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What changed in ARKO Corp.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of ARKO Corp.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+356 added−369 removedSource: 10-K (2025-02-26) vs 10-K (2024-02-27)

Top changes in ARKO Corp.'s 2024 10-K

356 paragraphs added · 369 removed · 279 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

59 edited+21 added−20 removed38 unchanged
Biggest changeIn 2023, we updated approximately 310 of our stores with expanded core categories. • Development and strengthening of customer relationships through our fas REWARDS® loyalty program, which offers enrolled loyalty members in-store exclusive promotional pricing, in-app member only HOT deals not available in stores, order and delivery, age verified offers on tobacco and alcohol, and a store locator with current gas prices at stores close to members.
Biggest changeAlso, the app provides customers an order and delivery function, age verified offers on tobacco and alcohol, and a store locator with current gas prices at nearby GPM stores. Currently, approximately 2.3 million customers are enrolled in our fas REWARDS® loyalty program.
We operate our stores under more than 25 regional store brands (which we consider “a Family of Community Brands”), including 1-Stop, Admiral, Apple Market ® , BreadBox, Corner Mart, Dixie Mart, ExpressStop ® , E-Z Mart ® , fas mart ® , fastmarket®, Flash Market, Handy Mart, Jetz, Jiffi Stop ® , Jiffy Stop, Li’l Cricket, Market Express, Next Door Store ® , Pride, Roadrunner Markets, Rose Mart, Rstore, Scotchman ® , shore stop ® , Speedy’s, Town Star, Uncle’s, Village Pantry ® and Young’s.
We operate our stores under more than 25 regional store brands (which we consider “a Family of Community Brands”), including 1-Stop, Admiral, Apple Market ® , BreadBox, Corner Mart, Dixie Mart, ExpressStop ® , E-Z Mart ® , fas mart ® , fastmarket®, Flash Market, Handy Mart, Jetz, Jiffi Stop ® , Jiffy Stop, Li’l Cricket, Market Express, Next Door Store ® , Pride, Roadrunner Markets, Rose Mart, Rstore, Scotchman ® , shore stop ® , Speedy’s, SpeedyQ, Town Star, Uncle’s, Village Pantry ® and Young’s.
Fleet Fueling Segment We added our fleet fueling segment as part of our acquisition of certain assets from Quarles Petroleum, Incorporated (“Quarles”) in July 2022 that included 184 cardlock locations, and we added an additional 111 cardlock locations in our 2023 acquisition of the GASCARD fleet fueling operations of WTG Fuels Holdings, LLC (the “WTG Acquisition”), one of the largest fleet fueling operations in West Texas.
Fleet Fueling Segment We added our fleet fueling segment as part of our acquisition of certain assets from Quarles Petroleum, Incorporated (“Quarles”) in July 2022 that included 184 cardlock locations, and we added an additional 111 cardlock locations in our 2023 2 acquisition of the GASCARD fleet fueling operations of WTG Fuels Holdings, LLC (the “WTG Acquisition”), one of the largest fleet fueling operations in West Texas.
Our acquired brands have been in existence for an average of approximately 50 years, and their names are highly recognizable to local customers. By maintaining the regional store branding of our acquired stores, we believe we retain the goodwill associated with the respective brands’ long-term community involvement.
Our brands have been in existence for an average of approximately 50 years, and their names are highly recognizable to local customers. By maintaining the regional store branding of our stores, we believe we retain the goodwill associated with the respective brands’ long-term community involvement.
We also use our website to expedite public access to time-critical information regarding our Company in advance of, or in lieu of, distributing a press release or a filing with the SEC disclosing the same information. Therefore, investors should look to the News & Events, Company Info, and Governance sections of our website for important and time-critical information.
We also use our website to expedite public access to 7 time-critical information regarding our Company in advance of, or in lieu of, distributing a press release or a filing with the SEC disclosing the same information. Therefore, investors should look to the News & Events, Company Info, and Governance sections of our website for important and time-critical information.
By researching and understanding hiring trends, we have adopted mobile technology to simplify the application process and we have invested in additional recruiting 6 resources and implemented virtual recruiting and interviewing methods. We have also deployed enhanced recruiting techniques to optimize the selection of our talent pool.
By researching and understanding hiring trends, we have adopted mobile technology to simplify the application process and we have invested in additional recruiting resources and implemented virtual recruiting and interviewing methods. We have also deployed enhanced recruiting techniques to optimize the selection of our talent pool.
We routinely post on our website important information, including press releases, investor presentations and financial information, which may be accessed by clicking on the News & Events, Company Info, and Governance sections of www.arkocorp.com.
We post on our website important information, including press releases, investor presentations and financial information, which may be accessed by clicking on the News & Events, Company Info, and Governance sections of www.arkocorp.com.
We are diversified geographically and, as of December 31, 2023, operated in the District of Columbia and in more than 30 states in the Mid-Atlantic, Midwestern, Northeastern, Southeastern and Southwestern U.S. We have achieved strong site count growth over the last decade, primarily by implementing a highly successful acquisition strategy.
We are diversified geographically and, as of December 31, 2024, operated in the District of Columbia and in more than 30 states in the Mid-Atlantic, Midwestern, Northeastern, Southeastern and Southwestern U.S. We have achieved strong site count growth over the last decade, primarily by implementing a highly successful acquisition strategy.
As of December 31, 2023, none of our employees were represented by a labor union or have terms of employment that are subject to a collective bargaining agreement. We consider our relationships with our employees to be good and have not experienced any work stoppages.
As of December 31, 2024, none of our employees were represented by a labor union or have terms of employment that are subject to a collective bargaining agreement. We consider our relationships with our employees to be good and have not experienced any work stoppages.
Wage rates in the markets in which we operate, including voluntary increases in wages because of current labor market conditions, have increased our costs associated with recruiting and retaining qualified personnel, and may continue to do so in the future. We look to promote employee retention by providing attractive employee benefits such as medical, dental, 401(k) retirement plan and insurance.
Wage rates in the markets in which we operate, including voluntary increases in wages because of current labor market conditions, have increased our costs associated with recruiting and retaining qualified personnel, and expect to continue to do so in the future. We look to promote employee retention by providing employee benefits such as medical, dental, 401(k) retirement plan and insurance.
With regard to non-fuel products, there are legal restrictions at the federal, state and local levels in connection with the sale of food, alcohol, cigarettes and other tobacco products, menu labeling, video retention, money orders, money transfer services, gaming, lottery, and ephedrine.
With regard to non-fuel products, there are legal restrictions at the federal, state and local levels in connection with the sale of food, alcohol, cigarettes and other tobacco products, lottery, ephedrine, menu labeling, video retention, money orders, money transfer services, gaming, pricing, rebates and incentives.
We intentionally focus our marketing and merchandising initiatives at our retail stores to offer our customers an assortment of products with an attractive value proposition. Our retail store offering includes a wide array of cold and hot foodservice, beverages, cigarettes and other tobacco products, candy, salty snacks, grocery, beer and general merchandise.
We focus our marketing and merchandising initiatives at our retail stores on offering our customers an assortment of products with an attractive value proposition. Our store offering includes a wide array of cold and hot foodservice, beverages, cigarettes and other tobacco products, candy, salty snacks, grocery, beer and general merchandise.
We believe that the primary competitive factors influencing the retail segment are: site location; competitive prices; convenient access routes; the quality and configuration of the store and the fueling facility; the range of high-quality products and services offered; a convenient store-front; cleanliness; branded fuel; and the degree of capital investment in the store.
We believe that the primary competitive factors influencing the retail segment are: site location; the number of sites in an area; competitive prices; convenient access routes; the quality and configuration of the store and the fueling facility; the range of high-quality products and services offered; a convenient store-front; cleanliness; branded fuel; and the degree of capital investment in the store.
The EPA, and several states, have established regulations concerning the ownership and operation of underground fuel storage tanks (“USTs”), the release of hazardous substances into the air, water and land, the storage, handling disposal and transportation of hazardous materials, restrictions on exposure to hazardous substances and maintaining safety and health of employees who handle or are exposed to such substances.
The EPA and several states regulate the ownership and operation of underground fuel storage tanks (“USTs”), the release of hazardous substances into the air, water and land, the storage, handling disposal and transportation of hazardous materials, restrictions on exposure to hazardous substances and maintaining safety and health of employees who handle or are exposed to such substances.
In certain cases, gross profit is split based on a percentage and in others we pay a fixed fee per gallon to the dealer. • Fuel supply contracts (“Cost Plus”) — 1,537 sites as of December 31, 2023 plus bulk and spot purchasers. In arrangements of this type, the dealer purchases the fuel from us.
In certain cases, gross profit is split based on a percentage and in other cases we pay a fixed fee per gallon to the dealer. • Fuel supply contracts (“Cost Plus”) — 1,635 sites as of December 31, 2024 plus bulk and spot purchasers. In arrangements of this type, the dealer purchases the fuel from us.
Available Information We are required to file annual, quarterly and current reports, proxy statements and other information with the SEC. Information that we file with the SEC is available at the SEC’s website at www.sec.gov.
Securities and Exchange Commission (“SEC”). Available Information We are required to file annual, quarterly and current reports, proxy statements and other information with the SEC. Information that we file with the SEC is available at the SEC’s website at www.sec.gov.
These categories represented approximately 53% of our merchandise contribution for the year ended December 31, 2023. Because our core destination merchandise categories represent a high concentration of our merchandise contribution, we focus on marketing and merchandising initiatives within these categories because we believe that they will have the greatest impact on our performance.
These categories represented approximately 54% of our same store merchandise contribution for the year ended December 31, 2024. Because our core destination merchandise categories represent a high concentration of our merchandise contribution, we focus on marketing and merchandising initiatives within these categories because we believe that they will have the greatest impact on our performance.
In particular, dollar stores (such as Family Dollar and Dollar General) and 4 pharmacies (such as CVS and Walgreens) have expanded their product offerings to sell snacks, beer and wine and other products that have traditionally been sold by convenience stores, while grocery and large warehouse stores (such as Costco and Wal-Mart) have expanded their fuel offering adjacent to their stores.
In particular, dollar stores (such as Family Dollar and Dollar General) and pharmacies (such as CVS and Walgreens) now sell snacks, beer and wine and other products that have traditionally been sold by convenience stores, while grocery and large warehouse stores (such as Costco and Wal-Mart) sell fuel adjacent to their stores.
GPM Petroleum LP (“GPMP”) sells fuel at GPMP’s cost of fuel (including taxes and transportation) plus a fixed margin and charges a fixed fee primarily to sites in the fleet fueling segment which are not supplied by GPMP. We own 100% of the general partner of GPMP and, as of December 31, 2023, 99.8% of the GPMP limited partner units.
GPM Petroleum LP (“GPMP”) sells fuel at GPMP’s cost of fuel (including taxes and transportation) plus a fixed margin and charges a fixed fee primarily to sites in the fleet fueling segment that are not supplied by GPMP. We own 100% of the general partner of GPMP and 100% of the GPMP limited partner units.
Our Sustainability Report is available on our website at www.arkocorp.com. The information related to Environmental, Social and Governance on our website, including our Sustainability Report, is not, and shall not be deemed to be, a part hereof or incorporated by reference into this or any of our other filings with the U.S. Securities and Exchange Commission (“SEC”).
Our 2024 Sustainability Report issued in July 2024 is available on our website at www.arkocorp.com. The information related to Environmental, Social and Governance on our website, including our Sustainability Report, is not, and shall not be deemed to be, a part hereof or incorporated by reference into this or any of our other filings with the U.S.
Organic Growth Opportunities Our current organic strategies are focused on improving the performance of our retail stores through enhanced marketing and merchandising initiatives across our brands, such as our loyalty program, which deepens our relationship with our customers, expanding our foodservice offering to meet our customers’ needs and enhancing our existing retail store base. Foodservice Opportunity.
Organic Growth Opportunities Our organic strategies are focused on improving the performance of our retail stores through enhanced marketing and merchandising initiatives across our brands, such as our loyalty program, which deepens our relationship with our customers, implementing a multi-year transformation plan with the goal of enhancing our existing retail store base and expanding our foodservice offering to meet our customers’ needs.
The wholesale segment adds significant fuel volumes to the Company’s robust retail fuel sales, which we believe enhances our purchasing power for our entire platform, including our retail segment, and improves our competitiveness as an acquirer of choice. • Consignment contracts — 288 sites as of December 31, 2023.
The wholesale segment adds significant fuel volumes to the Company’s robust retail fuel sales, which we believe enhances our purchasing power for our entire platform, including our retail segment, and improves our competitiveness as an acquirer of choice.
Additionally, we operate a fleet fueling business that included, as of December 31, 2023, the operation of 298 proprietary and third-party cardlock locations (unstaffed fueling locations) and issuance of proprietary fuel cards that provide customers access to a nationwide network of fueling sites.
As of December 31, 2024, we supplied fuel to 1,922 dealer locations. Additionally, we operate a fleet fueling business that included, as of December 31, 2024, the operation of 280 proprietary and third-party cardlock locations (unstaffed fueling locations) and the issuance of proprietary fuel cards that provide customers access to a nationwide network of fueling sites.
We allocate a portion of our capital expenditure program to compliance with environmental laws and regulations and environmental remediation and such capital expenditures were approximately $4.8 million for the year ended December 31, 2023, and we anticipate expenditures of approximately $9.3 million for the year ending December 31, 2024.
We allocate a portion of our capital expenditure program to compliance with environmental laws and regulations and environmental remediation and such capital expenditures were approximately $3.5 million for the year ended December 31, 2024, and we anticipate expenditures of approximately $2.6 million for the year ending December 31, 2025.
For the year ended December 31, 2023, the retail segment generated total revenues of approximately $5.8 billion, including approximately $1.9 billion of in-store sales and other revenues. Gross profit dollars from in-store merchandise accounted for 53.4% of our gross profit dollars from our retail segment for the year ended December 31, 2023.
For the year ended December 31, 2024, the retail segment generated total revenues of approximately $5.3 billion, including approximately $1.8 billion of in-store sales and other revenues. Gross profit dollars from in-store merchandise accounted for 54.0% of our gross profit dollars from our retail segment for the year ended December 31, 2024.
Approximately 45% of our retail stores are in cities with populations of fewer than 20,000 people, and approximately 24% of our retail stores are in cities with populations between 20,000 and 50,000 people. We believe that our focus on secondary and tertiary markets allows us to preserve “local” brand name recognition and align local market needs with capital investment.
Approximately 46% of our retail stores are in cities with populations of fewer than 20,000 people, and approximately 17% of our retail stores are in cities with populations between 20,000 and 50,000 people. We believe that our focus on secondary and tertiary markets allows us to preserve “local” brand name recognition.
With respect to data collected by us or on our behalf, including credit card information and data related to loyalty customers, we are subject to federal, state and local requirements related to the possession, use and disclosure of personally identifiable information, including mandated procedures to be followed in the event a data breach were to occur.
With respect to data collected by us or on our behalf, including credit card information and data related to loyalty customers, we are subject to federal, state and local requirements related to the possession, use and disclosure of personally identifiable information, including mandated procedures to be followed in the event a data breach were to occur. 5 We hold various federal, state, and local licenses and permits, some of which are perpetual, but most of which must be renewed annually.
Environmental, Social and Governance As a leading operator of convenience stores and gas stations, we are focused on integrating Environmental, Social and Governance principles that are aligned with our long-term business strategy. Our second Sustainability Report issued in 2023 included a description of our baseline governance framework, environmental initiatives and social responsibility initiatives.
Environmental, Social and Governance As a leading operator of convenience stores and gas stations, we are focused on integrating Environmental, Social and Governance principles that are aligned with our long-term business strategy. Annually, we issue a Sustainability Report which includes a description of our governance framework, environmental initiatives and social responsibility initiatives.
In addition, the retail segment sold a total of more than 1.1 billion gallons of branded and unbranded fuel to our retail customers. Wholesale Segment The wholesale segment supplies fuel to dealers, sub-wholesalers and bulk and spot purchasers, on either a consignment or cost plus basis.
In addition, the retail segment sold approximately 1.1 billion gallons of branded and unbranded fuel to our retail customers. Wholesale Segment The wholesale segment supplies fuel to dealers, sub-wholesalers and bulk and spot purchasers, on either a consignment or cost plus basis. • Consignment contracts — 287 sites as of December 31, 2024.
For the year ended December 31, 2023, the wholesale segment sold 969.3 million gallons of fuel (approximately 43.2% of our total gallons sold in 2023), generating revenues of approximately $3.1 billion.
For the year ended December 31, 2024, the wholesale segment sold 949.4 million gallons of fuel (approximately 43.4% of our total gallons sold in 2024), generating revenues of approximately $2.8 billion.
GPMP Segment The GPMP segment engages in the wholesale distribution of fuel to substantially all of our sites that sell fuel in the retail and wholesale segments and a limited number of third-party dealers and bulk purchasers.
GPMP Segment The GPMP segment engages in the wholesale distribution of fuel to substantially all of our sites that sell fuel in the retail and wholesale segments.
The fleet fueling segment includes the operation of proprietary and third-party cardlock locations (unstaffed fueling locations) with sales to commercial and municipal entities, and issuance of proprietary fuel cards that provide 2 customers access to a nationwide network of fueling sites.
The fleet fueling segment includes the operation of proprietary and third-party cardlock locations (unstaffed fueling locations) with sales to commercial and municipal entities, and commissions from the sale of fuel using proprietary fuel cards that provide customers access to a nationwide network of fueling sites. Diesel fuel currently accounts for approximately 80% of our fleet fueling sales.
We believe that our business model provides us with strategic flexibility to acquire chains with retail, dealer and cardlock locations. We believe that our scale has enabled us to become a formidable industry player, enhanced our competitiveness, and positioned us as an acquirer of choice within the industry.
We believe that our scale has enabled us to become a formidable industry player, enhanced our competitiveness, and positioned us as an acquirer of choice within the industry.
ITEM 1. BUSINESS Overview Based in Richmond, VA, ARKO Corp. is a leading independent convenience store operator and, as of December 31, 2023, we were the sixth largest convenience store chain in the United States (“U.S.”) ranked by store count, operating 1,543 retail convenience stores.
ITEM 1. BUSINESS Overview Based in Richmond, VA, ARKO Corp. is a leading independent convenience store operator and one of the largest convenience store chains in the United States (“U.S.”) ranked by store count.
We have foodservice offerings at approximately 1,260 retail stores, which include hot and fresh grab-n-go foods, deli, fried chicken, bakery, pizza, roller grill items and other prepared foods.
We have foodservice offerings at approximately 1,185 stores, which include hot and fresh grab-n-go foods, deli, fried chicken, bakery, pizza, roller grill items and other prepared foods. We supplement our foodservice offering with approximately 110 quick service major national brand restaurants.
Our Business Segments Retail Segment Our primary business is the operation of convenience stores, and we generate a significant portion of our revenue from the retail sale of products and the fuel at our stores. Consequently, our retail stores generate a large proportion of our profitability.
Our Business Segments Retail Segment Our retail segment includes the operation of a chain of retail stores, which includes convenience stores selling fuel products and merchandise to retail customers, from which we generate a significant portion of our revenue and large proportion of our profitability.
In 2023, we continued to upgrade existing stores through functional remodels, such as adding bean-to-cup coffee offerings (added into more than 390 stores), roller grills (added into 47 stores), enhanced dispensed beverage offerings and our successful grab-n-go and freezer strategy.
In 2023, we opened three new Dunkin’ stores and a new Pride location. In the past two years, we continued to upgrade existing stores through functional remodels, such as adding bean-to-cup coffee offerings, roller grills, enhanced dispensed beverage offerings and our successful grab-n-go and freezer strategy.
For sites that we do not own or lease, in the renewal of contracts we compete with refiners that distribute their own products, as well as other independent third-party motor fuel distributors. Wholesale fuel distributors typically compete by offering shorter contract commitments, lesser collateral requirements and larger incentives to enter into contracts.
For sites that we do not own or lease, in the renewal of contracts, we compete with refiners that distribute their own products, as well as other independent third-party motor fuel distributors.
As a result, we believe that our under-penetration of foodservice presents an opportunity to expand foodservice offerings and margin in response to changing consumer behavior.
We have historically relied upon a limited number of franchised quick service restaurants and in-store delis to drive customer traffic. As a result, we believe that our under-penetration of foodservice presents an opportunity to expand foodservice offerings and margin in response to changing consumer behavior.
While maintaining established diversified store brands, our stores derive significant value from the scale, corporate infrastructure and centralized marketing programs associated with our large network, including a common operating platform and a loyalty program network that we use as a platform for promotions and marketing initiatives throughout our convenience stores.
As of December 31, 2024, we operated 1,389 retail convenience stores under more than 25 regional store brands that have been in existence for an average of approximately 50 years, which we consider “a Family of Community Brands.” While maintaining multiple established store brand names, our stores derive significant value from the scale, corporate infrastructure and centralized marketing programs associated with our large network, including a common operating platform and a loyalty program network that we use as a platform for promotions and marketing initiatives throughout our convenience stores.
The convenience store industry is also experiencing competition from other retail sectors, including grocery stores, large warehouse retail stores, dollar stores and pharmacies.
In developing our Transformation Plan, our goal is to better position ARKO to face growing competition. The convenience store industry experiences competition from other retail sectors, including grocery stores, large warehouse retail stores, dollar stores and pharmacies.
We pursue numerous in-store sales growth and margin enhancement opportunities through marketing and merchandising initiatives across our expansive footprint, including, among others: • Using customer centric data-driven decisions to expand our six core destination merchandise categories, which are packaged beverages, candy, salty snacks, packaged sweet snacks, alternative snacks and beer.
Enhanced Marketing and Merchandising Initiatives (i) Increased focused on both our pricing and procurement strategies across our retail stores to support ongoing merchandise margin rate growth, including using customer centric data-driven decisions to expand our six core destination merchandise categories, which are packaged beverages, candy, salty snacks, packaged sweet snacks, alternative snacks and beer.
We have a dedicated in-house M&A team that focuses on identifying, closing and integrating acquisitions. As an experienced acquirer, we have demonstrated our ability to generate strong returns on capital and meaningfully improve target performance post-integration through operating expertise and economies of scale.
As an experienced acquirer, we have demonstrated our ability to generate strong returns on capital and meaningfully improve target performance post-integration through operating expertise and economies of scale. We believe that our business model provides us with strategic flexibility to acquire chains with retail, dealer and cardlock locations.
Human Capital As of December 31, 2023, we employed 13,481 employees, with 11,960 employed in our stores and 1,521 in corporate and field management positions. To build, and continually improve upon, our corporate culture, we emphasize core values such as integrity, teamwork, and customer focus communicated through various channels such as training programs, internal communications, and employee feedback.
To build, and continually improve upon, our corporate culture, we emphasize core values such as integrity, teamwork, and customer focus communicated through various channels such as training programs, internal communications, and employee feedback. We value our employees and believe that communication, training, and employee development are key elements of our performance.
We have communication vehicles allowing us to send company information and reminders to targeted levels of employees, to keep them informed and improve efficiency, particularly during key times throughout the year such as the 100 days of summer.
Our experienced store managers and our regional trainers conduct the training of store managers from acquired sites in a classroom setting pre- and post-acquisition, as well as on-the-job training that extends several weeks once the acquisition is complete. 6 We have communication vehicles allowing us to send company information and reminders to targeted levels of employees, to keep them informed and improve efficiency, particularly during key times throughout the year such as the 100 days of summer.
We offer training based on our employees’ specific job requirements and employee levels using our new Learning Management System (LMS) designed for delivering online training modules. These include, but are not limited to, a series of short online modules that are completed upon hire and some that are repeated annually to promote consistent compliance.
These include, but are not limited to, a series of short online modules that are completed upon hire and some that are repeated annually to promote consistent compliance. Additionally, our store managers or our Regional Training team conduct on-the-job training activities that we have developed.
Suppliers In 2023, we purchased merchandise inventory from two primary wholesale distributors, Core-Mark and Grocery Supply Company, as well as approximately 850 direct store delivery supplier distributors. We leverage our relationships to generate economies of scale across our store base. We purchase motor fuel primarily from large, integrated oil companies and independent refiners under supply agreements.
We leverage our relationships to generate economies of scale across our store base. We purchase motor fuel primarily from large, integrated oil companies and independent refiners under supply agreements. In addition, we purchase unbranded fuel from branded and unbranded fuel suppliers to supply 246 unbranded retail fueling locations and 280 cardlock locations.
Competition We operate in the highly competitive retail convenience market, which includes businesses with operations and services that are similar to those that we provide, primarily the sale of convenience items and motor fuels. We face significant competition from other large chain operators, such as: 7-Eleven/Speedway; Circle K; Casey’s; Murphy USA; Quik Trip; Royal Farms; Sheetz; and Wawa.
We face significant competition from other large chain operators, such as 7-Eleven/Speedway; Circle K; Casey’s; Murphy USA; Quik Trip; Royal Farms; Sheetz; and 4 Wawa, many of which are building NTI sites in our markets.
We value our employees and believe that communication, training, and employee development are key elements of our performance. We feel that improving the skills of our current staff through training increases productivity and boosts our bottom line at a fraction of the cost of hiring new employees.
We feel that improving the skills of our current staff through training increases productivity and boosts our bottom line at a fraction of the cost of hiring new employees. We offer training based on our employees’ specific job requirements and employee levels using our Learning Management System (LMS) designed for delivering online training modules.
As of the date of this Annual Report on Form 10-K, we own all of the GPMP limited partner units. Growth Strategy We believe that continuing to execute on our organic and inorganic strategies provides a significant opportunity to increase our sales and profitability.
Growth Strategy We believe that we have a significant opportunity to increase our sales and profitability by continuing to execute on our organic and inorganic strategies described below.
Proposals have emerged at local, state and federal levels to increase minimum wage rates. 5 With respect to environmental regulations, we are subject to local, state and federal laws and regulations that address our properties and operations, including, without limitation the transportation, storage and sale of fuel, which have a considerable impact on our operations, including compliance with the requirements and regulations of the U.S.
With respect to environmental regulations, we are subject to a comprehensive framework of local, state and federal environmental laws and regulations governing our properties and operations, including, but not limited to, the transportation, storage and sale of fuel. These regulations significantly impact on our operations and necessitate strict adherence to the requirements set forth by the U.S.
Our current foodservice offering, which varies by store, primarily consists of hot and fresh grab-n-go foods, deli, fried chicken, bakery, pizza, roller grill items and other prepared foods. We have historically relied upon a limited number of franchised quick service restaurants and in-store delis to drive customer traffic.
Elements of this program are expected to include an expanded and refined merchandise assortment across our store network, with a focus on food and an enhanced in-store experience. Our current foodservice offering, which varies by store, primarily consists of hot and fresh grab-n-go foods, deli, fried chicken, bakery, pizza, roller grill items and other prepared foods.
Environmental Protection Agency (“EPA”) and comparable state counterparts. We are required to comply with the following regulations, among others: the Comprehensive Environmental Response, Compensation, and Liability Act of 1980; the Resource Conservation and Recovery Act; the Clean Air Act; and the federal Occupational Safety and Health Act.
Environmental Protection Agency (“EPA”) and comparable state agencies. Key applicable statutes include the Comprehensive Environmental Response, Compensation, and Liability Act; the Resource Conservation and Recovery Act; the Clean Air Act; the Occupational Safety and Health Act; the Hazardous Materials Transportation Act; and the Energy Policy and Conservation Act.
Our environmental department maintains direct interaction with federal, state and local environmental agencies for each state in which we operate. As part of our environmental risk management process, we engage environmental consultants and service providers to assist in analyzing our exposure to environmental risks by developing remediation plans, providing other environmental services, and taking corrective actions as necessary.
Our environmental department maintains direct interaction with federal, state and local environmental agencies across all jurisdictions in which we operate so that we remain informed of regulatory developments and to promote compliance with evolving environmental standards. As part of our environmental risk management process, we engage qualified environmental consultants and service providers.
We believe our significant size and scale aids our efforts to successfully deploy our organic growth strategies in our acquired assets, which we anticipate will result in value accretion. EV Opportunity. As part of our overall EV strategy, we pursue grants and subsidies across our footprint to expand our EV charging capacity.
We believe our significant size and scale aids our efforts to successfully deploy our organic growth strategies in our acquired assets, which we anticipate will result in value accretion. Suppliers In 2024, we purchased merchandise inventory from one primary wholesale distributor, Core-Mark, as well as approximately 870 direct store delivery supplier distributors.
We sell branded fuel under brand names including, among others, Valero ® , Marathon ® , BP ® , Exxon ® and Shell ® brand names. In addition to driving customer traffic, we believe that our branded fuel strategy enables us to maintain a secure fuel supply.
As of December 31, 2024, approximately 82% of our retail fuel locations sold branded fuel. We sell branded fuel under brand names including, among others, Valero ® , Marathon ® , BP ® , Exxon ® and Shell ® brand names.
From 2013 through 2023, we completed 25 acquisitions, and our site count has grown from 320 sites in 2011 to 3,666 sites as of December 31, 2023.We believe that our acquired locations combined with our scalable infrastructure create a strong platform for future growth within the highly fragmented convenience store industry through both strategic acquisitions and organic growth.
From 2013 through 2024, we completed 26 acquisitions, and our site count has grown from 320 sites in 2011 to 3,591 sites as of December 31, 2024. We have traditionally acquired our stores in smaller towns that have lower concentrations of national-chain convenience stores.
We supplement our foodservice offering with approximately 150 quick service major national brand restaurants. Additionally, we provide a number of traditional convenience store services that generate additional income, including lottery, prepaid products, gift cards, money orders, ATMs, gaming, and other ancillary product and service offerings. We also generate revenues from car washes at approximately 95 of our locations.
Additionally, we provide a number of traditional convenience store services, including lottery, prepaid products, gift cards, money orders, ATMs, gaming, and other ancillary product and service offerings. Almost all stores sell fuel, and we had 111 electric vehicle (“EV”) chargers at 38 stores across 13 states as of December 31, 2024.
The liability for fraudulent credit card transactions shifted from the credit card processor to us in October 2015 for transactions processed inside the convenience stores and shifted to us in April 2021 for transactions at the fuel dispensers. Our operations are subject to federal and state laws governing such matters as minimum wage, overtime, working conditions and employment eligibility requirements.
Our operations are subject to federal and state laws governing such matters as minimum wage, overtime, rest breaks, working conditions and employment eligibility requirements. New and proposed regulations at local, state and federal levels have affected minimum wage rates, paid time-off and paid sick leave.
Removed
As of December 31, 2023, we operated our stores under more than 25 regional store brands that have been in existence for an average of approximately 50 years, which we consider “a Family of Community Brands.” We leverage their long-term community involvement, highly recognizable brands and customer loyalty in their respective markets.
Added
During 2024, we commenced development and initial implementation of a multi-year transformation plan (the “Transformation Plan”).
Removed
Our fas REWARDS® loyalty program with approximately 2.0 million enrolled members is available in the majority of our stores and offers exclusive savings on merchandise and gas to our enrolled members. We are also a leading wholesale distributor of motor fuel, and as of December 31, 2023, we supplied fuel to 1,825 dealer locations.
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As part of this plan, we converted a significant number of retail stores throughout our chain to dealer sites, and we are in the process of converting a significant number of additional retail stores to dealer sites, leveraging the fact that we are also a leading wholesale distributor of motor fuel.
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With approximately 69% of the convenience store market composed of chains with 50 or fewer locations as of December 2022, we believe that there is ample opportunity to continue to consolidate. We have traditionally acquired our stores in smaller towns that have lower concentrations of national-chain convenience stores.
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Such conversions will enable us to focus the investment elements of our Transformation Plan in a more select group of stores that we believe will create a strong platform for future growth within the highly fragmented and competitive convenience store industry.
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In 2024, we launched an extensive new pizza program that offers private label pizza, at an attractive value of $4.99 for enrolled loyalty members, which is currently offered at more than 1,000 stores as take-and-bake from the freezer, and 1 currently available at approximately 225 of those stores also as fresh and hot pizza either whole or by the slice.
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Relevant and delicious food offerings are a key strategic priority for our retail segment, and as part of our Transformation Plan, we 1 expect to maintain a significant focus on frozen grab-n-go and enhanced hot food capabilities.
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Almost all stores sell fuel, and we had 70 electric vehicle (“EV”) chargers at 19 stores as of December 31, 2023.
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We also generate revenues from car washes at approximately 75 of our locations.
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Bank) and which can be used at more than 230,000 fleet fueling sites. Diesel fuel accounts for approximately 82% of our fleet fueling sales, and, as opposed to retail volumes, commercial volumes have been less impacted by retail fuel consumption trends. Within our fleet fueling segment, we generally achieve fuel margins that are higher than those in our wholesale segment.
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In 2024, as part of our Transformation Plan, we utilized our wholesale platform to convert retail sites that we believe will provide more economic benefit as dealer sites leased from us and supplied through our fuel agreements, and in certain cases, providing benefits under our vendor agreements.
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The lack of on-site labor required to run these sites also generally offers us compelling economics. As of December 31, 2023, we operated 298 cardlock locations, and, for the year ended December 31, 2023, the fleet fueling segment sold 140.8 million gallons of fuel, generating revenues of approximately $538.8 million.
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Bank) and which can be used at more than 230,000 fueling sites. For the year ended December 31, 2024, the fleet fueling segment sold 148.9 million gallons of fuel, generating revenues of approximately $524.6 million.
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We constantly monitor macroeconomic factors such as interest rates, material costs, product availability, construction industry pricing, and the availability and cost of labor, and we closely analyze key performance indicators to calibrate our strategies between organic and inorganic initiatives, as described in further detail below.
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(ii) Development and strengthening of customer relationships through our fas REWARDS® loyalty program, which is available in the majority of our stores and offers enrolled loyalty members in store exclusive promotional pricing, in-app member only deals not available without the app, as well as the ability to earn points that can be redeemed for either fuel or merchandise savings.
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In the third quarter of 2023, we created and filled a new role at GPM, Senior Vice President of Food Service, to evaluate our current foodservice offering and to expand our company-wide, cross-functional food strategy to position our stores as a food destination for our customers, scaled across our Family of Community Brands.
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Other in-app features include the ability to convert earned points to fas BUCKS, which can be spent like cash on most merchandise categories in our stores, or stackable fuel cents off up to $2.00 off per gallon, up to 20 gallons at the pump.
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In 2024, we launched an extensive new pizza program. Other Enhanced Marketing Initiatives.
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Remodels and New-to-Industry (“NTI”) In 2024, we expanded our pipeline of NTI stores to eight NTI stores, out of which we opened one NTI HandyMart location and a new Dunkin’ store in 2024 and in the first quarter of 2025, we opened a new Dunkin’ store and a fastmarket® location, with the balance of the pipeline to be opened over the course of 2025.
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In the first quarter of 2023, we launched a new enhanced fas REWARDS app to better connect with and understand our customers.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThese hazards and risks include, but are not limited to, fires, explosions, traffic accidents, spills, discharges and other releases, and cross-drops, any of which could result in distribution difficulties and disruptions, environmental pollution, governmentally-imposed fines or clean-up obligations, personal injury or wrongful death claims and other damage to our properties and the properties of others. 11 The transportation of motor fuels, as well as the associated storage of such fuels at locations including convenience stores, are subject to various federal, state and local environmental laws and regulations, including those relating to ownership and operation of storage tanks, the release or discharge of regulated materials into the air, water and soil, the generation, storage, handling, use, transportation and disposal of hazardous materials, the exposure of persons to regulated materials, and the health and safety of employees dedicated to such transportation and storage activities.
Biggest changeThese hazards and risks include, but are not limited to, fires, explosions, traffic accidents, spills, discharges and other releases, and 11 cross-drops, any of which could result in distribution difficulties and disruptions, environmental pollution, governmentally-imposed fines or clean-up obligations, personal injury or wrongful death claims and other damage to our properties and the properties of others.
You should carefully consider the risks described below, as well as other information contained in this Annual Report on Form 10-K, including the audited consolidated financial statements contained in Part II, Item 8 (the “Consolidated Financial 7 Statements”) and the notes thereto and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” The occurrence of any of the events discussed below could significantly and adversely affect our business, prospects, results of operations, financial condition, and cash flows.
You should carefully consider the risks described below, as well as other information contained in this Annual Report on Form 10-K, including the audited consolidated financial statements contained in Part II, Item 8 of this Annual Report on Form 10-K (the “Consolidated Financial Statements”) and the notes thereto and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” The occurrence of any of the events discussed below could significantly and adversely affect our business, prospects, results of operations, financial condition, and cash flows.
In addition, successful cyberattacks, data breaches, or data security incidents, at one of our vendors, other convenience store operators, large retailers or other market participants, whether or not we are directly impacted, could lead to a general loss of customer confidence or affect our supply chain which could negatively affect us, including harming the market 14 perception of the effectiveness of our security measures or harming the reputation of the industry in general, which could result in reduced use of our products and services.
In addition, successful cyberattacks, data breaches, or data security incidents, at one of our vendors, other convenience store operators, large retailers or other market participants, whether or not we are directly impacted, could lead to a general loss of customer confidence or affect our supply chain which could negatively affect us, including harming the market perception of the effectiveness of our security measures or harming the reputation of the industry in general, which could result in reduced use of our products and services.
In addition, our amended and restated certificate of incorporation provides that any person or entity purchasing or otherwise acquiring any interest in shares of common stock is deemed to have notice of and consented to the Delaware Forum Provision and the Federal Forum Provision; provided, however, that stockholders cannot and will not be deemed to have waived our compliance with the federal securities laws and the rules and regulations thereunder.
In addition, our amended and restated certificate of incorporation provides that any 16 person or entity purchasing or otherwise acquiring any interest in shares of common stock is deemed to have notice of and consented to the Delaware Forum Provision and the Federal Forum Provision; provided, however, that stockholders cannot and will not be deemed to have waived our compliance with the federal securities laws and the rules and regulations thereunder.
We accept a variety of credit cards and debit cards in our convenience stores and at our fuel dispensers and, accordingly, we are, and will continue to be, subject to significant and evolving regulations and compliance requirements, including obligations to 13 implement enhanced authentication processes that could result in increased costs and liability and reduce the ease of use of certain payment methods.
We accept a variety of credit cards and debit cards in our convenience stores and at our fuel dispensers and, accordingly, we are, and will continue to be, subject to significant and evolving regulations and compliance requirements, including obligations to implement enhanced authentication processes that could result in increased costs and liability and reduce the ease of use of certain payment methods.
This volatility makes it extremely difficult to predict the impact future wholesale cost fluctuations will have on our financial condition and results of operations. Increases in fuel prices generally compress retail fuel margin because fuel costs typically increase faster than retailers are able to pass them along to 9 customers.
This volatility makes it extremely difficult to predict the impact future wholesale cost fluctuations will have on our financial condition and results of operations. Increases in fuel prices generally compress retail fuel margin because fuel costs typically increase faster than retailers are able to pass them along to customers.
Our inability to successfully compete in the marketplace by continuously meeting customer requirements concerning price, quality and service level could have a material adverse effect on our business, financial condition and results of operations. Negative events or developments associated with branded motor fuel suppliers could have a material adverse impact on our revenues.
Our inability to successfully compete in the marketplace by continuously meeting customer requirements concerning price, quality and service level could have a material adverse effect on our business, financial condition and results of operations. 10 Negative events or developments associated with branded motor fuel suppliers could have a material adverse impact on our revenues.
Third-parties may also oppose our trademark applications, or otherwise challenge our use of the 15 trademarks. In the event that our trademarks are successfully challenged, we could be forced to rebrand our products or services, which could result in loss of brand recognition, and could require us to devote resources advertising and marketing new brands.
Third-parties may also oppose our trademark applications, or otherwise challenge our use of the trademarks. In the event that our trademarks are successfully challenged, we could be forced to rebrand our products or services, which could result in loss of brand recognition, and could require us to devote resources advertising and marketing new brands.
Our operations are subject to numerous federal, state and local laws and regulations, including regulations related to the sale of alcohol, cigarettes and other tobacco products, lottery/lotto products, other age-restricted products, operation of gaming machines, various food safety and product quality requirements, environmental laws and regulations, and various employment laws, including requirements for various licenses and registrations.
Our operations are subject to numerous federal, state and local laws and regulations, including regulations related to the sale of alcohol, cigarettes and other tobacco products, lottery products, other age-restricted products, operation of gaming machines, various food safety and product quality requirements, environmental laws and regulations, and various employment laws, including requirements for various licenses and registrations.
A portion of our revenue is generated under fuel supply agreements with dealers that must be renegotiated or replaced periodically. If we are unable to successfully renegotiate or replace these agreements, then our results of operations and financial condition could be adversely affected. A portion of our revenue is generated under fuel supply agreements with dealers.
A significant portion of our revenue is generated under fuel supply agreements with dealers that must be renegotiated or replaced periodically. If we are unable to successfully renegotiate or replace these agreements, then our results of operations and financial condition could be adversely affected. A significant portion of our revenue is generated under fuel supply agreements with dealers.
Current employment trends and the prevailing wage rates in the markets in which we operate, including voluntary increases in wages because of current labor market conditions, have increased our costs associated with recruiting and retaining qualified personnel, and may continue to do so in the future.
Current employment trends and the prevailing wage rates in the markets in which we operate, including voluntary increases in wages because of current labor market 12 conditions, have increased our costs associated with recruiting and retaining qualified personnel, and may continue to do so in the future.
Many of these tax liabilities are subject to periodic audits by the respective taxing authorities. Further changes in the tax laws could arise as a result of the base erosion and profit shifting project undertaken by the Organization for Economic Co-operation and Development (“OECD”).
Many of these tax liabilities are subject to periodic audits by the respective taxing authorities. Changes in the tax laws could arise as a result of the base erosion and profit shifting project undertaken by the Organization for Economic Co-operation and Development (“OECD”).
Our business may also be (indirectly) affected by the adoption of environmental laws and regulations intended to address global climate change by limiting carbon emissions and introducing more stringent requirements for the exploration, drilling and transportation of crude oil and petroleum products.
Our business may also be affected by the adoption of environmental laws and regulations intended to address global climate change by limiting carbon emissions and introducing more stringent requirements for the exploration, drilling and transportation of crude oil and petroleum products.
Temporary or long-term disruptions to our supply chain in connection with unfavorable weather conditions could impact our network of suppliers and distributors, significantly impacting the quality, variety and pricing of merchandise sold at our sites.
Temporary or long-term disruptions to our supply chain in connection with unfavorable weather conditions could impact our network of suppliers and distributors, significantly impacting the quality, variety and pricing of merchandise and fuel sold at our sites.
The operating and financial restrictions and covenants in our credit facilities and our 5.125% Senior Notes due 2029 (the “Senior Notes”), 16 and any future financing agreements, may restrict our ability to finance future operations or expand our business activities.
The operating and financial restrictions and covenants in our credit facilities and our 5.125% Senior Notes due 2029 (the “Senior Notes”), and any future financing agreements, may restrict our ability to finance future operations or expand our business activities.
We may face additional tax liabilities in transferring cash through our Israeli subsidiaries by means of dividends or otherwise to support us, primarily due to withholding tax requirements imposed pursuant to the provisions of the Israeli tax law (which may be reduced under the provisions of the convention between the Government of the United States of America and the Government of Israel with respect to Taxes on Income), which could have a material adverse effect on our business, financial condition and results of operations.
We may face additional tax liabilities in transferring cash through our Israeli entities by means of dividends or otherwise to support us, primarily due to withholding tax requirements imposed pursuant to the provisions of the Israeli tax law (which may be reduced under the provisions of the convention between the Government of the United States of America and the Government of Israel with respect to Taxes on Income), which could have a material adverse effect on our business, financial condition and results of operations.
Increasingly wide-spread implementation of such laws and regulations may lead to a significant increase in the cost of petroleum-based fuels and, in turn, lower demand for road transportation fuel.
Wide-spread implementation of such laws and regulations may lead to a significant increase in the cost of petroleum-based fuels and, in turn, lower demand for road transportation fuel.
As a fuel and merchandise retailer, we collect and store large amounts of data on our network, including personal data from customers and other sensitive information concerning our employees, customers and vendors.
As a retailer of merchandise and retailer and wholesaler of fuel, we collect and store large amounts of data on our network, including personal data from customers and other sensitive information concerning our employees, customers and vendors.
Our violation of, or inability to comply with such regulation could expose us to regulatory sanctions ranging from monetary fines to the revocation or suspension of our permits and licenses for the sale of such products. We may also be subject to litigation including class action litigation which may result in substantial costs, expenses and damages related to legal proceedings.
Our violation of, or inability to comply with, such regulations could expose us to regulatory sanctions ranging from monetary fines to the revocation or suspension of our permits and licenses for the sale of such products. We may also be subject to litigation including class action litigation which may result in substantial costs, expenses and damages related to legal proceedings.
Like most other companies, despite our current cybersecurity risk management framework (see “Cybersecurity” for additional detail) and process controls, our information technology systems, and those of our third-party service providers, may be vulnerable to information security breaches, ransomware or extortion, mishandled data, acts of vandalism, computer viruses and interruption or loss of valuable business data.
Like most other companies, despite our current cybersecurity risk management framework (see “Cybersecurity” for additional detail) and process controls, our IT Systems and those of our third-party service providers, may be vulnerable to information security breaches, ransomware or extortion, mishandled data, acts of vandalism, computer viruses and interruption or loss of valuable business data.
Our business could suffer if we fail to adequately secure, maintain, and enforce our intellectual property rights. We rely on our trademarks, trade names, and brand names to distinguish our products and services from those of our competitors, and have registered or applied to register many of these trademarks. We cannot assure you that our trademark applications will be approved.
Our business could suffer if we fail to adequately secure, maintain, and enforce our intellectual property rights. We rely on our trademarks and trade names to distinguish some of our products and services from those of our competitors, and have registered or applied to register many of these trademarks. We cannot assure you that our trademark applications will be approved.
Significant increases in wholesale cigarette and other tobacco product prices, current and future tobacco legislation, including restrictions or bans on flavored and menthol tobacco products and related advertising, national, state and local campaigns to discourage smoking, a decrease in the consumption of cigarettes, increases in retail cigarette prices, lawsuits against manufacturers and retailers of cigarettes and other tobacco products, reductions in manufacturer rebates for the purchase of tobacco products and increases in, and new, taxes on cigarettes and other tobacco products could have a material adverse effect on the demand for tobacco products and, in turn, on our financial condition and results of operations.
Significant increases in wholesale cigarette and other tobacco product prices, current and future tobacco legislation, including restrictions or bans on flavored and menthol tobacco products and related advertising, national, state and local campaigns to discourage smoking, a decrease in the consumption of cigarettes, increases in retail cigarette prices, lawsuits against manufacturers and retailers of cigarettes and other tobacco products, reductions in manufacturer rebates for the purchase of tobacco 9 products and increases in, and new, taxes on cigarettes and other tobacco products could have a material adverse effect on the demand for tobacco products, and on our customer transactions and, in turn, on our financial condition and results of operations.
The Delaware Forum Provision 17 will not apply to any causes of action arising under the Securities Act or the Exchange Act.
The Delaware Forum Provision will not apply to any causes of action arising under the Securities Act or the Exchange Act.
During the year ended December 31, 2023, fuel sales were approximately 79% of our total revenues and approximately 46% of our combined fuel, merchandise and other income margin. Generally, our retail fuel inventory on hand turns quickly in the ordinary course of our business.
During the year ended December 31, 2024, fuel sales were approximately 79% of our total revenues and approximately 46% of our combined fuel, merchandise and other income margin. Generally, our retail fuel inventory on hand turns quickly in the ordinary course of our business.
A number of key macro-economic factors, such as high interest rates, inflation and unemployment, could have a negative effect on consumer habits and spending, and lead to lower demand for fuel and other products sold at our convenience stores and gas stations. The U.S. economy has continued to experience inflationary pressures, which reduce consumer purchasing power.
A number of key macro-economic factors, such as interest rates, inflation and unemployment, could have a negative effect on consumer habits and spending, and lead to lower demand for fuel and other products sold at our convenience stores. The U.S. economy has continued to experience inflationary pressures, which reduce consumer purchasing power.
Such regulatory action or litigation could adversely affect our business, financial condition and results of operations. Our failure to comply with applicable labor and employment laws pertaining to, among others, minimum wage, mandated healthcare benefits or paid time-off benefits could result in increased regulatory scrutiny, monetary fines and substantial costs and expenses related to legal proceedings.
Such regulatory action or litigation could adversely affect our business, financial condition and results of operations. Our failure to comply with applicable labor and employment laws pertaining to, among others, minimum wage, overtime, rest breaks, mandated healthcare benefits or paid time-off benefits could result in increased regulatory scrutiny, monetary fines and substantial costs and expenses related to legal proceedings.
Our ability to meet our changing labor needs while controlling our costs is subject to external factors outside of our control such as labor laws and mandatory requirements at the local, state and federal levels (such as minimum wages, paid leave time, and other social benefits), unemployment levels, prevailing wage rates, benefit costs, changing demographics, and our reputation and relevance within the labor market.
Our ability to meet our changing labor needs while controlling our costs is subject to external factors outside of our control such as labor laws and mandatory requirements at the local, state and federal levels (such as minimum wages, overtime, rest breaks, paid leave time, and other social benefits), unemployment levels, prevailing wage rates, benefit costs, changing demographics, and our reputation and relevance within the labor market.
In addition, tax law or regulations in Israel may be amended and Israeli tax authorities may change their interpretations of existing tax law and regulations such that we may be subject to increased tax liabilities, including upon termination or liquidation of our Israeli subsidiaries.
In addition, tax law or regulations in Israel may be amended, and Israeli tax authorities may change their interpretations of existing tax law and regulations such that we may be subject to increased tax liabilities, including upon termination or liquidation of our Israeli entities.
As of December 31, 2023, approximately 46% of our debt bore interest at variable rates, which is based on CME Group’s forward-looking Secured Overnight Financing Rate (“SOFR”). Consequently, significant increases in market interest rates would create substantially higher debt service requirements, which could have a material adverse effect on our overall financial condition, including our ability to service our indebtedness.
As of December 31, 2024, approximately 49% of our debt bore interest at variable rates, which is based on CME Group’s forward-looking Secured Overnight Financing Rate (“SOFR”). Consequently, significant increases in market interest rates would create substantially higher debt service requirements, which could have a material adverse effect on our overall financial condition, including our ability to service our indebtedness.
A change of key transportation providers, a disruption or cessation in services provided by such providers, a significant accident or other incident involving a transportation provider, or a significant change in our relationship with such providers could have a material adverse effect on our business, financial condition and results of operations.
A change of key transportation providers, a disruption or cessation in services or supply provided by our providers, a significant change in our relationship with our suppliers or a significant accident or other incident involving a transportation provider could have a material adverse effect on our business, financial condition and results of operations.
As these supply agreements expire, they must be renegotiated or replaced. Our fuel supply agreements generally have an initial term of 10 years and, as of December 31, 2023, had a volume-weighted average remaining term of approximately 5.1 years. Our dealers have no obligation to renew their fuel supply agreements with us on similar terms or at all.
As these supply agreements expire, they must be renegotiated or replaced. Our fuel supply agreements generally have an initial term of 10 years and, as of December 31, 2024, had a volume-weighted average remaining term of approximately 4.5 years. Our dealers have no obligation to renew their fuel supply agreements with us on similar terms or at all.
To the extent we are not able to provide information that is required under such regulations because owners of our stock do not provide the necessary documentation to comply or fail to comply with such regulations, we may have those licenses suspended or revoked.
To the extent we are not able to provide information that is required under such regulations because owners of our stock do not provide the necessary documentation to comply or fail to comply with such regulations, we may have those licenses suspended or revoked, or new licenses may not be issued.
Risks Related to Our Business and Industry Changes in economic conditions and consumer confidence in the U.S. could materially adversely affect our business. Our operations and the scope of services we provide are affected by changes in the macro-economic situation in the United States, which has a direct impact on consumer confidence and spending patterns.
Risks Related to Our Business and Industry Changes in economic conditions, tax or trade policy, and consumer confidence in the U.S. could materially adversely affect our business. Our operations and the scope of services we provide are affected by changes in the macro-economic situation in the United States, which has a direct impact on consumer confidence and spending patterns.
Any further additional federal fund rate increases could in turn make our financing activities, including those related to our acquisition activity, more costly and limit our ability to refinance existing debt when it matures or pay higher interest rates upon refinancing and increase interest expense on refinanced indebtedness.
Any future federal fund rate increases could in turn make our financing activities, including those related to our acquisition activity, more costly and limit our ability to refinance existing debt when it 15 matures or pay higher interest rates upon refinancing and increase interest expense on refinanced indebtedness.
Our operations present risks which may not be fully covered by insurance. We carry comprehensive insurance against the hazards and risks underlying our operations. We believe our insurance policies are customary in the industry; however, some losses and liabilities associated with our operations may not be covered by our insurance policies.
We carry comprehensive insurance against the hazards and risks underlying our operations. We believe our insurance policies are customary in the industry; however, some losses and liabilities associated with our operations may not be covered by our insurance policies.
Any failure to comply with such rules or requirements could significantly harm our brand, reputation, business, financial condition and results of operations. Significant disruptions of information technology systems, breaches of data security, or compromised data could materially adversely affect our business.
Any failure to comply with such rules or requirements could significantly harm our brand, reputation, business, financial condition and results of operations. 13 Significant disruptions of information technology systems, breaches of data security or other cybersecurity incidents, or compromised data could materially adversely affect our business.
With approximately 12,000 store employees, our labor costs represent one of our largest store operating expenses and our business is dependent on our ability to attract, train, and retain the appropriate mix of qualified employees. Most of our store employees are in entry-level or part-time positions, which have historically high turnover rates.
With approximately 10,300 store employees, our labor costs represent one of our largest site operating expenses and our business is dependent on our ability to attract, train, and retain the appropriate mix of qualified employees. Most of our store employees are in entry-level or part-time positions, which historically have high turnover rates.
Such risks, in addition to potential difficulties in obtaining any required licenses and permits, could lead to significant cost increases and substantial delays in the opening of the remodeled convenience stores.
Such risks, in addition to potential difficulties in obtaining any required licenses and permits, could lead to significant cost increases and substantial delays in opening remodeled or new convenience stores.
We cannot assure you that the market price of our common stock will not fluctuate widely or decline significantly in the future in response to a number of factors, including, among others: the realization of any of the risk factors presented in this Annual Report on Form 10-K; actual or anticipated differences in our estimates, or in the estimates of securities analysts, or the expectations of stockholders, or changes by securities analysts in their estimates of our future earnings; failure of our operating results to meet our published guidance; the 18 performance and market valuations of other similar companies; and broad disruptions in the financial markets, including sudden disruptions in the credit markets.
If the market price of our common stock declines significantly, you may be unable to resell your shares at a price above your purchase price We cannot assure you that the market price of our common stock will not fluctuate widely or decline significantly in the future in response to a number of factors, including, among others: the realization of any of the risk factors presented in this Annual Report on Form 10-K; actual or anticipated differences in our estimates, or in the estimates of securities analysts, or the expectations of stockholders, or changes by securities analysts in their estimates of our future earnings; failure of our operating results to meet our published guidance; the performance and market valuations of other similar companies; and broad disruptions in the financial markets, including sudden disruptions in the credit markets.
As of December 31, 2023, due to the required time and cost necessary to upgrade each site, supply chain constraints related to necessary equipment, and contractor availability, we completed upgrading our fuel dispensers to be EMV-compliant at approximately 75% of our retail locations, and anticipate being substantially complete by the end of 2025.
As of December 31, 2024, due to the required time and cost necessary to upgrade each site, supply chain constraints related to necessary equipment, and contractor availability, we completed upgrading our fuel dispensers to be EMV-compliant at approximately 79% of our retail locations, and anticipate being substantially complete during 2025.
A significant disruption or operational failure affecting the operations of our suppliers, including their ability to provide timely deliveries, could materially impact the availability, quality and price of products sold at our convenience stores and cardlock locations, cause us to incur substantial unanticipated costs and expenses, and adversely affect our business, financial condition and results of operations.
A significant disruption or operational failure affecting the operations of any of our suppliers, including its ability to provide timely deliveries, could materially impact the availability, quality and price of products and fuel sold at our sites, cause us to incur substantial unanticipated costs and expenses, and adversely affect our business, financial condition and results of operations.
An event which adversely affects the value of those brands could have a negative impact on the volumes of motor fuel we distribute, which in turn could have a material adverse effect on our business, financial condition and results of operations. We depend on several principal suppliers for our fuel purchases and two principal suppliers for merchandise.
An event which adversely affects the value of those brands could have a negative impact on the volumes of motor fuel we distribute, which in turn could have a material adverse effect on our business, financial condition and results of operations.
This concentration of ownership may delay or deter possible changes in control, which may reduce the value of an investment in the common stock.
This concentration of ownership may delay or deter possible changes in control, and reduces the liquidity of our shares, which may reduce the value of an investment in the common stock.
Additionally, we pay interchange and other fees, which may increase over time. Europay, MasterCard and Visa, or EMV, is a global standard for credit cards that uses computer chips to authenticate and secure chip-card transactions. The liability for fraudulent credit card transactions shifted from the credit card processor to us in April 2021 for transactions at the fuel dispensers.
Additionally, we pay interchange and other fees, which may increase over time. Europay, MasterCard and Visa, or EMV, is a global standard for credit cards that uses computer chips to authenticate and secure chip-card transactions. We are liable for fraudulent credit card transactions at the fuel dispensers.
Sales of a substantial number of shares of our common stock in the public market could cause the price of our common stock to decline. As of December 31, 2023, we had 116,171,208 shares of common stock outstanding and warrants to purchase approximately 18.4 million shares of common stock.
Sales of a substantial number of shares of our common stock in the public market could cause the price of our common stock to decline. As of December 31, 2024, we had 115,771,318 shares of common stock outstanding and warrants to purchase approximately 18.4 million shares of common stock.
Our corporate structure includes Israeli subsidiaries that file tax returns in Israel. Israeli tax authorities may challenge positions taken by such subsidiaries with respect to their tax returns. To the extent such a challenge is sustained, this could increase our worldwide effective tax rate and adversely impact our financial position and results of operations.
Israeli tax authorities may challenge positions taken by such entities with respect to their tax returns. To the extent such a challenge is sustained, this could increase our worldwide effective tax rate and adversely impact our financial position and results of operations.
General political conditions, acts of war or terrorism and instability in oil producing regions, particularly in the Middle East, Russia, Africa and South America, such as the ongoing war between Russia and Ukraine, could significantly affect crude oil supplies and wholesale fuel prices.
General political conditions, tariffs, trade wars, acts of war or terrorism and instability in oil producing regions, particularly in the Middle East, Russia, Africa and South America, could significantly affect crude oil supplies and wholesale fuel prices.
A portion of fuel is transported in our own trucks, instead of by third-party carriers, therefore, our operations are also subject to hazards and risks inherent in transporting motor fuel.
Most of our fuel is transported by third-party carriers to our retail, dealer and fleet fueling sites. A portion of fuel is transported in our own trucks, therefore, our operations are also subject to hazards and risks inherent in transporting motor fuel.
Accordingly, we may be subject to liability for fraudulent credit card transactions processed at fuel dispensers that are now EMV-compliant. We do not believe that this will expose us to material chargeback liability. We rely on fuel brands and independent service providers for payment processing, including credit and debit cards.
Accordingly, we may be subject to liability for fraudulent credit card transactions processed at fuel dispensers that are not EMV-compliant. We rely on fuel brands and independent service providers for payment processing, including credit and debit cards.
Certain of our outstanding term loans and revolving credit facilities bear interest at variable rates, subjecting us to fluctuations in the short-term interest rate. The U.S.
Certain of our outstanding term loans and revolving credit facilities bear interest at variable rates, subjecting us to fluctuations in the short-term interest rate. Beginning in early 2022, in response to significant and prolonged increases in inflation, the U.S.
In February 2022, we announced that our board of directors (the “Board”) authorized a regular dividend program under which we commenced payment of quarterly dividends on our common stock, subject to quarterly declarations in the sole discretion of our Board.
We may not continue to declare cash dividends or may reduce the amount of cash dividends in the future. 17 In February 2022, we announced that our board of directors (the “Board”) authorized a regular dividend program under which we commenced payment of quarterly dividends on our common stock, subject to quarterly declarations in the sole discretion of our Board.
Where releases of motor fuels or other substances or wastes have occurred, federal and state laws and regulations, and our lease agreements, require that contamination caused by such releases be assessed and remediated to meet applicable clean-up standards.
Federal and state authorities, including the DOT and EPA, monitor compliance and may impose fines, penalties, or orders to halt operations. Where releases of motor fuels or other substances or wastes have occurred, federal and state laws and regulations, and our lease agreements, require that contamination caused by such releases be assessed and remediated to meet applicable clean-up standards.
In 2023, electric vehicles accounted for approximately 7.6% of all light vehicle sales in the United States.
In 2024, electric vehicles accounted for approximately 8.1% of all light vehicle sales in the United States.
The costs associated with the investigation and remediation of contamination, as well as any associated third-party claims for damages or to impose corrective action obligations, could be substantial and could have a material adverse effect on us or our customers who transport motor fuels or own or operate convenience stores or other facilities where motor fuels are stored.
The costs associated with the investigation and remediation of contamination, as well as any associated third-party claims for damages or to impose corrective action obligations, could be substantial and could have a material adverse effect on us or our dealers.
We purchase motor fuels from a variety of suppliers under term contracts. In times of extreme market demand, supply disruption or as a result of futures market and geopolitical conditions, we may be unable to acquire enough fuel, including diesel fuel in particular, to satisfy the demand of our customers.
We rely upon our suppliers to timely provide the volumes and types of motor fuels for which they contract. In times of extreme market demand, supply disruption or as a result of futures market and geopolitical conditions, we may be unable to acquire enough fuel, including diesel fuel in particular, to satisfy the demand of our customers.
The termination or non-renewal of any of these licenses could require us to rebrand or to replace the licensed goods and services, and accordingly could have a material adverse effect on our business, reputation, financial condition and results of operations. We also rely on unpatented proprietary technology.
The termination or non-renewal of any of these licenses could require us to rebrand or to replace the licensed goods and services, and accordingly could have a material adverse effect on our business, reputation, financial condition and results of operations. Our operations present risks which may not be fully covered by insurance.
We are unable to predict the effect that sales may have on the prevailing market price of our common stock. We may not continue to declare cash dividends or may reduce the amount of cash dividends in the future.
We are unable to predict the effect that sales may have on the prevailing market price of our common stock.
Because all such competitors offer products and services that are very similar to those offered by us, a number of key factors determine our ability to successfully compete in the marketplace. These include the location of stores, competitive pricing, convenient access routes, the quality, configuration and efficiency of stores and fueling facilities, and a high level of service.
Because all such competitors offer products and services that are very similar to those offered by us, a number of key factors determine our ability to successfully compete in the marketplace.
In particular, many large convenience store chains have expanded their number of locations and remodeled their existing locations in recent years, enhancing their competitive position. In addition, some of our competitors have greater financial resources and scale than us, which may provide them with competitive advantages in negotiating fuel and other supply arrangements.
In addition, some of our competitors have greater financial resources and scale than us, which may provide them with competitive advantages in negotiating fuel and other supply arrangements.
If any of our principal suppliers elects not to renew its contracts with us, we may be unable to replace the volume of motor fuel we currently purchase from such supplier on similar terms or at all. We rely upon our suppliers to timely provide the volumes and 10 types of motor fuels for which they contract.
Our fuel supply agreements expire on various dates through June 2032. If any of our principal suppliers elects not to renew its contracts with us, we may be unable to replace the volume of motor fuel we currently purchase from such supplier on similar terms or at all.
In certain instances, these factors have led to delays and increased costs for our projects and although we believe we are successfully navigating these challenges, there can be no assurance that we will be able to achieve our growth targets by successfully implementing this strategy.
In certain instances, these factors have led to delays and increased costs for our projects, and there can be no assurance that we will be able to achieve our growth targets by successfully implementing this strategy. Significant changes in current consumption of cigarettes and other tobacco products and related regulations and litigation could materially adversely affect our business.
Our executive officers and directors and a limited number of stockholders beneficially owned approximately 71% of our outstanding voting stock as of December 31, 2023. Each share of common stock entitles its holders to one vote on all matters presented to stockholders.
The majority of our common stock is held by a limited number of stockholders and their interests may conflict with yours in the future. A limited number of stockholders beneficially owned approximately 67% of our outstanding voting stock as of December 31, 2024. Each share of common stock entitles its holders to one vote on all matters presented to stockholders.
Demand for trucking services in the United States generally reflects the amount of commercial activity in the U.S. economy. When the U.S. economy declines, demand for goods moved by trucks usually declines, and in turn demand for diesel fuel supplied by our fleet fueling segment typically declines, which could significantly harm our results of operations and financial condition.
When the U.S. economy declines, demand for goods moved by trucks usually declines, and in turn demand for diesel fuel supplied by our fleet fueling segment typically declines, which could significantly harm our results of operations and financial condition. A number of key factors could impact current customer behavior and trends with respect to road transportation and fuel consumption.
Such upgrades and remodeling projects, regardless of scale, entail significant risks, including shortages of materials or skilled labor, unforeseen engineering, environmental and/or geological problems, work stoppages, weather interference, unanticipated cost increases and non-availability of construction equipment.
Specifically, with the execution of remodeling and building strategies, risks include shortages of materials and skilled labor, environmental or geological problems, work stoppages, weather interference, unanticipated cost increases and non-availability of construction equipment.
So long as they continue to own a significant amount of the combined voting power, even if such amount is less than 50%, they will continue to be able to strongly influence or effectively control our decisions. Our corporate structure includes Israeli subsidiaries that may have adverse tax consequences and expose us to additional tax liabilities.
So long as they continue to own a significant amount of the combined voting power, even if such amount is less than 50%, they will continue to be able to strongly influence or effectively control our decisions. The market price and trading volume of our common stock has been and may be volatile and could decline significantly.
Our business, particularly the operation of gas stations, and the storage and transportation of fuel products, is directly affected by numerous environmental laws and regulations pertaining, in particular, to the quality of fuel products, the handling and disposal of hazardous wastes and the prevention and remediation of environmental contaminations.
We and our facilities, particularly the operation of gas stations, and the storage, transportation and sale of fuel products, are subject to various federal, state and local environmental, health and safety laws, and regulations, in particular, those related to the quality of fuel products, the handling and disposal of hazardous wastes and the prevention and remediation of environmental contaminations.
Hackers and data thieves are increasingly sophisticated and operate large-scale and complex attacks which may remain undetected until after they occur.
Hackers and data thieves are increasingly sophisticated and operate large-scale and complex attacks which may remain undetected until after they occur. Such attacks also may be further enhanced in frequency or effectiveness through threat actors’ use of artificial intelligence.
Even if an active, liquid and orderly trading market is sustained for our common stock, the market price of our common stock may be volatile and could decline significantly. In addition, the trading volume in our common stock may fluctuate and cause significant price variations to occur.
In addition, the trading volume in our common stock may fluctuate and cause significant price variations to occur.
If this trend continues or increases, it could negatively impact demand and seasonal travel patterns, which could reduce future sales volumes. Significant negative developments in the macro-economic environment in the United States could have a material adverse effect on our business, financial condition and results of operations.
Any of these actions could adversely affect our reputation and results of operations. Significant negative developments in the macro-economic environment in the United States could have a material adverse effect on our business, financial condition and results of operations.
A failure by a principal supplier to renew its supply agreement, a disruption in supply or an unexpected change in supplier relationships could have a material adverse effect on our business. We depend on several principal suppliers for our fuel purchases. Our fuel supply agreements expire on various dates through June 2032.
A failure by a principal supplier to renew its supply agreement, a disruption in supply, a significant change in supplier relationships or a significant incident related to a supplier could have a material adverse effect on our business and results of operations.
Such providers may suspend, reduce or terminate their obligations to us if certain events (such as force majeure) occur.
Most of the motor fuel we distribute is transported from terminals to gas stations and cardlock locations by third-party transportation providers. Such providers may suspend, reduce or terminate their obligations to us if certain events (such as force majeure) occur.
The U.S. Federal Trade Commission (the “FTC”) and state governments expect a company’s data security and privacy measures to be compliant.
The U.S. Federal Trade Commission (the “FTC”) and state governments require companies to implement data security and privacy measures appropriate to the sensitivity of customer information, business size, and available tools.
If the payment of our debt is accelerated, our assets may be insufficient to repay such debt in full, which could result in our insolvency. Risks Related to Our Organizational Structure The majority of our common stock is held by a limited number of stockholders and management and their interests may conflict with yours in the future.
If the payment of our debt is accelerated, our assets may be insufficient to repay such debt in full, which could result in our insolvency. Risks Related to Our Organizational Structure and Securities Our corporate structure includes Israeli entities that may expose us to additional tax liabilities. Our corporate structure includes Israeli entities that file tax returns in Israel.
Further, we make public statements about our use and disclosure of personal information through our privacy policies that are posted on our websites and in our loyalty applications.
Failure to meet these expectations may result in claims of unfair or deceptive practices under the FTC Act or similar state laws, leading to potential legal actions for privacy and data security violations. 14 Further, we make public statements about our use and disclosure of personal information through our privacy policies that are posted on our websites and in our loyalty applications.
Federal Reserve Board significantly increased the federal funds rate in 2022 and 2023, which has increased the borrowing costs on our variable rate debt and may increase the cost of any new debt we incur.
Federal Reserve Board raised interest rates eleven times during 2022 and 2023, which increased the borrowing costs on our variable rate debt. The Federal Reserve Board then paused rate increases in the fourth quarter of 2023 following the deceleration of inflationary growth.
Significant changes in current consumption of cigarettes and other tobacco products and related regulations and litigation could materially adversely affect our business. Cigarettes and other tobacco products, which accounted for approximately 8% of our total revenues for the year ended December 31, 2023, are a significant revenue source for us.
Cigarettes and other tobacco products accounted for approximately 39% of our total merchandise revenues for the year ended December 31, 2024.
Any disruption in supply or a significant change in our relationship with our principal fuel suppliers could have a material adverse effect on our business, financial condition and results of operations. We depend on two major vendors to supply a majority of our in-store merchandise.
We depend on several principal suppliers for our fuel purchases, and we depend on one major vendor to supply a majority of our in-store merchandise.
In addition, severe weather phenomena, such as hurricanes, may adversely affect our results of operations and could result in significant damage to our gas stations, convenience stores and infrastructure, potentially resulting in substantial costs and expenses.
Severe weather phenomena, such as hurricanes, floods, and blizzards, may adversely affect our results of operations due to increased costs associated with such weather conditions, possible significant damage to our retail sites and infrastructure, and possible interruption of distributions to our dealer sites and fleet fueling sites.
We may incur expenses for corrective actions or environmental investigations at various owned and previously owned facilities, leased or previously leased facilities, at third-party sites we manage, and at third-party-owned waste disposal sites used by us. An obligation may arise when operations are closed or sold or at non-company sites where company products have been handled or disposed of.
Accidental leaks and spills requiring cleanup may occur during business operations, resulting in expenses for corrective actions or environmental investigations at our facilities, leased locations, or third-party sites we manage. Obligations may also arise at non-company locations where our products have been handled or disposed of, particularly if prior practices—acceptable at the time—require remediation to meet current standards.
If we are unable to maintain the proprietary nature of our technologies, we could be materially adversely affected. We depend on third-party transportation providers for the transportation of most of our motor fuel.
We depend on several principal suppliers for our fuel purchases, third-party transportation providers for the transportation of most of our motor fuel and one principal supplier for merchandise.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWe assess, rank and prioritize cybersecurity incidents based on their severity and impact on our operations and business. Our information security team, with assistance from our legal team, oversees cybersecurity incident response and breach management processes and commencing with the formation of the Board’s Cybersecurity Special Committee, reports to such committee.
Biggest changeOur information security team, with assistance from our legal team, oversees cybersecurity incident response and breach management processes and commencing with the formation of the Board’s Cybersecurity Special Committee, reports to such committee. 18 GPM’s Senior Vice President of Information Technology (the “SVP of IT”), who has more than 30 years of technology experience, leads our information security team.
In the event of a cybersecurity incident which is potentially material, the SVP of IT must report such incident to the Company’s CEO, CFO, General Counsel and the chair of the Cybersecurity Special Committee, and these executives and board member determine whether, based on materiality or potential materiality, to report the cybersecurity incident to the Cybersecurity Special Committee, which committee makes a determination if such cybersecurity incident requires a public filing.
In the event of a cybersecurity incident which is potentially material, the SVP of IT must report such incident to the Company’s CEO, CFO, General Counsel and the chair of the Cybersecurity Subcommittee, and these executives and board member determine whether, based on materiality or potential materiality, to report the cybersecurity incident to the Cybersecurity Subcommittee, which committee makes a determination if such cybersecurity incident requires a public filing.
As of the date of this Annual Report on Form 10-K, we have not 19 encountered risks from cybersecurity threats that have materially affected, or are reasonably likely to materially affect, our business strategy, results of operations or financial position. Refer to “Item 1A.
As of the date of this Annual Report on Form 10-K, we have not encountered incidents from cybersecurity threats that have materially affected, or are reasonably likely to materially affect, our business strategy, results of operations or financial position. Refer to “Item 1A.
Currently, the Cybersecurity Special Committee consists of four independent directors. The Board’s oversight, including through the Cybersecurity Special Committee, includes receiving periodic reports from the SVP of IT and other information technology team members on various cybersecurity matters, including risk assessments, mitigation strategies, areas of emerging risks, incidents and industry trends, and other areas of importance.
The Board’s oversight, including through the Cybersecurity Subcommittee, includes receiving periodic reports from the SVP of IT and other information technology team members on various cybersecurity matters, including risk assessments, mitigation strategies, areas of emerging risks, incidents and industry trends, and other areas of importance.
In addition, the Cybersecurity Special Committee is now tasked with oversight of our annual cybersecurity assessment of key cybersecurity risks, which was previously overseen by the Board. In November 2023, the Board adopted cybersecurity processes, which strengthened and formalized company-wide procedures related to identifying, managing and assessing cybersecurity threats.
In addition, the Cybersecurity Subcommittee is tasked with oversight of our annual cybersecurity assessment of key cybersecurity risks. In November 2023, the Board adopted cybersecurity processes, which strengthened and formalized company-wide procedures related to identifying, managing and assessing cybersecurity threats.
Until November 2023, our Board had oversight responsibility for cybersecurity threats, and the SVP of IT provided cybersecurity-related information to the Board on a periodic basis. In November 2023, the Board formed a Cybersecurity Special Committee which has oversight over our management of cybersecurity threats and is charged with periodically reporting on cybersecurity matters to the Board.
In November 2023, the Board formed a Cybersecurity Special Committee which had oversight over our management of cybersecurity threats and until November 2024, was charged with periodically reporting on cybersecurity matters to the Board. The Cybersecurity Special Committee consisted of four independent directors.
GPM’s Senior Vice President of Information Technology (the “SVP of IT”), who has more than 30 years of technology experience, leads our information security team. We also use additional employees with relevant educational and industry experience to support our information security program.
We also use additional employees with relevant educational and industry experience to support our information security program. Until November 2023, our Board had oversight responsibility for cybersecurity threats, and the SVP of IT provided cybersecurity-related information to the Board on a periodic basis.
Added
We assess, rank and prioritize cybersecurity incidents based on their severity and impact on our operations and business.
Added
In January 2025, the Board changed the Cybersecurity Special Committee to be a subcommittee of the Audit Committee (the “Cybersecurity Subcommittee”).

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeITEM 2. PR OPERTIES. As of December 31, 2023, we owned 395 properties, including 267 retail stores, 51 consignment agent locations, 44 lessee-dealer sites and 33 cardlock locations. Additionally, we have long-term control over a leased property portfolio composed of 1,640 locations as of December 31, 2023.
Biggest changeITEM 2. PR OPERTIES. As of December 31, 2024, we owned 390 properties, including 241 retail stores, 49 consignment agent locations, 69 lessee-dealer sites and 31 cardlock locations. Additionally, we have long-term control over a leased property portfolio composed of 1,630 locations as of December 31, 2024.
Of the leased properties, 1,276 were retail stores, 103 were consignment agent locations, 105 were lessee-dealer sites and 156 were cardlock locations.
Of the leased properties, 1,148 were retail stores, 116 were consignment agent locations, 212 were lessee-dealer sites and 154 were cardlock locations.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe performance graph shall not be deemed incorporated by reference by any general statement incorporating by reference this Annual Report on Form 10-K into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent we specifically incorporate this information by reference, and shall not otherwise be deemed filed under such acts. 21 12/23/2020 12/31/2021 12/31/2022 12/31/2023 ARKO Corp. $ 100 $ 87.70 $ 87.47 $ 84.61 S&P 500 100 133.65 109.45 138.22 Russell 2000 100 124.75 99.26 116.06 S&P Retail Select Industry Index 100 153.59 104.87 127.46 22
Biggest changeThe performance graph shall not be deemed incorporated by reference by any general statement incorporating by reference this Annual Report on Form 10-K into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent we specifically incorporate this information by reference, and shall not otherwise be deemed filed under such acts. 20 12/23/2020 12/31/2021 12/31/2022 12/31/2023 12/31/2024 ARKO Corp. $ 100 $ 87.70 $ 87.47 $ 84.61 $ 68.89 S&P 500 100 133.65 109.45 138.22 172.80 Russell 2000 100 124.75 99.26 116.06 129.45 S&P Retail Select Industry Index 100 153.59 104.87 127.46 142.91 21
Performance Graph The following graph compares the performance of our common stock during the period beginning December 23, 2020 through December 31, 2023, assuming an investment of $100 on December 23, 2020, to that of the total return index for the S&P 500, the Russell 2000 and the S&P Retail Select Industry Index.
Performance Graph The following graph compares the performance of our common stock during the period beginning December 23, 2020 through December 31, 2024, assuming an investment of $100 on December 23, 2020, to that of the total return index for the S&P 500, the Russell 2000 and the S&P Retail Select Industry Index.
As of February 23, 2024, there were 17 holders of record of our common stock and eight holders of record of our publicly-traded warrants to purchase one whole share of common stock at a price of $11.50 per share.
As of February 24, 2025, there were 23 holders of record of our common stock and eight holders of record of our publicly-traded warrants to purchase one whole share of common stock at a price of $11.50 per share.
Removed
Purchases of Equity Securities by the Issuer and Affiliated Purchasers The following table presents our share repurchase activity for the quarter ended December 31, 2023 (dollars in thousands, except per share amounts): Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1) Maximum Dollar Value that May Yet Be Purchased Under the Plans or Programs (1) October 1, 2023 to October 31, 2023 452,916 $ 7.43 452,916 $ 34,104 November 1, 2023 to November 30, 2023 450,454 7.43 450,454 30,755 December 1, 2023 to December 31, 2023 227,242 7.74 227,242 28,995 Total 1,130,612 $ 7.49 1,130,612 $ 28,995 (1) All of the above repurchases were made on the open market at prevailing market rates plus related expenses under our stock repurchase program, which authorizes the repurchase of up to $100 million of our common stock.
Removed
We publicly announced this program on February 23, 2022 and announced the increased amount authorized to be repurchased on May 16, 2023.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeWe believe our significant size and scale aids our efforts to successfully deploy our organic growth strategies in our acquired assets, which we anticipate will result in value accretion. 24 The following table provides a history of our acquisitions, site conversions and site closings for each of the last three years, for the retail, wholesale and fleet fueling segments: For the Year Ended December 31, Retail Segment 2023 2022 2021 Number of sites at beginning of period 1,404 1,406 1,330 Acquired sites 166 32 97 Newly opened or reopened sites 4 — 1 Company-controlled sites converted to consignment or fuel supply locations, net (16 ) (17 ) (9 ) Closed, relocated or divested sites (15 ) (17 ) (13 ) Number of sites at end of period 1,543 1,404 1,406 For the Year Ended December 31, Wholesale Segment 1 2023 2022 2021 Number of sites at beginning of period 1,674 1,628 1,597 Acquired sites 190 46 — Newly opened or reopened sites 2 83 74 76 Consignment or fuel supply locations converted from Company-controlled or fleet fueling sites, net 15 17 9 Closed, relocated or divested sites (137 ) (91 ) (54 ) Number of sites at end of period 1,825 1,674 1,628 1 Excludes bulk and spot purchasers. 2 Includes all signed fuel supply agreements irrespective of fuel distribution commencement date.
Biggest changeThe following table provides a history of our acquisitions, site conversions and site closings for each of the last three years, for the retail, wholesale and fleet fueling segments: For the Year Ended December 31, Retail Segment 2024 2023 2022 Number of sites at beginning of period 1,543 1,404 1,406 Acquired sites 21 166 32 Newly opened or reopened sites 3 4 — Company-controlled sites converted to consignment or fuel supply locations, net (153 ) (16 ) (17 ) Sites closed, divested or converted to rentals (25 ) (15 ) (17 ) Number of sites at end of period 1,389 1,543 1,404 For the Year Ended December 31, Wholesale Segment 1 2024 2023 2022 Number of sites at beginning of period 1,825 1,674 1,628 Acquired sites — 190 46 Newly opened or reopened sites 2 39 83 74 Consignment or fuel supply locations converted from Company-controlled or fleet fueling sites, net 153 15 17 Closed or divested sites (95 ) (137 ) (91 ) Number of sites at end of period 1,922 1,825 1,674 1 Excludes bulk and spot purchasers. 2 Includes all signed fuel supply agreements irrespective of fuel distribution commencement date. 24 For the Year Ended December 31, Fleet Fueling Segment 2024 2023 2022 Number of sites at beginning of period 298 183 — Acquired sites — 111 184 Newly opened or reopened sites 1 6 — Fleet fueling locations converted from fuel supply locations, net — 1 — Closed or divested sites (19 ) (3 ) (1 ) Number of sites at end of period 280 298 183 In recent years, the convenience store industry has focused on increasing and improving in-store foodservice offerings, including fresh foods, quick service restaurants and proprietary food offerings.
The cost of our main products, gasoline and diesel fuel, is greatly impacted by the wholesale cost of fuel in the United States. We attempt to pass wholesale fuel cost changes through to our customers through retail price changes; however, we are not always able to do so.
The cost of our main products, gasoline and diesel fuel, is greatly impacted by the wholesale cost of fuel in the United States. We attempt to pass wholesale fuel cost changes to our customers through retail price changes; however, we are not always able to do so.
We determine, based on past experience and consumer price index increase expectations, if these types of variable payments are in-substance fixed payments, in which case such payments are included in the lease payments and measurement of the lease liabilities. • The discount rates used in the calculations of the right-of-use assets and lease liabilities are based on our incremental borrowing rates and are primarily affected by economic environment, differences in the duration of each lease and the nature of the leased asset.
We determine, based on past experience and consumer price index increase expectations, if these types of variable payments are in-substance fixed payments, in which case such payments are included in the lease payments and measurement of the lease liabilities. 37 • The discount rates used in the calculations of the right-of-use assets and lease liabilities are based on our incremental borrowing rates and are primarily affected by economic environment, differences in the duration of each lease and the nature of the leased asset.
Repurchases may be effected from time to time through open market purchases, including 35 pursuant to a pre-set trading plan meeting the requirements of Rule 10b5-1(c) of the Exchange Act, privately negotiated transactions, pursuant to accelerated share repurchase agreements entered into with one or more counterparties, or otherwise.
Repurchases may be effected from time to time through open market purchases, including pursuant to a pre-set trading plan meeting the requirements of Rule 10b5-1(c) of the Exchange Act, privately negotiated transactions, pursuant to accelerated share repurchase agreements entered into with one or more counterparties, or otherwise.
The Senior Notes and the guarantees rank equally in right of payment with all of the Company’s and the Guarantors’ respective existing and future senior unsubordinated indebtedness and are effectively subordinated to all of the Company’s and the Guarantors’ existing and future secured indebtedness to the extent of the 37 value of the collateral securing such indebtedness; and are structurally subordinated to any existing and future obligations of subsidiaries of the Company that are not Guarantors.
The Senior Notes and the guarantees rank equally in right of payment with all of the Company’s and the Guarantors’ respective existing and future senior unsubordinated indebtedness and are effectively subordinated to all of the Company’s and the Guarantors’ existing and future secured indebtedness to the extent of the value of the collateral securing such indebtedness; and are structurally subordinated to any existing and future obligations of subsidiaries of the Company that are not Guarantors.
Depending on future 25 market and geopolitical conditions, the supply of fuel, including diesel fuel in particular, may become constrained. Accordingly, we maintain terminal storage of diesel fuel for short-term supply needs for our fleet fueling sites.
Depending on future market and geopolitical conditions, the supply of fuel, including diesel fuel in particular, may become constrained. Accordingly, we maintain terminal storage of diesel fuel for short-term supply needs for our fleet fueling sites.
Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion, or all, of the deferred tax assets will not be realized.
Deferred tax assets are reduced by a valuation 38 allowance when, in the opinion of management, it is more likely than not that some portion, or all, of the deferred tax assets will not be realized.
Retail Segment Our retail segment includes the operation of a chain of retail stores, which includes convenience stores selling fuel products and other merchandise to retail customers. At our convenience stores, we own the merchandise and fuel inventory and employ personnel to manage the store.
Retail Segment Our retail segment includes the operation of a chain of retail stores, which includes convenience stores selling fuel products and merchandise to retail customers. At our convenience stores, we own the merchandise and fuel inventory and employ personnel to manage the store.
EBITDA and Adjusted EBITDA are also used by many of our investors, securities analysts, and other interested parties in evaluating our operational and financial performance across reporting periods.
EBITDA and Adjusted EBITDA are also used by many of our investors, securities analysts, and other interested parties in evaluating 32 our operational and financial performance across reporting periods.
The future minimum volume purchase requirements under the existing supply agreements are based on gallons, with a purchase price at prevailing market rates for wholesale distribution. Credit Facilities and Senior Notes Senior Notes As of December 31, 2023, the Company had outstanding $450 million aggregate principal amount of its 5.125% Senior Notes due 2029 (the “Senior Notes”).
The future minimum volume purchase requirements under the existing supply agreements are based on gallons, with a purchase price at prevailing market rates for wholesale distribution. Credit Facilities and Senior Notes Senior Notes As of December 31, 2024, the Company had outstanding $450 million aggregate principal amount of its 5.125% Senior Notes due 2029 (the “Senior Notes”).
As a normal part of our business, we will from time to time consider opportunities to repay, redeem, repurchase or refinance our indebtedness, depending on market conditions. Changes in our operating plans, lower than anticipated sales, increased expenses, acquisitions, or other events may cause us to seek additional debt or equity financing.
As a normal part of our business, we will from time to time consider opportunities to repay, redeem, repurchase or refinance our indebtedness, depending on market conditions. Changes in our operating plans, lower than anticipated sales, increased expenses, acquisitions, or other events may cause us to seek additional debt or equity financing in future periods.
Our fas REWARDS® loyalty program is available in the majority of our stores and offers enrolled loyalty members in store exclusive promotional pricing, in-app member only HOT deals not available in stores, as well as the ability to earn points that can be redeemed for either fuel or merchandise savings.
Our fas REWARDS® loyalty program is available in the majority of our stores and offers enrolled loyalty members in store exclusive promotional pricing, in-app member only deals not available without the app, as well as the ability to earn points that can be redeemed for either fuel or merchandise savings.
On June 6, 2023, we completed our acquisition of 24 Uncle’s convenience stores located across Western Texas, 68 proprietary GASCARD-branded cardlock sites and 43 private cardlock sites for fleet fueling operations located in Western Texas and Southeastern New Mexico from WTG Fuels Holdings, LLC (the “WTG Acquisition”).
In June 2023, we completed our acquisition of 24 Uncle’s convenience stores located across Western Texas, 68 proprietary GASCARD-branded cardlock sites and 43 private cardlock sites for fleet fueling operations located in Western Texas and Southeastern New Mexico from WTG Fuels Holdings, LLC (the “WTG Acquisition”).
It therefore may not be possible to compare our use of these non-GAAP financial measures with those used by other companies. The following table contains a reconciliation of net income to EBITDA and Adjusted EBITDA for the years ended December 31, 2023, 2022 and 2021.
It therefore may not be possible to compare our use of these non-GAAP financial measures with those used by other companies. The following table contains a reconciliation of net income to EBITDA and Adjusted EBITDA for the years ended December 31, 2024, 2023 and 2022.
As of December 31, 2023, we operated the stores under more than 25 regional store brands, including 1-Stop, Admiral, Apple Market®, BreadBox, Corner Mart, Dixie Mart, ExpressStop, E-Z Mart®, fas mart®, fastmarket®, Flash Market, Handy Mart, Jetz, Jiffi Stop®, Jiffy Stop, Li’l Cricket, Market Express, Next Door Store®, Pride, Roadrunner Markets, Rose Mart, Rstore, Scotchman®, shore stop®, Speedy’s, Town Star, Uncle’s, Village Pantry® and Young’s.
As of December 31, 2024, we operated the stores under more than 25 regional store brands including 1-Stop, Admiral, Apple Market®, BreadBox, Corner Mart, Dixie Mart, ExpressStop, E-Z Mart®, fas mart®, fastmarket®, Flash Market, Handy Mart, Jetz, Jiffi Stop®, Jiffy Stop, Li’l Cricket, Market Express, Next Door Store®, Pride, Roadrunner Markets, Rose Mart, Rstore, Scotchman®, shore stop®, Speedy’s, SpeedyQ, Town Star, Uncle’s, Village Pantry® and Young’s.
The wholesale segment adds significant fuel volumes to 23 our robust retail fuel sales, which we believe enhances our purchasing power for our entire platform, including our retail segment, and improves our competitiveness as an acquirer of choice. Description of Segments Our reportable segments are described below.
The wholesale segment adds significant fuel volumes to our robust retail fuel sales, which we believe enhances our purchasing power for our entire platform, including our retail segment, and improves our competitiveness as an acquirer of choice. 22 Description of Segments Our reportable segments are described below.
These fuel margins can change rapidly as they are influenced by many factors, including: the wholesale cost of fuel; interruptions in supply caused by severe weather; supply chain disruptions; refinery mechanical failures; and competition in the local markets in which we operate.
These fuel margins can change rapidly because they are influenced by many factors, including: the wholesale cost of fuel; interruptions in supply caused by severe weather; supply chain disruptions; refinery mechanical failures; and competition in the local markets in which we operate.
On August 15, 2023, we acquired seven Speedy’s convenience stores located in Arkansas and Oklahoma, which were previously locations operated by a dealer to which we supplied fuel (the “Speedy’s Acquisition” and, together with the TEG Acquisition and the WTG Acquisition, the “2023 Acquisitions”).
In August 2023, we acquired seven Speedy’s convenience stores located in Arkansas and Oklahoma, which were previously locations operated by a dealer to which we supplied fuel (the “Speedy’s Acquisition” and, together with the TEG Acquisition and the WTG Acquisition, the “2023 Acquisitions”).
Seasonality Our business is seasonal, and our operating income in the second and third quarters has historically been significantly greater than in the first and fourth quarters as a result of the generally improved climate and seasonal buying patterns of our customers.
Seasonality Our business is seasonal, and our operating income in the second and third quarters has historically been significantly greater than in the first and fourth quarters as a result of the generally favorable climate and seasonal buying patterns of our customers.
In July 2022, we completed our acquisition of certain assets from Quarles Petroleum, Incorporated (the “Quarles Acquisition”), which included at closing 121 proprietary Quarles-branded cardlock sites and 63 third-party cardlock sites for fleet fueling operations, and 46 dealer locations, and in December 2022, we completed our acquisition of Pride Convenience Holdings, LLC, which operated 31 Pride convenience stores at closing and had one store under construction that is now opened (the “Pride Acquisition” and together with the Quarles Acquisition, the “2022 Acquisitions”).
In July 2022, we completed our acquisition of certain assets from Quarles Petroleum, Incorporated (the “Quarles Acquisition”), which included on the acquisition date 121 proprietary Quarles-branded cardlock sites and 63 third-party cardlock sites for fleet fueling operations, and 46 dealer locations, and in December 2022, we completed our acquisition of Pride Convenience Holdings, LLC, which operated 31 Pride convenience stores on the acquisition date and had one store under construction that is now opened (the “Pride Acquisition” and together with the Quarles Acquisition, the “2022 Acquisitions”).
(4) Includes financial liabilities related to the 2023 Acquisitions of TEG and WTG, the 2022 Acquisitions of Quarles and Pride and the 2021 acquisition of ExpressStop stores, assuming lease purchase option is not exercised. (5) Our fuel vendor agreements with suppliers require minimum volume purchase commitments of branded and unbranded gasoline and distillates annually.
(4) Includes financial liabilities related to the 2023 Acquisitions of TEG and WTG, the 2022 Acquisitions and the 2021 acquisition of ExpressStop convenience stores, assuming lease purchase option is not exercised. (5) Our fuel vendor agreements with suppliers require minimum volume purchase commitments of branded and unbranded gasoline and distillates annually.
Results of Operations for the years ended December 31, 2023, 2022 and 2021 The period-to-period comparisons of our results of operations contained in this Management’s Discussion and Analysis of Financial Condition and Results of Operation have been prepared using the Consolidated Financial Statements and the notes thereto, and the following discussion should be read in conjunction with such audited annual consolidated financial statements and related notes contained elsewhere in this Annual Report on Form 10-K.
Results of Operations for the years ended December 31, 2024, 2023 and 2022 The period-to-period comparisons of our results of operations contained in this Management’s Discussion and Analysis of Financial Condition and Results of Operation have been prepared using the Consolidated Financial Statements and the notes thereto, and the following discussion should be read in conjunction with such Consolidated Financial Statements and related notes contained 25 elsewhere in this Annual Report on Form 10-K.
Additionally, because of current labor market conditions and the prevailing wage rates in the markets in which we operate, we have voluntarily increased wages, which has increased our costs associated with recruiting and retaining qualified personnel, and may continue to do so in the future.
Because of recent and current labor market conditions and the prevailing wage rates in the markets in which we operate, we have increased wages, which has increased our costs associated with recruiting and retaining qualified personnel, and may continue to do so in the future.
We also derive revenue from the wholesale distribution of fuel and the sale of fuel at cardlock locations, and we earn commissions from the sales of fuel using proprietary fuel cards that provide customers access to a nationwide network of fueling sites.
We also generate revenue from our wholesale distribution of fuel and the sale of fuel at cardlock locations, and we earn commissions from the sales of fuel using proprietary fuel cards that provide customers access to a nationwide network of fueling sites.
We intentionally focus our marketing and merchandising initiatives at our retail stores to offer our customers an assortment of products with an attractive value proposition. Our retail offering includes a wide array of cold and hot foodservice, beverages, cigarettes and other tobacco products, candy, salty snacks, grocery, beer and general merchandise.
We focus our marketing and merchandising initiatives at our retail stores on offering our customers an assortment of products with an attractive value proposition. Our retail offering includes a wide array of cold and hot foodservice, beverages, cigarettes and other tobacco products, candy, salty snacks, grocery, beer and general merchandise.
Financing Agreements with M&T Bank GPM has a financing arrangement with M&T Bank that provides a line of credit for up to $45.0 million to purchase equipment on or before September 2026, which may be borrowed in tranches, as well as an aggregate principal amount of $44.4 million of real estate loans (the “M&T Term Loans”).
Financing Agreements with M&T Bank GPM has a financing arrangement with M&T Bank that provides a line of credit for up to $45.0 million to purchase equipment on or before September 2026, which may be borrowed in tranches, as well as an aggregate original principal amount of $49.5 million of real estate loans (the “M&T Term Loans”).
For the year ended December 31, 2023, total general, administrative, depreciation and amortization expenses increased slightly from those in the year ended December 31, 2022. Use of Non-GAAP Measures We disclose certain measures on a “same store basis,” which is a non-GAAP measure.
For the year ended December 31, 2024, total general and administrative expenses increased slightly from those in the year ended December 31, 2023, and depreciation and amortization expenses for 2024 remained consistent with 2023. Use of Non-GAAP Measures We disclose certain measures on a “same store basis,” which is a non-GAAP measure.
We believe these revenues result in stable, ratable cash flows which, together with free cash flow from our retail segment, can be deployed to pursue accretive acquisitions and investments in our retail stores.
We believe these revenues provide stable, ratable cash flows that, together with free cash flow from our retail segment, can be deployed to pursue accretive acquisitions and investments in our retail stores.
For the 2023 annual impairment test, the data used for the income approach was directly linked to our internal projections for 2024 through 2028. The long-term growth rate used in the terminal year was (0.2)% for the GPMP reporting unit, and was 2.6% for the retail reporting unit, in accordance with the relevant weighted average long-term nominal growth rate.
For the 2024 annual impairment test, the data used for the income approach was directly linked to our internal projections for 2025 through 2029. The long-term growth rate used in the terminal year was (0.6)% for the GPMP reporting unit, and was 3.0% for the retail reporting unit, in accordance with the relevant weighted average long-term nominal growth rate.
(c) Eliminates the non-cash loss from the sale 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.
(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.
As of December 31, 2023, approximately 46% of our debt bore interest at variable rates, an increase from approximately 38% from the prior year, which has increased our interest rate risk and may require that we use more of our cash flow for the payment of interest if prevailing interest rates continue to increase or we incur additional indebtedness under our variable rate facilities or otherwise.
As of December 31, 2024, approximately 49% of our debt bore interest at variable rates, an increase from approximately 46% as of December 31, 2023, which has increased our interest rate risk and may require that we use more of our cash flow for the payment of interest if prevailing interest rates increase or we incur additional indebtedness under our variable rate facilities or otherwise.
Adjusted EBITDA further adjusts EBITDA by excluding the gain or loss on disposal of assets, impairment charges, acquisition costs, other non-cash items, and other unusual or non-recurring charges. Both EBITDA and Adjusted EBITDA are non-GAAP financial measures.
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 calculation of the availability under the PNC Line of Credit is determined monthly subject to terms and limitations as set forth in the PNC Credit Agreement, taking into account the balances of receivables, inventory and letters of credit, among other things. As of December 31, 2023, $7.3 million of letters of credit were outstanding under the PNC Credit Agreement.
The calculation of the availability under the PNC Line of Credit is determined monthly subject to terms and limitations as set forth in the PNC Credit Agreement, taking into account the balances of receivables, inventory and letters of credit, among other things. As of December 31, 2024, $8.2 million of letters of credit were outstanding under the PNC Credit Agreement.
Additionally, the Board declared a quarterly dividend of $0.03 per share of common stock, to be paid on March 21, 2024 to stockholders of record as of March 11, 2024.
Additionally, 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.
Overview Based in Richmond, VA, we are a leading independent convenience store operator and, as of December 31, 2023, we were the sixth largest convenience store chain in the United States (“U.S.”) ranked by store count, operating 1,543 retail convenience stores.
Overview Based in Richmond, VA, we are a leading independent convenience store operator and, as of December 31, 2024, we were one of the largest convenience store chain in the United States (“U.S.”) ranked by store count, operating 1,389 retail convenience stores.
As of December 31, 2023, we had no outstanding borrowings under our $140.0 million PNC Line of Credit (as defined below), $19.5 million of unused availability under the M&T equipment line of credit, described below, and $461.2 million of unused availability under our $800 million Capital One Line of Credit (as defined below), which we may elect to increase up to $1.0 billion, subject to obtaining additional financing commitments from current lenders or other banks, and subject to certain other terms.
As of December 31, 2024, we had no outstanding borrowings under our $140.0 million PNC Line of Credit (as defined below), $29.1 million of unused availability under the M&T equipment line of credit, described below, and $418.7 million of unused availability under our $800 million Capital One Line of Credit (as defined below), which we may elect to increase up to $1.0 billion, subject to obtaining additional financing commitments from current lenders or other banks, and subject to certain other terms.
The discount rate applied to the cash flow projections for the GPMP and the retail reporting units was approximately 9.0% and 11.0%, respectively. 39 The impairment review was sensitive to changes in the key assumptions used. Our key assumptions included revenue and profit growth, capital expenditures, external industry data and past experiences.
The discount rate applied to the cash flow projections for the GPMP and the retail reporting units was approximately 8.5% and 10.5%, respectively. The impairment review was sensitive to changes in the key assumptions used. Our key assumptions included revenue and profit growth, capital expenditures, external industry data and past experiences.
Fleet Fueling Segment Our fleet fueling segment includes the operation of proprietary and third-party cardlock locations (unstaffed fueling locations), and issuance of proprietary fuel cards that provide customers access to a nationwide network of fueling sites.
Fleet Fueling Segment Our fleet fueling segment includes the operation of proprietary and third-party cardlock locations (unstaffed fueling locations), and commissions from the sales of fuel using proprietary fuel cards that provide customers access to a nationwide network of fueling sites.
Fleet Fueling Segment The table below shows the results of the fleet fueling segment for the years ended December 31, 2023 and 2022, together with certain key metrics for the segment.
Retail Segment The table below shows the results of the retail segment for the years ended December 31, 2024, 2023 and 2022, together with certain key metrics for the segment.
GPMP Segment The table below shows the results of the GPMP segment for the years ended December 31, 2023, 2022 and 2021, together with certain key metrics for the segment.
Wholesale Segment The table below shows the results of the wholesale segment for the years ended December 31, 2024, 2023 and 2022, together with certain key metrics for the segment.
See also “Quantitative and Qualitative Disclosures about Market Risk—Interest Rate Risk.” As of December 31, 2023, we were in a strong liquidity position of approximately $831 million, consisting of approximately $218 million of cash and cash equivalents and approximately $613 million of availability under our lines of credit available for certain purposes.
See also “Quantitative and Qualitative Disclosures about Market Risk—Interest Rate Risk.” As of December 31, 2024, we were in a strong liquidity position of approximately $841 million, consisting of approximately $262 million of cash and cash equivalents and approximately $579 million of availability under our lines of credit available for certain purposes.
(2) Includes principal and interest payments. Assumes an interest rate of 8.2% on the $338.3 million of the Capital One Line of Credit utilized as of December 31, 2023 and a zero balance on the PNC Line of Credit. (3) Deferred payments related to the TEG Acquisition and the Speedy’s Acquisition.
(2) Includes principal and interest payments. Assumes an interest rate of 7.4% on the $380.8 million of the Capital One Line of Credit utilized as of December 31, 2024 and a zero balance on the PNC Line of Credit. (3) Deferred payments related to the Speedy’s Acquisition.
As of December 31, 2023, we also supplied fuel to 1,825 dealers and operated 298 cardlock locations (unstaffed fueling locations). We are well diversified geographically and, as of December 31, 2023, operated in the District of Columbia and more than 30 states in the Mid-Atlantic, Midwestern, Northeastern, Southeastern and Southwestern U.S.
As of December 31, 2024, we also supplied fuel to 1,922 dealer locations and operated 280 cardlock locations (unstaffed fueling locations). We are well diversified geographically and as of December 31, 2024, operated in the District of Columbia and more than 30 states in the Mid-Atlantic, Midwestern, Northeastern, Southeastern and Southwestern U.S.
For the year ended December 31, 2023, we utilized $111.2 million for capital expenditures, including the purchase of certain fee properties, upgrades to fuel dispensers and other investments in our stores.
For the year ended December 31, 2024, we utilized $113.9 million for capital expenditures, including the purchase of certain fee properties, upgrades to fuel dispensers and other investments in our stores.
For the year ended December 31, 2023, income tax expense was $12.2 million compared to $35.6 million for the year ended December 31, 2022, and our effective tax rate for the years ended December 31, 2023 and 2022 was 26.0% and 33.1%, respectively.
For the year ended December 31, 2024, income tax expense was $6.1 million compared to $12.2 million for the year ended December 31, 2023, and our effective tax rate for the years ended December 31, 2024 and 2023 was 22.8% and 26.0%, respectively.
For the year ended December 31, 2023, depreciation and amortization expenses increased $25.8 million, or 25.4%, as compared to the year ended December 31, 2022 primarily due to assets acquired in the past two years, largely in connection with the 2023 Acquisitions and the 2022 Acquisitions.
For the year ended December 31, 2024, depreciation and amortization expenses increased $4.8 million, or 3.8%, compared to the year ended December 31, 2023 primarily due to assets acquired in the past two years, largely in connection with the 2023 Acquisitions and the SpeedyQ Acquisition.
All references to fuel contribution and fuel margin per gallon are excluding the estimated fixed margin or fixed fee paid to GPMP for the cost of fuel (intercompany charges by GPMP). 26 Consolidated Results The table below shows our consolidated results for the years ended December 31, 2023, 2022 and 2021, together with certain key metrics.
All figures for fuel costs, fuel contribution and fuel margin per gallon exclude the estimated fixed margin or fixed fee paid to GPMP for the cost of fuel (intercompany charges by GPMP). Consolidated Results The table below shows our consolidated results for the years ended December 31, 2024, 2023 and 2022, together with certain key metrics.
More recently, on March 1, 2023, we acquired 135 convenience stores and gas stations, 181 dealer locations, a commercial, government, and industrial business, and certain distribution and transportation assets from Transit Energy Group, LLC (the “TEG Acquisition”).
In March 2023, we acquired 135 convenience stores, 181 dealer locations, a commercial, government, and industrial business, and certain distribution and transportation assets from Transit Energy Group, LLC (the “TEG Acquisition”).
We added the fleet fueling segment only upon consummation of the Quarles Acquisition on July 22, 2022; therefore, the year ended December 31, 2022 does not reflect the operations of this segment for the entirety of 2022, which affects year-over-year comparability, and there are no comparable period results for the year ended December 31, 2021.
We added the fleet fueling segment only upon consummation of the Quarles Acquisition on July 22, 2022; therefore, the year ended December 31, 2022 does not reflect the operations of this segment for the entirety of 2022, which affects year-over-year comparability.
Cash Flows for the Years Ended December 31, 2023, 2022 and 2021 Net cash provided by (used in) operating activities, investing activities and financing activities for the years ended December 31, 2023, 2022 and 2021 were as follows: For the Year Ended December 31, 2023 2022 2021 Net cash provided by (used in): (in thousands) Operating activities $ 136,094 $ 209,256 $ 159,191 Investing activities (296,822 ) (175,488 ) (171,777 ) Financing activities 85,357 10,555 (26,384 ) Effect of exchange rates 23 (97 ) (1,464 ) Total $ (75,348 ) $ 44,226 $ (40,434 ) For a discussion of the comparison of our cash flows for the years ended December 31, 2022 and 2021, refer to Part II, Item 7 “Management's Discussion and Analysis of Financial Condition and Results of Operations ” in our Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on February 28, 2023, under the subheading “Cash Flows for the Years Ended December 31, 2022, 2021 and 2020.” Operating Activities Cash flows provided by operations are our main source of liquidity.
Cash Flows for the Years Ended December 31, 2024, 2023 and 2022 Net cash provided by (used in) operating activities, investing activities and financing activities for the years ended December 31, 2024, 2023 and 2022 were as follows: For the Year Ended December 31, 2024 2023 2022 Net cash provided by (used in): (in thousands) Operating activities $ 221,858 $ 136,094 $ 209,256 Investing activities (114,858 ) (296,822 ) (175,488 ) Financing activities (56,004 ) 85,357 10,555 Effect of exchange rates (9 ) 23 (97 ) Total $ 50,987 $ (75,348 ) $ 44,226 For a discussion of the comparison of our cash flows for the years ended December 31, 2023 and 2022, refer to Part II, Item 7 “Management's Discussion and Analysis of Financial Condition and Results of Operations ” in our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 27, 2024, under the subheading “Cash Flows for the Years Ended December 31, 2023, 2022 and 2021.” Operating Activities Cash flows provided by operations are our main source of liquidity.
We believe the following critical accounting estimates affect our more significant judgments and estimates used in the preparation of our consolidated financial statements. 38 Application of ASC 842, Leases (“ASC 842”) The lease liabilities and right-of-use assets are significantly impacted by the following: • Our determination of whether it is reasonably certain that an extension option will be exercised. • Our determination of whether it is reasonably certain a purchase option will be exercised. • Some of the lease agreements include an increase in the consumer price index coupled with a multiplier and a percentage increase cap effectively assures the cap will be reached each year.
Application of ASC 842, Leases (“ASC 842”) The lease liabilities and right-of-use assets are significantly impacted by the following: • Our determination of whether it is reasonably certain that an extension option will be exercised. • Our determination of whether it is reasonably certain a purchase option will be exercised. • Some of the lease agreements include an increase in the consumer price index coupled with a multiplier and a percentage increase cap effectively assures the cap will be reached each year.
There can be no assurance that we will continue to pay such dividends or the amounts of such dividends. In May 2023, we announced that our Board authorized an increase to our share repurchase program from $50 million to up to an aggregate of $100.0 million of our outstanding shares of common stock.
There can be no assurance that we will continue to pay such dividends or the amounts of such dividends. In May 2024, the Board increased the size of our share repurchase program for up to an aggregate of $125.0 million of our outstanding shares of common stock, from an aggregate of $100.0 million of our outstanding shares of common stock.
Each additional equipment loan tranche under such financing agreement will have a term of up to five years from the date it is advanced, payable in equal monthly payments of principal plus interest of SOFR (as defined in the agreement) plus 2.75%.
As of December 31, 2024, approximately $29.1 million remained available under the equipment line of credit. Each additional equipment loan tranche under such financing agreement will have a term of up to five years from the date it is advanced, payable in equal monthly payments of principal plus interest of SOFR (as defined in the agreement) plus 2.75%.
For the year ended December 31, 2023, cash flows provided by operating activities were $136.1 million compared to $209.3 million for the year ended December 31, 2022.
For the year ended December 31, 2024, cash flows provided by operating activities were $221.9 million compared to $136.1 million for the year ended December 31, 2023.
The Board declared, and the Company paid, dividends of $0.03 per share of common stock on each of March 21, 2023, June 1, 2023, September 1, 2023 and December 1, 2023, totaling approximately $14.3 million.
The Board declared, and the Company paid, dividends of $0.03 per share of common stock on each of March 21, 2024, May 31, 2024, August 30, 2024, and December 3, 2024, totaling approximately $14.0 million.
The decrease in fuel revenue was attributable to a $0.42 per gallon decrease in the average retail price of fuel in 2023 as compared to 2022, primarily due to market factors, as well as a decrease in gallons sold at same stores of approximately 5.3%, or 52.1 million gallons.
The decrease in fuel revenue was attributable to a decrease in gallons sold at same stores of approximately 6.1%, or 65.5 million gallons, reflecting the challenging macro-economic environment, as well as a $0.19 per gallon decrease in the average retail price of fuel in 2024 as compared to 2023, primarily due to market factors.
Investing Activities Cash flows used in investing activities primarily reflect capital expenditures for acquisitions and replacing and maintaining existing facilities and equipment used in the business. For the year ended December 31, 2023, cash used in investing activities increased by $121.3 million to $296.8 million from $175.5 million for the year ended December 31, 2022.
Investing Activities Cash flows used in investing activities primarily reflect capital expenditures for acquisitions and replacing and maintaining existing facilities and equipment used in the business. For the year ended December 31, 2024, cash used in investing activities decreased by $182.0 million to $114.9 million from $296.8 million for the year ended December 31, 2023.
The sales price to the dealer is determined according to the terms of the relevant agreement with the dealer, which typically reflects our total fuel costs plus the cost of transportation and a margin, with us generally retaining the prompt pay discounts and rebates.
For cost plus arrangements, we sell fuel to dealers and bulk and spot purchasers on a fixed-fee basis. The sales price is determined according to the terms of the relevant agreement, which typically reflects our total fuel costs plus the cost of transportation and a margin, with us generally retaining the prompt pay discounts and rebates.
GPMP Segment Our GPMP segment engages in the wholesale distribution of fuel to substantially all of our sites that sell fuel in the retail and wholesale segments and a limited number of third-party dealers and bulk purchasers.
GPMP Segment Our GPMP segment engages in the wholesale distribution of fuel to substantially all of our sites that sell fuel in the retail and wholesale segments.
Wholesale Segment Our wholesale segment supplies fuel to dealers, on either a consignment or cost plus basis. For consignment arrangements, we retain ownership of the fuel inventory at the site, are responsible for the pricing of the fuel to the end consumer and share a portion of the gross profit earned from the sale of fuel by the consignment dealers.
For consignment arrangements, we retain ownership of the fuel inventory at the site, are responsible for the pricing of the fuel to the end consumer and share a portion of the gross profit earned from the sale of fuel with the consignment dealers.
As of December 31, 2023, approximately $338.3 million was drawn on the Capital One Line of Credit, $0.5 million of letters of credit were outstanding under the Capital One Line of Credit and approximately $461.2 million was available thereunder.
As of December 31, 2024, approximately $380.8 million was drawn on the Capital One Line of Credit, $0.5 million of letters of credit were outstanding under the Capital One Line of Credit and approximately $418.7 million was available thereunder.
Additionally, throughout 2023, the U.S. economy continued to endure price inflation and the effect of higher prevailing interest rates, which began in 2022 and which has increased merchandise cost and reduced consumer purchasing power. We have mitigated a portion of these higher costs with retail price increases.
Additionally, the significant increase in the rate of inflation in the U.S. in recent years and the effect of higher prevailing interest rates has increased merchandise cost and reduced consumer purchasing power. We have mitigated a portion of these higher costs with retail price increases.
For the year ended December 31, 2023, interest and other financial expenses, net increased by $11.8 million compared to the year ended December 31, 2022 primarily due to higher average outstanding debt balances and a higher average interest rate for 2023 and higher interest expenses related to financial liabilities, which was partially offset by an increase of $9.6 million in income, net recorded for fair value adjustments related to the Ares Put Option, Public Warrants, Private Warrants and Additional Deferred Shares (each of which is defined in the notes to the Consolidated Financial Statements) and additional interest income generated in 2023.
For the year ended December 31, 2024, interest and other financial expenses, net decreased by $4.1 million compared to the year ended December 31, 2023 primarily as a result of $9.2 million recorded as financial income related to the issuance of the First Installment Shares (as defined in Note 4 to the Consolidated Financial Statements) as payment of deferred consideration and the settlement of deferred consideration related to the TEG Acquisition, an increase of $0.8 million in income recorded in 2024 compared to the prior year period for fair value adjustments related to the Ares Put Option, Public Warrants, Private Warrants and Additional Deferred Shares (each as defined in the notes to the Consolidated Financial Statements) and additional interest income generated in 2024, which was partially offset by higher average outstanding debt balances, a higher average interest rate for 2024 and higher interest expenses related to financial liabilities.
Our store count has grown from 320 sites in 2011 to 3,666 sites as of December 31, 2023, of which 1,543 were operated as retail convenience stores, 1,825 were locations at which we supplied fuel to dealers and 298 were cardlock locations.
Our store count has grown from 320 sites in 2011 to 3,591 sites as of December 31, 2024, of which 1,389 were operated as retail convenience stores, 1,922 were dealer locations to which we supplied fuel, and 280 were cardlock locations.
Offsetting these decreases, the 2023 Acquisitions and the Pride Acquisition contributed 182.0 million incremental gallons sold, or $639.0 million in fuel revenue. Underperforming retail stores, which we closed or converted to dealers during 2023 in order to optimize profitability, also negatively impacted gallons sold during 2023.
Partially offsetting these decreases was an incremental 41.3 million gallons sold, or $132.8 million in fuel revenue, contributed by the 2023 Acquisitions and the SpeedyQ Acquisition. Underperforming retail stores, which we closed or converted to dealers during 2024 to optimize profitability, also negatively impacted gallons sold by 19.3 million gallons.
At consignment agent locations, fuel contribution decreased $2.6 million and fuel margin per gallon also decreased for 2023 as compared to 2022, primarily due to lower rack-to-retail margins and decreased prompt pay discounts related to lower fuel costs, which was partially offset by the incremental contribution from the 2023 Acquisitions and the Quarles Acquisition.
At consignment agent locations, fuel contribution decreased $2.1 million while fuel margin per 30 gallon increased for 2024 compared to 2023, primarily due to incremental contribution of $0.5 million from the retail stores converted to dealers, and the 2023 Acquisitions, which was offset by lower rack-to-retail margins and decreased prompt pay discounts related to lower fuel costs.
For the year ended December 31, 2023 compared to the year ended December 31, 2022 GPMP Revenues For the year ended December 31, 2023, fuel revenue decreased by $526.8 million, or 9.3%, as compared to the year ended December 31, 2022.
For the year ended December 31, 2024 compared to the year ended December 31, 2023 Retail Revenues For the year ended December 31, 2024, fuel revenue decreased by $348.8 million, or 9.0%, compared to the year ended December 31, 2023.
At fuel supply locations, fuel contribution decreased by $2.7 million, and fuel margin per gallon decreased for 2023 as compared to 2022, primarily due to decreased prompt pay discounts related to lower fuel costs and lower 31 volumes at comparable wholesale sites, which was partially offset by the incremental contribution from the 2023 Acquisitions and the Quarles Acquisition.
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 the retail stores converted to dealers of $0.7 million, and the 2023 Acquisitions.
In 2024, we launched an extensive new pizza program. Our results of operation are significantly impacted by the retail fuel margins we earn on gallons sold.
In the first quarter of 2024, we launched an extensive new pizza program as described above, and we are working on the expansion of our food offering as part of our Transformation Plan. Our results of operation are significantly impacted by the retail fuel margins we earn on gallons sold.
During the year ended December 31, 2023, we repurchased approximately 4.2 million shares of common stock under the repurchase program for approximately $32.0 million, or an average share price of $7.54. The share repurchase program does not have a stated expiration date.
During the year ended December 31, 2024, inclusive of the repurchase of the First Installment Shares from TEG, we repurchased approximately 4.8 million shares of common stock under the share repurchase program for approximately $28.3 million, or an average share price of $5.89. The share repurchase program does not have a stated expiration date.
For the Year Ended December 31, 2023 2022 Revenues: (in thousands) Fuel revenue $ 530,937 $ 270,670 Other revenues, net 7,818 2,178 Total revenues 538,755 272,848 Operating expenses: Fuel costs 481,885 245,733 Store operating expenses 22,298 8,733 Total operating expenses 504,183 254,466 Operating income $ 34,572 $ 18,382 Fuel gallons sold – proprietary cardlock locations 130,995 57,104 Fuel gallons sold – third-party cardlock locations 9,832 2,882 Fuel margin, cents per gallon 1 – proprietary cardlock locations 41.7 48.4 Fuel margin, cents per gallon 1 – third-party cardlock locations 12.4 6.5 1 Calculated as fuel revenue less fuel costs divided by fuel gallons sold; excludes the estimated fixed fee paid to GPMP for the cost of fuel.
For the Year Ended December 31, 2024 2023 2022 Revenues: (in thousands) Fuel revenue $ 515,462 $ 530,937 $ 270,670 Other revenues, net 9,135 7,818 2,178 Total revenues 524,597 538,755 272,848 Operating expenses: Fuel costs 1 451,173 475,037 242,849 Site operating expenses 24,917 22,298 8,733 Total operating expenses 476,090 497,335 251,582 Operating income $ 48,507 $ 41,420 $ 21,266 Fuel gallons sold – proprietary cardlock locations 136,104 130,995 57,104 Fuel gallons sold – third-party cardlock locations 12,814 9,832 2,882 Fuel margin, cents per gallon 2 – proprietary cardlock locations 46.0 41.7 48.4 Fuel margin, cents per gallon 2 – third-party cardlock locations 13.1 12.4 6.5 1 Excludes the estimated fixed fee paid to GPMP for the cost of fuel. 2 Calculated as fuel revenue less fuel costs divided by fuel gallons sold.
For the year ended December 31, 2022 compared to the year ended December 31, 2021 For a discussion of the comparative results of operations for the years ended December 31, 2022 and 2021, refer to Part II, Item 7 “Management's Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on February 28, 2023. 28 Segment Results Retail Segment The table below shows the results of the retail segment for the years ended December 31, 2023, 2022 and 2021, together with certain key metrics for the segment.
Refer to “Use of Non-GAAP Measures” below for discussion of this non-GAAP performance measure and related reconciliation to net income. 27 For the year ended December 31, 2023 compared to the year ended December 31, 2022 For a discussion of the comparative results of operations for the years ended December 31, 2023 and 2022, refer to Part II, Item 7 “Management's Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 27, 2024.
For the Year Ended December 31, 2023 2022 2021 Revenues: (in thousands) Fuel revenue $ 7,464,372 $ 7,401,090 $ 5,714,333 Merchandise revenue 1,838,001 1,647,642 1,616,404 Other revenues, net 110,358 94,067 86,661 Total revenues 9,412,731 9,142,799 7,417,398 Operating expenses: Fuel costs 6,876,084 6,856,651 5,275,907 Merchandise costs 1,252,879 1,146,423 1,143,494 Store operating expenses 860,134 721,174 630,518 General and administrative expenses 165,294 139,969 124,667 Depreciation and amortization 127,597 101,752 97,194 Total operating expenses 9,281,988 8,965,969 7,271,780 Other expenses, net 12,729 9,816 3,536 Operating income 118,014 167,014 142,082 Interest and other financial expenses, net (71,243 ) (59,405 ) (71,207 ) Income before income taxes 46,771 107,609 70,875 Income tax expense (12,166 ) (35,557 ) (11,634 ) (Loss) income from equity investment (39 ) (74 ) 186 Net income $ 34,566 $ 71,978 $ 59,427 Less: Net income attributable to non-controlling interests 197 231 229 Net income attributable to ARKO Corp. $ 34,369 $ 71,747 $ 59,198 Series A redeemable preferred stock dividends (5,750 ) (5,750 ) (5,735 ) Net income attributable to common shareholders $ 28,619 $ 65,997 $ 53,463 Fuel gallons sold 2,241,805 1,971,011 2,019,206 Fuel margin, cents per gallon 1 26.2 27.6 21.7 Merchandise contribution 2 $ 585,122 $ 501,219 $ 472,910 Merchandise margin 3 31.8 % 30.4 % 29.3 % Adjusted EBITDA 4 $ 290,428 $ 301,054 $ 256,575 1 Calculated as fuel revenue less fuel costs divided by fuel gallons sold. 2 Calculated as merchandise revenue less merchandise costs. 3 Calculated as merchandise contribution divided by merchandise revenue. 4 Refer to “ Use of Non-GAAP Measures” below for discussion of this non-GAAP performance measure and related reconciliation to net income.
For the Year Ended December 31, 2024 2023 2022 Revenues: (in thousands) Fuel revenue $ 6,858,919 $ 7,464,372 $ 7,401,090 Merchandise revenue 1,767,345 1,838,001 1,647,642 Other revenues, net 105,698 110,358 94,067 Total revenues 8,731,962 9,412,731 9,142,799 Operating expenses: Fuel costs 6,271,696 6,876,084 6,856,651 Merchandise costs 1,187,776 1,252,879 1,146,423 Site operating expenses 875,272 860,134 721,174 General and administrative expenses 162,920 165,294 139,969 Depreciation and amortization 132,414 127,597 101,752 Total operating expenses 8,630,078 9,281,988 8,965,969 Other expenses, net 7,858 12,729 9,816 Operating income 94,026 118,014 167,014 Interest and other financial expenses, net (67,161 ) (71,243 ) (59,405 ) Income before income taxes 26,865 46,771 107,609 Income tax expense (6,144 ) (12,166 ) (35,557 ) Income (loss) from equity investment 124 (39 ) (74 ) Net income $ 20,845 $ 34,566 $ 71,978 Less: Net income attributable to non-controlling interests — 197 231 Net income attributable to ARKO Corp. $ 20,845 $ 34,369 $ 71,747 Series A redeemable preferred stock dividends (5,750 ) (5,750 ) (5,750 ) Net income attributable to common shareholders $ 15,095 $ 28,619 $ 65,997 Fuel gallons sold 2,189,245 2,241,805 1,971,011 Fuel margin, cents per gallon 1 26.8 26.2 27.6 Merchandise contribution 2 $ 579,569 $ 585,122 $ 501,219 Merchandise margin 3 32.8 % 31.8 % 30.4 % Adjusted EBITDA 4 $ 248,860 $ 276,260 $ 293,151 Non-cash rent expense 5 $ 14,335 $ 14,168 $ 7,903 1 Calculated as fuel revenue less fuel costs divided by fuel gallons sold. 2 Calculated as merchandise revenue less merchandise costs. 3 Calculated as merchandise contribution divided by merchandise revenue. 4 Refer to “ Use of Non-GAAP Measures” below for discussion of this non-GAAP performance measure and related reconciliation to net income. 5 Non-cash rent expense reflects the extent to which our GAAP rent expense recognized exceeded (or was less than) our cash rent payments.
For the year ended December 31, 2023, general and administrative expenses increased $25.3 million, or 18.1%, as compared to the year ended December 31, 2022, primarily due to incremental expenses associated with the 2023 Acquisitions and the 2022 Acquisitions, annual wage increases and an increase in share-based compensation expense, partially offset by lower incentive accruals.
For the year ended December 31, 2024, general and administrative expenses decreased $2.4 million, or 1.4%, compared to the year ended December 31, 2023, primarily due to a decrease of $2.7 million in share-based compensation expense and lower incentive accruals, partially offset by incremental expenses associated with the 2023 Acquisitions, annual wage increases and consulting support for the development of our Transformation Plan.
(d) Eliminates non-cash share-based compensation expense related to the equity incentive program in place to incentivize, retain, and motivate our employees, certain non-employees, and members of our Board. (e) Eliminates our share of loss (income) attributable to our unconsolidated equity investment. (f) Eliminates fair value adjustments to the contingent consideration owed to the seller for the 2020 Empire acquisition.
(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 our Board. (d) Eliminates our share of (income) loss attributable to our unconsolidated equity investment. (e) Eliminates the receipt of historical fuel and franchise tax amounts for multiple prior periods.
For the year ended December 31, 2023, net income attributable to the Company was $34.4 million compared to $71.7 million for the year ended December 31, 2022. For the year ended December 31, 2023, Adjusted EBITDA was $290.4 million, as compared to $301.1 million for the year ended December 31, 2022.
For the year ended December 31, 2024, net income attributable to the Company was $20.8 million compared to $34.4 million for the year ended December 31, 2023. For the year ended December 31, 2024, Adjusted EBITDA was $248.9 million, as compared to $276.3 million for the year ended December 31, 2023.
For the Year Ended December 31, 2023 2022 2021 Revenues: (in thousands) Fuel revenue – inter-segment $ 5,149,228 $ 5,674,516 $ 4,384,227 Fuel revenue – external customers 3,681 5,160 5,734 Other revenues, net 939 1,024 1,092 Other revenues, net – inter-segment 10,918 3,651 — Total revenues 5,164,766 5,684,351 4,391,053 Operating expenses: Fuel costs 5,052,391 5,585,050 4,289,092 General and administrative expenses 3,162 2,897 2,970 Depreciation and amortization 7,365 7,369 7,372 Total operating expenses 5,062,918 5,595,316 4,299,434 Other (income), net (598 ) — — Operating income $ 102,446 $ 89,035 $ 91,619 Fuel gallons sold – inter-segment 2,017,522 1,890,946 2,015,907 Fuel gallons sold – external customers 1,364 1,592 2,626 Fuel margin, cents per gallon 1 5.0 5.0 5.0 1 Calculated as fuel revenue less fuel costs divided by fuel gallons sold.
GPMP Segment The table below shows the results of the GPMP segment for the years ended December 31, 2024, 2023 and 2022, together with certain key metrics for the segment. 31 For the Year Ended December 31, 2024 2023 2022 Revenues: (in thousands) Fuel revenue – inter-segment 1 $ 4,576,222 $ 5,149,228 $ 5,674,516 Fuel revenue – external customers 3,624 3,681 5,160 Other revenues, net 838 939 1,024 Other revenues, net – inter-segment 1 11,236 10,918 3,651 Total revenues 4,591,920 5,164,766 5,684,351 Operating expenses: Fuel costs 4,481,926 5,052,391 5,585,050 General and administrative expenses 3,585 3,162 2,897 Depreciation and amortization 7,371 7,365 7,369 Total operating expenses 4,492,882 5,062,918 5,595,316 Other (income), net — (598 ) — Operating income $ 99,038 $ 102,446 $ 89,035 Fuel gallons sold – inter-segment 1,955,989 2,017,522 1,890,946 Fuel gallons sold – external customers 1,044 1,364 1,592 Fuel margin, cents per gallon 2 5.0 5.0 5.0 1 Includes the estimated fixed margin or fixed fee paid to GPMP for the cost of fuel. 2 Calculated as fuel revenue less fuel costs divided by fuel gallons sold.
Trends Impacting Our Business We achieved strong store growth over the last decade, driven primarily by a highly successful acquisition strategy, inclusive of 25 completed acquisitions from 2013 through 2023.
Trends Impacting Our Business We achieved strong store growth over the last decade, driven primarily by a highly successful acquisition strategy, inclusive of 26 completed acquisitions from 2013 through 2024. Most recently, on April 9, 2024, we completed our acquisition of 21 SpeedyQ Markets convenience stores located in Michigan (the “SpeedyQ Acquisition”).
For the year ended December 31, 2023 compared to the year ended December 31, 2022 Wholesale Revenues For the year ended December 31, 2023, fuel revenue decreased by $194.2 million, or 6.0%, compared to the year ended December 31, 2022.
For the year ended December 31, 2024 compared to the year ended December 31, 2023 GPMP Revenues For the year ended December 31, 2024, fuel revenue decreased by $573.1 million, or 11.1%, compared to the year ended December 31, 2023.
For the year ended December 31, 2023, other revenues, net increased by $7.1 million, or 10.6%, from the year ended December 31, 2022, primarily related to additional income from the 2023 Acquisitions and the Pride Acquisition, partially offset by the loss of income from skill gaming machines in Virginia.
For the year ended December 31, 2024, other revenues, net decreased by $9.1 million, or 12.3%, from the year ended December 31, 2023, primarily related to the regulatory state-wide elimination of Virginia skill gaming machine income, partially offset by additional income from the 2023 Acquisitions and the SpeedyQ Acquisition.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeAs of December 31, 2022, the interest rate on our Capital One Line of Credit was 6.6% and the interest rate on our M&T Term Loans was 7.3% (the entire M&T equipment loan had a fixed rate). As of December 31, 2023, approximately 46% of our debt bore interest at variable rates.
Biggest changeAs of December 31, 2024, the interest rate on our Capital One Line of Credit was 7.4%, the interest rate on our M&T Term Loans was 7.6% and the interest rate on the variable portion of our M&T equipment loan was 7.4% (approximately $15.9 million of the total loan).
Interest Rate Risk We may be subject to market risk from exposure to changes in interest rates based on our financing, investing, and cash management activities. The Senior Notes bear a fixed rate of interest; therefore, an increase or decrease in prevailing interest rates has no impact on our debt service for the Senior Notes.
Interest Rate Risk We may be subject to market risk from exposure to changes in interest rates based on our financing, investing, and cash management activities. The Senior Notes bear a fixed interest rate; therefore, an increase or decrease in prevailing interest rates has no impact on our debt service for the Senior Notes.
For additional information regarding our interest rate risk, see “Risk Factors—Risks Related to Our Business and Industry—Our variable rate debt could adversely affect our financial condition and results of operations.” 40
For additional information regarding our interest rate risk, see “Risk Factors—Risks Related to Our Business and Industry—Our variable rate debt could adversely affect our financial condition and results of operations.” 39
Based on our outstanding balances at December 31, 2023, if our applicable interest rates increase by 1%, then our debt service on an annual basis would increase by approximately $3.9 million. Interest rates on commercial bank borrowings and debt offerings could be higher than current levels, causing our financing costs to increase accordingly.
Based on the outstanding balances at December 31, 2024, if our applicable interest rates each increase by 1%, then our debt service on an annual basis would increase by approximately $4.3 million. Interest rates on commercial bank borrowings and debt offerings could be higher than current levels, causing our financing costs to increase accordingly.
As of December 31, 2023, the interest rate on our Capital One Line of Credit was 8.2%, the interest rate on our M&T Term Loans was 8.4% and the interest rate on the variable portion of our M&T equipment loan was 8.1% (approximately $16.4 million of the total loan).
As of December 31, 2023, the interest rate on our Capital One Line of Credit was 8.2%, the interest rate on our M&T Term Loans was 8.4% and the interest rate on the variable portion of our M&T equipment loan was 8.1% (approximately $16.4 million of the total loan) As of December 31, 2024, approximately 49% of our debt bore interest at variable rates.
In connection with the Quarles Acquisition, we began to use derivative commodity instruments to manage risks associated with an immaterial number of gallons designed to offset changes in the price of fuel that are directly tied to firm commitments to purchase diesel fuel.
From time to time, we make use of derivative commodity instruments to manage risks associated with an immaterial number of gallons designed to offset changes in the price of fuel that are directly tied to firm commitments to purchase diesel fuel.

Other ARKO 10-K year-over-year comparisons