Marathon Petroleum 2Q Profits Collapse, Set to Sell Gas Stations in $21 Billion Deal

By Adriano Marchese

Marathon Petroleum Corp. on Monday reported a significant fall in second-quarter profit as it faced pandemic-related challenges in the period and said it would sell its gas stations to the owners of convenience-store chain 7-Eleven for $21 billion.

The Findlay, Ohio fuel-maker earned a quarterly profit of $9 million, or 1 cent a share, compared with $1.11 billion, or $1.67, for the same period last year.

Excluding exceptional costs, Marathon Petroleum reported an adjusted loss of $1.33 a share for the quarter, compared with analysts' forecasts of a loss of $1.77.

Sales were more than halved in the period to $15.02 billion from $33.69 billion.

"We began April with demand at historic lows. Despite seeing some recovery during the quarter, demand for our products and services continues to be significantly depressed, particularly across the West Coast and Midwest," President and Chief Executive Michael J. Hennigan said.

The company said it is on track to deliver $1.4 billion of capital spending and at least $950 million of operating expense reductions.

Marathon agreed to sell its Speedway gas stations to the owners of the 7-Eleven for $21 billion in the largest U.S. energy-related deal of the year. The deal was announced Sunday.

The company said the after-tax proceeds of $16.5 billion are expected to be used to strengthen the balance sheet and return capital to shareholders.

Write to Adriano Marchese at [e-mail]

(END) Dow Jones Newswires

August 03, 2020 07:26 ET (11:26 GMT)

Copyright (c) 2020 Dow Jones & Company, Inc.