Murphy USA Inc.'s net income dropped 24.8 percent during the 2016 third quarter, the El Dorado company said Wednesday.
Murphy USA turned a profit of $45.5 million for the third quarter, down from $60.5 million during the same period in 2015.
The company had earnings per share of $1.16 during the quarter, compared with $1.41 during the third quarter a year ago. Analysts expected Murphy USA to have $1.57 in earnings per share for the third quarter.
"Our business performed well during a challenging third quarter," Chief Executive Officer Andrew Clyde said in a statement.
Clyde said that while merchandise margins were at "record levels" during the third quarter, the business was hit by rising crude prices and the shutdown of Colonial Pipeline Co.'s gasoline pipeline in September.
Colonial's 36-inch pipeline ruptured in Alabama, releasing at least 252,000 gallons from the pipeline into a pond. The pipeline delivers gasoline from refineries in the Gulf Coast to much of the Southeast and Mid-Atlantic.
After the rupture, several states -- including Georgia and North Carolina -- that are supplied by the pipeline saw fuel prices jump and experienced shortages at gas pumps.
Murphy USA said the pipeline rupture and higher wholesale prices led to lower retail fuel volume per store and lower fuel margins. The company saw same-store fuel sales drop 3.1 percent.
"It was not their best quarter," said Bob Williams, senior vice president and managing director of Simmons First Investment Group Inc. in Little Rock. "The fuel margins alone were down nearly 25 percent."
Murphy USA, which separated from Murphy Oil Corp. in 2013, is a retail fuel and convenience store company.
The company also saw its revenue decline 10.6 percent during the third quarter. Murphy USA posted revenue of $3.04 billion for the period that ended Sept. 30, down from $3.4 billion during the same quarter a year ago.
"Volatility will always play a role in the markets where we operate and will remain impactful to our bottom line results, but the initiatives we have taken to improve our core business against this backdrop of uncertainty help to mitigate short-term earnings variability and ultimately drive superior long-term performance," Clyde said in a statement.
Murphy USA shares on Wednesday rose almost 1.2 percent to $67.83 on the New York Stock Exchange. The company released its third-quarter financial results after markets closed Wednesday.
Murphy USA bought back 607,000 shares during the third quarter, for $45 million, under its $500 million share-repurchasing program.
The company said it opened 21 new stores during the third quarter. Murphy USA had a total of 1,364 stores by the end of the quarter.
Murphy USA will hold a conference call at 10 a.m. today to discuss its financial results. The call will be live on the company's website at ir.corporate.murphyusa.com.
Business on 11/03/2016