Murphy USA Inc. (NYSE:MUSA) Q1 2018 Earnings Conference Call - Preliminary Transcript

May 02, 2018 • 12:00 pm ET

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Murphy USA Inc. (NYSE:MUSA) Q1 2018 Earnings Conference Call - Preliminary Transcript

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Presentation
Operator
Operator

Good morning. Good afternoon. My name is Kim, and I will be your conference operator today. At this time, I would like to welcome everyone to the Murphy USA 2018 First Quarter Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. (Operator Instructions)

I will now turn the call over to your host, Christian Pikul, Senior Director of Investor Relations. Please go ahead, sir.

Executive
Christian Pikul

Hey, good morning. Thank you, Kim, and thank you everyone for joining us today. With me are Andrew Clyde, President and Chief Executive Officer; Mindy West, Executive Vice President and Chief Financial Officer; and Donnie Smith, Vice President and Controller. After some opening comments from Andrew, Mindy will provide an overview of the financial results. And then we'll open up the call to Q&A.

Please keep in mind that some of the comments made during this call, including the Q&A portion, will be considered forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. As such, no assurances can be given that these events will occur or that the projections will be attained. A variety of factors exist that may cause actual results to differ. For further discussion of risk factors, please see the latest Murphy USA Forms 10-K, 10-Q, 8-K and any other recent SEC filings. Murphy USA takes no duty to publicly update or revise any forward-looking statements. During today's call, we may also provide certain performance measures that do not conform to generally accepted accounting principles or GAAP. We have provided schedules to reconcile these non-GAAP measures with the reported results on a GAAP basis as part of our earnings press release, which can be found on the investors section of our website.

With that, I will turn the call over to Andrew.

Executive
Andrew Clyde

Thank you, Christian. Good morning, and welcome to Murphy USA's first quarter 2018 conference call. I trust you've all reviewed the earnings release, so I will start by adding some color to the quarterly results before Mindy provide some additional financial details, and we open up the call to Q&A.

We all recognize Q1 is the most challenging quarter of the year, and last year truly brought that point home. We also know that Q1 performance is the weakest predictor of full-year performance as 2017 also proved out. So when looking at first quarter 2018 performance, I want to highlight three components of our strategy that are relevant to both our financial results and our long-term competitive positioning in the industry. First point is that our fuel business showed resilience on many fronts this quarter. From a year-over-year perspective, we saw higher all-in margins on a cents per gallon basis, $0.114 per gallon versus $0.101, which led a higher fuel contribution dollars of $114.6 million versus a $102.7 million in the first quarter of 2017. This increase was largely driven by results from our product supply and wholesale business which posted $0.03