MURPHY USA INC. 2026 Q3 Earnings Call

Good morning, everybody. Thanks for joining us. With me are Mindy West, Chief Executive Officer, and Donnie Smith, Chief Financial Officer. I know you've all probably accessed our earnings release and management commentary from the website last night, so we'll go ahead and kick off the Q&A session. Please limit yourself to one question and a follow-up, and then get back in the queue to make sure we get to everybody. Please also keep in mind that some of the comments made during this call, including the Q&A portion, will be considered forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. As such, no assurances can be given that these events will occur or that the projections will be attained. A variety of factors exist that may cause actual results to differ.

For further discussion of risk factors, please see the latest Murphy USA Forms 10-K, 10-Q, 8-K and other recent SEC filings. Murphy USA takes no duty to publicly update or revise any forward-looking statements. During today's call, we may also provide certain performance measures that do not conform to generally accepted accounting principles or GAAP. We have provided schedules to reconcile those non-GAAP measures with the reported results on a GAAP basis as part of our earnings press release, which can be found on the investor section of our website. With that, let's go ahead and open up the call. I'll turn it back over to Frida.

Thanks for your question, Jacob. Yes, we're really pleased to have built a pipeline where we have 18 stores open year to date, 55, as you mentioned, under construction, and also a firm plan to start 15 to 20 between now and the end of January. Our guidance still holds. We'll be around that 45 to 50, obviously a little bit better than 45, we hope, as we end the year. Very difficult to predict what stores are going to open December 31, for example, versus January 2, because we have so many in flight right now. That's why we wanted to give you comfort in the stores under construction, because obviously, whatever doesn't open in December is going to open very soon within the new year, starting our 2027 pipeline off in a good direction.

We are still firm that we have built our pipeline sufficient now to be able to carry out 50 stores a year, not just for this year, but also next year and maybe even do better than that by the time we get to 2028. I would also estimate that by 2028, our hope is to get our pipeline more rateable. Instead of opening everything kind of at the end of the year, first of the year, we're more rateable throughout the year. Too soon to tell how lumpy the pipeline is going to be in 2027. Obviously, we're going to have a slug of stores that are going to open early, but then we would also expect to have a nice complement of stores going behind that in the second, third, and fourth quarters as well.

Yeah, that's a great question, Jacob, and one actually we anticipated getting. Just to clarify for everyone, we actually refer to that program internally as MARS, so Murphy Automated Restaurant Solutions. We view this as a test to scale program. Currently, we have more than 100 units in the market today and are deliberately scaling the program across new markets and formats. Our goal, though, really is threefold. It's to build evidence around customer demand, fit to our operating model, and also the store-level economics as we deploy this out. At this point, it's simply too early to comment on any scalable performance potential, although we will say the initial results that we've seen so far are encouraging. But that's really all that we really want to say at this time.

Hopefully in future calls, we will have line of sight to some more details to be able to provide you.

Thank you. Yeah, I would say that our business is advantaged as we enter this more elevated price environment for longer because that is going to make customers more price sensitive.