The Pantry reported third-quarter earnings Tuesday that missed Wall Street estimates.
Excluding the impact of impairment charges, the Cary convenience store chain reported net income of $6.4 million, or 28 cents per share. That was well below the $10.2 million, or 45 cents per share, that was the consensus among analysts who cover the company.
The Pantry has been working to offset declines in fuel sales at its stores with increased merchandise sales.
The company sold less gasoline during the quarter, and its profit margins on the fuel it sold decreased. Fuel gross profit was $53.8 million, compared to $67.1 million during the third quarter last year. Comparable store fuel gallons sold declined 4.4 percent.
But CEO Dennis Hatchell said in a statement that he is pleased with the progress the company made during the quarter, noting that comparable store merchandise revenue increased 1.3 percent and the average sales per customer increased 2.5 percent.
The company also completed 31 store remodels during the quarter. The Pantry has been tailoring some of its stores to appeal to local audiences, such as beach or college towns or Hispanic communities. The company is also adding quick-service restaurants at its stores.
The Pantry has 1,559 stores throughout the Southeast, primarily under the Kangaroo Express brand.
The Pantrys shares closed Monday at $12.38. The stock is up 2 percent this year.