TravelCenters of America Income Falls as Growth Outpaces Fuel-Efficiency Headwinds
TravelCenters of America, an operator of truck stops and convenience stores, reported lower net income for the fourth quarter and full year in 2016 as revenue was mixed.
Income for the quarter ended Dec. 31 was a net loss of $6.4 million, or 14 cents per diluted share, compared with a net loss of $1.6 million, or 4 cents, TCA said Feb. 28.
Revenue increased to $1.4 billion compared with $1.3 billion a year earlier.
Full-year income amounted to a loss of $2 million, or 5 cents, compared with a net profit of $27.7 million, or 72 cents, in the 2015 period.
Revenue slipped to $5.5 billion, compared with $5.8 billion.
The company attributed the decline in income to increased depreciation expense associated with investments in new locations and existing site improvements that were placed in service during the past year.
“During the 2016 fourth quarter, our business strategies resulted in gains in nonfuel gross margin as well as continued improvement in operating efficiencies as reflected in lower site-level operating expenses on a same-site basis,” Thomas O'Brien, TA's CEO, said in a statement.
Its fuel gross margin was negatively affected by the absence in the 2016 period of an $8 million pretax benefit in the 2015 fourth quarter related to biodiesel fuel-tax credits, the company said; its 2016 performance made up for all but $2.2 million of that amount.
“The combination of our internal and external growth activities outpaced headwinds of increased fuel efficiency for heavy-duty truck engines, the impact of competition and a softness in freight volume,” O'Brien added.
