Slide 1: 2023 Second Quarter Earnings
2023 Second Quarter Earnings AUGUST 7, 2023 A Leading Retail Convenience Store Operator A Fortune 500® Company
Slide 2: Safe Harbor Statement
Safe Harbor Statement FORWARD-LOOKING STATEMENTS This document includes certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may address, among other things, the Company’s expected financial and operational
Slide 3: ARKO Overview
ARKO Overview 24 Acquisitions 6TH LARGEST CONVENIENCE STORE CHAIN IN U.S. (Since 2013) • Large, Multi-State Convenience Store Operator with Majority of Profits Generated from Company Operated Stores • Runway for Growth Through Continued Acquisitions and in- 1,547 ~14,000 30+ Store Marketing Initiati
Slide 4: Strong Adjusted EBITDA Growth
Strong Adjusted EBITDA Growth Understanding seasonality: Based on the average from 2021 and 2022, Q1, Q2, Q3 and Q4 have historically represented 17%, 28%, 32% and 23% of annual Adjusted EBITDA contribution, respectively. Adjusted EBITDA1 ($ In millions) $129.12 $133.73 $99.5 $86.2 $80.2 79.0 $75.7
Slide 5: Majority of ARKO Profits from Operating Convenience Stores
We believe that the stable, ratable cash flow from the wholesale Majority of ARKO Profits from and fleet fueling segments have enhanced our dealmaking flexibility and augments further investment in our core Operating Convenience Stores convenience store business. Q2 2023 Operating RETAIL Income by S
Slide 6: Strong Q2 2023 In-Store Performance
Strong Q2 2023 In-Store Performance Total Merchandise 31.9% 150 BPS 170 BPS 30.4% 32.0% 28.7% 27.0% 22.0%Total Merchandise contribution ($ in millions) 17.0% 12.4% CAGR Total Merchandise margin (%) 12.0% 7.0% $122.4 $131.4 $154.7 2.0% Q2 2021 Q2 2022 Q2 2023 3.8% Increase in Same Store Sales Excludi
Slide 7: Focus on Three Key Pillars: Core Destination Categories
Focus on Three Key Pillars Core Destination Categories Performance 1 CORE DESTINATION CATEGORIES In Detail Represents same-store sales growth Q2 2023 vs. Q2 20221 Core Destination Categories represented 54.7% of merchandise gross profit in Q2 2023 (vs. 47.3% in Q2 2020) Core Destination Categories:
Slide 8: Focus on Three Key Pillars: Loyalty
Focus on Three Key Pillars 2 LOYALTY ARKO’s newly upgraded fas REWARDS® loyalty program launched March 28, 2023. On May 17, 2023 we launched our 100 days of summer loyalty enrollment offer. ~1.48 Million >$60 Average enrolled Enrolled members1 monthly spend vs. non-enrolled1 205,234 ~37% ~6x more In
Slide 9: Focus on Three Key Pillars: Food and Beverage
Focus on Three Key Pillars 3 FOOD AND BEVERAGE ARKO continues to expand its branded food franchises, packaged, fresh, and frozen food offerings, including pizza, chicken, roller grills, and hot, cold, and frozen dispensed beverage offerings. Our current footprint boasts1: • 150+ branded food franchi
Slide 10: Strong Early Results at Pride with the ARKO Way
Strong Early Results at Pride with the “ARKO Way” 31 stores in eastern Massachusetts and Connecticut acquired in December 2022, 1 New-To-Industry store opened in June 2023 (32 stores total). ARKO financed approximately $30 million of the consideration from its own sources. • ~1,000 merchandise items
Slide 11: Key Financial Highlights – Strong Liquidity
Key Financial Highlights – Strong Liquidity OVER $2 BILLION $220M Quarterly dividend Cash on hand announced for Q3 2023 Available funding for continued M&A activity $0.03/SHARE ~$602M Approximate availability under AUTHORIZED UP TO our lines of credit, as of June 30, 20231 $100 MILLION Share repurch
Slide 12: Highly Fragmented Convenience Store Industry
Total store counts for NACS regions as of December 31, 2022 Highly Fragmented CENTRAL Convenience Store Industry 13,127 Stores MIDWEST 23,516 Stores 150,174 convenience stores operate in the United States, NORTHEAST a 1.5% increase from 2021.1, 2 30,852 Stores • 69.2% of operators operate 50 stores
Slide 13: ARKO's Retail Brand Footprint
ARKO’s Retail Brand Footprint ARKO’s Retail Footprint • Highly successful strategy embracing well known regional convenience store brands with brand equity and long histories in their communities. • We operate 1,547 retail convenience stores in more than 30 states under more than 25 regional store b
Slide 14: Appendix: Cigarette Performance
Appendix: Cigarette Performance • ARKO’s marketing and merchandising initiatives intentionally focus on our Core Domestic Cigarettes Sold (sticks in billions)(1) Destination Categories 450 400 • We measure our retail success on our ability to grow sales and profitability in 350 our Core Destination
Slide 15: Appendix: Reconciliation of EBITDA and Adjusted EBITDA
Appendix: Reconciliation of EBITDA and Adjusted EBITDA
Slide 16: A Family of Community Brands
A Family of Community Brands ADMIRAL CMARKET BreadBox <Ge DixieMart. =§_Emrine fawsesston EDS MMPS rAcHre. “te vet HAS F Hendy ‘Mert ded Jit fis Li oe Marte Benes $= Pride Quarles seqimmer Rdse Mart Markets —shorestep —_y¢townstar VP wae. PXLYOUNGS) pices