Acquisitions

9 Months Ended

Jan. 31, 2025

On November 1, 2024, the Company closed on the acquisition of Fikes Wholesale, owner of CEFCO Convenience Stores, and Group Petroleum Services (collectively “Fikes”) through an equity purchase agreement. As part of the

acquisition, the Company acquired 100% of the equity of Fikes. The transaction includes 198 retail locations and a fuel terminal, commissary, and wholesale network, where the Company will manage fuel wholesale supply agreements to certain locations. A combination of the land and/or building at 101 retail locations are subject to lease agreements. The acquisition brought 148 additional stores to Texas, as well as 50 stores in Alabama, Florida, and Mississippi. This acquisition met the criteria to be considered a business combination.

The acquisition was recorded in the financial statements by allocating the purchase price to the assets acquired, including intangible assets, and liabilities assumed, based on their estimated fair values at the acquisition date. Fair values were determined using Level 3 inputs, which are unobservable inputs that are not corroborated by market data. The excess of the cost of the acquisition over the net amounts assigned to the fair value of the assets acquired and the liabilities assumed is recorded as goodwill. Goodwill of $574,207 was recognized as the result of the acquisition and is primarily attributable to the location of the stores in relation to our footprint and expected synergies. Almost all of the goodwill associated with this transaction will be deductible for income tax purposes over 15 years.

The aggregate purchase price for the acquisition totaled $1,165,752, which is gross of cash and cash equivalents acquired and includes an amount accrued for final settlement of $6,912, which is included in accrued expenses on the condensed consolidated balance sheets as of January 31, 2025. Upon closing, $1,158,840 was paid in cash using available cash on hand and proceeds from the Incremental Term Loan, and the issuance of the Notes. For further information, see Note 4.

The table below summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date. We utilized a third-party valuation specialist to assist in valuing the customer relationships, trade name, leases, and property and equipment acquired. The valuation is still in process and, as a result, amounts related to goodwill, customer relationships, trade name, leases, property and equipment, and deferred income taxes are provisional measurements and are subject to change. Additionally, the accounting related to contingent liabilities and the working capital adjustment is considered provisional and subject to change.


Assets acquired:
Cash and cash equivalents	$	60,212
Receivables	25,368
Inventories	50,928
Prepaid and other current assets	2,509
Deferred income taxes	9,857
Property and equipment	533,040
Operating lease right-of-use assets	314,364
Other assets	940
Customer relationships and trade name	38,000
Goodwill	574,207
Total assets	1,609,425
Liabilities assumed:
Accounts payable	70,892
Accrued expenses and other long-term liabilities	21,972
Operating lease liabilities	350,809
Total liabilities	443,673
Net assets acquired and total purchase price	$	1,165,752

Customer relationships and trade name will be amortized over their respective useful lives of 15 years and 4 years, and are included within other assets, net of amortization in the condensed consolidated balance sheets as of January 31, 2025. These assets were valued using the multi-period excess earnings method, and relief from royalty method, respectively.

Acquisition-related transaction costs are recognized as period costs as incurred. The Company incurred total acquisition-related transaction costs of $13,482 and $22,227 for the three and nine months ended January 31, 2025, respectively, for the Fikes acquisition, which are recorded within operating expenses on the consolidated statements of income.

The Company recognized approximately $459,422 of revenue related to the acquired locations in the condensed consolidated statements of income for the three and nine months ended January 31, 2025. The impact to net income related to the acquired locations was not material for the three and nine months ended January 31, 2025.

During the nine months ended January 31, 2025, the Company acquired a further 30 stores through a variety of transactions, pursuant to the terms and conditions of the individual asset purchase agreements. The majority of these acquisitions meet the criteria to be considered business combinations, and have been recorded in the financial statements in line with the methods discussed above. The impact of these acquisitions is not considered to be material.

Pro Forma Information

The following unaudited pro forma information presents a summary of our consolidated results of operations as if the acquisition of Fikes occurred at the beginning of the first fiscal year of the periods presented (amounts in thousands, except per share data):


	Three Months Ended January 31,				Nine Months Ended January 31,
	2025		2024		2025		2024
Total revenue	$	3,903,633	$	3,825,442	$	13,018,515	$	12,935,739
Net income	$	95,890	$	71,445	$	448,799	$	372,624
Net income per common share
Basic	$	2.58	$	1.93	$	12.09	$	10.01
Diluted	$	2.57	$	1.91	$	12.02	$	9.96