TRAVELCENTERS OF AMERICA LLC | ||||
(Exact Name of Registrant as Specified in Its Charter) | ||||
Delaware | 20-5701514 | |||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||
24601 Center Ridge Road, Suite 200, Westlake, OH 44145-5639 | ||||
(Address of Principal Executive Offices) | ||||
(440) 808-9100 | ||||
(Registrant's Telephone Number, Including Area Code) |
Large accelerated filer o | Accelerated filer x | |
Non-accelerated filer o | Smaller reporting company o | |
(Do not check if a smaller reporting company) | ||
Emerging growth company o |
Page | ||
September 30, 2017 | December 31, 2016 | ||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 74,652 | $ | 61,312 | |||
Accounts receivable (less allowance for doubtful accounts of $743 and $744 as of September 30, 2017 and December 31, 2016, respectively) | 140,479 | 107,246 | |||||
Inventory | 212,553 | 204,145 | |||||
Other current assets | 27,101 | 29,358 | |||||
Total current assets | 454,785 | 402,061 | |||||
Property and equipment, net | 1,023,080 | 1,082,022 | |||||
Goodwill | 94,059 | 88,542 | |||||
Other intangible assets, net | 34,510 | 37,738 | |||||
Other noncurrent assets | 84,239 | 49,478 | |||||
Total assets | $ | 1,690,673 | $ | 1,659,841 | |||
Liabilities and Shareholders' Equity | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 167,089 | $ | 157,964 | |||
Current HPT Leases liabilities | 40,758 | 39,720 | |||||
Other current liabilities | 169,206 | 132,648 | |||||
Total current liabilities | 377,053 | 330,332 | |||||
Long term debt, net | 319,409 | 318,739 | |||||
Noncurrent HPT Leases liabilities | 372,194 | 381,854 | |||||
Other noncurrent liabilities | 35,031 | 75,837 | |||||
Total liabilities | 1,103,687 | 1,106,762 | |||||
Shareholders' equity: | |||||||
Common shares, no par value, 41,369 shares authorized as of September 30, 2017 and December 31, 2016, and 39,549 and 39,523 shares issued and outstanding as of September 30, 2017 and December 31, 2016, respectively | 689,887 | 686,348 | |||||
Accumulated other comprehensive income | 475 | 11 | |||||
Accumulated deficit | (104,791 | ) | (134,678 | ) | |||
Total TA shareholders' equity | 585,571 | 551,681 | |||||
Noncontrolling interests | 1,415 | 1,398 | |||||
Total shareholders' equity | 586,986 | 553,079 | |||||
Total liabilities and shareholders' equity | $ | 1,690,673 | $ | 1,659,841 |
Three Months Ended September 30, | |||||||
2017 | 2016 | ||||||
Revenues: | |||||||
Fuel | $ | 1,055,593 | $ | 947,558 | |||
Nonfuel | 515,836 | 510,559 | |||||
Rent and royalties from franchisees | 4,248 | 4,529 | |||||
Total revenues | 1,575,677 | 1,462,646 | |||||
Cost of goods sold (excluding depreciation): | |||||||
Fuel | 950,584 | 837,525 | |||||
Nonfuel | 230,920 | 230,325 | |||||
Total cost of goods sold | 1,181,504 | 1,067,850 | |||||
Operating expenses: | |||||||
Site level operating | 244,161 | 247,584 | |||||
Selling, general and administrative | 36,587 | 34,812 | |||||
Real estate rent | 69,599 | 66,573 | |||||
Depreciation and amortization | 30,714 | 22,698 | |||||
Total operating expenses | 381,061 | 371,667 | |||||
Income from operations | 13,112 | 23,129 | |||||
Acquisition costs | 68 | 225 | |||||
Interest expense, net | 7,486 | 7,200 | |||||
Income from equity investees | 528 | 1,534 | |||||
Income before income taxes | 6,086 | 17,238 | |||||
Benefit (provision) for income taxes | 56,268 | (6,263 | ) | ||||
Net income | 62,354 | 10,975 | |||||
Less: net income for noncontrolling interests | 30 | 77 | |||||
Net income attributable to common shareholders | $ | 62,324 | $ | 10,898 | |||
Other comprehensive income, net of tax: | |||||||
Foreign currency income (loss), net of taxes of $78 and $(30), respectively | $ | 89 | $ | (46 | ) | ||
Equity interest in investee's unrealized gain on investments | 116 | 80 | |||||
Other comprehensive income attributable to common shareholders | 205 | 34 | |||||
Comprehensive income attributable to common shareholders | $ | 62,529 | $ | 10,932 | |||
Net income per common share attributable to common shareholders: | |||||||
Basic and diluted | $ | 1.58 | $ | 0.28 |
Nine Months Ended September 30, | |||||||
2017 | 2016 | ||||||
Revenues: | |||||||
Fuel | $ | 2,981,154 | $ | 2,588,297 | |||
Nonfuel | 1,471,306 | 1,441,044 | |||||
Rent and royalties from franchisees | 12,651 | 13,135 | |||||
Total revenues | 4,465,111 | 4,042,476 | |||||
Cost of goods sold (excluding depreciation): | |||||||
Fuel | 2,684,750 | 2,284,570 | |||||
Nonfuel | 650,886 | 644,320 | |||||
Total cost of goods sold | 3,335,636 | 2,928,890 | |||||
Operating expenses: | |||||||
Site level operating | 743,022 | 725,754 | |||||
Selling, general and administrative | 115,276 | 101,787 | |||||
Real estate rent | 206,742 | 194,838 | |||||
Depreciation and amortization | 91,163 | 64,545 | |||||
Total operating expenses | 1,156,203 | 1,086,924 | |||||
(Loss) income from operations | (26,728 | ) | 26,662 | ||||
Acquisition costs | 271 | 2,286 | |||||
Interest expense, net | 22,708 | 20,761 | |||||
Income from equity investees | 1,731 | 3,572 | |||||
(Loss) income before income taxes | (47,976 | ) | 7,187 | ||||
Benefit (provision) for income taxes | 77,963 | (2,571 | ) | ||||
Net income | 29,987 | 4,616 | |||||
Less: net income for noncontrolling interests | 100 | 141 | |||||
Net income attributable to common shareholders | $ | 29,887 | $ | 4,475 | |||
Other comprehensive income, net of tax: | |||||||
Foreign currency income, net of taxes of $144 and $102, respectively | $ | 168 | $ | 165 | |||
Equity interest in investee's unrealized gain on investments | 296 | 175 | |||||
Other comprehensive income attributable to common shareholders | 464 | 340 | |||||
Comprehensive income attributable to common shareholders | $ | 30,351 | $ | 4,815 | |||
Net income per common share attributable to common shareholders: | |||||||
Basic and diluted | $ | 0.76 | $ | 0.12 |
Nine Months Ended September 30, | |||||||
2017 | 2016 | ||||||
Cash flows from operating activities: | |||||||
Net income | $ | 29,987 | $ | 4,616 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Noncash rent expense | (11,008 | ) | (10,317 | ) | |||
Depreciation and amortization expense | 91,163 | 64,545 | |||||
Deferred income taxes | (79,191 | ) | 1,080 | ||||
Changes in operating assets and liabilities, net of effects of business acquisitions: | |||||||
Accounts receivable | (33,439 | ) | (25,645 | ) | |||
Inventory | (7,572 | ) | (7,425 | ) | |||
Other assets | 2,290 | 9,453 | |||||
Accounts payable and other liabilities | 46,232 | 69,249 | |||||
Other, net | 7,965 | 3,551 | |||||
Net cash provided by operating activities | 46,427 | 109,107 | |||||
Cash flows from investing activities: | |||||||
Proceeds from asset sales | 88,129 | 157,749 | |||||
Capital expenditures | (98,780 | ) | (229,217 | ) | |||
Acquisitions of businesses, net of cash acquired | (19,854 | ) | (72,137 | ) | |||
Investment in equity investee | (4,500 | ) | — | ||||
Net cash used in investing activities | (35,005 | ) | (143,605 | ) | |||
Cash flows from financing activities: | |||||||
Proceeds from sale leaseback transactions with HPT | 2,361 | 216 | |||||
Sale leaseback financing obligation payments | (555 | ) | (468 | ) | |||
Other, net | (121 | ) | (74 | ) | |||
Net cash provided by (used in) financing activities | 1,685 | (326 | ) | ||||
Effect of exchange rate changes on cash | 233 | 25 | |||||
Net increase (decrease) in cash and cash equivalents | 13,340 | (34,799 | ) | ||||
Cash and cash equivalents at the beginning of the period | 61,312 | 172,087 | |||||
Cash and cash equivalents at the end of the period | $ | 74,652 | $ | 137,288 | |||
Supplemental disclosure of cash flow information: | |||||||
Interest paid (including rent classified as interest and net of capitalized interest) | $ | 21,817 | $ | 20,587 | |||
Income taxes paid, net | 424 | 420 |
1. | Business Description and Basis of Presentation |
2. | Earnings Per Share |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Net income attributable to common shareholders, as reported | $ | 62,324 | $ | 10,898 | $ | 29,887 | $ | 4,475 | |||||||
Less: net income attributable to participating securities | 3,239 | 534 | 1,572 | 219 | |||||||||||
Net income available to common shareholders | $ | 59,085 | $ | 10,364 | $ | 28,315 | $ | 4,256 | |||||||
Weighted average common shares(1) | 37,497 | 36,953 | 37,458 | 36,922 | |||||||||||
Basic and diluted net income per common share | $ | 1.58 | $ | 0.28 | $ | 0.76 | $ | 0.12 |
(1) | Excludes unvested shares awarded under our share award plan, which shares are considered participating securities because they participate equally in earnings and losses with all of our other common shares. The weighted average number of unvested shares outstanding for the three months ended September 30, 2017 and 2016, was 2,055 and 1,900, respectively. The weighted average number of unvested shares outstanding for the nine months ended September 30, 2017 and 2016, was 2,080 and 1,904, respectively. |
3. | Acquisitions |
4. | Goodwill |
September 30, 2017 | December 31, 2016 | ||||||
Travel center segment | $ | 21,613 | $ | 17,252 | |||
Convenience store segment | 69,400 | 69,400 | |||||
Corporate and other | 3,046 | 1,890 | |||||
Total goodwill | $ | 94,059 | $ | 88,542 |
5. | Income Taxes |
6. | Equity Investments |
PTP | Other(1) | Total | |||||||||
Investment balance: | |||||||||||
As of September 30, 2017 | $ | 19,810 | $ | 23,171 | $ | 42,981 | |||||
As of December 31, 2016 | 21,657 | 24,097 | 45,754 | ||||||||
Income (loss) from equity investments: | |||||||||||
Three months ended September 30, 2017 | $ | 1,253 | $ | (725 | ) | $ | 528 | ||||
Three months ended September 30, 2016 | 1,520 | 14 | 1,534 | ||||||||
Nine months ended September 30, 2017 | 2,954 | (1,223 | ) | 1,731 | |||||||
Nine months ended September 30, 2016 | 3,464 | 108 | 3,572 |
(1) | Includes equity investments that are not individually material to our consolidated financial statements, including our investment in Affiliates Insurance Company, or AIC. See Note 9 for more information about our investment in AIC. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Total revenues | $ | 31,983 | $ | 31,935 | $ | 89,215 | $ | 84,907 | |||||||
Cost of goods sold (excluding depreciation) | 22,794 | 22,242 | 63,709 | 59,570 | |||||||||||
Operating income | 3,392 | 4,184 | 8,139 | 9,673 | |||||||||||
Net income and comprehensive income | 3,267 | 3,938 | 7,790 | 9,067 |
7. | HPT Leases |
September 30, 2017 | December 31, 2016 | ||||||
Current HPT Leases liabilities: | |||||||
Accrued rent | $ | 23,682 | $ | 22,868 | |||
Sale leaseback financing obligation | 719 | 484 | |||||
Straight line rent accrual | 2,458 | 2,458 | |||||
Deferred gain | 10,129 | 10,140 | |||||
Deferred tenant improvements allowance | 3,770 | 3,770 | |||||
Total current HPT Leases liabilities | $ | 40,758 | $ | 39,720 | |||
Noncurrent HPT Leases liabilities: | |||||||
Deferred rent obligation | $ | 150,000 | $ | 150,000 | |||
Sale leaseback financing obligation | 22,813 | 21,165 | |||||
Straight line rent accrual | 47,036 | 47,771 | |||||
Deferred gain | 113,585 | 121,331 | |||||
Deferred tenant improvements allowance | 38,760 | 41,587 | |||||
Total noncurrent HPT Leases liabilities | $ | 372,194 | $ | 381,854 |
8. | Business and Property Management Agreements with RMR |
9. | Related Party Transactions |
10. | Contingencies |
11. | Inventory |
September 30, 2017 | December 31, 2016 | ||||||
Nonfuel products | $ | 171,816 | $ | 167,813 | |||
Fuel products | 40,737 | 36,332 | |||||
Total inventory | $ | 212,553 | $ | 204,145 |
12. | Segment Information |
Three Months Ended September 30, 2017 | |||||||||||||||
Travel Centers | Convenience Stores | Corporate and Other | Consolidated | ||||||||||||
Revenues: | |||||||||||||||
Fuel | $ | 905,325 | $ | 129,783 | $ | 20,485 | $ | 1,055,593 | |||||||
Nonfuel | 432,128 | 73,553 | 10,155 | 515,836 | |||||||||||
Rent and royalties from franchisees | 3,169 | 54 | 1,025 | 4,248 | |||||||||||
Total revenues | 1,340,622 | 203,390 | 31,665 | 1,575,677 | |||||||||||
Site level gross margin in excess of site level operating expenses | $ | 134,098 | $ | 13,755 | $ | 2,159 | $ | 150,012 | |||||||
Corporate operating expenses: | |||||||||||||||
Selling, general and administrative | $ | 36,587 | $ | 36,587 | |||||||||||
Real estate rent | 69,599 | 69,599 | |||||||||||||
Depreciation and amortization | 30,714 | 30,714 | |||||||||||||
Income from operations | 13,112 | ||||||||||||||
Acquisition costs | 68 | 68 | |||||||||||||
Interest expense, net | 7,486 | 7,486 | |||||||||||||
Income from equity investees | 528 | 528 | |||||||||||||
Income before income taxes | 6,086 | ||||||||||||||
Benefit for income taxes | 56,268 | 56,268 | |||||||||||||
Net income | 62,354 | ||||||||||||||
Less: net income for noncontrolling interests | 30 | ||||||||||||||
Net income attributable to common shareholders | $ | 62,324 |
Three Months Ended September 30, 2016 | |||||||||||||||
Travel Centers | Convenience Stores | Corporate and Other | Consolidated | ||||||||||||
Revenues: | |||||||||||||||
Fuel | $ | 808,366 | $ | 119,375 | $ | 19,817 | $ | 947,558 | |||||||
Nonfuel | 427,524 | 73,922 | 9,113 | 510,559 | |||||||||||
Rent and royalties from franchisees | 3,238 | 58 | 1,233 | 4,529 | |||||||||||
Total revenues | 1,239,128 | 193,355 | 30,163 | 1,462,646 | |||||||||||
Site level gross margin in excess of site level operating expenses | $ | 131,866 | $ | 12,249 | $ | 3,097 | $ | 147,212 | |||||||
Corporate operating expenses: | |||||||||||||||
Selling, general and administrative | $ | 34,812 | $ | 34,812 | |||||||||||
Real estate rent | 66,573 | 66,573 | |||||||||||||
Depreciation and amortization | 22,698 | 22,698 | |||||||||||||
Income from operations | 23,129 | ||||||||||||||
Acquisition costs | 225 | 225 | |||||||||||||
Interest expense, net | 7,200 | 7,200 | |||||||||||||
Income from equity investees | 1,534 | 1,534 | |||||||||||||
Income before income taxes | 17,238 | ||||||||||||||
Provision for income taxes | (6,263 | ) | (6,263 | ) | |||||||||||
Net income | 10,975 | ||||||||||||||
Less: net income for noncontrolling interests | 77 | ||||||||||||||
Net income attributable to common shareholders | $ | 10,898 |
Nine Months Ended September 30, 2017 | |||||||||||||||
Travel Centers | Convenience Stores | Corporate and Other | Consolidated | ||||||||||||
Revenues: | |||||||||||||||
Fuel | $ | 2,567,755 | $ | 355,776 | $ | 57,623 | $ | 2,981,154 | |||||||
Nonfuel | 1,235,281 | 206,139 | 29,886 | 1,471,306 | |||||||||||
Rent and royalties from franchisees | 9,387 | 162 | 3,102 | 12,651 | |||||||||||
Total revenues | 3,812,423 | 562,077 | 90,611 | 4,465,111 | |||||||||||
Site level gross margin in excess of site level operating expenses | $ | 348,603 | $ | 30,825 | $ | 7,025 | $ | 386,453 | |||||||
Corporate operating expenses: | |||||||||||||||
Selling, general and administrative | $ | 115,276 | $ | 115,276 | |||||||||||
Real estate rent | 206,742 | 206,742 | |||||||||||||
Depreciation and amortization | 91,163 | 91,163 | |||||||||||||
Loss from operations | (26,728 | ) | |||||||||||||
Acquisition costs | 271 | 271 | |||||||||||||
Interest expense, net | 22,708 | 22,708 | |||||||||||||
Income from equity investees | 1,731 | 1,731 | |||||||||||||
Loss before income taxes | (47,976 | ) | |||||||||||||
Benefit for income taxes | 77,963 | 77,963 | |||||||||||||
Net income | 29,987 | ||||||||||||||
Less: net income for noncontrolling interests | 100 | ||||||||||||||
Net income attributable to common shareholders | $ | 29,887 |
Nine Months Ended September 30, 2016 | |||||||||||||||
Travel Centers | Convenience Stores | Corporate and Other | Consolidated | ||||||||||||
Revenues: | |||||||||||||||
Fuel | $ | 2,222,962 | $ | 311,199 | $ | 54,136 | $ | 2,588,297 | |||||||
Nonfuel | 1,226,735 | 197,718 | 16,591 | 1,441,044 | |||||||||||
Rent and royalties from franchisees | 10,556 | 249 | 2,330 | 13,135 | |||||||||||
Total revenues | 3,460,253 | 509,166 | 73,057 | 4,042,476 | |||||||||||
Site level gross margin in excess of site level operating expenses | $ | 353,645 | $ | 27,188 | $ | 6,999 | $ | 387,832 | |||||||
Corporate operating expenses: | |||||||||||||||
Selling, general and administrative | $ | 101,787 | $ | 101,787 | |||||||||||
Real estate rent | 194,838 | 194,838 | |||||||||||||
Depreciation and amortization | 64,545 | 64,545 | |||||||||||||
Income from operations | 26,662 | ||||||||||||||
Acquisition costs | 2,286 | 2,286 | |||||||||||||
Interest expense, net | 20,761 | 20,761 | |||||||||||||
Income from equity investees | 3,572 | 3,572 | |||||||||||||
Income before income taxes | 7,187 | ||||||||||||||
Provision for income taxes | (2,571 | ) | (2,571 | ) | |||||||||||
Net income | 4,616 | ||||||||||||||
Less: net income for noncontrolling interests | 141 | ||||||||||||||
Net income attributable to common shareholders | $ | 4,475 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||
2017 | 2016 | Change | 2017 | 2016 | Change | ||||||||||||||||
Revenues: | |||||||||||||||||||||
Fuel | $ | 1,055,593 | $ | 947,558 | 11.4 | % | $ | 2,981,154 | $ | 2,588,297 | 15.2 | % | |||||||||
Nonfuel | 515,836 | 510,559 | 1.0 | % | 1,471,306 | 1,441,044 | 2.1 | % | |||||||||||||
Rent and royalties from franchisees | 4,248 | 4,529 | (6.2 | )% | 12,651 | 13,135 | (3.7 | )% | |||||||||||||
Total revenues | 1,575,677 | 1,462,646 | 7.7 | % | 4,465,111 | 4,042,476 | 10.5 | % | |||||||||||||
Gross margin: | |||||||||||||||||||||
Fuel | 105,009 | 110,033 | (4.6 | )% | 296,404 | 303,727 | (2.4 | )% | |||||||||||||
Nonfuel | 284,916 | 280,234 | 1.7 | % | 820,420 | 796,724 | 3.0 | % | |||||||||||||
Rent and royalties from franchisees | 4,248 | 4,529 | (6.2 | )% | 12,651 | 13,135 | (3.7 | )% | |||||||||||||
Total gross margin | 394,173 | 394,796 | (0.2 | )% | 1,129,475 | 1,113,586 | 1.4 | % | |||||||||||||
Operating expenses: | |||||||||||||||||||||
Site level operating | 244,161 | 247,584 | (1.4 | )% | 743,022 | 725,754 | 2.4 | % | |||||||||||||
Selling, general and administrative | 36,587 | 34,812 | 5.1 | % | 115,276 | 101,787 | 13.3 | % | |||||||||||||
Real estate rent | 69,599 | 66,573 | 4.5 | % | 206,742 | 194,838 | 6.1 | % | |||||||||||||
Depreciation and amortization | 30,714 | 22,698 | 35.3 | % | 91,163 | 64,545 | 41.2 | % | |||||||||||||
Total operating expenses | 381,061 | 371,667 | 2.5 | % | 1,156,203 | 1,086,924 | 6.4 | % | |||||||||||||
Income (loss) from operations | 13,112 | 23,129 | (43.3 | )% | (26,728 | ) | 26,662 | (200.2 | )% | ||||||||||||
Acquisition costs | 68 | 225 | (69.8 | )% | 271 | 2,286 | (88.1 | )% | |||||||||||||
Interest expense, net | 7,486 | 7,200 | 4.0 | % | 22,708 | 20,761 | 9.4 | % | |||||||||||||
Income from equity investees | 528 | 1,534 | (65.6 | )% | 1,731 | 3,572 | (51.5 | )% | |||||||||||||
Income (loss) before income taxes | 6,086 | 17,238 | (64.7 | )% | (47,976 | ) | 7,187 | (767.5 | )% | ||||||||||||
Benefit (provision) for income taxes | 56,268 | (6,263 | ) | NM | 77,963 | (2,571 | ) | NM | |||||||||||||
Net income | 62,354 | 10,975 | 468.1 | % | 29,987 | 4,616 | 549.6 | % | |||||||||||||
Less: net income for noncontrolling interests | 30 | 77 | (61.0 | )% | 100 | 141 | (29.1 | )% | |||||||||||||
Net income attributable to common shareholders | $ | 62,324 | $ | 10,898 | 471.9 | % | $ | 29,887 | $ | 4,475 | 567.9 | % |
Three Months Ended September 30, | |||||||||
Fuel Gallons Sold | 2017 | 2016 | Change | ||||||
Travel centers | 477,497 | 487,114 | (2.0 | )% | |||||
Convenience stores | 67,645 | 68,680 | (1.5 | )% | |||||
Corporate and other | 10,299 | 11,646 | (11.6 | )% | |||||
Consolidated totals | 555,441 | 567,440 | (2.1 | )% |
Three Months Ended September 30, | |||||||||||
Fuel Revenues | 2017 | 2016 | Change | ||||||||
Travel centers | $ | 905,325 | $ | 808,366 | 12.0 | % | |||||
Convenience stores | 129,783 | 119,375 | 8.7 | % | |||||||
Corporate and other | 20,485 | 19,817 | 3.4 | % | |||||||
Consolidated totals | $ | 1,055,593 | $ | 947,558 | 11.4 | % |
Nine Months Ended September 30, | |||||||||
Fuel Gallons Sold | 2017 | 2016 | Change | ||||||
Travel centers | 1,401,263 | 1,446,793 | (3.1 | )% | |||||
Convenience stores | 190,840 | 189,867 | 0.5 | % | |||||
Corporate and other | 29,841 | 32,938 | (9.4 | )% | |||||
Consolidated totals | 1,621,944 | 1,669,598 | (2.9 | )% |
Nine Months Ended September 30, | |||||||||||
Fuel Revenues | 2017 | 2016 | Change | ||||||||
Travel centers | $ | 2,567,755 | $ | 2,222,962 | 15.5 | % | |||||
Convenience stores | 355,776 | 311,199 | 14.3 | % | |||||||
Corporate and other | 57,623 | 54,136 | 6.4 | % | |||||||
Consolidated totals | $ | 2,981,154 | $ | 2,588,297 | 15.2 | % |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||
2017 | 2016 | Change | 2017 | 2016 | Change | ||||||||||||||||
Number of company operated travel center locations at end of period | 228 | 225 | 3 | 228 | 225 | 3 | |||||||||||||||
Number of franchise operated travel center locations at end of period | 28 | 30 | (2 | ) | 28 | 30 | (2 | ) | |||||||||||||
Fuel: | |||||||||||||||||||||
Fuel sales volume (gallons) | 477,497 | 487,114 | (2.0) | % | 1,401,263 | 1,446,793 | (3.1) | % | |||||||||||||
Fuel revenues | $ | 905,325 | $ | 808,366 | 12.0 | % | $ | 2,567,755 | $ | 2,222,962 | 15.5 | % | |||||||||
Fuel gross margin | 88,130 | 94,915 | (7.1) | % | 252,619 | 264,446 | (4.5) | % | |||||||||||||
Fuel gross margin per gallon | $ | 0.185 | $ | 0.195 | (5.1) | % | $ | 0.180 | $ | 0.183 | (1.6) | % | |||||||||
Nonfuel: | |||||||||||||||||||||
Nonfuel revenues | $ | 432,128 | $ | 427,524 | 1.1 | % | $ | 1,235,281 | $ | 1,226,735 | 0.7 | % | |||||||||
Nonfuel gross margin | 252,341 | 248,967 | 1.4 | % | 728,692 | 717,707 | 1.5 | % | |||||||||||||
Nonfuel gross margin percentage | 58.4 | % | 58.2 | % | 20 | pts | 59.0 | % | 58.5 | % | 50 | pts | |||||||||
Total revenues | $ | 1,340,622 | $ | 1,239,128 | 8.2 | % | $ | 3,812,423 | $ | 3,460,253 | 10.2 | % | |||||||||
Total gross margin | 343,640 | 347,120 | (1.0) | % | 990,698 | 992,709 | (0.2) | % | |||||||||||||
Site level operating expenses | 209,542 | 215,254 | (2.7) | % | 642,095 | 639,064 | 0.5 | % | |||||||||||||
Site level operating expenses as a percentage of nonfuel revenues | 48.5 | % | 50.3 | % | (180 | )pts | 52.0 | % | 52.1 | % | (10 | )pts | |||||||||
Site level gross margin in excess of site level operating expenses | $ | 134,098 | $ | 131,866 | 1.7 | % | $ | 348,603 | $ | 353,645 | (1.4) | % |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||
2017 | 2016 | Change | 2017 | 2016 | Change | ||||||||||||||||
Number of same site company operated travel center locations | 223 | 223 | — | 220 | 220 | — | |||||||||||||||
Fuel: | |||||||||||||||||||||
Fuel sales volume (gallons) | 473,615 | 487,114 | (2.8) | % | 1,379,134 | 1,436,790 | (4.0) | % | |||||||||||||
Fuel revenues | $ | 897,646 | $ | 808,315 | 11.1 | % | $ | 2,527,209 | $ | 2,206,538 | 14.5 | % | |||||||||
Fuel gross margin | 86,869 | 94,922 | (8.5) | % | 247,941 | 261,820 | (5.3) | % | |||||||||||||
Fuel gross margin per gallon | $ | 0.183 | $ | 0.195 | (6.2) | % | $ | 0.180 | $ | 0.182 | (1.1) | % | |||||||||
Nonfuel: | |||||||||||||||||||||
Nonfuel revenues | $ | 426,871 | $ | 427,385 | (0.1) | % | $ | 1,208,828 | $ | 1,213,534 | (0.4) | % | |||||||||
Nonfuel gross margin | 248,692 | 249,327 | (0.3) | % | 712,519 | 710,368 | 0.3 | % | |||||||||||||
Nonfuel gross margin percentage | 58.3 | % | 58.3 | % | — | 58.9 | % | 58.5 | % | 40 | pts | ||||||||||
Total gross margin | $ | 335,561 | $ | 344,249 | (2.5) | % | $ | 960,460 | $ | 972,188 | (1.2) | % | |||||||||
Site level operating expenses | 206,084 | 215,074 | (4.2) | % | 625,856 | 631,202 | (0.8) | % | |||||||||||||
Site level operating expenses as a percentage of nonfuel revenues | 48.3 | % | 50.3 | % | (200 | )pts | 51.8 | % | 52.0 | % | (20 | )pts | |||||||||
Site level gross margin in excess of site level operating expenses | $ | 129,477 | $ | 129,175 | 0.2 | % | $ | 334,604 | $ | 340,986 | (1.9) | % |
Gallons Sold | Fuel Revenues | |||||
Results for the three months ended September 30, 2016 | 487,114 | $ | 808,366 | |||
Increase due to petroleum products price changes | 115,085 | |||||
Decrease due to same site volume changes | (13,499 | ) | (25,585 | ) | ||
Increase due to locations opened | 3,882 | 7,459 | ||||
Net change from prior year period | (9,617 | ) | 96,959 | |||
Results for the three months ended September 30, 2017 | 477,497 | $ | 905,325 |
Gallons Sold | Fuel Revenues | |||||
Results for the nine months ended September 30, 2016 | 1,446,793 | $ | 2,222,962 | |||
Increase due to petroleum products price changes | 426,032 | |||||
Decrease due to same site volume changes | (57,656 | ) | (105,411 | ) | ||
Increase due to locations opened | 12,126 | 24,172 | ||||
Net change from prior year period | (45,530 | ) | 344,793 | |||
Results for the nine months ended September 30, 2017 | 1,401,263 | $ | 2,567,755 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||
2017 | 2016 | Change | 2017 | 2016 | Change | ||||||||||||||||
Number of company operated convenience store locations at end of period | 232 | 232 | — | 232 | 232 | — | |||||||||||||||
Number of dealer operated convenience store locations at end of period | 1 | 1 | — | 1 | 1 | — | |||||||||||||||
Fuel: | |||||||||||||||||||||
Fuel sales volume (gallons) | 67,645 | 68,680 | (1.5) | % | 190,840 | 189,867 | 0.5 | % | |||||||||||||
Fuel revenues | $ | 129,783 | $ | 119,375 | 8.7 | % | $ | 355,776 | $ | 311,199 | 14.3 | % | |||||||||
Fuel gross margin | 16,631 | 15,059 | 10.4 | % | 43,411 | 38,905 | 11.6 | % | |||||||||||||
Fuel gross margin per gallon | $ | 0.246 | $ | 0.219 | 12.3 | % | $ | 0.227 | $ | 0.205 | 10.7 | % | |||||||||
Nonfuel: | |||||||||||||||||||||
Nonfuel revenues | $ | 73,553 | $ | 73,922 | (0.5) | % | $ | 206,139 | $ | 197,718 | 4.3 | % | |||||||||
Nonfuel gross margin | 25,838 | 25,015 | 3.3 | % | 72,068 | 67,721 | 6.4 | % | |||||||||||||
Nonfuel gross margin percentage | 35.1 | % | 33.8 | % | 130 | pts | 35.0 | % | 34.3 | % | 70 | pts | |||||||||
Total revenues | $ | 203,390 | $ | 193,355 | 5.2 | % | $ | 562,077 | $ | 509,166 | 10.4 | % | |||||||||
Total gross margin | 42,523 | 40,132 | 6.0 | % | 115,641 | 106,875 | 8.2 | % | |||||||||||||
Site level operating expenses | 28,768 | 27,883 | 3.2 | % | 84,816 | 79,687 | 6.4 | % | |||||||||||||
Site level operating expenses as a percentage of nonfuel revenues | 39.1 | % | 37.7 | % | 140 | pts | 41.1 | % | 40.3 | % | 80 | pts | |||||||||
Site level gross margin in excess of site level operating expenses | $ | 13,755 | $ | 12,249 | 12.3 | % | $ | 30,825 | $ | 27,188 | 13.4 | % |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||
2017 | 2016 | Change | 2017 | 2016 | Change | ||||||||||||||||
Number of same site company operated convenience store locations | 229 | 229 | — | 200 | 200 | — | |||||||||||||||
Fuel: | |||||||||||||||||||||
Fuel sales volume (gallons) | 67,645 | 68,680 | (1.5) | % | 170,759 | 175,655 | (2.8) | % | |||||||||||||
Fuel revenues | $ | 129,783 | $ | 119,375 | 8.7 | % | $ | 318,594 | $ | 286,691 | 11.1 | % | |||||||||
Fuel gross margin | 16,631 | 15,059 | 10.4 | % | 39,176 | 36,297 | 7.9 | % | |||||||||||||
Fuel gross margin per gallon | $ | 0.246 | $ | 0.219 | 12.3 | % | $ | 0.229 | $ | 0.207 | 10.6 | % | |||||||||
Nonfuel: | |||||||||||||||||||||
Nonfuel revenues | $ | 73,553 | $ | 73,922 | (0.5) | % | $ | 181,855 | $ | 181,010 | 0.5 | % | |||||||||
Nonfuel gross margin | 25,838 | 25,015 | 3.3 | % | 64,669 | 63,037 | 2.6 | % | |||||||||||||
Nonfuel gross margin percentage | 35.1 | % | 33.8 | % | 130 | pts | 35.6 | % | 34.8 | % | 80 | pts | |||||||||
Total gross margin | $ | 42,469 | $ | 40,074 | 6.0 | % | $ | 103,845 | $ | 99,334 | 4.5 | % | |||||||||
Site level operating expenses | 28,758 | 27,876 | 3.2 | % | 75,476 | 73,215 | 3.1 | % | |||||||||||||
Site level operating expenses as a percentage of nonfuel revenues | 39.1 | % | 37.7 | % | 140 | pts | 41.5 | % | 40.4 | % | 110 | pts | |||||||||
Site level gross margin in excess of site level operating expenses | $ | 13,711 | $ | 12,198 | 12.4 | % | $ | 28,369 | $ | 26,119 | 8.6 | % |
Gallons Sold | Fuel Revenues | |||||
Results for the three months ended September 30, 2016 | 68,680 | $ | 119,375 | |||
Increase due to petroleum products price changes | 12,345 | |||||
Decrease due to same site volume changes | (1,035 | ) | (1,937 | ) | ||
Net change from prior year period | (1,035 | ) | 10,408 | |||
Results for the three months ended September 30, 2017 | 67,645 | $ | 129,783 |
Gallons Sold | Fuel Revenues | |||||
Results for the nine months ended September 30, 2016 | 189,867 | $ | 311,199 | |||
Increase due to petroleum products price changes | 40,892 | |||||
Decrease due to same site volume changes | (4,896 | ) | (8,988 | ) | ||
Increase due to locations opened | 5,869 | 12,673 | ||||
Net change from prior year period | 973 | 44,577 | ||||
Results for the nine months ended September 30, 2017 | 190,840 | $ | 355,776 |
• | cash balance; |
• | operating cash flow; |
• | our revolving credit facility, or our Credit Facility, with a current maximum availability of $200,000, subject to limits based on our qualified collateral; |
• | sales to HPT of improvements we make to the sites we lease from HPT; |
• | potential issuances of new debt and equity securities; and |
• | potential financing or selling of unencumbered real estate that we own. |
• | continuing decreased demand for our fuel products resulting from regulatory and market efforts for improved engine fuel efficiency, fuel conservation and alternative fuels; |
• | decreased demand for our products and services that we may experience as a result of competition; |
• | the fixed nature of a significant portion of our expenses, which may restrict our ability to realize a sufficient reduction in our expenses to offset a reduction in our revenues; |
• | the possible inability of acquired or developed properties to generate the stabilized financial results we expected at the time of acquisition; |
• | the risk of an economic slowdown or recession in the U.S. economy; and |
• | the risk of continued litigation costs associated with the Comdata litigation. |
• | OUR OPERATING RESULTS FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2017, REFLECT INCREASES IN FUEL AND NONFUEL REVENUES AND NONFUEL GROSS MARGIN OVER THE SAME PERIOD LAST YEAR, WHICH MAY IMPLY THAT OUR FUEL AND NONFUEL REVENUES AND NONFUEL GROSS MARGIN ARE IMPROVING AND WILL CONTINUE TO IMPROVE. FUEL PRICES, CUSTOMER DEMAND AND COMPETITIVE CONDITIONS, AMONG OTHER FACTORS, MAY SIGNIFICANTLY IMPACT OUR FUEL AND NONFUEL REVENUES AND THE COSTS OF OUR NONFUEL PRODUCTS MAY INCREASE IN THE FUTURE BECAUSE OF INFLATION OR OTHER REASONS. IF FUEL PRICES OR FUEL OR NONFUEL SALES VOLUMES DECLINE, IF WE ARE NOT ABLE TO PASS INCREASED FUEL OR NONFUEL COSTS TO OUR CUSTOMERS, OR IF OUR NONFUEL SALES MIX CHANGES IN A MANNER THAT NEGATIVELY IMPACTS OUR NONFUEL GROSS MARGIN, OUR FUEL AND NONFUEL REVENUES AND OUR NONFUEL GROSS MARGIN MAY DECLINE; |
• | WE EXPECT THAT LOCATIONS WE ACQUIRE WILL PRODUCE STABILIZED FINANCIAL RESULTS AFTER A PERIOD OF TIME FOLLOWING ACQUISITION. THIS STATEMENT MAY IMPLY THAT THE EXPECTED STABILIZATION OF OUR ACQUIRED SITES WILL GENERATE INCREASED OPERATING INCOME. HOWEVER, MANY OF THE LOCATIONS WE HAVE ACQUIRED OR MAY ACQUIRE PRODUCED OPERATING RESULTS THAT CAUSED THE PRIOR OWNERS TO EXIT THESE BUSINESSES AND OUR ABILITY TO OPERATE THESE LOCATIONS PROFITABLY DEPENDS UPON MANY FACTORS, SOME OF WHICH ARE BEYOND OUR CONTROL. ACCORDINGLY, OUR ACQUIRED SITES MAY NOT GENERATE INCREASED OPERATING INCOME OR IT MAY TAKE LONGER THAN WE EXPECT TO REALIZE ANY SUCH INCREASES; |
• | WE HAVE MADE ACQUISITIONS AND DEVELOPED NEW LOCATIONS AND EXPECT THAT IN THE FUTURE WE MAY MAKE ACQUISITIONS AND DEVELOP LOCATIONS. THESE STATEMENTS MAY IMPLY THAT ANY FUTURE ACQUISITIONS AND DEVELOPMENT PROJECTS WILL BE COMPLETED AND THAT THESE COMPLETED ACQUISITIONS AND DEVELOPMENT PROJECTS WILL IMPROVE OUR FUTURE PROFITS. THERE ARE MANY FACTORS THAT MAY RESULT IN OUR NOT BEING ABLE TO ACQUIRE, RENOVATE AND DEVELOP ADDITIONAL LOCATIONS THAT YIELD PROFITS, INCLUDING COMPETITION FROM OTHER BUYERS OR DEVELOPERS, OUR INABILITY TO NEGOTIATE ACCEPTABLE PURCHASE TERMS AND THE POSSIBILITY THAT WE MAY NEED TO USE OUR AVAILABLE FUNDS FOR OTHER PURPOSES. WE MAY DETERMINE TO DELAY OR NOT TO PROCEED WITH RENOVATIONS OR DEVELOPMENT PROJECTS. MOREOVER, MANAGING AND INTEGRATING ACQUIRED AND DEVELOPED LOCATIONS CAN BE DIFFICULT, TIME CONSUMING AND/OR MORE EXPENSIVE THAN ANTICIPATED AND INVOLVE RISKS OF FINANCIAL LOSSES. WE MAY NOT OPERATE OUR ACQUIRED OR DEVELOPED LOCATIONS AS PROFITABLY AS WE NOW EXPECT; |
• | WE CURRENTLY PLAN TO CONTINUE TO INVEST IN EXISTING LOCATIONS AND MAY INVEST IN NEW LOCATIONS. AN IMPLICATION OF THIS STATEMENT MAY BE THAT WE HAVE OR WILL HAVE SUFFICIENT CAPITAL TO MAKE THE INVESTMENTS WE HAVE IDENTIFIED AS WELL AS OTHER INVESTMENTS THAT WE HAVE NOT YET IDENTIFIED. HOWEVER, WE CANNOT BE SURE THAT WE WILL HAVE SUFFICIENT CAPITAL FOR SUCH INVESTMENTS. THE AMOUNT AND TIMING OF CAPITAL EXPENDITURES ARE OFTEN DIFFICULT TO PREDICT. SOME CAPITAL PROJECTS COST MORE THAN ANTICIPATED AND THE PROCEEDS FROM OUR SALES OF IMPROVEMENTS TO HPT, IF ANY, MAY BE LESS THAN ANTICIPATED. CURRENTLY UNANTICIPATED PROJECTS THAT WE MAY BE REQUIRED TO UNDERTAKE IN THE FUTURE (AS A RESULT OF GOVERNMENT PROGRAMS OR REGULATION, ADVANCES OR CHANGES MADE BY OUR COMPETITION, DEMANDS OF OUR CUSTOMERS, OR FOR OTHER REASONS) MAY ARISE AND CAUSE US TO SPEND MORE |
• | WE HAVE A CREDIT FACILITY WITH A CURRENT MAXIMUM AVAILABILITY OF $200.0 MILLION. THE AVAILABILITY OF THIS MAXIMUM AMOUNT IS SUBJECT TO LIMITS BASED ON OUR QUALIFIED COLLATERAL, INCLUDING OUR ELIGIBLE CASH, ACCOUNTS RECEIVABLE AND INVENTORY, THAT VARIES IN AMOUNT FROM TIME TO TIME. ACCORDINGLY, OUR BORROWING AND LETTER OF CREDIT AVAILABILITY AT ANY TIME MAY BE LESS THAN $200.0 MILLION. AT SEPTEMBER 30, 2017, BASED ON OUR ELIGIBLE COLLATERAL AT THAT DATE, OUR BORROWING AND LETTER OF CREDIT AVAILABILITY WAS $125.4 MILLION, OF WHICH WE HAD USED $15.2 MILLION FOR OUTSTANDING LETTERS OF CREDIT. THE MAXIMUM AMOUNT AVAILABLE UNDER THE CREDIT FACILITY MAY BE INCREASED TO $300.0 MILLION, THE AVAILABILITY OF WHICH IS SUBJECT TO LIMITS BASED ON OUR AVAILABLE COLLATERAL AND LENDER PARTICIPATION. HOWEVER, IF WE DO NOT HAVE SUFFICIENT COLLATERAL OR IF WE ARE UNABLE TO IDENTIFY LENDERS WILLING TO INCREASE THEIR COMMITMENTS OR JOIN OUR CREDIT FACILITY, WE MAY NOT BE ABLE TO INCREASE THE SIZE OF OUR CREDIT FACILITY OR THE AVAILABILITY OF BORROWINGS WHEN WE MAY NEED OR WANT TO DO SO; |
• | WE MAY FINANCE OR SELL UNENCUMBERED REAL ESTATE THAT WE OWN. HOWEVER, WE DO NOT KNOW THE EXTENT TO WHICH WE COULD MONETIZE OUR EXISTING UNENCUMBERED REAL ESTATE OR WHAT THE TERMS OF ANY SUCH SALE OR FINANCING WOULD BE; AND |
• | ON SEPTEMBER 11, 2017, THE COURT OF CHANCERY OF THE STATE OF DELAWARE ISSUED A MEMORANDUM OPINION IN OUR LITIGATION AGAINST COMDATA, WHICH, AMONG OTHER THINGS, ENTITLES US TO AN ORDER REQUIRING COMDATA TO SPECIFICALLY PERFORM UNDER OUR MERCHANT AGREEMENT WITH COMDATA AND AWARDS DAMAGES TO US AND AGAINST COMDATA FOR THE DIFFERENCE BETWEEN THE HIGHER TRANSACTION FEES PAID BY US TO COMDATA SINCE FEBRUARY 1, 2017, AND WHAT WE SHOULD HAVE PAID UNDER THE MERCHANT AGREEMENT. THIS OPINION ALSO FOUND THAT THE MERCHANT AGREEMENT PROVIDES FOR AN AWARD OF REASONABLE ATTORNEY'S FEES AND COSTS TO US. WE AND COMDATA HAVE REACHED AGREEMENT ON THE AMOUNT OF EXCESS TRANSACTION FEES TO BE PAID TO US, BUT WE AND COMDATA HAVE NOT REACHED AN AGREEMENT ON WHEN FINAL JUDGMENT SHOULD ENTER IN THIS LITIGATION OR ON THE AMOUNT OF OUR ATTORNEYS' FEES AND OTHER COSTS THAT COMDATA SHOULD PAY US. THE COURT HAS NOT ISSUED ITS FINAL JUDGMENT AND THE COURT MAY NOT AWARD US SOME OR ALL OF OUR ATTORNEY'S FEES AND COSTS. FURTHERMORE, COMDATA MAY APPEAL THE COURT'S JUDGMENT AND THE COURT'S DECISION MAY BE REVERSED OR AMENDED UPON APPEAL. THE CONTINUATION OF THIS LITIGATION IS DISTRACTING TO OUR MANAGEMENT AND EXPENSIVE, AND THIS DISTRACTION AND EXPENSE MAY CONTINUE. |
• | CONTINUED IMPROVED FUEL EFFICIENCY OF MOTOR VEHICLE ENGINES AND OTHER FUEL CONSERVATION AND ALTERNATIVE FUEL PRACTICES EMPLOYED BY OUR CUSTOMERS AND ALTERNATIVE FUEL TECHNOLOGIES THAT MAY BE DEVELOPED AND WIDELY ADOPTED IN THE FUTURE MAY CONTINUE TO REDUCE THE DEMAND FOR THE FUEL THAT WE SELL AND MAY ADVERSELY AFFECT OUR BUSINESS; |
• | COMPETITION WITHIN THE TRAVEL CENTER, CONVENIENCE STORE AND RESTAURANT INDUSTRIES MAY ADVERSELY IMPACT OUR FINANCIAL RESULTS. OUR BUSINESS REQUIRES SUBSTANTIAL AMOUNTS OF WORKING CAPITAL AND OUR COMPETITORS MAY HAVE GREATER FINANCIAL AND OTHER RESOURCES THAN WE DO; |
• | FUTURE INCREASES IN FUEL PRICES MAY REDUCE THE DEMAND FOR THE PRODUCTS AND SERVICES THAT WE SELL BECAUSE HIGH FUEL PRICES MAY ENCOURAGE FUEL CONSERVATION, DIRECT FREIGHT BUSINESS AWAY FROM TRUCKING OR OTHERWISE ADVERSELY AFFECT THE BUSINESS OF OUR CUSTOMERS; |
• | FUTURE COMMODITY FUEL PRICE INCREASES, FUEL PRICE VOLATILITY OR OTHER FACTORS MAY CAUSE US TO NEED MORE WORKING CAPITAL TO MAINTAIN OUR INVENTORY AND CARRY OUR ACCOUNTS RECEIVABLE THAN WE NOW EXPECT AND THE GENERAL AVAILABILITY OF, DEMAND FOR AND PRICING OF MOTOR FUELS MAY CHANGE IN WAYS WHICH LOWER THE PROFITABILITY ASSOCIATED WITH OUR SELLING MOTOR FUELS; |
• | OUR SUPPLIERS MAY BE UNWILLING OR UNABLE TO MAINTAIN THE CURRENT CREDIT TERMS FOR OUR PURCHASES. IF WE ARE UNABLE TO PURCHASE GOODS ON REASONABLE CREDIT TERMS, OUR REQUIRED WORKING CAPITAL MAY INCREASE AND WE MAY INCUR MATERIAL LOSSES. ALSO, IN TIMES OF RISING FUEL AND NONFUEL PRICES, OUR SUPPLIERS MAY BE UNWILLING OR UNABLE TO INCREASE THE CREDIT AMOUNTS THEY EXTEND TO US, WHICH MAY INCREASE OUR WORKING CAPITAL REQUIREMENTS. THE AVAILABILITY AND THE TERMS OF ANY CREDIT WE MAY BE ABLE TO OBTAIN ARE UNCERTAIN; |
• | ACQUISITIONS OR PROPERTY DEVELOPMENT MAY SUBJECT US TO GREATER RISKS THAN OUR CONTINUING OPERATIONS, INCLUDING THE ASSUMPTION OF UNKNOWN LIABILITIES; |
• | MOST OF OUR TRUCKING COMPANY CUSTOMERS TRANSACT BUSINESS WITH US BY USE OF FUEL CARDS ISSUED BY THIRD PARTY FUEL CARD COMPANIES. FUEL CARD COMPANIES FACILITATE PAYMENTS TO US AND CHARGE US FEES FOR THESE SERVICES. THE FUEL CARD INDUSTRY HAS ONLY A FEW SIGNIFICANT PARTICIPANTS. WE BELIEVE ALMOST ALL TRUCKING COMPANIES USE ONLY ONE FUEL CARD PROVIDER AND HAVE BECOME INCREASINGLY DEPENDENT UPON SERVICES PROVIDED BY THEIR RESPECTIVE FUEL CARD PROVIDER TO MANAGE THEIR FLEETS. COMPETITION, OR LACK THEREOF, AMONG FUEL CARD COMPANIES MAY RESULT IN FUTURE INCREASES IN OUR TRANSACTION FEE EXPENSES OR WORKING CAPITAL REQUIREMENTS, OR BOTH; |
• | FUEL SUPPLY DISRUPTIONS MAY OCCUR, WHICH MAY LIMIT OUR ABILITY TO PURCHASE FUEL FOR RESALE; |
• | COMPLIANCE WITH, AND CHANGES TO, FEDERAL, STATE AND LOCAL LAWS AND REGULATIONS, INCLUDING THOSE RELATED TO TAX, EMPLOYMENT AND ENVIRONMENTAL MATTERS, ACCOUNTING RULES AND FINANCIAL REPORTING STANDARDS, PAYMENT CARD INDUSTRY REQUIREMENTS AND SIMILAR MATTERS MAY INCREASE OUR OPERATING COSTS AND REDUCE OR ELIMINATE OUR PROFITS; |
• | WE ARE ROUTINELY INVOLVED IN LITIGATION. DISCOVERY DURING LITIGATION AND COURT DECISIONS OFTEN HAVE UNANTICIPATED RESULTS. LITIGATION IS USUALLY EXPENSIVE AND CAN BE DISTRACTING TO MANAGEMENT. WE CANNOT BE SURE OF THE OUTCOME OF ANY OF THE LITIGATION MATTERS IN WHICH WE ARE OR MAY BECOME INVOLVED; |
• | ACTS OF TERRORISM, GEOPOLITICAL RISKS, WARS, OUTBREAKS OF SO CALLED PANDEMICS OR OTHER MANMADE OR NATURAL DISASTERS BEYOND OUR CONTROL MAY ADVERSELY AFFECT OUR FINANCIAL RESULTS; AND |
• | ALTHOUGH WE BELIEVE THAT WE BENEFIT FROM OUR RELATIONSHIPS WITH OUR RELATED PARTIES, INCLUDING HPT, RMR, AIC AND OTHERS AFFILIATED WITH THEM, ACTUAL AND POTENTIAL CONFLICTS OF INTEREST WITH RELATED PARTIES MAY PRESENT A CONTRARY APPEARANCE OR RESULT IN LITIGATION, AND THE BENEFITS WE BELIEVE WE MAY REALIZE FROM THE RELATIONSHIPS MAY NOT MATERIALIZE. |
Exhibit 101.1 | The following materials from TravelCenters of America LLC's Quarterly Report on Form 10-Q for the quarter ended September 30, 2017, formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Income and Comprehensive Income, (iii) the Consolidated Statements of Cash Flows, and (iv) related notes to these financial statements, tagged as blocks of text (filed herewith) |
TRAVELCENTERS OF AMERICA LLC | |||||||
By: | /s/ ANDREW J. REBHOLZ | ||||||
Date: | November 7, 2017 | Name: | Andrew J. Rebholz | ||||
Title: | Executive Vice President, Chief Financial Officer and Treasurer (Principal Financial Officer) |
LANDLORD: | |
HPT TA PROPERTIES TRUST | |
By: | /s/ Mark K. Kleifges |
Mark L. Kleifges | |
Treasurer and Chief Financial Officer |
HPT TA PROPERTIES LLC | |
By: | /s/ Mark L. Kleifges |
Mark L. Kleifges | |
Treasurer and Chief Financial Officer |
TENANT: | |
TA OPERATING LLC | |
By: | /s/ Mark R. Young |
Mark R. Young | |
Executive Vice President |
TRAVELCENTERS OF AMERICA LLC | |
By: | /s/ Mark R. Young |
Mark R. Young | |
Executive Vice President |
TRAVELCENTERS OF AMERICA HOLDING COMPANY LLC | |
By: | /s/ Mark R. Young |
Mark R. Young | |
Executive Vice President |
Nine Months Ended September 30, 2017 | Years Ended December 31, | ||||||||||||||||||||||
2016 | 2015 | 2014 | 2013 | 2012 | |||||||||||||||||||
(in thousands, except ratio amounts) | |||||||||||||||||||||||
(Loss) income before income taxes, income from equity investees and noncontrolling interests | $ | (49,707 | ) | $ | (8,206 | ) | $ | 40,202 | $ | 95,768 | $ | 2,331 | $ | 31,812 | |||||||||
Distributions received from equity investees | 4,800 | 3,000 | 4,800 | — | — | 4,800 | |||||||||||||||||
Fixed charges | 92,300 | 118,248 | 106,344 | 93,101 | 90,880 | 79,161 | |||||||||||||||||
Amortization of capitalized interest | 98 | 90 | 30 | 41 | 31 | — | |||||||||||||||||
Capitalized interest | (488 | ) | (2,377 | ) | (1,797 | ) | (755 | ) | (1,033 | ) | — | ||||||||||||
Total earnings | $ | 47,003 | $ | 110,755 | $ | 149,579 | $ | 188,155 | $ | 92,209 | $ | 115,773 | |||||||||||
Interest expense(1) | $ | 22,898 | $ | 28,438 | $ | 24,425 | $ | 17,241 | $ | 17,650 | $ | 10,358 | |||||||||||
Estimated interest within real estate rent expense(2) | 68,914 | 87,433 | 80,122 | 75,105 | 72,197 | 68,803 | |||||||||||||||||
Capitalized interest | 488 | 2,377 | 1,797 | 755 | 1,033 | — | |||||||||||||||||
Total fixed charges | $ | 92,300 | $ | 118,248 | $ | 106,344 | $ | 93,101 | $ | 90,880 | $ | 79,161 | |||||||||||
Ratio of earnings to fixed charges | 0.51 | 0.94 | 1.41 | 2.02 | 1.01 | 1.46 | |||||||||||||||||
Deficiency of earnings available to cover fixed charges | $ | (45,297 | ) | $ | (7,493 | ) | $ N/A | $ N/A | $ N/A | $ N/A |
(1) | Includes interest expense and amortization of premiums and discounts related to indebtedness. |
(2) | Estimated interest within rent expense includes one third of rental expense, which approximates the interest component of operating leases. |
1. | I have reviewed this quarterly report on Form 10-Q of TravelCenters of America LLC; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: November 7, 2017 | /s/ THOMAS M. O'BRIEN |
Thomas M. O'Brien | |
President and Chief Executive Officer |
1. | I have reviewed this quarterly report on Form 10-Q of TravelCenters of America LLC; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: November 7, 2017 | /s/ ANDREW J. REBHOLZ |
Andrew J. Rebholz | |
Executive Vice President, Chief Financial | |
Officer and Treasurer |
Date: November 7, 2017 | /s/ THOMAS M. O’BRIEN |
Thomas M. O’Brien | |
President and Chief Executive Officer | |
/s/ ANDREW J. REBHOLZ | |
Andrew J. Rebholz | |
Executive Vice President, Chief Financial Officer and Treasurer |
Document and Entity Information - shares |
9 Months Ended | |
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Sep. 30, 2017 |
Nov. 06, 2017 |
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Document and Entity Information | ||
Entity Registrant Name | TRAVELCENTERS OF AMERICA LLC | |
Entity Central Index Key | 0001378453 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 39,516,181 | |
Document Fiscal Year Focus | 2017 | |
Document Fiscal Period Focus | Q3 |
Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) shares in Thousands, $ in Thousands |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 743 | $ 744 |
Common shares, shares authorized (in shares) | 41,369 | 41,369 |
Common shares, shares issued (in shares) | 39,549 | 39,523 |
Common shares, shares outstanding (in shares) | 39,549 | 39,523 |
Consolidated Statements of Income and Comprehensive Income (Unaudited) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
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Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
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Revenues: | ||||
Fuel | $ 1,055,593 | $ 947,558 | $ 2,981,154 | $ 2,588,297 |
Nonfuel | 515,836 | 510,559 | 1,471,306 | 1,441,044 |
Rent and royalties from franchisees | 4,248 | 4,529 | 12,651 | 13,135 |
Total revenues | 1,575,677 | 1,462,646 | 4,465,111 | 4,042,476 |
Cost of goods sold (excluding depreciation): | ||||
Fuel | 950,584 | 837,525 | 2,684,750 | 2,284,570 |
Nonfuel | 230,920 | 230,325 | 650,886 | 644,320 |
Total cost of goods sold | 1,181,504 | 1,067,850 | 3,335,636 | 2,928,890 |
Operating expenses: | ||||
Site level operating | 244,161 | 247,584 | 743,022 | 725,754 |
Selling, general and administrative | 36,587 | 34,812 | 115,276 | 101,787 |
Real estate rent | 69,599 | 66,573 | 206,742 | 194,838 |
Depreciation and amortization | 30,714 | 22,698 | 91,163 | 64,545 |
Total operating expenses | 381,061 | 371,667 | 1,156,203 | 1,086,924 |
Income (loss) from operations | 13,112 | 23,129 | (26,728) | 26,662 |
Acquisition costs | 68 | 225 | 271 | 2,286 |
Interest expense, net | 7,486 | 7,200 | 22,708 | 20,761 |
Income from equity investees | 528 | 1,534 | 1,731 | 3,572 |
Income (loss) before income taxes | 6,086 | 17,238 | (47,976) | 7,187 |
Benefit (provision) for income taxes | 56,268 | (6,263) | 77,963 | (2,571) |
Net income | 62,354 | 10,975 | 29,987 | 4,616 |
Less: net income for noncontrolling interests | 30 | 77 | 100 | 141 |
Net income attributable to common shareholders | 62,324 | 10,898 | 29,887 | 4,475 |
Other comprehensive income, net of tax: | ||||
Foreign currency income (loss), net of taxes | 89 | (46) | 168 | 165 |
Equity interest in investee's unrealized gain on investments | 116 | 80 | 296 | 175 |
Other comprehensive income attributable to common shareholders | 205 | 34 | 464 | 340 |
Comprehensive income attributable to common shareholders | $ 62,529 | $ 10,932 | $ 30,351 | $ 4,815 |
Net income per common share attributable to common shareholders: | ||||
Basic and diluted (in usd per share) | $ 1.58 | $ 0.28 | $ 0.76 | $ 0.12 |
Consolidated Statements of Income and Comprehensive Income (Unaudited) (Parenthetical) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
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Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
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Income Statement [Abstract] | ||||
Foreign currency income (loss), tax | $ 78 | $ (30) | $ 144 | $ 102 |
Business Description and Basis of Presentation |
9 Months Ended |
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Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business Description and Basis of Presentation | Business Description and Basis of Presentation TravelCenters of America LLC, which we refer to as the Company or we, us and our, is a Delaware limited liability company. As of September 30, 2017, we operated and franchised 539 travel centers, standalone convenience stores, and standalone restaurants. Our customers include trucking fleets and their drivers, independent truck drivers, highway and local motorists and casual diners. We also collect rents, royalties and other fees from our tenants and franchisees. We manage our business on the basis of two separately reportable segments, travel centers and convenience stores. See Note 12 for more information about our reportable segments. We have a single travel center located in a foreign country, Canada, that we do not consider material to our operations. As of September 30, 2017, our business included 256 travel centers in 43 states in the U.S., primarily along the U.S. interstate highway system, and the province of Ontario, Canada. Our travel centers included 178 locations operated under the "TravelCenters of America" and "TA" brand names and 78 locations operated under the "Petro Stopping Centers" and "Petro" brand names. Of our 256 travel centers at September 30, 2017, we owned 30, we leased 200, we operated two for a joint venture in which we own a noncontrolling interest and 24 were owned or leased from others by our franchisees. We operated 228 of our travel centers and franchisees operated 28 travel centers, including four we leased to franchisees. Our travel centers offer a broad range of products and services, including diesel fuel and gasoline as well as nonfuel products and services such as truck repair and maintenance services, full service restaurants, quick service restaurants, or QSRs, and various customer amenities. We report this portion of our business as our travel center segment. As of September 30, 2017, our business included 233 convenience stores in 11 states in the U.S. We operate our convenience stores under the "Minit Mart" brand name. Of these 233 convenience stores at September 30, 2017, we owned 198, we leased 32 and we operated three for a joint venture in which we own a noncontrolling interest. Our convenience stores offer gasoline as well as a variety of nonfuel products and services, including coffee, groceries, some fresh foods, and, in many stores, a QSR and/or car wash. We report this portion of our business as our convenience store segment. As of September 30, 2017, our business included 50 standalone restaurants in 14 states in the U.S. operated primarily under the "Quaker Steak & Lube", or QSL, brand name. Of our 50 standalone restaurants at September 30, 2017, we owned seven, we leased nine, we operated one for a joint venture in which we own a noncontrolling interest and 33 were owned or leased from others by our franchisees. We report this portion of our business within corporate and other in our segment information. The accompanying consolidated financial statements are unaudited. These unaudited interim financial statements have been prepared in accordance with U.S. generally accepted accounting principles, or GAAP, applicable for interim financial statements. The disclosures presented do not include all the information necessary for complete financial statements in accordance with GAAP. These unaudited interim financial statements should be read in conjunction with the consolidated financial statements and notes contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2016, or our Annual Report. In the opinion of our management, the accompanying consolidated financial statements include all adjustments, including normal recurring adjustments, considered necessary for a fair presentation. All intercompany transactions and balances have been eliminated. While our revenues are modestly seasonal, the quarterly variations in our operating results may reflect greater seasonal differences because our rent expense and certain other costs do not vary seasonally. For this and other reasons, our operating results for interim periods are not necessarily indicative of the results that may be expected for a full year. Certain prior year amounts have been reclassified to conform to the current year presentation. Fair Value Measurement Senior Notes We collectively refer to our $110,000 of 8.25% Senior Notes due 2028, our $120,000 of 8.00% Senior Notes due 2029 and our $100,000 of 8.00% Senior Notes due 2030 as our Senior Notes, which are our senior unsecured obligations. We estimate that, based on their trading prices (a Level 1 input), the aggregate fair value of our Senior Notes on September 30, 2017, was $311,600. Property and Equipment Impairment Property and equipment is reviewed for impairment during each reporting period at the individual location level because that is the lowest level of asset groupings for which cash flows are largely independent of cash flows of other asset groups. If indicators of impairment exist, we record an impairment charge to the extent that the carrying value of the assets exceeds the estimated fair value of the assets. These analyses require the exercise of significant judgments, including judgments about appropriate discount rates, growth rates and timing of expected future cash flows of the respective individual location. During the nine months ended September 30, 2017, we recorded impairment charges aggregating $4,380 related to certain convenience store locations primarily due to increased competition in their specific markets subsequent to when we acquired those sites. The impairment charge is presented in our consolidated financial statements in depreciation and amortization expense. Recently Issued Accounting Pronouncements In May 2014, the Financial Accounting Standards Board, or the FASB, issued Accounting Standards Update 2014-09, Revenue from Contracts with Customers, or ASU 2014-09, which establishes a comprehensive revenue recognition standard under GAAP for almost all industries. This new standard will apply for annual periods beginning after December 15, 2017, including interim periods therein. To address implementation of ASU 2014-09 and evaluate its impact on our consolidated financial statements, we have developed a project plan in which we are utilizing a bottom up approach to evaluate our revenue streams and related internal controls. We are still finalizing our evaluation; however, we have selected the full retrospective transition method for adoption, which requires that we restate prior comparative periods in our consolidated financial statements. Although much of our revenue is initiated at the point of sale, the implementation of this standard will affect our accounting for initial franchise fees, our loyalty programs and certain gift card programs. We expect that the changes to our accounting for our loyalty program will result in a reclassification of amounts between fuel and nonfuel revenues but that the adoption of this standard will not have a material impact on our operating income or net income attributable to common shareholders or our consolidated balance sheets. In February 2016, the FASB issued Accounting Standards Update 2016-02, Leases, which establishes a comprehensive lease standard under GAAP for virtually all industries. The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase of the leased asset by the lessee. This classification will determine whether the lease expense is recognized based on an effective interest method or on a straight line basis over the term of the lease. A lessee is also required to record a right of use asset and a lease liability on the consolidated balance sheet for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases. The new standard requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales type leases, direct financing leases and operating leases. The new standard will apply for annual periods beginning after December 15, 2018, including interim periods therein, and requires modified retrospective application. Early adoption is permitted. We are in the process of evaluating the effects the adoption of this update may have on our consolidated financial statements. We believe the adoption of this update will have a material impact on our consolidated balance sheets due to the recognition of the lease rights and obligations as assets and liabilities. While the adoption of this standard will have no effect on the cash we pay under our lease agreements, we expect amounts within our statements of income and comprehensive income will change materially. |
Earnings Per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share | Earnings Per Share The following table presents a reconciliation of net income attributable to common shareholders to net income available to common shareholders and the related earnings per share.
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Acquisitions |
9 Months Ended |
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Sep. 30, 2017 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions During the nine months ended September 30, 2017, we acquired six standalone restaurants from one of our franchisees and a travel center from another of our franchisees for an aggregate purchase price of $19,854, and accounted for these transactions as business combinations, which requires, among other things, that the assets acquired and liabilities assumed be recognized at their respective fair values as of the date of acquisition. The purchase price allocation for the travel center acquired is based on a valuation that is not yet finalized, primarily with respect to certain intangible assets. The process for estimating the fair value of assets acquired and liabilities assumed requires the use of judgment in determining appropriate assumptions and estimates. As we obtain additional information to finalize this preliminary valuation, adjustments to the recorded amounts may be made during the measurement period (up to one year from the acquisition date). We have included the results of these acquired businesses in our consolidated financial statements from the date of acquisition. The pro forma impact of these acquisitions, including the results of operations of the acquired standalone restaurants and travel center from the beginning of the periods presented, are not material to our consolidated financial statements. Acquisition costs, such as legal fees, due diligence costs and closing costs, are not included as a component of consideration transferred in business combinations but instead are expensed as incurred. |
Goodwill |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill | Goodwill Goodwill consisted of the following:
During the nine months ended September 30, 2017, goodwill increased by $4,361 and $1,156 in connection with the acquisition of a travel center and six standalone restaurants, respectively. See Note 3 for more information about our acquisitions. Goodwill Impairment Goodwill is tested for impairment annually as of July 31, or more frequently if the circumstances warrant, at the reporting unit level. We have three reporting units, which include our two reportable segments, travel centers and convenience stores, and our QSL business. Impairment testing for the travel center and convenience store reporting units for 2017 was performed using a quantitative analysis under which the fair value of our goodwill was estimated using both an income approach and a market approach. The income approach considered discounted forecasted cash flows that were based on our long term operating plan. A terminal value was used to estimate the cash flows beyond the period covered by the operating plan. The discount rate is an estimate of the overall after tax market rate of return we believe may be required by equity and debt holders of a business enterprise. The market approach considered the estimated fair values of possible comparable publicly traded companies. For each comparable publicly traded company, value indicators, or pricing multiples, were considered to estimate the value of our business enterprise. These analyses require the exercise of significant judgments, including judgments about appropriate discount rates, perpetual growth rates and the timing of expected future cash flows, including revenue growth rates and operating cash flow margins, of the respective reporting unit. The fair value estimates are sensitive and actual rates and results may differ materially. Applying different assumptions could lead to different results. We utilized a qualitative approach to perform impairment testing for the QSL business, which included evaluating financial trends and industry and market conditions. The fair value of our travel center reporting unit substantially exceeded its carrying value, and the fair value of our convenience store reporting unit exceeded its carrying amount by 2.6%. Based on our analyses, we concluded that as of July 31, 2017, our goodwill was not impaired. As a measure of sensitivity, a 5% decrease in the fair value of our convenience store reporting unit as of July 31, 2017, would result in the carrying amount exceeding its fair value by approximately $12,800. Separately, a 50 basis point increase in the discount rate would result in the carrying amount exceeding its fair value by approximately $13,700. |
Income Taxes |
9 Months Ended |
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Sep. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Discrete Tax Rate Calculation We historically have calculated the provision for income taxes during interim reporting periods by applying an estimated annual effective tax rate for the full fiscal year to income (loss) before income taxes for the reporting period. Since we determined that relatively small changes in estimated annual income (loss) before income taxes could result in significant changes in the estimated annual effective tax rate, we have changed how we calculate our income tax provision (benefit) to instead use a discrete rate based on the actual loss before income taxes for the nine months ended September 30, 2017. Uncertain Tax Position Because of uncertainties concerning our value as of the date of an ownership change for federal income tax purposes that we experienced as a result of certain trading in our common shares during 2007, and as to the measurement of the net unrecognized built-in loss and allocation of the net unrecognized built-in loss, if any, to our various assets as of the date of the ownership change, we previously had not recognized certain of our tax attributes. In September 2017, as a result of a number of factors including the passage of time and the results of audits of certain of our U.S. federal income tax returns, the uncertainty related to the filing positions giving rise to these tax attributes was resolved and, accordingly, we recognized deferred tax assets related to those tax attributes and reversed a related accrued tax liability. The benefit (provision) for income taxes in our consolidated statements of income and comprehensive income for the three and nine months ended September 30, 2017, includes $58,602 recognized in connection with the resolution of the previous uncertain tax positions. |
Equity Investments |
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Equity Method Investments and Joint Ventures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity Investments | Equity Investments Our investments in equity affiliates, which are presented in our consolidated balance sheets in other noncurrent assets, and our proportional share of our investees' net income (loss) recognized in our consolidated statements of income and comprehensive income were as follows:
Petro Travel Plaza Holdings LLC Petro Travel Plaza Holdings LLC, or PTP, is a joint venture between us and Tejon Development Corporation that owns two travel centers, three convenience stores and one standalone restaurant in California. We own a 40% interest in PTP and we receive a management fee from PTP to operate the two travel centers, three convenience stores and one standalone restaurant. We recognized management fee income of $386 and $323 for the three months ended September 30, 2017 and 2016, respectively, and $1,156 and $776 for the nine months ended September 30, 2017 and 2016, respectively. We supply PTP with its fuel at no markup. During the three and nine months ended September 30, 2017 and 2016, we sold to PTP $15,963 and$44,637, and $15,055 and $40,405 of fuel, respectively. The following table sets forth summarized financial information of PTP. PTP's operating results are not consolidated with ours as we account for our PTP investment under the equity method.
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HPT Leases |
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HPT Leases | HPT Leases As of September 30, 2017, we leased from Hospitality Properties Trust, or HPT, a total of 199 properties under five leases, four of which we refer to as the TA Leases and one of which we refer to as the Petro Lease, and which collectively we refer to as the HPT Leases. We recognized rent expense under the HPT Leases of $66,506 and $63,345 for the three months ended September 30, 2017 and 2016, respectively, and $197,365 and $185,858 for the nine months ended September 30, 2017 and 2016, respectively. Our minimum annual rent under the HPT Leases as of September 30, 2017, was $280,419. In addition to the payment of minimum annual rent, the HPT Leases provide for payment to HPT of percentage rent based on increases in total nonfuel revenues over base year levels. The total amount of percentage rent that we incurred was $434 and $408 for the three months ended September 30, 2017 and 2016, respectively, and $1,435 and $937 for the nine months ended September 30, 2017 and 2016, respectively. HPT waived $372 of percentage rent under the Petro Lease for the nine months ended September 30, 2016; as of June 30, 2016, HPT had cumulatively waived all of the $2,500 of percentage rent it previously agreed to waive and no further waivers are contractually required. During the nine months ended September 30, 2017 and 2016, we sold to HPT $62,888 and $75,314, respectively, of improvements we made to properties leased from HPT. As a result, pursuant to the terms of our HPT Leases, our minimum annual rent payable to HPT increased by $5,345 and $6,402, respectively. At September 30, 2017, our property and equipment balance included $23,216 of improvements of the type that we typically request that HPT purchase for an increase in minimum annual rent; however, HPT is not obligated to purchase these improvements. The following table summarizes the various amounts related to the HPT Leases that are included in our consolidated balance sheets.
On May 3, 2017, pursuant to the terms of our June 2015 transaction agreement with HPT, as amended, we sold to, and leased back from, HPT the fourth and final development property that is subject to that agreement. We received proceeds of $27,602, this property was added to the HPT Leases and our minimum annual rent under the HPT Leases increased by $2,346 as a result. On September 25, 2017, HPT purchased land and improvements that previously were leased by HPT from a third party and subleased to us. Effective as of that date, our rent due to that third party pursuant to the terms of our sublease with HPT ceased. Also on that date, we and HPT amended our lease to reflect our direct lease from HPT of that land and those improvements and to increase our minimum annual rent due to HPT by $731, which was 8.5% of HPT's investment. Business and Property Management Agreements with RMR The RMR Group LLC, or RMR, provides us certain services that we require to operate our business, and which relate to various aspects of our business. RMR provides these services pursuant to a business management agreement. In addition, until July 31, 2017, we also had a property management agreement with RMR, which related to building management services for our headquarters building. Pursuant to our business management agreement and property management agreement with RMR, we incurred aggregate fees of $3,782 and $3,935 for the three months ended September 30, 2017 and 2016, respectively, and $10,647 and $10,748 for the nine months ended September 30, 2017 and 2016, respectively. In addition, we incurred internal audit costs of $67 and $34 for the three months ended September 30, 2017 and 2016, respectively, and $202 and $168 for the nine months ended September 30, 2017 and 2016, respectively, for which we reimburse RMR pursuant to our business management agreement. These fees and costs are included in selling, general and administrative expenses in our consolidated statements of income and comprehensive income. For more information about our relationships with RMR please refer to Notes 11 and 12 in our Annual Report. Related Party Transactions We have relationships and historical and continuing transactions with HPT, RMR, AIC and others related to them, including other companies to which RMR provides management services and which have trustees, directors and officers who are also our Directors or officers. Relationship with HPT We are HPT's largest tenant and HPT is our principal landlord and largest shareholder. As of September 30, 2017, HPT owned 3,420 of our common shares, representing approximately 8.6% of our outstanding common shares. As of September 30, 2017, we leased from HPT a total of 199 properties under the HPT Leases. RMR provides management services to both us and HPT. See Note 7 for more information about our lease agreements and transactions with HPT. Relationship with RMR We have an agreement with RMR to provide management services to us. See Note 8 for further information regarding our current and former management agreements with RMR. Relationship with AIC We, HPT and five other companies to which RMR provides management services each currently own AIC, an Indiana insurance company, in equal amounts. We and the other AIC shareholders participate in a combined property insurance program arranged and reinsured in part by AIC. We paid aggregate annual premiums, including taxes and fees, of approximately $1,672 in connection with this insurance program for the policy year ending June 30, 2018, which amount may be adjusted from time to time as we acquire and dispose of properties that are included in this insurance program. As of September 30, 2017 and December 31, 2016, our investment in AIC had a carrying value of $7,945 and $7,116, respectively. These amounts are included in other noncurrent assets on our consolidated balance sheets. We recognized income related to our investment in AIC, which amounts are presented as income from equity investees in our consolidated statements of income and comprehensive income. Our other comprehensive income includes our proportionate share of unrealized gains on securities owned and held for sale by AIC. Relationship with PTP We have a relationship with PTP, a joint venture in which we own 40% that owns travel centers, convenience stores and a restaurant that we operate for a fee. We supply PTP with its fuel at no markup. See Note 6 for further information regarding our relationship with PTP. For further information about these and certain other related party relationships and transactions, please refer to our Annual Report. |
Business and Property Management Agreements with RMR |
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Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business and Property Management Agreements with RMR | HPT Leases As of September 30, 2017, we leased from Hospitality Properties Trust, or HPT, a total of 199 properties under five leases, four of which we refer to as the TA Leases and one of which we refer to as the Petro Lease, and which collectively we refer to as the HPT Leases. We recognized rent expense under the HPT Leases of $66,506 and $63,345 for the three months ended September 30, 2017 and 2016, respectively, and $197,365 and $185,858 for the nine months ended September 30, 2017 and 2016, respectively. Our minimum annual rent under the HPT Leases as of September 30, 2017, was $280,419. In addition to the payment of minimum annual rent, the HPT Leases provide for payment to HPT of percentage rent based on increases in total nonfuel revenues over base year levels. The total amount of percentage rent that we incurred was $434 and $408 for the three months ended September 30, 2017 and 2016, respectively, and $1,435 and $937 for the nine months ended September 30, 2017 and 2016, respectively. HPT waived $372 of percentage rent under the Petro Lease for the nine months ended September 30, 2016; as of June 30, 2016, HPT had cumulatively waived all of the $2,500 of percentage rent it previously agreed to waive and no further waivers are contractually required. During the nine months ended September 30, 2017 and 2016, we sold to HPT $62,888 and $75,314, respectively, of improvements we made to properties leased from HPT. As a result, pursuant to the terms of our HPT Leases, our minimum annual rent payable to HPT increased by $5,345 and $6,402, respectively. At September 30, 2017, our property and equipment balance included $23,216 of improvements of the type that we typically request that HPT purchase for an increase in minimum annual rent; however, HPT is not obligated to purchase these improvements. The following table summarizes the various amounts related to the HPT Leases that are included in our consolidated balance sheets.
On May 3, 2017, pursuant to the terms of our June 2015 transaction agreement with HPT, as amended, we sold to, and leased back from, HPT the fourth and final development property that is subject to that agreement. We received proceeds of $27,602, this property was added to the HPT Leases and our minimum annual rent under the HPT Leases increased by $2,346 as a result. On September 25, 2017, HPT purchased land and improvements that previously were leased by HPT from a third party and subleased to us. Effective as of that date, our rent due to that third party pursuant to the terms of our sublease with HPT ceased. Also on that date, we and HPT amended our lease to reflect our direct lease from HPT of that land and those improvements and to increase our minimum annual rent due to HPT by $731, which was 8.5% of HPT's investment. Business and Property Management Agreements with RMR The RMR Group LLC, or RMR, provides us certain services that we require to operate our business, and which relate to various aspects of our business. RMR provides these services pursuant to a business management agreement. In addition, until July 31, 2017, we also had a property management agreement with RMR, which related to building management services for our headquarters building. Pursuant to our business management agreement and property management agreement with RMR, we incurred aggregate fees of $3,782 and $3,935 for the three months ended September 30, 2017 and 2016, respectively, and $10,647 and $10,748 for the nine months ended September 30, 2017 and 2016, respectively. In addition, we incurred internal audit costs of $67 and $34 for the three months ended September 30, 2017 and 2016, respectively, and $202 and $168 for the nine months ended September 30, 2017 and 2016, respectively, for which we reimburse RMR pursuant to our business management agreement. These fees and costs are included in selling, general and administrative expenses in our consolidated statements of income and comprehensive income. For more information about our relationships with RMR please refer to Notes 11 and 12 in our Annual Report. Related Party Transactions We have relationships and historical and continuing transactions with HPT, RMR, AIC and others related to them, including other companies to which RMR provides management services and which have trustees, directors and officers who are also our Directors or officers. Relationship with HPT We are HPT's largest tenant and HPT is our principal landlord and largest shareholder. As of September 30, 2017, HPT owned 3,420 of our common shares, representing approximately 8.6% of our outstanding common shares. As of September 30, 2017, we leased from HPT a total of 199 properties under the HPT Leases. RMR provides management services to both us and HPT. See Note 7 for more information about our lease agreements and transactions with HPT. Relationship with RMR We have an agreement with RMR to provide management services to us. See Note 8 for further information regarding our current and former management agreements with RMR. Relationship with AIC We, HPT and five other companies to which RMR provides management services each currently own AIC, an Indiana insurance company, in equal amounts. We and the other AIC shareholders participate in a combined property insurance program arranged and reinsured in part by AIC. We paid aggregate annual premiums, including taxes and fees, of approximately $1,672 in connection with this insurance program for the policy year ending June 30, 2018, which amount may be adjusted from time to time as we acquire and dispose of properties that are included in this insurance program. As of September 30, 2017 and December 31, 2016, our investment in AIC had a carrying value of $7,945 and $7,116, respectively. These amounts are included in other noncurrent assets on our consolidated balance sheets. We recognized income related to our investment in AIC, which amounts are presented as income from equity investees in our consolidated statements of income and comprehensive income. Our other comprehensive income includes our proportionate share of unrealized gains on securities owned and held for sale by AIC. Relationship with PTP We have a relationship with PTP, a joint venture in which we own 40% that owns travel centers, convenience stores and a restaurant that we operate for a fee. We supply PTP with its fuel at no markup. See Note 6 for further information regarding our relationship with PTP. For further information about these and certain other related party relationships and transactions, please refer to our Annual Report. |
Related Party Transactions |
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Related Party Transactions | HPT Leases As of September 30, 2017, we leased from Hospitality Properties Trust, or HPT, a total of 199 properties under five leases, four of which we refer to as the TA Leases and one of which we refer to as the Petro Lease, and which collectively we refer to as the HPT Leases. We recognized rent expense under the HPT Leases of $66,506 and $63,345 for the three months ended September 30, 2017 and 2016, respectively, and $197,365 and $185,858 for the nine months ended September 30, 2017 and 2016, respectively. Our minimum annual rent under the HPT Leases as of September 30, 2017, was $280,419. In addition to the payment of minimum annual rent, the HPT Leases provide for payment to HPT of percentage rent based on increases in total nonfuel revenues over base year levels. The total amount of percentage rent that we incurred was $434 and $408 for the three months ended September 30, 2017 and 2016, respectively, and $1,435 and $937 for the nine months ended September 30, 2017 and 2016, respectively. HPT waived $372 of percentage rent under the Petro Lease for the nine months ended September 30, 2016; as of June 30, 2016, HPT had cumulatively waived all of the $2,500 of percentage rent it previously agreed to waive and no further waivers are contractually required. During the nine months ended September 30, 2017 and 2016, we sold to HPT $62,888 and $75,314, respectively, of improvements we made to properties leased from HPT. As a result, pursuant to the terms of our HPT Leases, our minimum annual rent payable to HPT increased by $5,345 and $6,402, respectively. At September 30, 2017, our property and equipment balance included $23,216 of improvements of the type that we typically request that HPT purchase for an increase in minimum annual rent; however, HPT is not obligated to purchase these improvements. The following table summarizes the various amounts related to the HPT Leases that are included in our consolidated balance sheets.
On May 3, 2017, pursuant to the terms of our June 2015 transaction agreement with HPT, as amended, we sold to, and leased back from, HPT the fourth and final development property that is subject to that agreement. We received proceeds of $27,602, this property was added to the HPT Leases and our minimum annual rent under the HPT Leases increased by $2,346 as a result. On September 25, 2017, HPT purchased land and improvements that previously were leased by HPT from a third party and subleased to us. Effective as of that date, our rent due to that third party pursuant to the terms of our sublease with HPT ceased. Also on that date, we and HPT amended our lease to reflect our direct lease from HPT of that land and those improvements and to increase our minimum annual rent due to HPT by $731, which was 8.5% of HPT's investment. Business and Property Management Agreements with RMR The RMR Group LLC, or RMR, provides us certain services that we require to operate our business, and which relate to various aspects of our business. RMR provides these services pursuant to a business management agreement. In addition, until July 31, 2017, we also had a property management agreement with RMR, which related to building management services for our headquarters building. Pursuant to our business management agreement and property management agreement with RMR, we incurred aggregate fees of $3,782 and $3,935 for the three months ended September 30, 2017 and 2016, respectively, and $10,647 and $10,748 for the nine months ended September 30, 2017 and 2016, respectively. In addition, we incurred internal audit costs of $67 and $34 for the three months ended September 30, 2017 and 2016, respectively, and $202 and $168 for the nine months ended September 30, 2017 and 2016, respectively, for which we reimburse RMR pursuant to our business management agreement. These fees and costs are included in selling, general and administrative expenses in our consolidated statements of income and comprehensive income. For more information about our relationships with RMR please refer to Notes 11 and 12 in our Annual Report. Related Party Transactions We have relationships and historical and continuing transactions with HPT, RMR, AIC and others related to them, including other companies to which RMR provides management services and which have trustees, directors and officers who are also our Directors or officers. Relationship with HPT We are HPT's largest tenant and HPT is our principal landlord and largest shareholder. As of September 30, 2017, HPT owned 3,420 of our common shares, representing approximately 8.6% of our outstanding common shares. As of September 30, 2017, we leased from HPT a total of 199 properties under the HPT Leases. RMR provides management services to both us and HPT. See Note 7 for more information about our lease agreements and transactions with HPT. Relationship with RMR We have an agreement with RMR to provide management services to us. See Note 8 for further information regarding our current and former management agreements with RMR. Relationship with AIC We, HPT and five other companies to which RMR provides management services each currently own AIC, an Indiana insurance company, in equal amounts. We and the other AIC shareholders participate in a combined property insurance program arranged and reinsured in part by AIC. We paid aggregate annual premiums, including taxes and fees, of approximately $1,672 in connection with this insurance program for the policy year ending June 30, 2018, which amount may be adjusted from time to time as we acquire and dispose of properties that are included in this insurance program. As of September 30, 2017 and December 31, 2016, our investment in AIC had a carrying value of $7,945 and $7,116, respectively. These amounts are included in other noncurrent assets on our consolidated balance sheets. We recognized income related to our investment in AIC, which amounts are presented as income from equity investees in our consolidated statements of income and comprehensive income. Our other comprehensive income includes our proportionate share of unrealized gains on securities owned and held for sale by AIC. Relationship with PTP We have a relationship with PTP, a joint venture in which we own 40% that owns travel centers, convenience stores and a restaurant that we operate for a fee. We supply PTP with its fuel at no markup. See Note 6 for further information regarding our relationship with PTP. For further information about these and certain other related party relationships and transactions, please refer to our Annual Report. |
Contingencies |
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Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Contingencies Environmental Contingencies Extensive environmental laws regulate our operations and properties. These laws may require us to investigate and clean up hazardous substances, including petroleum or natural gas products, released at our owned and leased properties. Governmental entities or third parties may hold us liable for property damage and personal injuries, and for investigation, remediation and monitoring costs incurred in connection with any contamination and regulatory compliance at our locations. We use both underground storage tanks and above ground storage tanks to store petroleum products, natural gas and other hazardous substances at our locations. We must comply with environmental laws regarding tank construction, integrity testing, leak detection and monitoring, overfill and spill control, release reporting and financial assurance for corrective action in the event of a release. At some locations we must also comply with environmental laws relative to vapor recovery or discharges to water. Under the terms of the HPT Leases, we generally have agreed to indemnify HPT for any environmental liabilities related to properties that we lease from HPT and we are required to pay all environmental related expenses incurred in the operation of the leased properties. Under an agreement with Equilon Enterprises LLC doing business as Shell Oil Products U.S., or Shell, we have agreed to indemnify Shell and its affiliates from certain environmental liabilities incurred with respect to our travel centers where Shell has installed natural gas fueling lanes. From time to time we have received, and in the future likely will receive, notices of alleged violations of environmental laws or otherwise have become or will become aware of the need to undertake corrective actions to comply with environmental laws at our locations. Investigatory and remedial actions were, and regularly are, undertaken with respect to releases of hazardous substances at our locations. In some cases we have received, and may receive in the future, contributions to partially offset our environmental costs from insurers, from state funds established for environmental clean up associated with the sale of petroleum products or from indemnitors who agreed to fund certain environmental related costs at locations purchased from those indemnitors. To the extent we incur material amounts for environmental matters for which we do not receive or expect to receive insurance or other third party reimbursement and for which we have not previously recorded a liability, our operating results may be materially adversely affected. In addition, to the extent we fail to comply with environmental laws and regulations, or we become subject to costs and requirements not similarly experienced by our competitors, our competitive position may be harmed. At September 30, 2017, we had an accrued liability of $3,221 for environmental matters as well as a receivable for expected recoveries of certain of these estimated future expenditures of $637, resulting in an estimated net amount of $2,584 that we expect to fund in the future. We cannot precisely know the ultimate costs we may incur in connection with currently known environmental related violations, corrective actions, investigation and remediation; however, we do not expect the costs for such matters to be material, individually or in the aggregate, to our financial position or results of operations. In February 2014, we reached an agreement with the California State Water Resources Control Board, or the State Water Board, to settle certain claims the State Water Board had filed against us in California Superior Court, or the Superior Court, in 2010 relating to alleged violations of underground storage tank laws and regulations for a cash payment of $1,800; suspended penalties of $1,000 that would become payable by us in the future if, prior to March 2019, we fail to comply with specified underground storage tank laws and regulations; and our agreement to invest, prior to March 2018, up to $2,000 of verified costs to develop and implement a comprehensive compliance program for the underground storage tank systems at all of our California facilities that is above and beyond minimum requirements of California law (which costs have since been incurred and were verified as of February 2017). The settlement, which was approved by the Superior Court on February 20, 2014, also included injunctive relief provisions requiring that we comply with certain California environmental laws and regulations applicable to underground storage tank systems. In October 2015, the State Water Board issued a notice of alleged suspended penalty conduct claiming that we are liable for the full amount of the $1,000 in suspended penalties as a result of five alleged violations of underground storage tank regulations and requesting further information concerning the alleged violations. In November 2015, we filed our response to the State Water Board's notice and we have since met with the State Water Board to attempt to respond to these matters without a court hearing. We believe we have meritorious defenses to these alleged violations, but cannot predict whether any penalties relating to these matters will be assessed by the Superior Court, which has retained jurisdiction over such matters. The State Water Board also has retained the right to file a separate action relating to these violations, but to date has not done so. As of September 30, 2017, our balance sheet included a liability of $1,000 with respect to these matters concerning the State Water Board and we believe, though we can provide no assurance, that any additional amount of loss we may realize above that accrued, if any, upon the ultimate resolution of this matter will not be material to us. We currently have insurance of up to $10,000 per incident and up to $25,000 in the aggregate for certain environmental liabilities, subject, in each case, to certain limitations and deductibles. However, we can provide no assurance that we will be able to maintain similar environmental insurance coverage in the future on acceptable terms. We cannot predict the ultimate effect changing circumstances and changing environmental laws may have on us in the future or the ultimate outcome of matters currently pending. We cannot be certain that contamination presently unknown to us does not exist at our sites, or that material liability will not be imposed on us in the future. If we discover additional environmental issues, or if government agencies impose additional environmental requirements, increased environmental compliance or remediation expenditures may be required, which could have a material adverse effect on us. Legal Proceedings We are routinely involved in various legal and administrative proceedings, including tax audits, incidental to the ordinary course of our business. Except as set forth below, we do not expect that any litigation or administrative proceedings in which we are presently involved or are aware will have a material adverse effect on our business, financial condition, results of operations or cash flows. On November 30, 2016, we filed a complaint, or the Complaint, captioned TA Operating LLC v. Comdata, Inc., et al. C.A. No. 12954-CB (Del. Ch.), in the Court of Chancery of the State of Delaware, or the Court, against Comdata Inc., or Comdata, and its parent company with respect to a notice of termination we received from Comdata on November 3, 2016. Based upon Comdata's assertion that we had breached an agreement under which we agreed to install radio frequency identification, or RFID, technology at our travel centers, or the RFID Agreement, the notice purported to terminate a different agreement between us and Comdata under which we agreed to accept Comdata issued fuel cards through January 2, 2022, for certain purchases by our customers in exchange for fees payable by us to Comdata, or the Merchant Agreement. In the Complaint, we sought, among other things, (a) a declaration that we are not in default under the Merchant Agreement; (b) a judgment that Comdata has breached its contractual duties to us; (c) a judgment that Comdata breached its implied covenant of good faith and fair dealing to us; (d) a judgment that Comdata has and is willfully and knowingly engaged in unfair, abusive and deceptive business practices in the course of its business dealings with us in violation of Tennessee law; (e) an order for specific performance by Comdata of its obligations to us under the Merchant Agreement; (f) injunctive relief; and (g) damages, including attorneys' fees and costs, and further relief as the Court deems appropriate. At a hearing held on December 14, 2016, the Court denied our request for preliminary injunctive relief subject to Comdata's agreement to continue providing services under the Merchant Agreement pending a final ruling from the Court. On December 21, 2016, Comdata filed a counterclaim alleging that we defaulted under the RFID Agreement and that this alleged default allows Comdata to terminate both the RFID Agreement and the Merchant Agreement. In addition, from February 1, 2017, until mid-September 2017, Comdata unilaterally withheld increased fees from the transaction settlement payments due to us. During the three and nine months ended September 30, 2017, the difference between the withheld fees and the fees payable under the Merchant Agreement totaled $2,292 and $6,903, respectively. After a trial in April 2017, and post-trial briefing and argument, on September 11, 2017, the Court issued its post-trial Memorandum Opinion. The Court found that we are entitled to, among other things, an order requiring Comdata to specifically perform under the Merchant Agreement, and awarded damages to us and against Comdata for the difference between the higher transaction fees we have paid to Comdata since February 1, 2017, and what we should have paid during this period under the fee structure in the Merchant Agreement, plus pre- and post- judgment interest under applicable law. The Court also found that the Merchant Agreement provides for an award of reasonable attorneys' fees and costs to the prevailing party in a lawsuit enforcing any rights under the Merchant Agreement. The Court directed us and Comdata to submit a form of final judgment with an accounting of TA's damages and a proposed schedule for resolution of those fees and costs within ten days of the date of the Memorandum Opinion. We and Comdata reached agreement on the amount of excess fees to be paid to us by Comdata and on the calculation of pre-judgment interest, but did not reach agreement on when final judgment should enter and on the amounts of, or schedule for resolving an award of, attorney's fees and costs. Consequently, we and Comdata each filed our own proposed forms of final judgment. On October 17, 2017, the Court entered an order outlining a schedule for resolving issues related to attorney's fees and costs. In September 2017, we recognized a receivable, with an offsetting reduction of transaction fees expense, of $6,903 for the amount of excess transaction fees we expect to recover from Comdata, $4,611 of which related to the period prior to July 1, 2017. Transaction fee expense is included in site level operating expenses in our consolidated statements of income and comprehensive income. During the three and nine months ended September 30, 2017, we recognized litigation expenses related to this matter of $312 and $9,211, respectively, which are included in selling, general and administrative expenses in our consolidated statements of income and comprehensive income. Although the Court's September 11, 2017, Memorandum Opinion found that the prevailing party in litigation to enforce the Merchant Agreement is entitled to recover its reasonable attorney's fees and costs, we have not recognized any amounts of receivable or expense reduction in respect to our attorney's fees and costs related to this matter, which totaled $10,024 through September 30, 2017, as the Court has not determined the amount of fees and costs that we are entitled to recover. |
Inventory |
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Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
Inventory | Inventory Inventory consisted of the following:
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Segment Information |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information | Segment Information Reportable segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision making group, in deciding how to allocate resources to an individual segment and in assessing performance. Our separately reportable segments are travel centers and convenience stores. We measure our reportable segments' profitability based on site level gross margin in excess of site level operating expenses. See Note 1 above and Note 15 to the Notes to Consolidated Financial Statements included in Item 15 of our Annual Report for more information about our reportable segments.
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Business Description and Basis of Presentation (Policies) |
9 Months Ended |
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Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Segment Reporting | We manage our business on the basis of two separately reportable segments, travel centers and convenience stores. See Note 12 for more information about our reportable segments. We have a single travel center located in a foreign country, Canada, that we do not consider material to our operations. |
Basis of Presentation | The accompanying consolidated financial statements are unaudited. These unaudited interim financial statements have been prepared in accordance with U.S. generally accepted accounting principles, or GAAP, applicable for interim financial statements. The disclosures presented do not include all the information necessary for complete financial statements in accordance with GAAP. These unaudited interim financial statements should be read in conjunction with the consolidated financial statements and notes contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2016, or our Annual Report. In the opinion of our management, the accompanying consolidated financial statements include all adjustments, including normal recurring adjustments, considered necessary for a fair presentation. All intercompany transactions and balances have been eliminated. While our revenues are modestly seasonal, the quarterly variations in our operating results may reflect greater seasonal differences because our rent expense and certain other costs do not vary seasonally. For this and other reasons, our operating results for interim periods are not necessarily indicative of the results that may be expected for a full year. |
Reclassifications | Certain prior year amounts have been reclassified to conform to the current year presentation. |
Property and Equipment Impairment | Property and Equipment Impairment Property and equipment is reviewed for impairment during each reporting period at the individual location level because that is the lowest level of asset groupings for which cash flows are largely independent of cash flows of other asset groups. If indicators of impairment exist, we record an impairment charge to the extent that the carrying value of the assets exceeds the estimated fair value of the assets. These analyses require the exercise of significant judgments, including judgments about appropriate discount rates, growth rates and timing of expected future cash flows of the respective individual location. During the nine months ended September 30, 2017, we recorded impairment charges aggregating $4,380 related to certain convenience store locations primarily due to increased competition in their specific markets subsequent to when we acquired those sites. The impairment charge is presented in our consolidated financial statements in depreciation and amortization expense. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In May 2014, the Financial Accounting Standards Board, or the FASB, issued Accounting Standards Update 2014-09, Revenue from Contracts with Customers, or ASU 2014-09, which establishes a comprehensive revenue recognition standard under GAAP for almost all industries. This new standard will apply for annual periods beginning after December 15, 2017, including interim periods therein. To address implementation of ASU 2014-09 and evaluate its impact on our consolidated financial statements, we have developed a project plan in which we are utilizing a bottom up approach to evaluate our revenue streams and related internal controls. We are still finalizing our evaluation; however, we have selected the full retrospective transition method for adoption, which requires that we restate prior comparative periods in our consolidated financial statements. Although much of our revenue is initiated at the point of sale, the implementation of this standard will affect our accounting for initial franchise fees, our loyalty programs and certain gift card programs. We expect that the changes to our accounting for our loyalty program will result in a reclassification of amounts between fuel and nonfuel revenues but that the adoption of this standard will not have a material impact on our operating income or net income attributable to common shareholders or our consolidated balance sheets. In February 2016, the FASB issued Accounting Standards Update 2016-02, Leases, which establishes a comprehensive lease standard under GAAP for virtually all industries. The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase of the leased asset by the lessee. This classification will determine whether the lease expense is recognized based on an effective interest method or on a straight line basis over the term of the lease. A lessee is also required to record a right of use asset and a lease liability on the consolidated balance sheet for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases. The new standard requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales type leases, direct financing leases and operating leases. The new standard will apply for annual periods beginning after December 15, 2018, including interim periods therein, and requires modified retrospective application. Early adoption is permitted. We are in the process of evaluating the effects the adoption of this update may have on our consolidated financial statements. We believe the adoption of this update will have a material impact on our consolidated balance sheets due to the recognition of the lease rights and obligations as assets and liabilities. While the adoption of this standard will have no effect on the cash we pay under our lease agreements, we expect amounts within our statements of income and comprehensive income will change materially. |
Goodwill (Policies) |
9 Months Ended |
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Sep. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill Impairment | Goodwill is tested for impairment annually as of July 31, or more frequently if the circumstances warrant, at the reporting unit level. We have three reporting units, which include our two reportable segments, travel centers and convenience stores, and our QSL business. Impairment testing for the travel center and convenience store reporting units for 2017 was performed using a quantitative analysis under which the fair value of our goodwill was estimated using both an income approach and a market approach. The income approach considered discounted forecasted cash flows that were based on our long term operating plan. A terminal value was used to estimate the cash flows beyond the period covered by the operating plan. The discount rate is an estimate of the overall after tax market rate of return we believe may be required by equity and debt holders of a business enterprise. The market approach considered the estimated fair values of possible comparable publicly traded companies. For each comparable publicly traded company, value indicators, or pricing multiples, were considered to estimate the value of our business enterprise. These analyses require the exercise of significant judgments, including judgments about appropriate discount rates, perpetual growth rates and the timing of expected future cash flows, including revenue growth rates and operating cash flow margins, of the respective reporting unit. The fair value estimates are sensitive and actual rates and results may differ materially. Applying different assumptions could lead to different results. We utilized a qualitative approach to perform impairment testing for the QSL business, which included evaluating financial trends and industry and market conditions. |
Earnings Per Share (Tables) |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation from net income attributable to common shareholders to net income available to common shareholders and the related earnings per share | The following table presents a reconciliation of net income attributable to common shareholders to net income available to common shareholders and the related earnings per share.
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Goodwill (Tables) |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of goodwill | Goodwill consisted of the following:
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Equity Investments (Tables) |
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Equity Method Investments and Joint Ventures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summarized financial information for investment in equity affiliates | Our investments in equity affiliates, which are presented in our consolidated balance sheets in other noncurrent assets, and our proportional share of our investees' net income (loss) recognized in our consolidated statements of income and comprehensive income were as follows:
The following table sets forth summarized financial information of PTP. PTP's operating results are not consolidated with ours as we account for our PTP investment under the equity method.
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HPT Leases (Tables) |
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Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of various amounts related to the HPT Leases included in the consolidated balance sheets | The following table summarizes the various amounts related to the HPT Leases that are included in our consolidated balance sheets.
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Inventory (Tables) |
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Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||
Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of inventory | Inventory consisted of the following:
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Segment Information (Tables) |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of segment reporting informationn |
|
Business Description and Basis of Presentation - Senior Notes (Details) - Senior Notes |
Sep. 30, 2017
USD ($)
|
---|---|
Level 1 input | |
Debt Instrument [Line Items] | |
Fair value of debt instrument | $ 311,600,000 |
8.25% Senior Notes due 2028 | |
Debt Instrument [Line Items] | |
Aggregate principal amount issued | $ 110,000,000 |
Interest rate (as a percent) | 8.25% |
8.00% Senior Notes due 2029 | |
Debt Instrument [Line Items] | |
Aggregate principal amount issued | $ 120,000,000 |
Interest rate (as a percent) | 8.00% |
8.00% Senior Notes due 2030 | |
Debt Instrument [Line Items] | |
Aggregate principal amount issued | $ 100,000,000 |
Interest rate (as a percent) | 8.00% |
Business Description and Basis of Presentation - Property and Equipment Impairment (Details) $ in Thousands |
9 Months Ended |
---|---|
Sep. 30, 2017
USD ($)
| |
Convenience stores | |
Impaired Long-Lived Assets Held and Used [Line Items] | |
Property and equipment impairment charge recorded | $ 4,380 |
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Earnings Per Share [Abstract] | ||||
Net income attributable to common shareholders, as reported | $ 62,324 | $ 10,898 | $ 29,887 | $ 4,475 |
Less: net income attributable to participating securities | 3,239 | 534 | 1,572 | 219 |
Net income available to common shareholders | $ 59,085 | $ 10,364 | $ 28,315 | $ 4,256 |
Weighted average common shares (in shares) | 37,497 | 36,953 | 37,458 | 36,922 |
Basic and diluted net income per common share (in usd per share) | $ 1.58 | $ 0.28 | $ 0.76 | $ 0.12 |
Weighted average number of unvested shares outstanding (in shares) | 2,055 | 1,900 | 2,080 | 1,904 |
Acquisitions (Details) $ in Thousands |
9 Months Ended |
---|---|
Sep. 30, 2017
USD ($)
franchisee
restaurant
travel_center
| |
Acquisitions | |
Aggregate purchase price | $ | $ 19,854 |
Travel centers | |
Acquisitions | |
Number of properties acquired | travel_center | 1 |
Number of franchisees | 1 |
Restaurants | |
Acquisitions | |
Number of properties acquired | restaurant | 6 |
Number of franchisees | 1 |
Goodwill - Schedule of Goodwill (Details) - USD ($) $ in Thousands |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Goodwill [Line Items] | ||
Total goodwill | $ 94,059 | $ 88,542 |
Reportable segments | Travel center segment | ||
Goodwill [Line Items] | ||
Total goodwill | 21,613 | 17,252 |
Reportable segments | Convenience store segement | ||
Goodwill [Line Items] | ||
Total goodwill | 69,400 | 69,400 |
Corporate and other | ||
Goodwill [Line Items] | ||
Total goodwill | $ 3,046 | $ 1,890 |
Goodwill - Narrative (Details) $ in Thousands |
9 Months Ended |
---|---|
Sep. 30, 2017
USD ($)
restaurant
travel_center
| |
Restaurants | |
Goodwill [Line Items] | |
Increase in goodwill | $ 1,156 |
Number of properties acquired | restaurant | 6 |
Travel centers | |
Goodwill [Line Items] | |
Increase in goodwill | $ 4,361 |
Number of properties acquired | travel_center | 1 |
Goodwill - Goodwill Impairment (Details) $ in Thousands |
9 Months Ended | |
---|---|---|
Jul. 31, 2017
USD ($)
|
Sep. 30, 2017
reporting_unit
segment
|
|
Goodwill [Line Items] | ||
Number of reporting units | reporting_unit | 3 | |
Number of reportable segments | segment | 2 | |
Convenience stores | ||
Goodwill [Line Items] | ||
Reporting unit's percentage of fair value in excess of carrying amount | 2.60% | |
Decrease in fair value of reporting unit | Convenience stores | ||
Goodwill [Line Items] | ||
Sensitivity analysis metrics | -.05 | |
Sensitivity analysis, reporting unit's carrying amount in excess of fair value | $ 12,800 | |
Increase in discount rate of reporting unit | Convenience stores | ||
Goodwill [Line Items] | ||
Sensitivity analysis metrics | 50 | |
Sensitivity analysis, reporting unit's carrying amount in excess of fair value | $ 13,700 |
Income Taxes (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended |
---|---|---|
Sep. 30, 2017 |
Sep. 30, 2017 |
|
Income Tax Disclosure [Abstract] | ||
Amount of previous uncertain tax positions recognized | $ 58,602 | $ 58,602 |
Equity Investments - Investments in Equity Affiliates Financial Information (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
Dec. 31, 2016 |
|
Schedule of Equity Method Investments [Line Items] | |||||
Investment balance | $ 42,981 | $ 42,981 | $ 45,754 | ||
Income (loss) from equity investments | 528 | $ 1,534 | 1,731 | $ 3,572 | |
PTP | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Investment balance | 19,810 | 19,810 | 21,657 | ||
Income (loss) from equity investments | 1,253 | 1,520 | 2,954 | 3,464 | |
Other | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Investment balance | 23,171 | 23,171 | $ 24,097 | ||
Income (loss) from equity investments | $ (725) | $ 14 | $ (1,223) | $ 108 |
Equity Investments - PTP Summarized Financial Information (Details) - PTP - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Schedule of Equity Method Investments [Line Items] | ||||
Total revenues | $ 31,983 | $ 31,935 | $ 89,215 | $ 84,907 |
Cost of goods sold (excluding depreciation) | 22,794 | 22,242 | 63,709 | 59,570 |
Operating income | 3,392 | 4,184 | 8,139 | 9,673 |
Net income and comprehensive income | $ 3,267 | $ 3,938 | $ 7,790 | $ 9,067 |
HPT Leases - Summary of Various Amounts Related to the HPT Leases Included in the Consolidated Balance Sheets (Details) - USD ($) $ in Thousands |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Related Party Transaction [Line Items] | ||
Total current HPT Leases liabilities | $ 40,758 | $ 39,720 |
Total noncurrent HPT Leases liabilities | 372,194 | 381,854 |
HPT | Principal landlord and largest shareholder | ||
Related Party Transaction [Line Items] | ||
Accrued rent | 23,682 | 22,868 |
Sale leaseback financing obligation | 719 | 484 |
Straight line rent accrual | 2,458 | 2,458 |
Deferred gain | 10,129 | 10,140 |
Deferred tenant improvements allowance | 3,770 | 3,770 |
Total current HPT Leases liabilities | 40,758 | 39,720 |
Deferred rent obligation | 150,000 | 150,000 |
Sale leaseback financing obligation | 22,813 | 21,165 |
Straight line rent accrual | 47,036 | 47,771 |
Deferred gain | 113,585 | 121,331 |
Deferred tenant improvements allowance | 38,760 | 41,587 |
Total noncurrent HPT Leases liabilities | $ 372,194 | $ 381,854 |
Business and Property Management Agreements with RMR (Details) - RMR - Affiliated entity - Business and property management agreement fees - Selling, general and administrative expenses - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Related Party Transaction [Line Items] | ||||
Business and property management fees | $ 3,782 | $ 3,935 | $ 10,647 | $ 10,748 |
Share in internal audit costs per business management agreement | $ 67 | $ 34 | $ 202 | $ 168 |
Related Party Transactions - Relationship with HPT (Details) shares in Thousands |
Sep. 30, 2017
property
shares
|
Dec. 31, 2016
shares
|
---|---|---|
Related Party Transaction [Line Items] | ||
Common shares, shares outstanding (in shares) | 39,549 | 39,523 |
Principal landlord and largest shareholder | HPT | ||
Related Party Transaction [Line Items] | ||
Common shares, shares outstanding (in shares) | 3,420 | |
Percentage of outstanding common shares owned | 8.60% | |
Principal landlord and largest shareholder | HPT | HPT Leases | ||
Related Party Transaction [Line Items] | ||
Number of sites subject to lease | property | 199 |
Related Party Transactions - Relationship with AIC (Details) $ in Thousands |
9 Months Ended | |
---|---|---|
Sep. 30, 2017
USD ($)
company
|
Dec. 31, 2016
USD ($)
|
|
Related Party Transaction [Line Items] | ||
Carrying value of investment | $ 42,981 | $ 45,754 |
AIC | Equity method investee | ||
Related Party Transaction [Line Items] | ||
Annual premium for property insurance | 1,672 | |
Carrying value of investment | $ 7,945 | $ 7,116 |
RMR | Affiliated entity | ||
Related Party Transaction [Line Items] | ||
Number of companies managed by RMR | company | 5 |
Related Party Transactions - Relationship with PTP (Details) |
Sep. 30, 2017 |
---|---|
PTP | |
Related Party Transaction [Line Items] | |
Ownership interest (as a percent) | 40.00% |
Contingencies - Environmental Contingencies (Details) |
1 Months Ended | 9 Months Ended | |
---|---|---|---|
Oct. 31, 2015
violation
|
Feb. 28, 2014
USD ($)
|
Sep. 30, 2017
USD ($)
|
|
Commitments and contingencies | |||
Loss contingency insurance limit for liabilities per incident | $ 10,000,000 | ||
Loss contingency insurance limit for liabilities | 25,000,000 | ||
Litigation by California State Water Resources Control Board | |||
Commitments and contingencies | |||
Settlement amount | $ 1,800,000 | ||
Suspended penalties | 1,000,000 | ||
Maximum verified costs | $ 2,000,000 | ||
Number of alleged violations | violation | 5 | ||
Environmental Issue | |||
Commitments and contingencies | |||
Total recorded liabilities | 3,221,000 | ||
Expected recoveries of future expenditures | 637,000 | ||
Loss contingency liability | $ 2,584,000 |
Contingencies - Legal Proceedsings (Details) - Litigation with Comdata - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended |
---|---|---|---|---|
Sep. 30, 2017 |
Jun. 30, 2017 |
Sep. 30, 2017 |
Sep. 30, 2017 |
|
Site level operating expenses | ||||
Other Commitments [Line Items] | ||||
Total excess transaction fees withheld | $ 2,292 | $ 4,611 | $ 6,903 | |
Selling, general and administrative expenses | ||||
Other Commitments [Line Items] | ||||
Litigation costs | $ 312 | $ 9,211 | $ 10,024 |
Inventory (Details) - USD ($) $ in Thousands |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Inventory [Line Items] | ||
Total inventory | $ 212,553 | $ 204,145 |
Nonfuel products | ||
Inventory [Line Items] | ||
Total inventory | 171,816 | 167,813 |
Fuel products | ||
Inventory [Line Items] | ||
Total inventory | $ 40,737 | $ 36,332 |
Segment Information (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Revenues: | ||||
Fuel | $ 1,055,593 | $ 947,558 | $ 2,981,154 | $ 2,588,297 |
Nonfuel | 515,836 | 510,559 | 1,471,306 | 1,441,044 |
Rent and royalties from franchisees | 4,248 | 4,529 | 12,651 | 13,135 |
Total revenues | 1,575,677 | 1,462,646 | 4,465,111 | 4,042,476 |
Site level gross margin in excess of site level operating expenses | 150,012 | 147,212 | 386,453 | 387,832 |
Selling, general and administrative | 36,587 | 34,812 | 115,276 | 101,787 |
Real estate rent | 69,599 | 66,573 | 206,742 | 194,838 |
Depreciation and amortization | 30,714 | 22,698 | 91,163 | 64,545 |
Income (loss) from operations | 13,112 | 23,129 | (26,728) | 26,662 |
Acquisition costs | 68 | 225 | 271 | 2,286 |
Interest expense, net | 7,486 | 7,200 | 22,708 | 20,761 |
Income from equity investees | 528 | 1,534 | 1,731 | 3,572 |
Income (loss) before income taxes | 6,086 | 17,238 | (47,976) | 7,187 |
Benefit (provision) for income taxes | 56,268 | (6,263) | 77,963 | (2,571) |
Net income | 62,354 | 10,975 | 29,987 | 4,616 |
Less: net income for noncontrolling interests | 30 | 77 | 100 | 141 |
Net income attributable to common shareholders | 62,324 | 10,898 | 29,887 | 4,475 |
Reportable Segments | Travel centers | ||||
Revenues: | ||||
Fuel | 905,325 | 808,366 | 2,567,755 | 2,222,962 |
Nonfuel | 432,128 | 427,524 | 1,235,281 | 1,226,735 |
Rent and royalties from franchisees | 3,169 | 3,238 | 9,387 | 10,556 |
Total revenues | 1,340,622 | 1,239,128 | 3,812,423 | 3,460,253 |
Site level gross margin in excess of site level operating expenses | 134,098 | 131,866 | 348,603 | 353,645 |
Reportable Segments | Convenience stores | ||||
Revenues: | ||||
Fuel | 129,783 | 119,375 | 355,776 | 311,199 |
Nonfuel | 73,553 | 73,922 | 206,139 | 197,718 |
Rent and royalties from franchisees | 54 | 58 | 162 | 249 |
Total revenues | 203,390 | 193,355 | 562,077 | 509,166 |
Site level gross margin in excess of site level operating expenses | 13,755 | 12,249 | 30,825 | 27,188 |
Corporate and Other | ||||
Revenues: | ||||
Fuel | 20,485 | 19,817 | 57,623 | 54,136 |
Nonfuel | 10,155 | 9,113 | 29,886 | 16,591 |
Rent and royalties from franchisees | 1,025 | 1,233 | 3,102 | 2,330 |
Total revenues | 31,665 | 30,163 | 90,611 | 73,057 |
Site level gross margin in excess of site level operating expenses | 2,159 | 3,097 | 7,025 | 6,999 |
Selling, general and administrative | 36,587 | 34,812 | 115,276 | 101,787 |
Real estate rent | 69,599 | 66,573 | 206,742 | 194,838 |
Depreciation and amortization | 30,714 | 22,698 | 91,163 | 64,545 |
Acquisition costs | 68 | 225 | 271 | 2,286 |
Interest expense, net | 7,486 | 7,200 | 22,708 | 20,761 |
Income from equity investees | 528 | 1,534 | 1,731 | 3,572 |
Benefit (provision) for income taxes | $ 56,268 | $ (6,263) | $ 77,963 | $ (2,571) |
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