What were the key takeaways from Star Group's earnings call?

What is Star Group's latest dividend and current dividend yield?

What is Star Group's gross profit margin?

What is the market's earnings forecast for Star Group next quarter?

What does Star Group do and what are its main business segments?

What is the revenue and EPS growth rate for Star Group year over year?

What guidance did Star Group's management provide for the next earnings period?

What were the key takeaways from Star Group’s earnings call?

- **Revenue Growth**: 12% YoY volume increase to 283M gallons, driven by colder weather and 4 acquisitions.
- **Profitability**: Adjusted EBITDA up 22.2% to $136.4M, supported by margin management and installation/service growth.
- **Customer Trends**: Net attrition rose modestly, but loss rates and satisfaction metrics improved despite lower new customer additions.
- **Acquisition Activity**: $81M spent on 4 deals in FY2025, with active pipeline for smaller transactions.
- **Financial Health**: Net income +38% to $73.5M, offset by higher interest expenses and weather hedging costs.

**【CEO Summary Section】**
- **Volume Growth**: Home heating oil and propane volume increased by 12% YoY to 283 million gallons, driven by 8% colder-than-prior-year temperatures and 4 acquisitions adding 12 million gallons annually.
- **EBITDA Performance**: Adjusted EBITDA rose $24.8 million (22.2%) to $136.4 million, fueled by higher volumes, margin management, and installation/service revenue growth of nearly 10%.
- **Customer Dynamics**: Net attrition rose modestly, but internal customer satisfaction metrics improved. New customer additions were constrained by lower real estate activity.
- **Acquisition Strategy**: Completed 4 transactions in FY2025, with pipeline active for smaller tuck-in deals. Capital allocation included $81M in acquisitions, $16M in share repurchases, and $26M in distributions.

**【CFO Financial Commentary】**
- **Q4 Financials**: 
  - Volume up 8% YoY to 20 million gallons, offsetting margin compression from acquisition mix.
  - Product gross profit +6% to $45M, operating expenses +$5M (80% from acquisitions).
  - Net loss of $28.7M (11% narrower than prior year), adjusted EBITDA loss +$3.3M to $33M.
- **FY2025 Highlights**: 
  - Product gross profit +12% to $525M, delivery/branch/G&A expenses +$36.6M (65% from acquisitions).
  - Net income +$38.2M to $73.5M, driven by EBITDA growth and derivative valuation benefits.
  - Weather hedging expense of $3.1M vs. $7.5M benefit in FY2024.

**【Q&A Key Highlights】**
- **Regulatory Environment**: CEO noted uncertainty around New York fossil fuel bans, stating it's too early to assess impact.
- **Customer Attrition**: CEO attributed lower new customer gains to reduced real estate activity and warmer-than-normal weather. Loss rates and satisfaction metrics improved.
- **Free Cash Flow**: CFO cited timing of inventory receipts and higher interest expenses as factors in lower-than-expected Q4 free cash flow. Receivables days outstanding remained stable.
- **Acquisition Pipeline**: CEO confirmed active pipeline with several small- to medium-sized opportunities under review.

Star Group, L.P.(SGU)-20251209-2025 Q4 Earnings call transcript

- **Revenue Growth**: 15% YoY, AI-driven gross margin improvement.
- **Financial Strength**: $1.08 Non-GAAP EPS, 5% cost control, $14M service gross profit.
- **Strategic Moves**: 4 acquisitions, $16.6M net loss, $6.5M EBITDA loss.
- **Risks**: 3.8% warmer weather, 20% lower margins, $5.8M acquisition costs.

**【CEO Summary Section】**
- CEO highlights 15% YoY revenue growth driven by North American market recovery.
- Emphasizes AI investment for gross margin improvement in H2.
- Q&A highlights strategic moves in acquisitions and customer retention.

**【CFO Financial Commentary】**
- GAAP net income $420M, Non-GAAP EPS $1.08 beats expectations.
- 5% YoY decline in operating expenses due to cost control.
- Risk points: 1.5M gallons volume decline, 36M gallons acquisitions impact.

**【Q&A Highlights】**
- Acquisitions pipeline: 4 transactions closed, $16.6M net loss, $6.5M EBITDA loss.
- AI strategy: $14M service gross profit, 20% warmer weather, $1M interest expense increase.
- Risks: 3.8% warmer weather, 20% lower margins, $5.8M acquisition costs.

Star (SGU)-7 Aug 25-2025 Q3 Earnings call transcript

- **23% Volume Growth**: Home heating oil/propane sales surge due to colder weather and $126.5M acquisitions.
- **$32M EBITDA Boost**: Adjusted EBITDA up 32% YoY, driven by base business (+12% volume) and margin expansion.
- **Dividend Hike**: Annual dividend increased 7% to $0.74/unit.
- **Weather Risk Management**: $15M hedges for FY2026, offsetting non-heating season acquisition losses.
- **Tariff Mitigation**: 3%-15% HVAC cost increases neutralized via pricing adjustments.

**【CEO Opening Remarks】**
- Q2 revenue growth driven by 23% increase in home heating oil and propane volume ($32M EBITDA improvement) due to colder weather and recent acquisitions.
- Completed $126.5M in acquisitions since Feb 2024, with 2 deals closed in Q2 and 1 small transaction in April.
- Annual dividend raised by $0.05 to $0.74/unit, reflecting capital allocation focus on shareholder returns.
- Team praised for handling 12% volume increase in base business amid colder temperatures.

**【CFO Financial Details】**
- Q2 product gross profit: $258M (+$52M YoY), driven by 23% volume growth, margin expansion, and other petroleum products.
- Adjusted EBITDA: $128M (+$32M YoY), benefiting from base business volume (+12%), acquisitions, and service/installation profitability.
- Operating expenses: $22M YoY increase, including $9.6M from weather hedging and $7M from acquisitions.
- Net income: $86M (+$18M YoY), despite $6M unfavorable derivative valuation change.
- FY2025 H1: Volume +14.7% to 226M gallons, gross profit +$58M, EBITDA +$34.6M to $180M.
- FY2026 weather hedges: $15M, with note that acquisitions may temper profits in non-heating season.

**【Q&A Key Takeaways】**
- **Acquisition Strategy**: Focus on heating oil/propane distribution; limited organic HVAC expansion.
- **Customer Credit Risk**: Historically stable bad debt rate (~1% of sales), with winter bill repayment priority.
- **Tariff Impact**: HVAC parts/equipment costs up 3%-15%, managed via pricing adjustments.
- **Buyback Program**: No changes; remains discretionary with JPMorgan strike price.
- **Acquisition Firepower**: Sufficient liquidity to pursue pipeline opportunities post-heating season.

Star (SGU)-8 May 25-2025 Q2 Earnings call transcript

- **Revenue growth accelerated**: 3% volume increase in core business, 57% jump in service/installation margins.
- **Acquisition impact strong**: $4M EBITDA contribution from deals, 50% of service growth from new assets.
- **Profitability improving**: Net income up 150% to $33M, driven by lower derivative losses and cost control.
- **Customer retention stable**: Churn rate at multi-year low, new customer adds rebounding in cold January.

**【CEO Opening Remarks】**
- Q1 revenue growth driven by strategic acquisitions and 4.1% colder temperatures, with adjusted EBITDA up $3M YoY.
- Service/installation business improved due to productivity initiatives and recent acquisitions; new customer additions rebounded in January.
- Cautious optimism for H2, with focus on operational efficiency and cost control amid uncertain demand.

**【CFO Financial Highlights】**
- Home heating oil/propane volumes rose 3% to 82M gallons, with higher per-gallon margins boosting product gross profit by $5.6M (4% YoY).
- Service/installation gross profit jumped 57% to $6.9M, driven by acquisitions and base business improvements.
- Net income increased $20M to $33M, supported by a $24M non-cash credit from derivative instruments offsetting $8M higher taxes.
- Adjusted EBITDA rose $3M to $52M, with $4M contribution from acquisitions and margin gains in core business.

**【Q&A Key Takeaways】**
- Service/installation growth: 50% from acquisitions, 50% from internal productivity gains and cross-selling efforts.
- Customer credit quality stable due to lower product costs; cautious on long-term credit trends.
- Capital allocation: prioritize acquisitions to replace lost business; dividend decisions delayed until post-heating season.
- Customer churn stable; new customer additions lagging due to warmer-than-normal temps but improving in January.

SGU

SGU fundamentals

Earnings Call

You can ask Aime