Westlake,
08
August
2017
|
11:46 PM
Europe/Amsterdam

TravelCenters of America LLC Announces Second Quarter 2017 Financial Results

TravelCenters of America LLC (Nasdaq: TA) today announced financial results for the three and six months ended June 30, 2017:

                       
(in thousands, except per share and per gallon

amounts unless indicated otherwise)

                Three Months EndedJune 30,   Six Months EndedJune 30,
                2017   2016   2017   2016
Total revenues                 $ 1,498,668     $ 1,430,008     $ 2,889,434     $ 2,579,830  
(Loss) income before income taxes                 (5,346 )   5,570     (54,062 )   (10,051 )
Net (loss) income attributable to common

shareholders

                (3,013 )   3,521     (32,437 )   (6,423 )
                               
Net (loss) income per common share attributable

to common shareholders (basic and diluted)

                $ (0.08 )   $ 0.09     $ (0.82 )   $ (0.17 )
                               
Supplemental Data:                              
Fuel sales volume (gallons):                              
Diesel fuel                 412,629     418,519     807,334     840,919  
Gasoline                 139,718     142,635     259,169     261,239  
Total fuel sales volume (gallons)                 552,347     561,154     1,066,503     1,102,158  
                               
Total fuel revenues                 $ 990,265     $ 931,211     $ 1,925,561     $ 1,640,739  
Fuel gross margin                 105,810     101,993     191,395     193,694  
Fuel gross margin per gallon                 $ 0.192     $ 0.182     $ 0.179     $ 0.176  
                               
Total nonfuel revenues                 $ 504,096     $ 494,467     $ 955,470     $ 930,485  
Nonfuel gross margin                 280,129     272,175     535,504     516,490  
Nonfuel gross margin percentage                 55.6 %   55.0 %   56.0 %   55.5 %
                               
EBITDA(1)                 $ 31,141     $ 33,632     $ 21,609     $ 45,357  
                                               

(1) A reconciliation from net (loss) income to earnings before interest, taxes and depreciation and amortization, or EBITDA, appears in the supplemental data below. TA believes that net (loss) income is the most directly comparable financial measure calculated and presented in accordance with U.S. generally accepted accounting principles, or GAAP.

Thomas M. O'Brien, TA's CEO, made the following statement regarding the 2017 second quarter results:

"During the second quarter of 2017 our dispute with FleetCor/Comdata increased our operating expenses by about $5.3 million in legal fees and what we believe to be excessive fuel card transaction fees. The status of our dispute with FleetCor/Comdata remained unchanged since the time of our first quarter report: we are awaiting a ruling from the Delaware Court of Chancery.

"We incurred about $1.3 million of site level operating expenses during the 2017 second quarter that we did not incur in the second quarter of 2016 in connection with certain operating initiatives, particularly in staffing our commercial tire efforts and to expand the capacity of our RoadSquad business.

"Our efforts to achieve stabilized results at our recently acquired locations continued largely as expected for our travel centers and restaurants, but we have encountered certain challenges at our convenience stores, including challenges that are impacting the convenience store industry generally. While I believe these challenges may increase the time it will take TA to achieve expected results at these stores, I believe TA's fuel pricing, merchandising and cost control strategies will continue positively impacting our financial results at these stores.

"Last quarter I reported that TA had identified certain cost savings initiatives that would begin to be realized in the second half of 2017. These initiatives have begun and we are starting to see the benefits in our financial results."

Second Quarter 2017 Business Commentary

Fuel sales volume decreased by 8.8 million gallons, or 1.6%, and same site fuel sales volume decreased by 11.1 million gallons, or 2.0%, each in the 2017 second quarter compared to the 2016 second quarter. TA believes fuel volume decreases experienced during the 2017 second quarter resulted from comparatively weak consumer demand for gasoline, a relatively weak trucking freight environment and especially continued fuel efficiency gains and especially by TA's commercial diesel fuel customers. Fuel revenue increased by $59.1 million, or 6.3%, in the 2017 second quarter compared to the 2016 second quarter primarily due to higher market prices for fuel during the 2017 second quarter compared to the 2016 second quarter. Fuel gross margin increased by $3.8 million ($0.010 per gallon), to $105.8 million ($0.192 per gallon) primarily as a result of increased fuel gross margin per gallon achieved as a result of declining fuel prices during the 2017 second quarter and the impact of TA's pricing and purchasing strategies.

Nonfuel revenue increased $9.6 million, or 1.9%, in the 2017 second quarter compared to the 2016 second quarter due to a $7.1 million increase attributable to sites acquired and developed since the beginning of the 2016 second quarter and a $2.5 million same site increase due to favorable effects of certain pricing and marketing initiatives. Nonfuel gross margin increased $8.0 million, or 2.9%, in the 2017 second quarter compared to the 2016 second quarter due to a $4.1 million increase from sites acquired and developed since the beginning of the 2016 second quarter, and a $3.9 million, or 1.5%, increase in same site nonfuel gross margin. Same site nonfuel gross margin in the 2017 second quarter was 55.4% of nonfuel revenue, compared to 54.9% in the 2016 second quarter, a change largely attributable to the positive impact of TA's purchasing and pricing strategies and TA's marketing initiatives.

Site level operating expenses increased $8.8 million, or 3.6%, in the 2017 second quarter compared to the 2016 second quarter primarily due to a $4.9 million increase from sites acquired and developed since the beginning of the 2016 second quarter and what TA believes to be excess transaction fees of $2.8 million TA incurred related to the dispute with FleetCor Technologies, Inc. and its subsidiary Comdata Inc., or FleetCor/Comdata. On a same site basis, site level operating expenses as a percentage of nonfuel revenues increased versus the prior year quarter by 50 basis points to 50.0%. The change in this percentage is primarily due to the increased transaction fees being charged by FleetCor/Comdata.

Selling, general and administrative expenses for the 2017 second quarter increased $1.9 million, or 5.2%, compared to the 2016 second quarter, primarily attributable to litigation costs of $2.5 million related to TA's dispute with FleetCor/Comdata.

Real estate rent expense increased $4.4 million, or 6.8%, in the 2017 second quarter compared to the 2016 second quarter primarily from TA's sale to, and lease back from, Hospitality Properties Trust, or HPT, of five travel centers and improvements at leased sites since the beginning of the 2016 second quarter.

Depreciation and amortization expense increased $7.3 million, or 34.4%, in the 2017 second quarter compared to the 2016 second quarter primarily resulting from the locations acquired and other capital investments TA completed (and did not subsequently sell to HPT) since the beginning of the 2016 second quarter. The increase was partially offset by the reduction in TA's depreciable assets as a result of the sale to, and lease back from, HPT of two travel centers in June 2016.

Interest expense, net, increased by $1.1 million, or 16.3%, in the 2017 second quarter compared to the 2016 second quarter primarily due to capitalizing a smaller amount of total interest expense as a result of a reduced amount of assets under construction in the 2017 second quarter compared to the 2016 second quarter.

Net loss attributable to common shareholders for the 2017 second quarter was $3.0 million ($0.08 per common share) compared to net income attributable to common shareholders of $3.5 million ($0.09 per common share) for the 2016 second quarter. EBITDA for the 2017 second quarter decreased by $2.5 million, or 7.4%, as compared to the 2016 second quarter. A reconciliation from net (loss) income to EBITDA appears in the supplemental data below.

Travel Centers Segment

Both fuel and nonfuel revenues increased, resulting in an increase in total revenues of $60.9 million, or 5.0%, in the 2017 second quarter as compared to the 2016 second quarter. The increase in total revenues was primarily due to increases in market prices for fuel and from sales at recently developed properties opened in 2016 and 2017.

Site level gross margin in excess of site level operating expenses increased in the 2017 second quarter by $2.3 million, or 1.9%, as compared to the 2016 second quarter primarily due to a $5.0 million increase in nonfuel gross margin and a $2.5 million increase in fuel gross margin, partially offset by what TA believes to be excess transaction fees of $2.8 million being charged by FleetCor/Comdata.

On a same site basis, site level gross margin in excess of site level operating expenses increased by $2.8 million, or 2.4%, in the 2017 second quarter compared to the 2016 second quarter due to increases in nonfuel ($3.3 million) and fuel ($2.5 million) gross margin, which primarily resulted from an increase in fuel gross margin per gallon achieved as a result of declining fuel prices during the 2017 second quarter and the impact of TA's pricing and purchasing strategies, partially offset by an increase in site level operating expenses ($3.0 million) primarily due to what TA believes to be excess transaction fees being charged by FleetCor/Comdata.

Convenience Stores Segment

Both fuel and nonfuel revenues increased, resulting in an increase in total revenues of $5.3 million, or 2.8%, in the 2017 second quarter compared to the 2016 second quarter. The increase in total revenues was primarily due to the impact of the five locations acquired since the beginning of the 2016 second quarter and increases in market prices for fuel.

Site level gross margin in excess of site level operating expenses increased in the 2017 second quarter by $1.1 million, or 10.8%, as compared to the 2016 second quarter due to improvements in operating results at same sites and locations acquired since the beginning of the 2016 second quarter.

On a same site basis, site level gross margin in excess of site level operating expenses increased by $0.9 million, or 8.5%, in the 2017 second quarter compared to the 2016 second quarter due to increases in fuel ($1.2 million) and nonfuel ($0.6 million) gross margin, which primarily resulted from the impact of TA's continued improvements at recently acquired sites, partially offset by an increase in site level operating expenses.

Investment and Growth Activities

Since the beginning of 2011, when TA began its growth and acquisition program, to June 30, 2017, TA has invested $895.3 million to develop, purchase and improve travel centers, convenience stores and standalone restaurants. For the 12 months ended June 30, 2017, these investments produced site level gross margin in excess of site level operating expenses of $103.5 million, which, on a sequential basis, was $1.0 million, or 1.0%, more than the site level gross margin in excess of site level operating expenses for the 12 months ended March 31, 2017.

TA believes that its investments require a period after they are developed or acquired and upgrades are completed to reach expected stabilized financial results, generally three years for travel centers and one year for convenience stores.

TA acquired 37 travel centers during the 2011 to June 30, 2017, period. Of these stores, 36 are included in the "Travel Centers Segment Same Site Operating Data" for the six months ended June 30, 2017 and 2016. As of June 30, 2017, TA invested $313.4 million (including the cost of improvements) in these 36 locations, and these locations generated $53.2 million of site level gross margin in excess of site level operating expenses during the 12 months ended June 30, 2017. TA also developed four travel centers for a total investment of $95.9 million, and these locations generated $4.9 million of site level gross margin in excess of site level operating expenses during the 12 months ended June 30, 2017; TA operated these locations on average for less than a full year as of June 30, 2017 (one opened in each of January, March and May 2016, and March 2017).

TA acquired 228 convenience stores during the 2013 to June 30, 2017, period. Of these stores, 199 are included in the "Convenience Store Segment Same Site Operating Data" for the six months ended June 30, 2017 and 2016. As of June 30, 2017, TA invested $394.4 million (including the cost of improvements) in these 199 locations, and these locations generated $33.5 million of site level gross margin in excess of site level operating expenses during the 12 months ended June 30, 2017. The remaining 29 locations were acquired by TA in 2016 for a total investment of $49.0 million (including the cost of improvements), and these convenience stores generated $3.2 million of site level gross margin in excess of site level operating expenses during the 12 months ended June 30, 2017. Some of the 29 convenience stores TA acquired during 2016 were fully or partially out of service while being renovated during the 12 months ended June 30, 2017.

TA acquired one standalone restaurant during 2015 and 48 during 2016 (38 of which were operated by franchisees), and in 2017 acquired six of those 48 from one of TA's franchisees. As of June 30, 2017, TA invested $42.0 million (including the cost of improvements) in these 49 locations, and these locations generated $8.7 million of site level gross margin in excess of site level operating expenses during the 12 months ended June 30, 2017.

Other Growth Initiatives

In addition to the investments in new locations described above, TA made capital expenditures of $58.8 million during the six months ended June 30, 2017, some of which were site improvements of the type TA typically sells to HPT for an increase in rent and some of which were not yet complete as of June 30, 2017. Approximately $34.9 million of these expenditures are considered by TA to be investments designed to provide incremental returns. The returns on these investments may not exceed the cost of capital invested on a short term basis. TA does expect, however, that on a longer term basis, and especially during periods of economic and industry expansion, these investments may provide attractive returns. The remainder, or $23.9 million, is considered by TA to be investments to maintain TA's competitive position.

Conference Call:

On Tuesday, August 8, 2017, at 10:00 a.m. Eastern Time, TA will host a conference call to discuss its financial results and other activities for the three months ended June 30, 2017. Following management's remarks, there will be a question and answer period.

The conference call telephone number is 877-329-4614. Participants calling from outside the United States and Canada should dial 412-317-5437. No pass code is necessary to access the call from either number. Participants should dial in about 15 minutes prior to the scheduled start of the call. A replay of the conference call will be available for about a week after the call. To hear the replay, dial 412-317-0088. The replay pass code is 10110436.

A live audio webcast of the conference call will also be available in a listen only mode on TA's website at www.ta-petro.com. To access the webcast, participants should visit TA's website about five minutes before the call. The archived webcast will be available for replay on TA's website for about one week after the call. The transcription, recording and retransmission in any way of TA's second quarter conference call is strictly prohibited without the prior written consent of TA. The Company's website is not incorporated as part of this press release.

About TravelCenters of America LLC:

TA's nationwide business includes travel centers located in 43 U.S. states and in Canada, standalone convenience stores in 11 states and standalone restaurants in 14 states. TA's travel centers operate under the "TravelCenters of America," "TA," "Petro Stopping Centers" and "Petro" brand names and offer diesel and gasoline fueling, restaurants, truck repair services, travel/convenience stores and other services which are designed to provide attractive and efficient travel experiences to professional drivers and other motorists. TA's convenience stores operate principally under the "Minit Mart" brand name and offer gasoline fueling as well as nonfuel products and services such as coffee, groceries, fresh food offerings and other convenience items. TA's standalone restaurants operate principally under the "Quaker Steak & Lube" brand name.

WARNING CONCERNING FORWARD LOOKING STATEMENTS

THIS PRESS RELEASE CONTAINS STATEMENTS THAT CONSTITUTE FORWARD LOOKING STATEMENTS WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 AND OTHER SECURITIES LAWS. WHENEVER TA USES WORDS SUCH AS "BELIEVE," "EXPECT," "ANTICIPATE," "INTEND," "PLAN," "ESTIMATE," "WILL," "MAY" AND NEGATIVES OR DERIVATIVES OF THESE OR SIMILAR EXPRESSIONS, TA IS MAKING FORWARD LOOKING STATEMENTS. THESE FORWARD LOOKING STATEMENTS ARE BASED UPON TA'S PRESENT INTENT, BELIEFS OR EXPECTATIONS, BUT FORWARD LOOKING STATEMENTS ARE NOT GUARANTEED TO OCCUR AND MAY NOT OCCUR. ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE CONTAINED IN OR IMPLIED BY TA'S FORWARD LOOKING STATEMENTS AS A RESULT OF VARIOUS FACTORS. AMONG OTHERS, THE FORWARD LOOKING STATEMENTS WHICH APPEAR IN THIS PRESS RELEASE THAT MAY NOT OCCUR INCLUDE:

  • STATEMENTS BY TA'S CEO, MR. O'BRIEN, THAT CERTAIN INITIATIVES ARE CURRENTLY EXPECTED TO RESULT IN COST SAVINGS BEGINNING IN THE SECOND HALF OF 2017, AND EXPRESSIONS OF HIS CONFIDENCE IN GENERATING IMPROVED FINANCIAL RESULTS FROM RECENTLY ACQUIRED LOCATIONS MAY IMPLY THAT TA'S INITIATIVES WILL GENERATE INCREASED OPERATING INCOME. HOWEVER, THE EXPECTED INCREASED MARGINS OR DECREASED EXPENSES MAY BE DELAYED, MAY NOT BE REALIZED AND/OR MAY NOT BE IN EXCESS OF THE NEGATIVE IMPACT OF DECLINING CUSTOMER DEMAND FOR TA'S GOODS AND SERVICES, INCLUDING FUEL, OR OF EXCESS TRANSACTION FEES OR OTHER COSTS. TA'S SUCCESS IN THESE MATTERS DEPENDS ON MANY FACTORS, SOME OF WHICH ARE BEYOND TA'S CONTROL;
  • STATEMENTS BY MR. O'BRIEN, AND OTHER DISCLOSURES IN THIS PRESS RELEASE, SEPARATELY ADDRESS SOME OF THE IMPACTS OF TA'S LITIGATION WITH FLEETCOR/COMDATA. THE FACT THAT THESE ARE SEPARATELY ADDRESSED MAY IMPLY THAT THESE IMPACTS ARE GOING TO BE TEMPORARY, OR ONE-TIME IN NATURE. HOWEVER, TA'S LITIGATION WITH FLEETCOR/COMDATA IS ONGOING, AND UNLESS THE COURT DECIDES IN TA'S FAVOR OR A NEW AGREEMENT IS ACHIEVED, TA EXPECTS THAT FLEETCOR/COMDATA IS LIKELY TO CONTINUE TO IMPOSE ON TA INCREASED TRANSACTION FEES IN EXCESS OF THE TRANSACTION FEES PREVIOUSLY PAID PURSUANT TO ITS MERCHANT AGREEMENT (SUCH EXCESS FEES AVERAGED $0.9 MILLION PER MONTH IN THE MONTHS FEBRUARY THROUGH JUNE 2017), AND THAT TA WILL CONTINUE TO INCUR SIGNIFICANT COSTS RELATED TO THIS LITIGATION UNTIL IT IS COMPLETED. WHILE TA CURRENTLY EXPECTS THIS LITIGATION MAY BE CONCLUDED DURING THE THIRD QUARTER OF 2017, IT MAY NOT BE. IN ADDITION, DESPITE TA'S BELIEF IN THE MERITS OF ITS POSITIONS IN THIS LITIGATION, TA MAY NOT PREVAIL IN THIS LITIGATION. IF TA DOES NOT PREVAIL IN THIS LITIGATION, TA WILL NO LONGER HAVE A MERCHANT AGREEMENT WITH FLEETCOR/COMDATA AND, IF TA DOES NOT THEN ENTER A NEW MERCHANT AGREEMENT WITH FLEETCOR/COMDATA, TA MAY LOSE A MATERIAL AMOUNT OF FUTURE BUSINESS FROM ITS CUSTOMERS WHO USE COMDATA ISSUED FUEL CARDS, THE RESULT OF WHICH COULD HAVE A MATERIAL ADVERSE AFFECT ON TA'S BUSINESS, FINANCIAL CONDITION, RESULTS OF OPERATIONS OR CASH FLOWS. EVEN IF TA PREVAILS IN THIS LITIGATION, TA MAY NEED TO REACH A NEW AGREEMENT WITH FLEETCOR/COMDATA REGARDING FEES BEFORE TA'S MERCHANT AGREEMENT EXPIRES ACCORDING TO ITS PRESENT TERMS ON JANUARY 2, 2022. MOREOVER, THE CONTINUATION OF THIS LITIGATION IS DISTRACTING TO TA'S MANAGEMENT AND IT IS EXPENSIVE, AND THIS DISTRACTION AND EXPENSE MAY CONTINUE BEYOND THE ISSUANCE OF A RULING FROM THE COURT BECAUSE OF DELAYS, APPEALS OR OTHERWISE;
  • THIS PRESS RELEASE DISCLOSES CERTAIN INVESTMENTS TA MADE DURING THE SIX MONTHS ENDED JUNE 30, 2017, SOME OF WHICH WERE DESIGNED TO PROVIDE INCREMENTAL RETURNS TO TA AND SOME THAT ARE CONSIDERED TO BE INVESTMENTS TO MAINTAIN ITS COMPETITIVE POSITION. HOWEVER, TA MAY NOT REALIZE INCREMENTAL RETURNS OR MAINTAIN ITS COMPETITIVE POSITION AS A RESULT OF THESE INVESTMENTS; AND
  • THIS PRESS RELEASE STATES THAT TA IS CURRENTLY UNDERTAKING SEVERAL OPERATING INITIATIVES. TA MAY NOT REALIZE THE BENEFITS IT EXPECTS FROM THESE INITIATIVES AND THE COSTS IT INCURS IN DESIGNING, IMPLEMENTING AND EXECUTING THESE INITIATIVES MAY EXCEED ANY BENEFITS IT MAY REALIZE FROM THEM.

THE INFORMATION CONTAINED IN TA'S PERIODIC REPORTS, INCLUDING TA'S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 2016, WHICH HAS BEEN FILED WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION, OR SEC, AND TA'S QUARTERLY REPORTS ON FORM 10-Q FOR THE PERIODS ENDED MARCH 31, 2017 AND JUNE 30, 2017, WHICH HAVE BEEN OR WILL BE FILED WITH THE SEC, UNDER THE CAPTION "RISK FACTORS," OR ELSEWHERE IN THOSE REPORTS, OR INCORPORATED THEREIN, IDENTIFIES OTHER IMPORTANT FACTORS THAT COULD CAUSE DIFFERENCES FROM TA'S FORWARD LOOKING STATEMENTS. TA'S FILINGS WITH THE SEC ARE AVAILABLE ON THE SEC'S WEBSITE AT WWW.SEC.GOV.

YOU SHOULD NOT PLACE UNDUE RELIANCE UPON FORWARD LOOKING STATEMENTS.

EXCEPT AS REQUIRED BY LAW, TA DOES NOT INTEND TO UPDATE OR CHANGE ANY FORWARD LOOKING STATEMENT AS A RESULT OF NEW INFORMATION, FUTURE EVENTS OR OTHERWISE.

 

TRAVELCENTERS OF AMERICA LLC

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

(in thousands, except per share amounts)

 
                  Three Months EndedJune 30,
                  2017     2016
Revenues:                        
Fuel                 $ 990,265       $ 931,211  
Nonfuel                 504,096       494,467  
Rent and royalties from franchisees                 4,307       4,330  
Total revenues                 1,498,668       1,430,008  
                         
Cost of goods sold (excluding depreciation):                        
Fuel                 884,455       829,218  
Nonfuel                 223,967       222,292  
Total cost of goods sold                 1,108,422       1,051,510  
                         
Operating expenses:                        
Site level operating                 252,946       244,120  
Selling, general and administrative                 37,877       36,009  
Real estate rent                 69,144       64,736  
Depreciation and amortization                 28,649       21,322  
Total operating expenses                 388,616       366,187  
                         
Income from operations                 1,630       12,311  
                         
Acquisition costs                 63       1,092  
Interest expense, net                 7,838       6,740  
Income from equity investees                 925       1,091  
(Loss) income before income taxes                 (5,346 )     5,570  
Benefit (provision) for income taxes                 2,380       (1,985 )
Net (loss) income                 (2,966 )     3,585  
Less: net income for noncontrolling interests                 47       64  
Net (loss) income attributable to common shareholders                 $ (3,013 )     $ 3,521  
                         
Net (loss) income per common share attributable to common shareholders:                        
Basic and diluted                 $ (0.08 )     $ 0.09  
                                 

These financial statements should be read in conjunction with TA's Quarterly Report on Form 10-Q for the quarter ended June 30, 2017, to be filed with the U.S. Securities and Exchange Commission.

 

TRAVELCENTERS OF AMERICA LLC

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

(in thousands, except per share amounts)

 
                  Six Months EndedJune 30,
                  2017     2016
Revenues:                        
Fuel                 $ 1,925,561       $ 1,640,739  
Nonfuel                 955,470       930,485  
Rent and royalties from franchisees                 8,403       8,606  
Total revenues                 2,889,434       2,579,830  
                         
Cost of goods sold (excluding depreciation):                        
Fuel                 1,734,166       1,447,045  
Nonfuel                 419,966       413,995  
Total cost of goods sold                 2,154,132       1,861,040  
                         
Operating expenses:                        
Site level operating                 498,861       478,170  
Selling, general and administrative                 78,689       66,975  
Real estate rent                 137,143       128,265  
Depreciation and amortization                 60,449       41,847  
Total operating expenses                 775,142       715,257  
                         
(Loss) income from operations                 (39,840 )     3,533  
                         
Acquisition costs                 203       2,061  
Interest expense, net                 15,222       13,561  
Income from equity investees                 1,203       2,038  
Loss before income taxes                 (54,062 )     (10,051 )
Benefit for income taxes                 21,695       3,692  
Net loss                 (32,367 )     (6,359 )
Less: net income for noncontrolling interests                 70       64  
Net loss attributable to common shareholders                 $ (32,437 )     $ (6,423 )
                         
Net loss per common share attributable to common shareholders:                        
Basic and diluted                 $ (0.82 )     $ (0.17 )
                                 

These financial statements should be read in conjunction with TA's Quarterly Report on Form 10-Q for the quarter ended June 30, 2017, to be filed with the U.S. Securities and Exchange Commission.

 

TRAVELCENTERS OF AMERICA LLC

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(in thousands)

 
                  June 30,2017     December 31,2016
Assets                        
Current assets:                        
Cash and cash equivalents                 $ 76,625       $ 61,312
Accounts receivable, net                 115,417       107,246
Inventory                 197,131       204,145
Other current assets                 26,292       29,358
Total current assets                 415,465       402,061
                         
Property and equipment, net                 1,023,032       1,082,022
Goodwill                 89,698       88,542
Other intangible assets, net                 35,510       37,738
Other noncurrent assets                 60,988       49,478
Total assets                 $ 1,624,693       $ 1,659,841
                         
Liabilities and Shareholders' Equity                        
Current liabilities:                        
Accounts payable                 $ 154,010       $ 157,964
Current HPT Leases liabilities                 40,432       39,720
Other current liabilities                 148,515       132,648
Total current liabilities                 342,957       330,332
                         
Long term debt, net                 319,183       318,739
Noncurrent HPT Leases liabilities                 375,792       381,854
Other noncurrent liabilities                 63,447       75,837
Total liabilities                 1,101,379       1,106,762
                         
Shareholders' equity (39,556 and 39,523 common shares outstanding

at June 30, 2017 and December 31, 2016, respectively)

                523,314       553,079
Total liabilities and shareholders' equity                 $ 1,624,693       $ 1,659,841
                               

These financial statements should be read in conjunction with TA's Quarterly Report on Form 10-Q for the quarter ended June 30, 2017, to be filed with the U.S. Securities and Exchange Commission.

TRAVELCENTERS OF AMERICA LLCRECONCILIATION OF NON-GAAP FINANCIAL MEASURES(in thousands)

Non-GAAP financial measures are financial measures that are not determined in accordance with GAAP. TA believes the non-GAAP financial measures presented in the table below are meaningful supplemental disclosures because they may help investors gain a better understanding of changes in TA's operating results and its ability to pay rent or service debt, make capital expenditures and expand its business. These non-GAAP financial measures also may help investors to make comparisons between TA and other companies on both a GAAP and a non-GAAP basis. TA calculates EBITDA as earnings before interest, taxes and depreciation and amortization, as shown below. TA believes that EBITDA is a meaningful disclosure that may help investors to better understand its financial performance, including by allowing investors to compare TA's performance between periods and to the performance of other companies. EBITDA is used by management to evaluate TA's financial performance and compare TA's performance over time and to the performance of other companies. This information should not be considered as an alternative to net (loss) income attributable to common shareholders, net (loss) income or income (loss) from operations, as an indicator of TA's operating performance or as a measure of TA's liquidity. Also, EBITDA as presented may not be comparable to similarly titled amounts calculated by other companies.

TA believes that net (loss) income is the most comparable financial measure, determined according to GAAP, to TA's presentation of EBITDA. The following table presents the reconciliation of this non-GAAP financial measure to net (loss) income for the three and six months ended June 30, 2017 and 2016.

                 
            Three Months EndedJune 30,   Six Months EndedJune 30,
            2017   2016   2017   2016
Calculation of EBITDA:                        
Net (loss) income           $ (2,966 )   $ 3,585     $ (32,367 )   $ (6,359 )
Add: (benefit) provision for income taxes           (2,380 )   1,985     (21,695 )   (3,692 )
Add: depre