12] - The effective tax rate for the first half was 22%, with expectations for the second half to be within the guided range of 24% to 26% [17][18] Business Line Data and Key Metrics Changes - Non-combustible nicotine categories are growing at a rate that offsets the decline in cigarette margins, which represent only 30% of total nicotine margin contribution [8] - Merchandise contribution increased by 8.9% for the quarter, excluding cigarettes and lottery, driven by strength in candy and packaged beverages [10][15] - Average per store month food and beverage sales at QuickChek have been positive for three consecutive quarters, indicating strong traffic [9] Market Data and Key Metrics Changes - Fuel prices remain range-bound despite geopolitical events, contributing to a lower price and less volatile environment [6] - The company outpaced OPUS volumes in each of its markets for the full quarter, despite a deceleration in June [33] Company Strategy and Development Direction - The company is focused on maintaining store profitability through operational cost improvements and a robust new store pipeline, with plans to deliver 50 new stores over the next twelve months [12][19] - The capital allocation strategy remains a fifty-fifty approach, balancing growth investments and shareholder returns [90][91] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the second half of the year, particularly regarding nicotine contributions and the impact of FDA crackdowns on illicit products [8][63] - The company is well-positioned to weather lower demand cycles while maintaining a focus on long-term growth and operational efficiencies [49][51] Other Important Information - The company repurchased 471,000 shares in the second quarter, with year-to-date repurchases nearing 900,000 shares [20] - The new store construction pipeline is robust, with over 45 new stores in construction for Q3, indicating strong future growth potential [19] Q&A Session Summary Question: Trends in gallons and market share - Management noted that trends worsened partly due to a different same-store base and that margins improved despite lower volumes [31][32] Question: Guidance on EBITDA - Management reiterated that while they do not provide EBITDA guidance, operational efficiencies are expected to offset merchandise pressures [34][36] Question: Store build confidence - Management highlighted that bottlenecks have been addressed, leading to confidence in meeting store build targets [40][41] Question: Demand environment and cost flexibility - Management discussed the importance of consumer price sensitivity and the ability to optimize costs in a lower demand environment [45][48] Question: Merchandise contribution growth - Management expressed confidence in achieving guidance due to strong performance in non-cigarette categories and initiatives to drive customer engagement [55][59] Question: Share repurchases and capital allocation - Management clarified that leverage is balanced between growth and shareholder returns, maintaining a focus on their fifty-fifty capital allocation strategy [89][91] Question: Competitive landscape and fuel volume trends - Management indicated no significant differences in customer behavior between Walmart and non-Walmart locations, with competitive pressures being consistent across markets [96][97]