Delaware | 001-35054 | 27-1284632 | ||
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification Number) |
539 South Main Street Findlay, Ohio | 45840-3229 | |
(Address of Principal Executive Offices) | (Zip Code) |
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). |
Emerging growth company o |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o |
Item 2.02 | Results of Operations and Financial Condition. |
Item 9.01 | Financial Statements and Exhibits. |
Exhibit Number | Description | |
Press Release dated February 7, 2019, issued by Marathon Petroleum Corporation |
Marathon Petroleum Corporation | |||
Date: February 7, 2019 | By: | /s/ John J. Quaid | |
Name: John J. Quaid | |||
Title: Vice President and Controller |
• | Reported fourth-quarter earnings of $951 million, or $1.35 per diluted share; results included costs of $1.06 per diluted share primarily from transaction-related items |
– | Refining and Marketing segment income from operations of $923 million driven by high utilization and wide crude differentials |
– | Midstream segment income from operations of $889 million supported by volume growth |
– | Retail segment income from operations of $613 million with strong margins |
• | Returned $4.2 billion of capital to shareholders in 2018, including $675 million in share repurchases in the fourth quarter |
• | Announced 15% increase in quarterly dividend to $0.53 per share |
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||
(In millions) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Income from Operations by Segment | |||||||||||||||
Refining & Marketing(a) | $ | 923 | $ | 732 | $ | 2,481 | $ | 2,321 | |||||||
Retail | 613 | 148 | 1,028 | 729 | |||||||||||
Midstream | 889 | 343 | 2,752 | 1,339 | |||||||||||
Items not allocated to segments: | |||||||||||||||
Corporate and other unallocated items | (233 | ) | (114 | ) | (502 | ) | (365 | ) | |||||||
Transaction-related costs | (183 | ) | — | (197 | ) | — | |||||||||
Litigation | — | 57 | — | (29 | ) | ||||||||||
Impairments | 8 | 2 | 9 | 23 | |||||||||||
Income from operations | $ | 2,017 | $ | 1,168 | $ | 5,571 | $ | 4,018 |
(a) | R&M segment results for the 2018 periods included estimated costs of $759 million due to purchase accounting related inventory effects. |
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||
(In millions, except per-share data) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Revenues and other income: | |||||||||||||||
Sales and other operating revenues(a) | $ | 32,151 | $ | 20,884 | $ | 95,750 | $ | 74,104 | |||||||
Sales to related parties | 182 | 171 | 754 | 629 | |||||||||||
Income from equity method investments | 111 | 82 | 373 | 306 | |||||||||||
Net gain (loss) on disposal of assets | 17 | (2 | ) | 23 | 10 | ||||||||||
Other income | 80 | 101 | 202 | 320 | |||||||||||
Total revenues and other income | 32,541 | 21,236 | 97,102 | 75,369 | |||||||||||
Costs and expenses: | |||||||||||||||
Cost of revenues (excludes items below)(a) | 28,112 | 18,855 | 85,456 | 66,519 | |||||||||||
Purchases from related parties | 182 | 150 | 610 | 570 | |||||||||||
Depreciation and amortization | 874 | 540 | 2,490 | 2,114 | |||||||||||
Selling, general and administrative expenses | 1,147 | 408 | 2,418 | 1,694 | |||||||||||
Other taxes | 209 | 115 | 557 | 454 | |||||||||||
Total costs and expenses | 30,524 | 20,068 | 91,531 | 71,351 | |||||||||||
Income from operations | 2,017 | 1,168 | 5,571 | 4,018 | |||||||||||
Net interest and other financial costs | 385 | 209 | 1,003 | 674 | |||||||||||
Income before income taxes | 1,632 | 959 | 4,568 | 3,344 | |||||||||||
(Benefit) provision for income taxes | 437 | (1,166 | ) | 962 | (460 | ) | |||||||||
Net income | 1,195 | 2,125 | 3,606 | 3,804 | |||||||||||
Less net income attributable to: | |||||||||||||||
Redeemable noncontrolling interest | 20 | 16 | 75 | 65 | |||||||||||
Noncontrolling interests | 224 | 93 | 751 | 307 | |||||||||||
Net income attributable to MPC | $ | 951 | $ | 2,016 | $ | 2,780 | $ | 3,432 | |||||||
Per-share data | |||||||||||||||
Basic: | |||||||||||||||
Net income attributable to MPC per share | $ | 1.38 | $ | 4.13 | $ | 5.36 | $ | 6.76 | |||||||
Weighted average shares: | 687 | 488 | 518 | 507 | |||||||||||
Diluted: | |||||||||||||||
Net income attributable to MPC per share | $ | 1.35 | $ | 4.09 | $ | 5.28 | $ | 6.70 | |||||||
Weighted average shares: | 704 | 493 | 526 | 512 | |||||||||||
(a) | The 2017 periods include consumer excise taxes. In 2018, most of the consumer excise taxes are reported on a net basis following the January 1, 2018 adoption of ASC 606 - Revenue from Contracts with Customers. |
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||
(In millions) | 2018(a) | 2017 | 2018(a) | 2017 | |||||||||||
Income from Operations by segment | |||||||||||||||
Refining & Marketing(b) | $ | 923 | $ | 732 | $ | 2,481 | $ | 2,321 | |||||||
Retail | 613 | 148 | 1,028 | 729 | |||||||||||
Midstream | 889 | 343 | 2,752 | 1,339 | |||||||||||
Items not allocated to segments: | |||||||||||||||
Corporate and other unallocated items | (233 | ) | (114 | ) | (502 | ) | (365 | ) | |||||||
Transaction-related costs(c) | (183 | ) | — | (197 | ) | — | |||||||||
Litigation | — | 57 | — | (29 | ) | ||||||||||
Impairments | 8 | 2 | 9 | 23 | |||||||||||
Income from operations | 2,017 | 1,168 | 5,571 | 4,018 | |||||||||||
Net interest and other financial costs(d) | 385 | 209 | 1,003 | 674 | |||||||||||
Income before income taxes | 1,632 | 959 | 4,568 | 3,344 | |||||||||||
(Benefit) provision for income taxes | 437 | (1,166 | ) | 962 | (460 | ) | |||||||||
Net income | 1,195 | 2,125 | 3,606 | 3,804 | |||||||||||
Less net income attributable to: | |||||||||||||||
Redeemable noncontrolling interest | 20 | 16 | 75 | 65 | |||||||||||
Noncontrolling interests | 224 | 93 | 751 | 307 | |||||||||||
Net income attributable to MPC | $ | 951 | $ | 2,016 | $ | 2,780 | $ | 3,432 | |||||||
(a) | Includes the results of Andeavor from the October 1, 2018 acquisition date forward. |
(b) | R&M segment results for the 2018 periods included estimated costs of $759 million due to purchase accounting related inventory effects. |
(c) | Includes costs related to the Andeavor acquisition including financial advisor and legal fees, employee severance, and other expenses. |
(d) | The 2018 periods include approximately $60 million related to the extinguishment of MPLX debt. |
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||
(In millions) | 2018(a) | 2017 | 2018(a) | 2017 | |||||||||||
Refining & Marketing | $ | 444 | $ | 262 | $ | 1,057 | $ | 832 | |||||||
Retail | 235 | 160 | 460 | 381 | |||||||||||
Midstream | 954 | 488 | 2,630 | 1,755 | |||||||||||
Corporate and Other(b) | 60 | 46 | 157 | 138 | |||||||||||
Total | $ | 1,693 | $ | 956 | $ | 4,304 | $ | 3,106 | |||||||
(a) | Includes the results of Andeavor from the October 1, 2018 acquisition date forward. |
(b) | Includes capitalized interest of $25 million, $16 million, $80 million and $55 million, respectively. |
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
R&M refined product sales volume (mbpd)(a) | 3,764 | 2,414 | 2,703 | 2,301 | |||||||||||
R&M margin (dollars per barrel)(b) | $ | 15.07 | $ | 13.12 | $ | 14.03 | $ | 12.60 | |||||||
Crude oil capacity utilization (percent)(c) | 94 | 101 | 96 | 97 | |||||||||||
Refinery throughputs (mbpd):(d) | |||||||||||||||
Crude oil refined | 2,857 | 1,837 | 2,081 | 1,765 | |||||||||||
Other charge and blendstocks | 254 | 187 | 193 | 179 | |||||||||||
Total | 3,111 | 2,024 | 2,274 | 1,944 | |||||||||||
Sour crude oil throughput (percent) | 50 | 53 | 52 | 59 | |||||||||||
Sweet crude oil throughput (percent) | 50 | 47 | 48 | 41 | |||||||||||
Refined product yields (mbpd):(d) | |||||||||||||||
Gasoline | 1,593 | 997 | 1,107 | 932 | |||||||||||
Distillates | 1,111 | 679 | 773 | 641 | |||||||||||
Propane | 53 | 40 | 41 | 36 | |||||||||||
Feedstocks and special products | 273 | 254 | 288 | 277 | |||||||||||
Heavy fuel oil | 62 | 42 | 38 | 37 | |||||||||||
Asphalt | 74 | 62 | 69 | 63 | |||||||||||
Total | 3,166 | 2,074 | 2,316 | 1,986 | |||||||||||
Refinery direct operating costs ($/barrel):(e) | |||||||||||||||
Planned turnaround and major maintenance | $ | 1.49 | $ | 1.80 | $ | 1.59 | $ | 1.72 | |||||||
Depreciation and amortization | 1.32 | 1.38 | 1.31 | 1.43 | |||||||||||
Other manufacturing(f) | 5.11 | 4.03 | 4.20 | 4.07 | |||||||||||
Total | $ | 7.92 | $ | 7.21 | $ | 7.10 | $ | 7.22 | |||||||
Memo: Total includes turnaround costs ($/barrel) of: (g) | $ | 0.79 | $ | 0.57 | $ | 0.79 | $ | 0.71 |
(a) | Includes intersegment sales. |
(b) | Sales revenue less cost of refinery inputs and purchased products, divided by total refinery throughputs. |
(c) | Based on calendar day capacity, which is an annual average that includes downtime for planned maintenance and other normal operating activities. |
(d) | Excludes inter-refinery volumes of 85 mbpd and 88 mbpd for fourth quarter 2018 and 2017, respectively, and 61 mbpd and 78 mbpd for the full-year 2018 and 2017, respectively. |
(e) | Per barrel of total refinery throughputs. |
(f) | Includes utilities, labor, routine maintenance and other operating costs. |
(g) | Reflects costs for turnaround activity which we expense as incurred. |
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Gulf Coast | |||||||||||||||
Refinery throughputs (mbpd):(a) | |||||||||||||||
Crude oil refined | 1,177 | 1,158 | 1,135 | 1,070 | |||||||||||
Other charge and blendstocks | 197 | 237 | 190 | 224 | |||||||||||
Total | 1,374 | 1,395 | 1,325 | 1,294 | |||||||||||
Sour crude oil throughput (percent) | 60 | 62 | 62 | 71 | |||||||||||
Sweet crude oil throughput (percent) | 40 | 38 | 38 | 29 | |||||||||||
Refined product yields (mbpd):(a) | |||||||||||||||
Gasoline | 622 | 608 | 574 | 546 | |||||||||||
Distillates | 467 | 440 | 432 | 405 | |||||||||||
Propane | 28 | 29 | 25 | 26 | |||||||||||
Feedstocks and special products | 260 | 313 | 291 | 311 | |||||||||||
Heavy fuel oil | 20 | 30 | 18 | 25 | |||||||||||
Asphalt | 16 | 17 | 19 | 17 | |||||||||||
Total | 1,413 | 1,437 | 1,359 | 1,330 | |||||||||||
Refinery direct operating costs ($/barrel):(b) | |||||||||||||||
Planned turnaround and major maintenance | $ | 0.61 | $ | 1.45 | $ | 1.12 | $ | 1.75 | |||||||
Depreciation and amortization | 1.03 | 1.05 | 1.03 | 1.12 | |||||||||||
Other manufacturing(c) | 3.35 | 3.55 | 3.41 | 3.74 | |||||||||||
Total | $ | 4.99 | $ | 6.05 | $ | 5.56 | $ | 6.61 | |||||||
Mid-Continent | |||||||||||||||
Refinery throughputs (mbpd):(a) | |||||||||||||||
Crude oil refined | 1,069 | 679 | 792 | 695 | |||||||||||
Other charge and blendstocks | 72 | 38 | 47 | 33 | |||||||||||
Total | 1,141 | 717 | 839 | 728 | |||||||||||
Sour crude oil throughput (percent) | 26 | 36 | 33 | 40 | |||||||||||
Sweet crude oil throughput (percent) | 74 | 64 | 67 | 60 | |||||||||||
Refined product yields (mbpd):(a) | |||||||||||||||
Gasoline | 617 | 389 | 444 | 386 | |||||||||||
Distillates | 398 | 239 | 279 | 236 | |||||||||||
Propane | 18 | 12 | 14 | 11 | |||||||||||
Feedstocks and special products | 36 | 27 | 43 | 42 | |||||||||||
Heavy fuel oil | 19 | 13 | 14 | 13 | |||||||||||
Asphalt | 58 | 45 | 50 | 46 | |||||||||||
Total | 1,146 | 725 | 844 | 734 | |||||||||||
Refinery direct operating costs ($/barrel):(b) | |||||||||||||||
Planned turnaround and major maintenance | $ | 1.67 | $ | 2.25 | $ | 1.97 | $ | 1.48 | |||||||
Depreciation and amortization | 1.60 | 1.86 | 1.67 | 1.81 | |||||||||||
Other manufacturing(c) | 5.08 | 4.46 | 4.34 | 4.26 | |||||||||||
Total | $ | 8.35 | $ | 8.57 | $ | 7.98 | $ | 7.55 | |||||||
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
West Coast | |||||||||||||||
Refinery throughputs (mbpd):(a) | |||||||||||||||
Crude oil refined | 611 | — | 154 | — | |||||||||||
Other charge and blendstocks | 70 | — | 17 | — | |||||||||||
Total | 681 | — | 171 | — | |||||||||||
Sour crude oil throughput (percent) | 72 | — | 72 | — | |||||||||||
Sweet crude oil throughput (percent) | 28 | — | 28 | — | |||||||||||
Refined product yields (mbpd):(a) | |||||||||||||||
Gasoline | 354 | — | 89 | — | |||||||||||
Distillates | 246 | — | 62 | — | |||||||||||
Propane | 7 | — | 2 | — | |||||||||||
Feedstocks and special products | 56 | — | 14 | — | |||||||||||
Heavy fuel oil | 29 | — | 7 | — | |||||||||||
Asphalt | — | — | — | — | |||||||||||
Total | 692 | — | 174 | — | |||||||||||
Refinery direct operating costs ($/barrel):(b) | |||||||||||||||
Planned turnaround and major maintenance | $ | 2.79 | $ | — | $ | 2.79 | $ | — | |||||||
Depreciation and amortization | 1.26 | — | 1.26 | — | |||||||||||
Other manufacturing(c) | 8.07 | — | 8.07 | — | |||||||||||
Total | $ | 12.12 | $ | — | $ | 12.12 | $ | — | |||||||
(a) | Includes inter-refinery transfer volumes. |
(b) | Per barrel of total refinery throughputs. |
(c) | Includes utilities, labor, routine maintenance and other operating costs. |
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Speedway fuel sales (millions of gallons) | 1,976 | 1,467 | 6,293 | 5,799 | |||||||||||
Direct dealer fuel sales (millions of gallons) | 644 | N/A | 644 | N/A | |||||||||||
Retail fuel margin (dollars per gallon)(a) | $ | 0.3235 | $ | 0.1772 | $ | 0.2230 | $ | 0.1738 | |||||||
Merchandise sales (in millions) | $ | 1,479 | $ | 1,200 | $ | 5,232 | $ | 4,893 | |||||||
Merchandise margin (in millions) | $ | 417 | $ | 337 | $ | 1,486 | $ | 1,402 | |||||||
Merchandise margin percent | 28.2 | % | 28.1 | % | 28.4 | % | 28.7 | % | |||||||
Same store gasoline sales volume (period over period)(b) | (0.7 | )% | (0.3 | )% | (1.5 | )% | (1.3 | )% | |||||||
Same store merchandise sales (period over period)(b)(c) | 6.5 | % | 0.5 | % | 4.2 | % | 1.2 | % | |||||||
Total convenience stores at period-end | 3,923 | 2,744 | |||||||||||||
Direct dealer locations at period-end | 1,081 | N/A | |||||||||||||
(a) | Includes bankcard processing fees (as applicable). |
(b) | Same store comparison includes only locations owned at least 13 months. |
(c) | Excludes cigarettes. |
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Pipeline throughputs (mbpd)(a) | 5,612 | 3,610 | 4,177 | 3,377 | |||||||||||
Terminal throughput (mbpd) | 3,188 | 1,497 | 1,901 | 1,477 | |||||||||||
Gathering system throughput (million cubic feet per day)(b) | 5,893 | 4,181 | 4,779 | 3,608 | |||||||||||
Natural gas processed (million cubic feet per day)(b) | 8,161 | 6,828 | 7,199 | 6,460 | |||||||||||
C2 (ethane) + NGLs fractionated (mbpd)(b) | 501 | 423 | 464 | 394 | |||||||||||
(a) | Includes common-carrier pipelines and private pipelines contributed to MPLX. Excludes equity method affiliate pipeline volumes. |
(b) | Includes amounts related to unconsolidated equity method investments on a 100% basis. |
(In millions) | December 31, 2018 | September 30 2018 | |||||
Cash and cash equivalents | $ | 1,687 | $ | 4,992 | |||
MPLX debt | 13,393 | 12,890 | |||||
ANDX debt | 4,973 | N/A | |||||
Total consolidated debt | 27,524 | 18,449 | |||||
Redeemable noncontrolling interest | 1,004 | 1,003 | |||||
Equity | 44,084 | 19,031 | |||||
Shares outstanding | 680 | 451 | |||||
Cash provided from operations (quarter ended) | $ | 2,727 | $ | 1,182 | |||
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Dividends paid per share | $ | 0.46 | $ | 0.40 | $ | 1.84 | $ | 1.52 | |||||||
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||
(In millions) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Adjusted EBITDA(a) | |||||||||||||||
Refining & Marketing | $ | 2,321 | $ | 1,115 | $ | 5,072 | $ | 3,904 | |||||||
Retail | 738 | 226 | 1,381 | 1,004 | |||||||||||
Midstream | 1,197 | 514 | 3,637 | 2,038 | |||||||||||
Corporate and other unallocated items | (205 | ) | (100 | ) | (424 | ) | (307 | ) | |||||||
Total Adjusted EBITDA(a) | 4,051 | 1,755 | 9,666 | 6,639 | |||||||||||
Less: | |||||||||||||||
Depreciation & amortization | (874 | ) | (540 | ) | (2,490 | ) | (2,114 | ) | |||||||
Turnaround costs | (226 | ) | (106 | ) | (658 | ) | (501 | ) | |||||||
Purchase accounting related inventory effects | (759 | ) | — | (759 | ) | — | |||||||||
Transaction-related costs | (183 | ) | — | (197 | ) | — | |||||||||
Litigation | — | 57 | — | (29 | ) | ||||||||||
Impairments | 8 | 2 | 9 | 23 | |||||||||||
Income from operations | 2,017 | 1,168 | 5,571 | 4,018 | |||||||||||
Net interest and other financial costs | 385 | 209 | 1,003 | 674 | |||||||||||
Income before income taxes | 1,632 | 959 | 4,568 | 3,344 | |||||||||||
(Benefit) provision for income taxes | 437 | (1,166 | ) | 962 | (460 | ) | |||||||||
Net income | 1,195 | 2,125 | 3,606 | 3,804 | |||||||||||
Less net income attributable to: | |||||||||||||||
Redeemable noncontrolling interest | 20 | 16 | 75 | 65 | |||||||||||
Noncontrolling interests | 224 | 93 | 751 | 307 | |||||||||||
Net income attributable to MPC | $ | 951 | $ | 2,016 | $ | 2,780 | $ | 3,432 | |||||||
(a) | Adjusted EBITDA represents earnings before net interest and other financial costs, income taxes, depreciation and amortization expense as well as adjustments to exclude R&M turnaround costs and the purchase accounting related inventory effects reported in fourth-quarter 2018 R&M segment results. We believe this non-GAAP financial measure is useful to investors and analysts to analyze and compare our operating performance between periods by excluding items that do not reflect the core operating results of our business. We also believe that excluding turnaround costs from this metric is useful for comparability to other companies as certain of our competitors defer these costs and amortize them between turnarounds. Adjusted EBITDA should not be considered as a substitute for, or superior to net income attributable to MPC, income before income taxes, cash flows from operating activities or any other measure of financial performance presented in accordance with GAAP. Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies. |
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||
(In millions) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Refining & Marketing income from operations | $ | 923 | $ | 732 | $ | 2,481 | $ | 2,321 | |||||||
Plus (Less): | |||||||||||||||
Refinery direct operating costs(a) | 1,889 | 1,084 | 4,801 | 4,113 | |||||||||||
Refinery depreciation and amortization | 377 | 258 | 1,089 | 1,013 | |||||||||||
Other: | |||||||||||||||
Operating expenses, net(a)(b) | 1,088 | 350 | 3,189 | 1,425 | |||||||||||
Depreciation and amortization | 36 | 19 | 85 | 69 | |||||||||||
Refining & Marketing margin(c) | $ | 4,313 | $ | 2,443 | $ | 11,645 | $ | 8,941 |
(a) | Excludes depreciation and amortization. |
(b) | Includes fees paid to MPLX for various midstream services. MPLX's results are reported in MPC's Midstream segment. |
(c) | Refining & Marketing margin is defined as sales revenue less cost of refinery inputs and purchased products, excluding any LCM inventory market adjustment. We believe this non-GAAP financial measure is useful to investors and analysts to assess our ongoing financial performance because, when reconciled to its most comparable GAAP measure, it provides improved comparability between periods through the exclusion of certain items that we believe are not indicative of our core operating performance and that may obscure our underlying business results and trends. This measure should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP, and our calculations thereof may not be comparable to similarly titled measures reported by other companies. |
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||
(in millions) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Retail income from operations | $ | 613 | $ | 148 | $ | 1,028 | $ | 729 | |||||||
Plus (Less): | |||||||||||||||
Operating, selling, general and administrative expenses | 593 | 400 | 1,796 | 1,533 | |||||||||||
Depreciation and amortization | 125 | 78 | 353 | 275 | |||||||||||
Income from equity method investments | (23 | ) | (15 | ) | (74 | ) | (69 | ) | |||||||
Net gain on disposal of assets | (16 | ) | (2 | ) | (17 | ) | (14 | ) | |||||||
Other income | (2 | ) | (5 | ) | (7 | ) | (14 | ) | |||||||
Retail total margin | $ | 1,290 | $ | 604 | $ | 3,079 | $ | 2,440 | |||||||
Retail total margin:(a) | |||||||||||||||
Fuel margin | $ | 848 | $ | 260 | $ | 1,547 | $ | 1,008 | |||||||
Merchandise margin | 417 | 337 | 1,486 | 1,402 | |||||||||||
Other margin | 25 | 7 | 46 | 30 | |||||||||||
Retail total margin | $ | 1,290 | $ | 604 | $ | 3,079 | $ | 2,440 |
(a) | Fuel margin includes bankcard processing fees (as applicable). Merchandise margin is defined as the price paid by consumers less the cost of merchandise. We believe these non-GAAP financial measures are useful to investors and analysts to assess our ongoing financial performance because, when reconciled to the most comparable GAAP measures, they provide improved comparability between periods through the exclusion of certain items that we believe are not indicative of our core operating performance and that may obscure our underlying business results and trends. These measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP, and our calculations thereof may not be comparable to similarly titled measures reported by other companies. |