Sale of Minit Mart Stores generated net proceeds of $319.9 million.
TravelCenters of America LLC (TA) outlined its financial results for the fourth quarter and year ended Dec. 31, 2018.
“For the fourth quarter of 2018, we had a loss from continuing operations of $7million, which is an improvement of $6.9 million, or 49.9%, over the prior year quarter,” said Andrew Rebholz, TA’s CEO.
Net loss for the 2018 fourth quarter improved by $14.8 million, or 71.4%, and adjusted EBITDA for the 2018 fourth quarter of $20.7 million was up by $7 million, or 50.8%, in each case compared to the prior year fourth quarter. Despite ongoing technological and competitive headwinds, the company grew total fuel sales volume by 0.8% and total nonfuel revenues by 3.9%.
“One soft spot in our fourth quarter operating results was related to site level operating expenses; our ratio of these expenses to nonfuel revenues increased. This resulted from higher labor costs as we recruited and trained truck repair technicians ahead of the increased business volume we expect,” Rebholz said.
“As important to me as the operating improvements is the fact that we made significant strides in our efforts to refocus the business back to our core travel center customer and reduce leverage,” Rebholz added.
In December 2018, TA closed on the sale of its standalone Minit Mart convenience stores business. In January 2019 it used most of the proceeds from that sale to purchase 20 previously leased travel centers from Hospitality Properties Trust (HPT), its primary landlord, and reduce its annual minimum rent payable to HPT by $43.1 million.
“We established a third brand in our travel center network by converting four existing locations to the smaller format TA Express brand announced earlier this year. Thus far in 2019, we have entered a franchise agreement to add a TA Express site to our network and an agreement to add up to five more TA Express sites to our network. Looking ahead, our plans include continuing to grow our travel center network and to extend our RoadSquad, RoadSquad OnSite and TA Commercial Tire Network™ to more customers, in addition to other marketing programs. We believe our plans will translate to increased EBITDA and cash flow this year,” Rebholz concluded.
A live audio webcast of a conference call on the results is available a listen only mode on TA’s website at www.ta-petro.com. The archived webcast will be available for replay on TA’s website for about one week.
