Murphy USA CEO Challenges Web Scraping Data: Fuel Margins Drive Performance

The corporate headquarters of Murphy USA in El Dorado at 200 E. Peach St. (Maggie McLemore)

Murphy USA Inc. CEO Andrew Clyde is no fan of web scraping services, particularly those that translate corporate quarterly reports.

“They focus on total revenue dollars, and it absolutely has nothing to do with the economics of our business,” the leader of more than 1,700 fuel and convenience stores told Arkansas Business last week. “You read Murphy USA revenues down 33%, but it’s a margin business and fuel margin cents per gallon drive our performance. What has happened since 2019 is our margins have gone from about 16 cents, on average, to north of 26 cents per gallon.”

With margins going up, the publicly traded El Dorado company said that investors and analysts seem to have forgotten there was once a serious debate about whether higher fuel margins would stay high.

“We’ve had a theory that yes, they will,” and second-quarter results reported Aug. 3 were confirmational, he said. Second-quarter income was $132 million, certainly not what it was in 2022 when gasoline prices were peaking.

“As a high-volume, low-cost retailer, we’re able to generate higher profits because of our advantaged model,” said Clyde, who has led Murphy USA since it was spun off from Murphy Oil Corp. 10 years ago.

Last year’s gas price volatility, fueled by the Ukraine invasion, and then a major price retreat in the third quarter left many questions, he said. Is the marginal retailer’s volume going to come back? Are they going to see deflation in their costs?

“What was helpful about the second quarter is that nothing remarkable happened. We didn’t see prices run up, we didn’t see them fall, we didn’t see heightened volatility, we didn’t see any real, extraordinary event whatsoever. And so against the backdrop of absolutely nothing remarkable, we still generated fuel margins at the high end of our 26- to 30-cent range at 29 and a half cents. And then on top of that unremarkable environment with actually remarkable fuel performance, the rest of the business performed exceedingly well.”

Murphy USA stock was trading at $315.59 last week, almost equaling its highest price ever, $317.58, last October. In 2013, at the time of the spinoff, Murphy USA stock was $37.25 per share.