Travel Ports of America, Inc.
Travel Ports of America, Inc.
3495 Winton Place
Rochester, New York 14623
Fax: (716) 272-9952
Incorporated: 1979 as Roadway Motor Plazas, Inc.
Sales: $165.2 million (1996)
Stock Exchanges: NASDAQ
SICs: 5411 Grocery Stores; 5541 Gasoline Service Stations; 5812 Eating Places; 7011 Hotels & Motels; 7538 General Automotive Repair Shops
Travel Ports of America, Inc., operates around-the-clock, full-service travel plazas that provide customers with motor fuel, automotive supplies and repairs, groceries, food service, and motel rooms. These plazas serve both truck drivers and the general public. In 1996 Travel Ports operated 15 full-service travel plazas, a mini-travel plaza, and a fuel terminal in New York, New Jersey, New Hampshire, Pennsylvania, Indiana, and North Carolina. The company was planning to open one or two more each year.
Travel Ports was among a half-dozen or so large chains that were increasingly dominating the “travel plaza” or “travel center” industry. These facilities, some of them with 40,000 square feet of floor space or more, were well lighted on the outside and tastefully landscaped to provide a secure environment and reassuring image. They offered not only the basic one-stop services that truckers had always sought—gas, meals, beds, and automotive supplies—but also shops selling souvenirs and consumer electronics, automatic teller machines, and even chapels. They had, in effect, become small cities.
Roadway Motor Plazas, 1987-91
Incorporated in 1979 as Roadway Motor Plazas, Inc., the company made its first public offering of common stock in 1986 and was subsequently listed on the NASDAQ exchange. E. Philip Saunders was its chairman, CEO, and principal stockholder, and John M. Holahan was its president and chief operating officer. Among the suppliers of petroleum products to the company was W. W. Griffith Oil Co., Inc., owned and operated by Saunders. A fuel-purchase agreement with Griffith Oil extended to January 1996. Griffith Oil later came to be owned by Sugar Creek Corp., also owned and operated by Saunders. In early 1996 Sugar Creek was running a chain of 105 Sugar Creek convenience stores and self-service gas stations in western New York.
By the end of 1987 Roadway was operating 13 24-hour, full-service motor plazas and four mini plazas, one family restaurant, one fuel terminal, and one truck-operating subsidiary in New York, New Jersey, North Carolina, South Carolina, and Pennsylvania. Roadway and other chains were cleaning up the once-seedy truck-stop image, inviting in the general public.
Roadway Motor Plazas had net sales of $45.9 million in fiscal 1986 (ending April 30,1986) and net income of $642,000. In fiscal 1987 net sales advanced to $64.2 million and net income to $913,000. In fiscal 1988 net sales rose again to $116.7 million, and net income to $1.2 million, which remained a company record until fiscal 1994. The sale of diesel fuel accounted for 45 percent and 62 percent of net sales in fiscal 1987 and 1988, respectively. The company’s long-term debt was $20.9 million at the end of fiscal 1988.
At the close of 1986, Roadway Motor Plazas acquired travel plazas from Smoky Mountain Truckstop, Inc., of Asheville, North Carolina, for $3,346,444 and LaBar Enterprises, Inc., of Berwick, Pennsylvania, for $12,990,233. The Smoky Mountain facility, on a 19-acre site at Exit 37 from Interstate Route 40, included a 136-seat restaurant and a general store as well as fuel pumps and a truck-service area.
LaBar Enterprises, owned by James C. LaBar of Blooms-burg, Pennsylvania, had sales of about $86 million in 1986. It consisted of ten truckstop facilities, a fuel terminal, a family restaurant, and four other related businesses, including a truck-leasing subsidiary and a Navistar truck dealership in New Jersey, Pennsylvania, and South Carolina. Most of the assets of the truck-leasing unit were sold in 1987 to Hertz Penske Truck Leasing Inc. for $15.6 million. Also in 1987, Roadway sold 23 gas stations acquired as part of the LaBar deal to United Petroleum Facilities, Inc., for $2.6 million and Allied Petroleum Marketers, Inc., a related Delaware business, to Stanley W. Mann for $225,000.
In June 1987 Roadway opened its 19th motor plaza, a leased truckstop located in Hamburg, New York. In November 1987, however, Roadway terminated the lease agreement and ceased doing business at the location because the lessor was unable to perform certain obligations, which resulted in revenues that were less than what had been projected.
Roadway acquired Pecan Shoppe of Harbor Creek, Inc., a business located on Interstate 90 outside Erie, Pennsylvania, in 1987 for $263,000. This facility was acquired with the intention of building a major new travel plaza on the property. In October 1989 Roadway acquired about 72 acres of land adjacent to this property. Construction of the travel plaza, which opened in August 1995, was to be financed through a combination of cash generated from operations and bank financing.
In 1988 Roadway subleased the New Cumberland, Pennsylvania, mini-plaza it had acquired from LaBar to Capital Petroleum Inc. and vacated its Big Earl mini-plaza in Bloomsburg, Pennsylvania, which it had sold to a real-estate developer for a $670,000 profit. Also in 1988, Roadway entered into an agreement to purchase 23 acres for $575,000 from Dahlstrom and Grove Associates, Inc., in order to build a major new facility on Interstate 81 in Greencastle, Pennsylvania. This travel center, the first constructed by Roadway, opened in December 1989.
Roadway sold various vehicle assets of P. L. Lawton, Inc., a company acquired in December 1986, to K. J. Transportation Inc. in April 1988 for $3 million. In November 1988 Roadway vacated its leased facilities in Rochester, selling its equipment, furniture, and inventories, transferring them to other locations, or returning them to vendors for reimbursement of original cost.
During fiscal 1989 Roadway phased out its truck sales division, selling its inventory of new and used trucks or returning them to Navistar. This subsidiary continued to operate Roadway’s truck service and repair business out of its shop in Bloomsburg. Roadway also sold its Belles Spring Restaurant in Mill Hall, Pennsylvania, which historically had been unprofitable.
In early 1989 Roadway acquired L & G Truckers City, Inc., for $4,252,741 in mortgages, thereby gaining its first facility in Indiana, a 36-acre full-service travel center in Porter. At the same time the company leased a 24-acre motor plaza at Lake Station, Indiana.
In June 1991 Roadway signed a franchise agreement with Choice Hotels International that identified its location in Greencastle, Pennsylvania, as a Friendship Inn and utilized the Choice Hotels national registration system. Under this agreement Roadway was required to remit monthly a royalty fee of two percent and a marketing fee of two percent of gross room revenue. Also in 1991, the company closed its Hickory Run truck stop at White Haven, Pennsylvania.
Roadway’s revenues rose from $109.6 million in fiscal 1989 to $125.5 million in 1990 and a record $144.9 million in 1991. In 1989 the company had net income of $903,000. The following year it lost $587,000, but in 1991 it returned to profitability, earning $136,000 in net income.
Travel Ports of America, 1992-95
Roadway was renamed Travel Ports of America in late 1991. The company sold its facility at Loganton, Pennsylvania, in August 1992 for net book value, receiving a mortgage on the property for a portion of the purchase price. In October 1993 it sold its Allentown, Pennsylvania, facility for a sum in excess of net book value and again received a mortgage on the property for a portion of the purchase price.
Travel Ports acquired certain assets of the Exit Three Truck Stop in Greenland, New Hampshire, in April 1994 for an undisclosed amount of cash. It later signed a new 20-year lease on the property, with two five-year extensions, and it also had purchase options throughout the term of the lease. In mid-1994 it took out a $2.5-million loan to cover the acquisition and certain improvements to the facility.
Travel Ports sold its facility at Fairplay, South Carolina, in June 1995 for net book value and received a mortgage on the property for a portion of the purchase price. In 1996 it leased an existing motor plaza in Baltimore.
Revenue figures for fiscal years 1992, 1993, and 1994 were remarkably alike, with net sales and operating revenues ranging between $137.6 million and $137.9 million. Net income was $554,000 in 1992, $783,000 in 1993, and $1,358,000 in 1994.
Net sales rose to $153.3 million in fiscal 1995, and net income to $1.9 million. Net sales rose to $165.2 million in fiscal 1996, but net income dropped to $1.7 million, a circumstance that management blamed on severe winter weather. The long-term debt was $19.8 million at the end of fiscal 1995.
Travel Ports in the Mid-1990s
The principal products sold at Travel Ports in the mid 1990s were diesel fuel, gasoline, and motor oil and other lubricants. Services and repairs were provided for trucks only. Truck washers, truck scales, and paved parking areas large enough to accommodate a number of oversized vehicles were also available at some or all of the company’s facilities. Repair facilities were not available at Belmont, New York, or Lake Station, Indiana. Tires and commonly needed parts were in stock at most locations.
Each Travel Ports facility, with the exception of the one at Mahwah, New Jersey, included a 24-hour, family-style restaurant where customers were served a variety of “home-cooked” meals. The company operated most of its restaurants under the name “Buckhorn Family Restaurants.” Food products were purchased from unaffiliated sources, with meals prepared and cooked in on-site kitchens.
Motel accommodations were available to both truck drivers and the general public. Rooms generally contained double beds, basic furniture, a color television set, and a full bathroom. Rates ranged from $25 to $30 a night. Public laundry facilities were also available. The Maybrook and Dansville, New York, motels operated under a franchise from Days Inn, and the Greencastle, Pennsylvania, motel under a franchise from the Friendship Inn division of Choice Hotels International.
Travel Ports was operating both travel and convenience stores. Travel stores carried a wide array of products often purchased by truck drivers, including health and beauty aids, snacks, tobacco products, western-style clothing and footwear, electronic products, and gift items. Convenience stores, generally located near the gasoline pump islands and used more by the general traveling public, offered bread, milk, beverages, snacks, and other items. An ATM machine was available at all these locations.
Diesel fuel accounted for 64 percent of Travel Ports’ revenues in fiscal 1994 but only 30 percent of gross profit. Restaurants accounted for 11 percent of revenues and 30 percent of gross profit. Stores accounted for eight and 11 percent, respectively; shops for six and 13 percent; gasoline for seven and three percent; and motels for one and three percent.
Of Travel Ports’ travel plazas in fiscal 1995, the ones in Binghamton and Fultonville, New York; Greencastle, Bloomsburg, Harborcreek, and Milesburg, Pennsylvania; Paulsboro, New Jersey; Candler, North Carolina; and Porter, Indiana, were owned. The ones in Dansville and Maybrook, New York; Mahwah, New Jersey; Lake Station, Indiana; Greenland, New Hampshire; and Baltimore were leased. The company owned its mini-plaza in Belmont, New York, and its fuel storage facility in Berwick, Pennsylvania. It was leasing its headquarters in Rochester, New York.
In 1995 E. Philip Saunders was still chairman and chief executive officer, and John M. Holahan was president and chief operating officer. At the end of January 1996 Saunders held about 31 percent of the company’s common stock and Holahan about nine percent. Institutions held about 16 percent.
“Roadway Motor Plazas Buys LaBar Enterprises,” Wall Street Journal, January 6, 1987, p. 22.
“Roadway Motor Truck Assets,” Wall Street Journal, July 23, 1987, p. 51.
Travel Ports of America, Inc. Annual Reports, Rochester, N.Y.: Travel Ports of America, Inc., 1995, 1996.