Star Group's Q1 2025: Navigating Customer Churn, Acquisition Challenges, and Economic Pressures

These are the key contradictions discussed in Star Group's latest 2025Q1 earnings call, specifically including: Customer Churn, Acquisition Environment, Economic Impact on Customers' Ability to Pay, and Acquisition Strategy:



Volume and Margin Increase:
- Star Group's home heating oil and propane volume rose by 2 million gallons or 3% to approximately 82 million gallons in Q1 2025.
- The increase in volume was driven by acquisitions and slightly colder temperatures, offset by customer attrition.

Service and Installation Improvement:
- The combined gross profit from service and installation increased by $2.5 million to $6.9 million in Q1 2025.
- This was due to recent acquisitions and improvements in the base business, including increased productivity and efficiency.

Financial Performance:
- Adjusted EBITDA increased by $3 million to $52 million in Q1 2025.
- The rise in adjusted EBITDA was attributed to an increase in per gallon margins and higher home heating oil and propane volumes from acquisitions, despite a decline in base business volumes.

Acquisition Impact:
- The company completed a sizable strategic acquisition post-Q1, expanding its propane presence and welcoming new employees and a well-regarded brand.
- This acquisition positively impacted financial results and operational efficiency, contributing to increased service and installation gross profit and EBITDA growth.