Alimentation Couche-Tard Inc. took advantage of soaring gasoline costs and an easing of COVID-19 restrictions to generate a record quarterly profit.

Fuel revenue in the fiscal first quarter jumped 52 per cent over last year and margins expanded. The owner of the Circle K chain earned US$872 million, or 85 cents a share, well above analysts’ expectations for 73 cents. 

“We continue to benefit from robust fuel margins, offsetting the pressures on volume across the network,” Chief Executive Officer Brian Hannasch told analysts Wednesday. Higher gasoline and diesel prices are causing changes in consumer behavior, he said, as drivers are buying less fuel at once. The average fill is down almost 10 per cent.

More than three-quarters of the company’s sales came from transportation fuel in the quarter ended July 17. Total gross profit in that segment rose 25 per cent to US$1.44 billion, while it was flat in convenience stores. 

“Operating costs inflated at a much lower level than we projected and well below the growth rate of recent quarters,” BMO Capital Markets analyst Peter Sklar said in a report. Couche-Tard’s US fuel margin was 49 cents per gallon, 8 cents above the industry average, he added.

“Q1 results came in ahead of even our more bullish expectations as the company delivered another robust fuel margin quarter and managed to make progress on rising costs,” Wells Fargo’s Anthony Bonadio said in a note.  

Couche-Tard executives said they remain interested in making a sizable deal. “I’m hoping the uncertainty that’s out there today does create an environment where we can be acquisitive,” Hannasch said.