ARKOW ARKO Corporation

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 26, 2025

 

 

ARKO Corp.

(Exact name of Registrant as Specified in Its Charter)

 

 

Delaware			001-39828	85-2784337
(State or Other Jurisdiction of Incorporation)			(Commission File Number)	(IRS Employer Identification No.)
8565 Magellan Parkway Suite 400
Richmond, Virginia				23227-1150
(Address of Principal Executive Offices)				(Zip Code)

 

Registrant’s Telephone Number, Including Area Code: (804) 730-1568

 

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.0001 par value per share		ARKO		The Nasdaq Stock Market LLC
Warrants, each warrant exercisable for one share of Common Stock at an exercise price of $11.50		ARKOW		The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

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Item 2.02 Results of Operations and Financial Condition.

On February 26, 2025, ARKO Corp., a Delaware corporation (the “Company”), issued a press release announcing its financial results for the fourth quarter and year ended December 31, 2024. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by reference into this Item 2.02.

 

Item 7.01 Regulation FD Disclosure.

The information contained in Item 2.02 of this Current Report on Form 8-K is incorporated by reference into this Item 7.01.

The information contained in this Current Report on Form 8-K, including Exhibit 99.1 furnished herewith, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (“Exchange Act”), or otherwise subject to the liabilities of that Section and shall not be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act except to the extent expressly stated in such filing.

 

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit Number		Description
99.1		Press Release issued by ARKO Corp. on February 26, 2025.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

			ARKO CORP.
Date:	February 26, 2025	By:	/s/ Arie Kotler
		Name: Title:	Arie Kotler Chairman of the Board, President and Chief Executive Officer

 

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ARKO Corp. Reports Fourth Quarter and Full Year 2024 Results

ARKO Corp. (Nasdaq: ARKO) (“ARKO” or the “Company”), a Fortune 500 company and one of the largest convenience store operators in the United States, today announced financial results for the fourth quarter and the full year ended December 31, 2024.

Fourth Quarter and Full Year 2024 Key Highlights (vs. Year-Ago Period)1,2

 

 

Other Key Highlights

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“We navigated a challenging macroeconomic environment in 2024, while advancing the development of our multi-year transformation plan," said Arie Kotler, Chairman, President, and CEO of ARKO. “We made progress with our dealerization program by strategically refining our retail footprint, strengthening merchandising initiatives, and enhancing customer engagement through value-driven promotions for in-store merchandise and, more recently, a more aggressive value offer at the pump. Our focus on operational efficiencies and the dealerization program allowed us to manage through industry-wide headwinds while making strategic investments in high-growth areas, such as food service and other tobacco products to meet evolving customer preferences.”

 

Mr. Kotler continued: “Looking ahead to 2025, we remain committed to driving sustainable long-term growth and value creation for our stakeholders. We plan to strengthen our competitiveness by continuing to invest in higher-growth categories, delivering further value to our customers and further optimizing our store portfolio. We are acutely focused on delivering innovative, value-driven solutions that enhance the customer experience while maximizing profitability and expanding revenue opportunities.”

Fourth Quarter and Full Year 2024 Segment Highlights

Retail

	For the Three Months Ended December 31,								For the Year Ended December 31,
	2024				2023				2024				2023
	(in thousands)
Fuel gallons sold		258,856				279,035				1,080,990				1,122,321
Same store fuel gallons sold decrease (%) 1		(4.4	%)			(7.5	%)			(6.1	%)			(5.3	%)
Fuel contribution 2	$	100,212			$	109,336			$	428,216			$	435,322
Fuel margin, cents per gallon 3		38.7				39.2				39.6				38.8
Same store fuel contribution 1,2	$	96,830			$	104,262			$	403,503			$	422,090
Same store merchandise sales (decrease)   increase (%) 1		(4.3	%)			(2.8	%)			(5.4	%)			0.4	%
Same store merchandise sales excluding   cigarettes (decrease) increase (%) 1		(2.1	%)			(1.8	%)			(3.8	%)			2.5	%
Merchandise revenue	$	408,826			$	446,727			$	1,767,345			$	1,838,001

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Merchandise contribution 4	$	134,873			$	146,773			$	579,569			$	585,122
Merchandise margin 5		33.0	%			32.9	%			32.8	%			31.8	%
Same store merchandise contribution 1,4	$	129,376			$	135,532			$	543,368			$	560,321
Same store site operating expenses 1	$	179,302			$	181,527			$	736,727			$	737,158
1 Same store is a common metric used in the convenience store industry. The Company considers a store a same store beginning in the first quarter in which the store had a full quarter of activity in the prior year. Refer to Use of Non-GAAP Measures below for discussion of this measure.
2 Calculated as fuel revenue less fuel costs; excludes the estimated fixed margin or fixed fee paid to GPMP for the cost of fuel.
3 Calculated as fuel contribution divided by fuel gallons sold.
4 Calculated as merchandise revenue less merchandise costs.
5 Calculated as merchandise contribution divided by merchandise revenue.

 

Merchandise contribution for the fourth quarter of 2024 decreased $11.9 million, or 8.1%, compared to the fourth quarter of 2023, while merchandise margin increased to 33.0% in the fourth quarter of 2024 compared to 32.9% in 2023. The decrease in merchandise contribution was due to a decrease in same store merchandise contribution of $6.2 million and a decrease of $7.7 million related to underperforming retail stores that were closed or converted to dealers, partially offset by an increase in merchandise contribution of $2.0 million from the SpeedyQ acquisition that closed in April 2024. Merchandise contribution at same stores decreased in the fourth quarter of 2024 primarily due to lower contribution from several core destination categories and cigarettes, partially offset by higher contribution from other tobacco products.

For the year ended December 31, 2024, merchandise contribution decreased $5.6 million, or 0.9%, compared to the year ended December 31, 2023, while merchandise margin increased to 32.8% in 2024 from 31.8% in 2023. The decrease in merchandise contribution was due to a decrease in same store merchandise contribution of $17.0 million and a decrease in merchandise contribution of $11.6 million related to underperforming retail stores that were closed or converted to dealers, partially offset by incremental merchandise contribution from recent acquisitions of $21.7 million.

For the fourth quarter of 2024, retail fuel contribution decreased $9.1 million to $100.2 million compared to the prior year period, with a same store fuel contribution decrease of $7.4 million attributable to gallon demand declines reflecting the challenging macro-economic environment. Fuel margin of 38.7 cents per gallon was down 0.5 cents per gallon compared to the fourth quarter of 2023, resulting from lower fuel costs and reduced price volatility this year. In addition, a decrease in retail fuel contribution of $3.7 million was related to underperforming retail stores that were closed or converted to dealers, partially offset by incremental fuel contribution from the SpeedyQ acquisition of approximately $1.8 million.

For the year ended December 31, 2024, fuel contribution decreased $7.1 million, or 1.6%, compared to the year ended December 31, 2023, while fuel margin per gallon increased. Same store fuel margin per gallon for 2024 increased to 39.7 cents per gallon from 39.0 cents per gallon for 2023. Incremental fuel contribution from recent acquisitions of approximately $16.8 million was more than offset by a decrease in same store fuel contribution of $18.6 million. In addition, a decrease in fuel contribution of $6.1

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million was related to underperforming retail stores that were closed or converted to dealers compared to 2023.

Wholesale

	For the Three Months Ended December 31,								For the Year Ended December 31,
	2024				2023				2024				2023
	(in thousands)
Fuel gallons sold – fuel supply locations		201,317				199,861				794,796				801,260
Fuel gallons sold – consignment agent locations		38,563				40,144				154,560				168,005
Fuel contribution 1 – fuel supply locations	$	12,004			$	11,499			$	47,930			$	48,396
Fuel contribution 1 – consignment agent locations	$	10,270			$	10,101			$	42,420			$	44,512
Fuel margin, cents per gallon 2 – fuel supply locations		6.0				5.8				6.0				6.0
Fuel margin, cents per gallon 2 – consignment agent locations		26.6				25.2				27.4				26.5
1 Calculated as fuel revenue less fuel costs; excludes the estimated fixed margin or fixed fee paid to GPMP for the cost of fuel.
2 Calculated as fuel contribution divided by fuel gallons sold.

 

Fuel contribution was approximately $22.3 million for the fourth quarter of 2024 compared to $21.6 million for the fourth quarter of 2023. Fuel contribution for the fourth quarter of 2024 at fuel supply locations increased by $0.5 million, and fuel contribution at consignment agent locations increased by $0.2 million, as compared to the prior year period, with fuel margin increases of 0.2 cents per gallon and 1.4 cents per gallon, respectively. For the fourth quarter of 2024, other revenues, net, increased by approximately $1.8 million, while site operating expenses increased by $0.6 million compared to the prior year period, resulting from the retail stores that were converted to dealers.

For the year ended December 31, 2024, wholesale operating income increased $0.8 million, compared to 2023. An increase of approximately $3.4 million in other revenues, net, was partially offset by a decrease in fuel contribution of approximately $2.6 million in 2024 compared to 2023. At fuel supply locations, fuel contribution decreased by $0.5 million, and fuel margin per gallon remained consistent with 2023, primarily due to decreased prompt pay discounts related to lower fuel costs and lower volumes at comparable wholesale sites, which was partially offset by incremental contribution from recent acquisitions and the retail stores converted to dealers. At consignment agent locations, fuel contribution decreased $2.1 million while fuel margin per gallon increased for 2024 compared to 2023, primarily due to incremental contribution from recent acquisitions and the retail stores converted to dealers, which was offset by lower rack-to-retail margins and decreased prompt pay discounts related to lower fuel costs.

Fleet Fueling

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	For the Three Months Ended December 31,								For the Year Ended December 31,
	2024				2023				2024				2023
	(in thousands)
Fuel gallons sold – proprietary cardlock locations		32,888				33,285				136,104				130,995
Fuel gallons sold – third-party cardlock locations		3,239				3,201				12,814				9,832
Fuel contribution 1 – proprietary cardlock locations	$	15,823			$	13,146			$	62,612			$	54,685
Fuel contribution 1 – third-party cardlock locations	$	509			$	245			$	1,677			$	1,215
Fuel margin, cents per gallon 2 – proprietary   cardlock locations		48.1				39.5				46.0				41.7
Fuel margin, cents per gallon 2 – third-party   cardlock locations		15.8				7.6				13.1				12.4
1 Calculated as fuel revenue less fuel costs; excludes the estimated fixed fee paid to GPMP for the cost of fuel.
2 Calculated as fuel contribution divided by fuel gallons sold.

 

For the fourth quarter of 2024, fuel contribution increased by $2.9 million compared to the fourth quarter of 2023. At proprietary cardlocks, fuel contribution increased by $2.7 million, and fuel margin per gallon also increased for the fourth quarter of 2024 compared to the fourth quarter of 2023. At third-party cardlock locations, fuel contribution increased by $0.3 million, and fuel margin per gallon also increased for the fourth quarter of 2024 compared to the fourth quarter of 2023.

For the year ended December 31, 2024, fuel contribution increased by $8.4 million compared to the year ended December 31, 2023. At proprietary cardlocks, fuel contribution increased by $7.9 million, and fuel margin per gallon also increased for the year ended December 31, 2024, compared to the year ended December 31, 2023. At third-party cardlock locations, fuel contribution increased $0.5 million, and fuel margin per gallon also increased for 2024 compared to 2023. These changes were primarily due to higher volumes and the cardlocks acquired in the Company’s acquisition of certain sites from WTG Fuels Holdings, LLC in 2023.

Site Operating Expenses

For the quarter ended December 31, 2024, convenience store operating expenses decreased $13.0 million, or 6.5%, compared to the prior year period primarily due to a decrease of $14.3 million from underperforming retail stores that were closed or converted to dealers and a decrease in same store operating expenses of $2.2 million, or 1.2%. The decrease in convenience store operating expenses was partially offset by incremental expenses related to the SpeedyQ acquisition that closed in April 2024.

For the year ended December 31, 2024, convenience store operating expenses increased $11.2 million, or 1.4%, as compared to the year ended December 31, 2023, primarily due to $33.1 million of incremental expenses related to recent acquisitions. The increase in site operating expenses was partially offset by a decrease in same store operating expenses of $0.4 million, and $22.1 million of reduced expenses for underperforming retail stores that were closed or converted to dealers.

Liquidity and Capital Expenditures

As of December 31, 2024, the Company’s total liquidity was approximately $841 million, consisting of approximately $262 million of cash and cash equivalents and approximately $579 million of availability

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under lines of credit. Outstanding debt was $881 million, resulting in net debt, excluding lease related financing liabilities, of approximately $619 million. Capital expenditures were $36.1 million, and $113.9 million for the quarter and year ended December 31, 2024, respectively.

Quarterly Dividend and Share Repurchase Program

The Company’s ability to return cash to its stockholders through its cash dividend program and share repurchase program is consistent with its capital allocation framework and reflects the Company’s confidence in the strength of its cash generation ability and strong financial position.

The Board declared a quarterly dividend of $0.03 per share of common stock to be paid on March 21, 2025 to stockholders of record as of March 10, 2025.

There was approximately $25.7 million remaining under the share repurchase program as of December 31, 2024.

Company-Operated Retail Store Count and Segment Update

The following tables present certain information regarding changes in the retail, wholesale and fleet fueling segments for the periods presented:

	For the Three Months Ended December 31,								For the Year Ended December 31,
Retail Segment	2024				2023				2024				2023
Number of sites at beginning of period		1,491				1,552				1,543				1,404
Acquired sites		—				—				21				166
Newly opened or reopened sites		1				—				3				4
Company-controlled sites converted to
consignment or fuel supply locations, net		(102	)			(3	)			(153	)			(16	)
Sites closed, divested or converted to rentals		(1	)			(6	)			(25	)			(15	)
Number of sites at end of period		1,389				1,543				1,389				1,543

 

	For the Three Months Ended December 31,								For the Year Ended December 31,
Wholesale Segment 1	2024				2023				2024				2023
Number of sites at beginning of period		1,832				1,825				1,825				1,674
Acquired sites		—				—				—				190
Newly opened or reopened sites 2		9				25				39				83
Consignment or fuel supply locations converted
from Company-controlled or fleet fueling sites, net		102				2				153				15
Closed or divested sites		(21	)			(27	)			(95	)			(137	)
Number of sites at end of period		1,922				1,825				1,922				1,825
1 Excludes bulk and spot purchasers.
2 Includes all signed fuel supply agreements irrespective of fuel distribution commencement date.

 

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	For the Three Months Ended December 31,								For the Year Ended December 31,
Fleet Fueling Segment	2024				2023				2024				2023
Number of sites at beginning of period		281				295				298				183
Acquired sites		—				—				—				111
Newly opened or reopened sites		—				2				1				6
Fleet fueling locations converted
from fuel supply locations, net		—				1				—				1
Closed or divested sites		(1	)			—				(19	)			(3	)
Number of sites at end of period		280				298				280				298

 

First Quarter and Full Year 2025 Guidance

The Company currently expects first quarter 2025 Adjusted EBITDA to range between $27 million and $33 million, with an assumed range of average retail fuel margin from 37.0 to 39.0 cents per gallon. The Company currently expects full year 2025 Adjusted EBITDA to range between $233 million and $253 million, with an assumed range of average retail fuel margin from 39.5 to 41.5 cents per gallon.

 

The Company is not providing guidance on net income at this time due to the volatility of certain required inputs that are not available without unreasonable efforts, including future fair value adjustments associated with its stock price, as well as depreciation and amortization related to its capital allocation as part of its focus on accelerating organic growth.

 

Conference Call and Webcast Details

The Company will host a conference call today, February 26, 2025, to discuss these results at 5:00 p.m. Eastern Time. Investors and analysts interested in participating in the live call can dial 877-605-1792 or 201-689-8728.

A simultaneous, live webcast will also be available on the Investor Relations section of the Company’s website at https://www.arkocorp.com/news-events/ir-calendar. The webcast will be archived for 30 days.

About ARKO Corp.

ARKO Corp. (Nasdaq: ARKO) is a Fortune 500 company that owns 100% of GPM Investments, LLC and is one of the largest operators of convenience stores and wholesalers of fuel in the United States. Based in Richmond, VA, our highly recognizable Family of Community Brands offers delicious, prepared foods, beer, snacks, candy, hot and cold beverages, and multiple popular quick serve restaurant brands. We operate in four reportable segments: retail, which includes convenience stores selling merchandise and fuel products to retail customers; wholesale, which supplies fuel to independent dealers and consignment agents; fleet fueling, which includes the operation of proprietary and third-party cardlock locations, and issuance of proprietary fuel cards that provide customers access to a nationwide network of fueling sites; and GPM Petroleum, which sells and supplies fuel to our retail and wholesale sites and charges a fixed fee, primarily to our fleet fueling sites. To learn more about GPM stores, visit: www.gpminvestments.com. To learn more about ARKO, visit: www.arkocorp.com.

 

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Forward-Looking Statements

This document includes certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may address, among other things, the Company’s expected financial and operational results and the related assumptions underlying its expected results. These forward-looking statements are distinguished by use of words such as “accretive,” “anticipate,” “aim,” “believe,” “continue,” “could,” “estimate,” “expect,” “guidance,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “will,” “would” and the negative of these terms, and similar references to future periods. These statements are based on management’s current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from these expectations due to, among other things, changes in economic, business and market conditions; the Company’s ability to maintain the listing of its common stock and warrants on the Nasdaq Stock Market; changes in its strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects and plans; expansion plans and opportunities; changes in the markets in which it competes; changes in applicable laws or regulations, including those relating to environmental matters; market conditions and global and economic factors beyond its control; and the outcome of any known or unknown litigation and regulatory proceedings. Detailed information about these factors and additional important factors can be found in the documents that the Company files with the Securities and Exchange Commission, such as Form 10-K, Form 10-Q and Form 8-K. Forward-looking statements speak only as of the date the statements were made. The Company does not undertake an obligation to update forward-looking information, except to the extent required by applicable law.

Use of Non-GAAP Measures

The Company discloses certain measures on a “same store basis,” which is a non-GAAP measure. Information disclosed on a “same store basis” excludes the results of any store that is not a “same store” for the applicable period. A store is considered a same store beginning in the first quarter in which the store had a full quarter of activity in the prior year. The Company believes that this information provides greater comparability regarding its ongoing operating performance. Neither this measure nor those described below should be considered an alternative to measurements presented in accordance with generally accepted accounting principles in the United States (“GAAP”).

The Company defines EBITDA as net income before net interest expense, income taxes, depreciation and amortization. Adjusted EBITDA further adjusts EBITDA by excluding the gain or loss on disposal of assets, impairment charges, acquisition and divestiture costs, share-based compensation expense, other non-cash items, and other unusual or non-recurring charges. Both EBITDA and Adjusted EBITDA are non-GAAP financial measures.

The Company uses EBITDA and Adjusted EBITDA for operational and financial decision-making and believe these measures are useful in evaluating its performance because they eliminate certain items that it does not consider indicators of its operating performance. EBITDA and Adjusted EBITDA are also used by many of its investors, securities analysts, and other interested parties in evaluating its operational and financial performance across reporting periods. The Company believes that the presentation of EBITDA and Adjusted EBITDA provides useful information to investors by allowing an understanding of key measures that it uses internally for operational decision-making, budgeting, evaluating acquisition targets, and assessing its operating performance.

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EBITDA and Adjusted EBITDA are not recognized terms under GAAP and should not be considered as a substitute for net income or any other financial measure presented in accordance with GAAP. These measures have limitations as analytical tools and should not be considered in isolation or as substitutes for analysis of its results as reported under GAAP. The Company strongly encourages investors to review its financial statements and publicly filed reports in their entirety and not to rely on any single financial measure.

Because non-GAAP financial measures are not standardized, same store measures, EBITDA and Adjusted EBITDA, as defined by the Company, may not be comparable to similarly titled measures reported by other companies. It therefore may not be possible to compare the Company’s use of these non-GAAP financial measures with those used by other companies.

 

Company Contact

Jordan Mann

ARKO Corp.

investors@gpminvestments.com

 

Investor Contact

Sean Mansouri, CFA

Elevate IR

(720) 330-2829

ARKO@elevate-ir.com

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	Consolidated Statements of Operations
	For the Three Months Ended December 31,								For the Year Ended December 31,
	2024				2023				2024				2023
	(in thousands)
Revenues:
Fuel revenue	$	1,556,185			$	1,759,216			$	6,858,919			$	7,464,372
Merchandise revenue		408,826				446,727				1,767,345				1,838,001
Other revenues, net		27,098				27,217				105,698				110,358
Total revenues		1,992,109				2,233,160				8,731,962				9,412,731
Operating expenses:
Fuel costs		1,416,234				1,613,230				6,271,696				6,876,084
Merchandise costs		273,953				299,954				1,187,776				1,252,879
Site operating expenses		209,906				222,751				875,272				860,134
General and administrative expenses		39,690				38,102				162,920				165,294
Depreciation and amortization		33,989				32,648				132,414				127,597
Total operating expenses		1,973,772				2,206,685				8,630,078				9,281,988
Other expenses, net		3,962				1,168				7,858				12,729
Operating income		14,375				25,307				94,026				118,014
Interest and other financial income		4,229				2,197				30,591				20,273
Interest and other financial expenses		(23,942	)			(25,099	)			(97,752	)			(91,516	)
(Loss) income before income taxes		(5,338	)			2,405				26,865				46,771
Income tax benefit (expense)		2,995				(1,317	)			(6,144	)			(12,166	)
Income (loss) from equity investment		45				38				124				(39	)
Net (loss) income	$	(2,298	)		$	1,126			$	20,845			$	34,566
Less: Net income attributable to non-controlling   interests		—				48				—				197
Net (loss) income attributable to ARKO Corp.	$	(2,298	)		$	1,078			$	20,845			$	34,369
Series A redeemable preferred stock dividends		(1,445	)			(1,449	)			(5,750	)			(5,750	)
Net (loss) income attributable to common   shareholders	$	(3,743	)		$	(371	)		$	15,095			$	28,619
Net (loss) income per share attributable to    common shareholders - basic	$	(0.03	)		$	(0.00	)		$	0.13			$	0.24
Net (loss) income per share attributable to    common shareholders - diluted	$	(0.03	)		$	(0.00	)		$	0.13			$	0.24
Weighted average shares outstanding:
Basic		115,771				116,638				116,139				118,782
Diluted		115,771				116,638				116,949				119,605

 

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	Consolidated Balance Sheets
	December 31, 2024				December 31, 2023
	(in thousands)
Assets
Current assets:
Cash and cash equivalents	$	261,758			$	218,120
Restricted cash		30,650				23,301
Short-term investments		5,330				3,892
Trade receivables, net		95,832				134,735
Inventory		231,225				250,593
Other current assets		97,413				118,472
Total current assets		722,208				749,113
Non-current assets:
Property and equipment, net		747,548				742,610
Right-of-use assets under operating leases		1,386,244				1,384,693
Right-of-use assets under financing leases, net		157,999				162,668
Goodwill		299,973				292,173
Intangible assets, net		182,355				214,552
Equity investment		3,009				2,885
Deferred tax asset		67,689				52,293
Other non-current assets		53,633				49,377
Total assets	$	3,620,658			$	3,650,364
Liabilities
Current liabilities:
Long-term debt, current portion	$	12,944			$	16,792
Accounts payable		190,212				213,657
Other current liabilities		159,239				179,536
Operating leases, current portion		71,580				67,053
Financing leases, current portion		11,515				9,186
Total current liabilities		445,490				486,224
Non-current liabilities:
Long-term debt, net		868,055				828,647
Asset retirement obligation		87,375				84,710
Operating leases		1,408,293				1,395,032
Financing leases		211,051				213,032
Other non-current liabilities		223,528				266,602
Total liabilities		3,243,792				3,274,247
Series A redeemable preferred stock		100,000				100,000
Shareholders' equity:
Common stock		12				12
Treasury stock		(106,123	)			(74,134	)
Additional paid-in capital		276,681				245,007
Accumulated other comprehensive income		9,119				9,119
Retained earnings		97,177				96,097
Total shareholders' equity		276,866				276,101
Non-controlling interest		—				16
Total equity		276,866				276,117

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Total liabilities, redeemable preferred stock and equity	$	3,620,658			$	3,650,364

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	Consolidated Statements of Cash Flows
	For the Three Months Ended December 31,								For the Year Ended December 31,
	2024				2023				2024				2023
	(in thousands)
Cash flows from operating activities:
Net (loss) income	$	(2,298	)		$	1,126			$	20,845			$	34,566
Adjustments to reconcile net (loss) income to net cash   provided by operating activities:
Depreciation and amortization		33,989				32,648				132,414				127,597
Deferred income taxes		(9,136	)			(652	)			(12,796	)			(4,680	)
Loss on disposal of assets and impairment charges		1,661				660				6,798				6,203
Foreign currency (gain) loss		(6	)			(101	)			35				29
Gain from issuance of shares as payment of   deferred consideration related to business   acquisition		—				—				(2,681	)			—
Gain from settlement related to business   acquisition		—				—				(6,356	)			—
Amortization of deferred financing costs and debt   discount		669				661				2,669				2,518
Amortization of deferred income		(4,351	)			(1,840	)			(14,477	)			(8,142	)
Accretion of asset retirement obligation		661				709				2,532				2,399
Non-cash rent		3,530				3,750				14,335				14,168
Charges to allowance for credit losses		112				244				845				1,265
(Income) loss from equity investment		(45	)			(38	)			(124	)			39
Share-based compensation		4,077				1,777				12,339				15,015
Fair value adjustment of financial assets and   liabilities		(222	)			842				(10,985	)			(10,785	)
Other operating activities, net		(627	)			352				125				2,631
Changes in assets and liabilities:
Decrease (increase) in trade receivables		21,946				44,550				38,058				(17,937	)
Decrease (increase) in inventory		5,262				15,373				22,689				(2,013	)
(Increase) decrease in other assets		(16	)			(957	)			13,893				(29,386	)
Decrease in accounts payable		(18,032	)			(35,836	)			(24,169	)			(6,169	)
(Decrease) increase in other current liabilities		(20,664	)			(8,002	)			(2,820	)			990
Decrease in asset retirement obligation		(634	)			(69	)			(917	)			(23	)
Increase in non-current liabilities		6,852				2,090				29,606				7,809
Net cash provided by operating activities		22,728				57,287				221,858				136,094
Cash flows from investing activities:
Purchase of property and equipment		(36,133	)			(35,561	)			(113,914	)			(111,164	)
Purchase of intangible assets		—				—				—				(45	)
Proceeds from sale of property and equipment		2,196				3,134				53,549				310,240
Business and asset acquisitions, net of cash		—				33				(54,549	)			(494,871	)
Prepayment for acquisitions		—				(1,000	)			—				(1,000	)
Loans to equity investment, net		14				18				56				18
Net cash used in investing activities		(33,923	)			(33,376	)			(114,858	)			(296,822	)
Cash flows from financing activities:
Receipt of long-term debt, net		—				20,810				47,556				99,643
Repayment of debt		(5,794	)			(5,640	)			(26,357	)			(22,157	)
Principal payments on financing leases		(1,360	)			(1,260	)			(4,940	)			(5,497	)

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Early settlement of deferred consideration   related to business acquisition		—				—				(17,155	)			—
Proceeds from sale-leaseback		—				—				—				80,397
Payment of Additional Consideration		(3,354	)			(3,505	)			(3,354	)			(3,505	)
Payment of Ares Put Option		—				—				—				(9,808	)
Common stock repurchased		—				(8,495	)			(31,989	)			(33,694	)
Dividends paid on common stock		(3,473	)			(3,497	)			(14,015	)			(14,272	)
Dividends paid on redeemable preferred stock		(1,445	)			(1,449	)			(5,750	)			(5,750	)
Net cash (used in) provided by financing activities		(15,426	)			(3,036	)			(56,004	)			85,357
Net (decrease) increase in cash and cash equivalents   and restricted cash		(26,621	)			20,875				50,996				(75,371	)
Effect of exchange rate on cash and cash equivalents   and restricted cash		18				106				(9	)			23
Cash and cash equivalents and restricted cash,   beginning of period		319,011				220,440				241,421				316,769
Cash and cash equivalents and restricted cash, end   of period	$	292,408			$	241,421			$	292,408			$	241,421

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Supplemental Disclosure of Non-GAAP Financial Information

	Reconciliation of EBITDA and Adjusted EBITDA
	For the Three Months Ended December 31,								For the Year Ended December 31,
	2024				2023				2024				2023
	(in thousands)
Net (loss) income	$	(2,298	)		$	1,126			$	20,845			$	34,566
Interest and other financing expenses, net		19,713				22,902				67,161				71,243
Income tax (benefit) expense		(2,995	)			1,317				6,144				12,166
Depreciation and amortization		33,989				32,648				132,414				127,597
EBITDA		48,409				57,993				226,564				245,572
Acquisition and divestiture costs (a)		1,249				1,099				5,168				9,079
Loss on disposal of assets and impairment charges (b)		1,661				660				6,798				6,203
Share-based compensation expense (c)		4,077				1,777				12,339				15,015
(Income) loss from equity investment (d)		(45	)			(38	)			(124	)			39
Fuel and franchise taxes received in arrears (e)		—				—				(1,427	)			—
Adjustment to contingent consideration (f)		978				68				(20	)			(604	)
Other (g)		519				230				(438	)			956
Adjusted EBITDA	$	56,848			$	61,789			$	248,860			$	276,260
Additional information
Non-cash rent expense (h)		3,530				3,750				14,335				14,168
(a) Eliminates costs incurred that are directly attributable to business acquisitions and divestitures (including conversion of retail stores to dealer sites) and salaries of employees whose primary job function is to execute the Company's acquisition and divestiture strategy and facilitate integration of acquired operations.
(b) Eliminates the non-cash loss from the sale or disposal of property and equipment, the loss recognized upon the sale of related leased assets, and impairment charges on property and equipment and right-of-use assets related to closed and non-performing sites.
(c) Eliminates non-cash share-based compensation expense related to the equity incentive program in place to incentivize, retain, and motivate employees, certain non-employees and members of the Board.
(d) Eliminates the Company's share of (income) loss attributable to its unconsolidated equity investment.
(e) Eliminates the receipt of historical fuel and franchise tax amounts for multiple prior periods.
(f) Eliminates fair value adjustments to the contingent consideration owed to the seller for the 2020 Empire acquisition.
(g) Eliminates other unusual or non-recurring items that the Company does not consider to be meaningful in assessing operating performance.
(h) Non-cash rent expense reflects the extent to which GAAP rent expense recognized exceeded (or was less than) cash rent payments. GAAP rent expense varies depending on the terms of the Company's lease portfolio. For newer leases, rent expense recognized typically exceeds cash rent payments, whereas, for more mature leases, rent expense recognized is typically less than cash rent payments.

 

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Supplemental Disclosures of Segment Information

Retail Segment

	For the Three Months Ended December 31,								For the Year Ended December 31,
	2024				2023				2024				2023
	(in thousands)
Revenues:
Fuel revenue	$	779,352			$	913,534			$	3,509,935			$	3,858,777
Merchandise revenue		408,826				446,727				1,767,345				1,838,001
Other revenues, net		15,768				17,104				65,264				74,406
Total revenues		1,203,946				1,377,365				5,342,544				5,771,184
Operating expenses:
Fuel costs 1		679,140				804,198				3,081,719				3,423,455
Merchandise costs		273,953				299,954				1,187,776				1,252,879
Site operating expenses		187,981				200,952				790,645				779,448
Total operating expenses		1,141,074				1,305,104				5,060,140				5,455,782
Operating income	$	62,872			$	72,261			$	282,404			$	315,402
1 Excludes the estimated fixed margin or fixed fee paid to GPMP for the cost of fuel.

 

The table below shows financial information and certain key metrics of the SpeedyQ acquisition in the Retail Segment for which there is no comparable information for any of the prior periods.

 

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		For the Three Months Ended December 31, 2024				For the Year Ended December 31, 2024
		SpeedyQ 1
	(in thousands)
Date of Acquisition:		April 9, 2024
Revenues:
Fuel revenue		$	11,359			$	38,937
Merchandise revenue			6,469				20,719
Other revenues, net			311				809
Total revenues			18,139				60,465
Operating expenses:
Fuel costs 2			9,580				33,455
Merchandise costs			4,473				14,709
Site operating expenses			3,373				9,760
Total operating expenses			17,426				57,924
Operating income		$	713			$	2,541
Fuel gallons sold			3,768				11,865
Fuel contribution 3		$	1,779			$	5,482
Merchandise contribution 4		$	1,996			$	6,010
Merchandise margin 5			30.9	%			29.0	%
1 Acquisition of seven Speedy's retail stores.
2 Excludes the estimated fixed margin paid to GPMP for the cost of fuel.
3 Calculated as fuel revenue less fuel costs.
4 Calculated as merchandise revenue less merchandise costs.
5 Calculated as merchandise contribution divided by merchandise revenue.

 

Wholesale Segment

 

	For the Three Months Ended December 31,								For the Year Ended December 31,
	2024				2023				2024				2023
	(in thousands)
Revenues:
Fuel revenue	$	652,016			$	700,026			$	2,799,869			$	3,039,904
Other revenues, net		8,681				6,909				29,140				25,775
Total revenues		660,697				706,935				2,829,009				3,065,679
Operating expenses:
Fuel costs 1		629,742				678,426				2,709,519				2,946,996
Site operating expenses		10,997				10,400				39,679				39,703
Total operating expenses		640,739				688,826				2,749,198				2,986,699
Operating income	$	19,958			$	18,109			$	79,811			$	78,980
1 Excludes the estimated fixed margin or fixed fee paid to GPMP for the cost of fuel.

 

 

Fleet Fueling Segment

 

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	For the Three Months Ended December 31,								For the Year Ended December 31,
	2024				2023				2024				2023
	(in thousands)
Revenues:
Fuel revenue	$	117,196			$	136,801			$	515,462			$	530,937
Other revenues, net		2,131				2,616				9,135				7,818
Total revenues		119,327				139,417				524,597				538,755
Operating expenses:
Fuel costs 1		100,864				123,410				451,173				475,037
Site operating expenses		6,056				6,259				24,917				22,298
Total operating expenses		106,920				129,669				476,090				497,335
Operating income	$	12,407			$	9,748			$	48,507			$	41,420
1 Excludes the estimated fixed fee paid to GPMP for the cost of fuel.

 

 

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v3.25.0.1

Document And Entity Information	Feb. 26, 2025
Document Information [Line Items]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Feb. 26, 2025
Entity Registrant Name	ARKO Corp.
Entity Central Index Key	0001823794
Entity Emerging Growth Company	false
Entity File Number	001-39828
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	85-2784337
Entity Address, Address Line One	8565 Magellan Parkway
Entity Address, Address Line Two	Suite 400
Entity Address, City or Town	Richmond
Entity Address, State or Province	VA
Entity Address, Postal Zip Code	23227-1150
City Area Code	(804)
Local Phone Number	730-1568
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Common Stock [Member]
Document Information [Line Items]
Title of 12(b) Security	Common Stock, $0.0001 par value per share
Trading Symbol	ARKO
Security Exchange Name	NASDAQ
Warrants Each Warrant Exercisable For One Share Of Common Stock At An Exercise Price Of 11.50 [Member]
Document Information [Line Items]
Title of 12(b) Security	Warrants, each warrant exercisable for one share of Common Stock at an exercise price of $11.50
Trading Symbol	ARKOW
Security Exchange Name	NASDAQ

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