Interesting stuff from the Marathon annual reports

I find the year end reports from Marathon fascinating. One of the most interesting things you can find there is the year end financial information for Speedway. At the moment, it goes back to 2011, although you can get numbers from 2009. Here is a chart of something I found very interesting:

Average Spike Line Margin % Margin Mthn. AR % M Mthn 2009 $ # SW Loc
2010 2.428 2.216 0.212 8.73 0.1207 4.97 0.1210 1358
2011 3.544 3.367 0.177 4.99 0.1308 3.69 0.1248 1371
2012 3.889 3.545 0.344 8.85 0.1318 3.39 0.1232 1464
2013 3.560 3.497 0.063 1.77 0.1441 4.05 0.1327 1478
2014 3.369 3.268 0.101 3.00 0.1775 5.27 0.1609 2746
2015 2.371 2.267 0.104 4.38 0.1823 7.69 0.1650 2766

Average = Indiana average for the year

Spike Line = Spike Line Average

Margin = Difference between Average and Spike Line

% Margin = Margin / Average

Mrthn. AR = Marathon’s reported margin for Speedway

% M Mthn = Mrthn. AR / Average

2009 $ = Mrthn. AR adjusted for 2009 dollars

# SW Loc = Number of Speedway locations

First thing that jumped out to me is that my predictions for the Spike Line have been all over the place. I’ve been frustrated about it, and it’s one of the many reasons I gave up on it.

Second thing is that the percent of margin is low. Even my highest year is still less than ten percent. To break even in any business, you need to make around 10% margin. As we all should know, however, they don’t make any money on the gas end, it’s usually all made inside on overpriced items.

But there is something interesting buried in there, and it’s pretty deep. Look at the margins adjusted for 2009 dollars. Notice the uptick in profit margin from 2013 to 2014. It almost jumps 3 cents. And it happens at about the same time they jump from about 1500 stores to almost 2800 stores.

Some would say that the jump probably corresponds with the even greater monopoly they have grabbed. If I hadn’t seen the following map, I would agree. But this map tells another tale:


They didn’t add more stores to Indiana, Ohio and Michigan, they expanded to the east and south. What I think is that they expanded into areas that had higher margins than ours, and thus it increased margins overall.

Something else to think about is how good Speedway stores are at selling gas than their Marathon partners. Speedway had almost 2770 stores when this report came out, Marathon almost 5600. But Speedway still outsold those Marathon stores 6 to 5.

Take a look over those annual reports and let us know what you think. And if you have an idea for a story, or something you’d like me to investigate further, leave a note in the comments, or email me at the address at the bottom left of this page.

Updated: August 29, 2016 — 9:54 am


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  1. Your % margin calculations are all off by a factor of 10, for example, the 2010 % margin should be 8.73, not 0.873.

  2. Good catch. I thought I had margin / average * 100, but for some reason it was only 10. I changed it an edited the paragraph about it.

  3. Very interesting. Thanks for the post!

  4. Neat info Bill! I think the Big Red execs were on here this morning reading and decided to give us a spike. Several Indiana gas stations going up to $2.35-$2.39 as I type. This SHOULD prevent a spike going into Labor Day weekend unless they decide to have one of those double spike weeks.

    I’m sure someone (ChrisDG74 knows who) will come on here later in the week bragging how spikes leading up to holidays are hogwash lol

  5. South Bend spike today to $2.35. SBN avg was $2.134
    Costco $2.03
    Speedway by ND was $2.13 this morning.

  6. Spot down mid-day 6 cents to $1.49. Nothing like a wonderful 90 cent margin!!

  7. Interesting how few stations they have in Illinois yet how much of the market they control…

  8. a late day spike coming in Ohio..odd its normally around 11.00am

    seen a couple local 2.299 but most still around 2.15.
    just as well I paid 2.039 on way home at 4.00pm i guess

    heading off the pre holiday spike..or will we get hit with another 20c later in week?

  9. Nothing in sw Ohio, yet. I guess GREEDway might be a little hesitant, after their attempt, last week, at $2.499 failed, MISERABLY.

    Been topping off for $1.999 every few days. Not at Speedway, of course.

  10. Toledo still showing 1.99, and a rocks throw away in Michigan its 2.39 which seems to be the average.

  11. You’re killing me with that $1.99 price, ChrisDG74. Around Ann Arbor Costco and Sam’s are selling for $2.22. It goes up from there.
    I can’t wait for January when we get to start paying an additional .06/gal that’s supposed to help fix the roads.

  12. the couple of stations the went to 2.299 here quietly fell “back in line” to 2.159 this morning. Guess they pulled the trigger too early and got tuesday confused with thursday. Easy mistake to make I guess

  13. Jeff L – you make me LOL at the “fix the roads!” But you got it right “SUPPOSED to.”

  14. Greedway trying to get people to spike again in sw Ohio this afternoon. This time to $2.399, 96 cents over spot.

    Fairfield still holding at $1.989.

  15. The West Side of Cincinnati jumped on the $2.399 spike for the most part within a few hours of GREEDways memo coming out. And we were just under four cents from hitting the National average.

    Silly me. I thought that with spot dropping 11+ cents in two days we would be safe.

  16. Well, well, well.
    Looks like the EIA has been OVER-estimating crude and gasoline demand all year, by 16%..

  17. Wow, some stations near home in Indiana with massive $1.02 “Cincinnati like” margins. Of course prices will drop like a feather. Could it be two years with no spikes leading up to Labor Day weekend??

  18. Spot dropped, what, 17 cents the last week or so?
    Sw Ohio still spikes to $2.399, right back to $1-plus over spot…..
    My $1.989s are gone now. They couldn’t resist an extra 41 cents/gallon profit this time around.

  19. Spot down to $1.31 today. Man these gas stations are making a killing!!

  20. independent retailer

    Chris, spot does not equal our cost. Everyone that profits from gas makes more than the retailer. One thing that always confuses me is, why are gas stations not suppose to make a profit?

  21. Speedway margins are Up, after nearly doubling the # of stations and the new stations do not, as far as I know, use the same Speedway pricing models as the originals. Of course there could be some other explanation. but it seems possible the company benefits more NOT using the spike and dribble down model.

  22. Axxispetro’s reported dealer wholesale at Chicago, for Chicago RFG blendstock, is down nearly 20 cents in 4 days. I think the conventional is down a little less.


    “With the summer driving season now behind us, what we see ahead looks terrific for motorists,” GasBuddy analyst Patrick DeHaan said. “Demand decreases for gasoline will accelerate as we progress toward autumn, and combined with the return of winter gasoline next week Friday, gasoline prices will track lower more often than the opposite.

    And then the caveat—

    “The only possible wrench could be a major hurricane that takes aim for the Gulf of Mexico, where many oil rigs and refiners are located, or a sudden cut in oil output from (the Organization of Petroleum Exporting Countries).”

    No mention of Squirrels.

  24. I’m sure BP Whiting will take the refinery down for maintenance so that things won’t fall too far. And then “unexpected” outages will happen at a few other chicagoland area refineries. Always seems to happen. I’ll be pleasantly surprised and see it as serendipity if it goes down. Meanwhile, managed to snag $1.95 gas at Speedway in Indy last eve and after using my credit card and getting the speedy rewards points, like them or not, I don’t think they came out ahead on that deal, lol! My philosophy is to never ever get gas from them within 4 days after they jacked the price up and the profits are good… at end of the cycle, game on.

  25. Crude is blasting off today (said it was the hurricane’s fault) and spot is up to $1.43 at mid-day. I smell a possible Greedway rabbit in the hat coming a.k.a. Saturday spike

  26. There was also a 14.5 million barrel draw in crude.
    Nevermind that there have been builds the last few weeks…
    Speculators off to the races.

  27. We would need a similar drop in crude inventories for the next four weeks to even draw even with last years inventory levels but we certainly can’t let a good storm on the East coast go to waste.

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