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Steve?

Steven Goldman -- Chief Executive Officer

Thanks, Chris. Good morning, everyone, and thanks for joining our year-end conference call. It's amazing how time has -- flies by and here we are back at the start of another winter season.During the fourth quarter our bottom-line performance was negatively impacted by lower volumes of home heating oil and propane, by acquisitions completed after the heating season, and investment in our service initiatives and certain onetime expenses such as severance, as Rich will review in a moment. But we took some strategic actions to better positon the company for future growth during this time.

Most notably, we sold our small security business for net proceeds of $7 million. We came to the conclusion that this was not a prudent area for us to be concentrating our efforts on or spending capital, and thus, made the decision to sell this operation. At the same time, we eliminated 18 small brand names of the company to improve overall marketing efficiency. We believe taking such steps leaves us more focused and streamlined as an enterprise dedicated to our core heating, cooling, and other HVAC-related markets.

As always, we continue to look at transactions that can strengthen or grow our customer base. For fiscal 2018 as a whole, we completed six acquisitions that brought in aggregate of approximately 17,000 new accounts to Star across several product categories, and we're actively looking at additional opportunities as we speak. It's exciting to watch the expansion of our geographic footprint as well as the increasing array of products and services we're now able to provide our customers. For the year, our net attrition was 3.2%.

While up from last year, attrition for the prior five years averaged around 2.5%. We believe this past year largely reflected customers' frustration with the extreme weather conditions we suffered in early January, but in -- although we dedicated to reducing net attrition in the quarter.As we start the winter season, I'd like to again thank our employees for their tremendous efforts this past fiscal year. We faced numerous challenges related to extreme weather and we believe we're better prepared today if similar conditions were to arise. Even though we're a very large enterprise, we need to remain nimble and very customer service oriented.

I believe the measures undertaken this fiscal year will help us do just that, leaving us well positioned for a solid financial performance in the quarters to come.With that, I'll turn the call over to Rich Ambury to provide some comments on the quarter's results.

Rich Ambury -- Chief Financial Officer

Thanks, Steven, and good morning, everyone. For the quarter, our home heating oil and propane volumes sold decreased by 3 million gallons or 15% to 19 million gallons as the additional volume provided from acquisitions of around three-quarters of a million gallons was more than offset by the impact of a delivery variance in net customer attrition. Sales volume of other petroleum products, however, did rise by about 13 million gallons or 45% to 42 million gallons, largely due to acquisitions. Our product gross profit increased by $0.5 million or 1.5% as higher per gallon margin and an acquisition-related increase in gross profit from other petroleum products mitigated the impact of a decline in home heating oil volume in the base business.

Our operating expenses increased by $9.5 million or 13% to $18 million during the quarter. Acquisitions accounted for $4.4 million of the increase while in the base business, expenses rose by $5.1 million or 7%. The major drivers of the expense increase include a higher bad debt expense and credit card fees of $1.3 million, an expansion of the company's concierge program for about $1.6 million. There were some rebranding expenses of $6 million as well.

We also took a charge of half a million for severance during the fourth quarter of fiscal 2018 as 11 positions were eliminated, which should save the company well over $2 million in fiscal 2019. Separately, as Steve mentioned, we sold our small security business and recorded a gain of $7 million in the quarter. The company's net loss increased by $3.8 million or 21% to $21.5 million as the gain on the sales of the security business was more than offset by the net loss attributable to acquisitions completed after the heating season, a widening of the adjusted EBITDA loss in the base business, and a $5.1 million noncash change in the fair value of derivative instruments. The company's adjusted EBITDA loss increased by $8.4 million to $38 million due to an increase in the base business adjusted EBITDA loss of $6.7 million and an adjusted EBITDA loss of $1.7 million related to acquisitions, largely completed after the heating season.

In the base business, total gross profit declined by $1.9 million as the reduction in home heating oil and propane volume was partially offset by higher home heating oil and propane margins. Expansion of the company's concierge service program, higher bad debt and credit card fees, the build-out of certain departments, severance payments, training, and inflation pressures accounted for the balance of the increase in the adjusted EBITDA loss.Moving over to fiscal 2018. As a whole, home heating oil and propane volume rose by 40 million gallons or 13% to 357 million gallons as the additional volume provided from acquisitions in colder weather more than offset the impact of net customer attrition and other factors. Temperatures for fiscal 2018 were 9% colder than last year's comparable period, but still about 5% warmer than normal.

As mentioned on prior calls, the fiscal year included some extreme weather patterns, including times when temperatures were nearly 50% colder and 50% warmer than normal. Our product gross profit increased by $57 million or 15% of $447 million due to higher home heating oil and propane volume, a 1.9% increase in home heating oil and propane margins and an increase in gross profit from other petroleum products.In the base business though, our home heating oil and propane margins did increase by $0.036. Our net service gross profit decreased by $2 million year over year, partly due to acquisitions, but also reflecting the extreme weather conditions experienced this past winter. Our delivery and branch expenses rose by $51 million or 17% to $357 million during the year.

This was partly due to acquisitions, which accounted for $18 million of the increase, and we also recorded a charge of $1.9 million related to our weather hedge contract. In the base business, expenses rose by $31 million. The extreme cold weather experienced earlier in the year resulted in an estimated $3 million increase in delivery expense, and the additional volume sold accounted for another $3 million. Higher prices and volume also resulted in an increase in bad debt expense and credit card fees of $6 million.

To attract and retain customers through our expanded service offerings, costs related to our concierge program rose by $3.4 million. In addition, the year-over-year comparison was impacted by higher insurance expense of $4.5 million due in part to the extreme weather we experienced earlier in fiscal 2018. Our onetime rebranding expenses of $1 million, service payments of a half million, and customer concessions of $4 million also contributed to the year-over-year comparison. An increase in our fixed cost, the normal salary benefit, and other expense items accounted for the balance of the increase.We posted net income for fiscal 2018 of $56 million or $29 million higher than the prior year due to an increase in the adjusted EBITDA of $5.2 million, a favorable change in the fair value of derivative instruments of $9 million, the nine -- the $7 million increase related to the sale of the security business, and a decline in the company's effective income tax rate.

Adjusted EBITDA rose by $5.2 million to $86 million for fiscal 2018. This reflected the additional EBITDA provided by acquisitions of $4.9 million, including the adjusted EBITDA loss for acquisitions completed after the heating season of $800,000. In the base business, the impact of the additional volumes sold, largely reflected colder temperatures and higher home heating oil and propane margins, was relatively offset by higher operating costs and a $1.9 million charge related to the customers' weather hedge contract. And with that, I'd like to turn the call back over to Steve.

Steven Goldman -- Chief Executive Officer

Thanks, Rich. And at this time, we'd be pleased to address any questions you may have. Operator, please open the phone lines for questions.

Questions and Answers:

Operator

Thank you, sir. [Operator instructions] And today's first question comes from Andrew Gadlin of Odeon Capital Group. Please go ahead.

Andrew Gadlin -- Odeon Capital Group -- Analyst

Thank you. I was wondering if you could talk about the M&A pipeline a little bit.

Steven Goldman -- Chief Executive Officer

Yes, sure. It's been relatively consistent. In the last six to eight months, we've been steadily looking at numerous potential acquisitions, both larger and small, in the range that we tend to look at things across our footprint, not external to our footprint for the most part. We're seriously looking at a couple of potential mix product businesses that were still in the relatively early stages.

So we don't know, as always, if they'll come to fruition. And we've gotten a lot of external interest and we always have conversations going end to end in our footprint. So potential possible acquisitions that may be presented later during the next six to 12 months. So from our perspective, what's in front of us looks pretty normal, and we're optimistic that we'll wind up with probably the similar type behavior as our past that we'll have some opportunities to close on some acquisitions in the next 12 months.

Andrew Gadlin -- Odeon Capital Group -- Analyst

OK. Thank you very much.

Operator

And our next question today comes from Michael Prouting of 10K Capital. Please go ahead.

Michael Prouting -- 10K Capital LLC -- Analyst

Steve, I was wondering if you could give us some metrics around the concierge business.

Steven Goldman -- Chief Executive Officer

I think the most important -- Rich talked a little bit about additional spending. I would characterize additional spending, for the most part, was in the form of marketing, advertising, and promotions to try to establish the branding of the product in a piece of our footprint. We're probably offering -- I'd say probably because it's hard to specifically tell you the exact percentage of population of customers because they are our first target audience, our internal customers although we're targeting internal customers, we're looking at external customers as well. So we're probably looking at a footprint which is equal to about 8% to 12% of our company footprint from a marketing standpoint.

Getting just the base formulation of the product was -- out into to the marketplace was sort of expensive. We're trying to measure some of that. So we're a bit more cautious about how we'll spend with that product going forward. So I don't think -- I guess my point is, what we've spent on some start-up cost and marketing probably isn't reflective of the same rate going forward.

We're going to do it pretty carefully. And part of that is we're trying to establish a new concept in our marketplace, which is personalized, extended concierge-level service for people, who primarily are heating oil or propane customers, but we're going to help them manage all the other services for their home. We have a -- I think it's easiest to characterize it as we have a few thousand paying customers, paying for a membership at this point. And that's our strategy that we're going to have either a monthly or annual membership to help offset some of the staffing costs to have the people that can answer the phones and provide this human touch type service.

It's growing. Maybe a bit slower than I'd like it to be, but it's -- we're aiding customers every day. And then of course, the selective footprint that we've decided to do that in, which is primarily the New York, Northern New Jersey, lower Connecticut, and Rhode Island geography, which -- Rhode Island spills a bit into Massachusetts, which, again, it's some of our more dense piece of our northern half of our business where we think the demographic best fits the target audience. I think that the pace of adding customers has been there and I was hoping it would be, at this point, a bit faster, but I think part of it is just getting people to understand the product and concept and growing referrals and reputation.

We've really only been marketing, as noted in Rich's comments, really, the aggressive launch started in the late September. So really, from a perspective standpoint, we're about a little over two months into this. And then, obviously, there's a lag in people kind of being receptive to it. So it's really still fully hard to measure people's appreciation.

But the people that are using it, for the most part, have stayed with it. The loss rates are relatively positive. Meaning the churn of people who've tried it and saying "We're getting out," we're retaining better than 70% of the customers that are starting. And I say that because we're just focusing on people who are paying.

And in the world of people who do trial things and they tend to try it, they don't stay with it. But we kind of have built some mechanisms to get some recurring contact, which I think will be a key to this successful product or not.One thing that I would mention that kind of filters back to Star internally that doesn't really offset directly, this product cost is the benefit to preexisting Star Group customers, which again, at this point, are still about 95% of these customers. We're seeing additional use of plumbing services, appliance repair, HVAC, heating fuels sold, generators, and some other partnered more traditional work like duct cleaning that we've been doing for a while. We're seeing some growth where, in concentration, where this product is being offered.

So that is very promising, I think. Again, it's -- the lift is embedded in the service and installation revenue numbers. And again, it is kind of small, so they're hard to notice. But materially, they're probably a few hundred thousand dollars for the period that we started doing this.

So again, all in, it's early in its onset. We're making adjustments as we see appropriate. We're certainly not looking to labor the Star Group performance in large part. But what we do with this concierge product, it's supposed to be additive in the long term, both for retention and support of growth of service revenues.

Michael Prouting -- 10K Capital LLC -- Analyst

OK. Great. And I would also assume too that the churn rate among customers who are signing up to the concierge service is likely to be much, much lower than nonconcierge customers, right?

Steven Goldman -- Chief Executive Officer

We hope that. We don't know that actually at this point. Right now, there's not enough data or time to -- that has lapsed to give us certainty in that. We'll probably know that in the nine months.

A better measure is a full 12-month period.

Michael Prouting -- 10K Capital LLC -- Analyst

Yes. No, of course. Yes. And just to delve back on the acquisition side of things, any potential for some much larger, transformative acquisitions in the foreseeable future?

Steven Goldman -- Chief Executive Officer

Anything we're looking at right now is pretty much within the difficult bandwidth of the size of acquisitions that we've been looking at before, a couple million up to few tens of millions in that range. There's nothing transformative, as I say. I'd say a couple of them, if they were to take place, could be very healthy and a benefit to us because of the overlap and what the long-term synergies would be. So there's a couple or really a few that we're looking at that if we can get them to work for us and the sellers that we'd be pretty happy to have as additions, but we never know if that really works out for us in the long term.

So I think that again, the key part is moving healthily in the same steady path we've been moving, but nothing that's going to make Star Group look very different in the next couple of years that we see right now on the horizon.

Michael Prouting -- 10K Capital LLC -- Analyst

OK. Thanks for the update there. And then finally in terms of the usual question on capital allocation, any update to what's unit repurchases versus dividend, etc.?

Rich Ambury -- Chief Financial Officer

We're in the market every day buying units back to the extent that we can buy them back and we'll still keep on -- probably the distributions will probably go along as they have been in the past.

Michael Prouting -- 10K Capital LLC -- Analyst

OK. Terrific. Good news. Thanks.

Rich Ambury -- Chief Financial Officer

You're welcome.

Operator

And ladies and gentlemen, our next question comes from Ed Olson, a private investor. Please go ahead.

Unidentified speaker

Hey, guys. A little more specificity on the buyback. You announced $5.5 million, I think, on August 28. What have you bought against that?

Rich Ambury -- Chief Financial Officer

Yes, that's a -- yes, just let me look that up.

Unidentified speaker

OK.

Rich Ambury -- Chief Financial Officer

Hold on a second.

Unidentified speaker

OK. And while you're doing that, I just -- a little elaboration on the propane business?

Steven Goldman -- Chief Executive Officer

Propane is growing at a healthy pace, kind of the similar pace to what we've seen for the last four years. The account growth has been steadily over 10% that we're happy about, and that's pretty much the blend over all the geographies. There's some smaller groups that are growing better than that. There are some larger, more mature groups of propane that are growing just about at 10%.

What we haven't been able to enjoy consistently is all the volume we've been hoping for. We've gotten growth in volume and it's been in line with prior years. But because we've spread out the geographical reach of the propane business, we've seen some very unevenness of how customers are using propane, and some of it has been kind of disappointing, especially as you get down south. The weather effect on propane consumption to the weather-sensitive piece of the propane business has been kind of more on and off as opposed to gradient as with the heating oil components in the north.

Unidentified speaker

Well, if it'll help you, in even South Carolina, we have a frost this morning.

Steven Goldman -- Chief Executive Officer

Well, that does help. And honestly, what -- if it's going to be prolonged, we'll probably see better volume this year down there. And what's happened in the last couple of years, we've had relatively late onset of colder periods, and then it's evacuated relatively rapidly above 50 degrees. And all of a sudden, we lose the draw in volume.

So if we do have the benefit of cold and it stays a while, I think we'll be pretty pleased with those volume numbers because I think our propane businesses have been, not only growing reliably, but it's been pretty healthy. So we're pretty happy about that.

Michael Prouting -- 10K Capital LLC -- Analyst

Good.

Rich Ambury -- Chief Financial Officer

To answer your question on the unit buyback, in the fourth quarter, the quarter ending September 30, we bought back 430,000 units and in October, we bought back 151,000 units. In November, we bought back 182,000 units. So ballpark, it looks like, on average, we're buying back between 130,000 and 150,000 units a month.

Unidentified speaker

And then what is the total against the $5.5 million? What's left?

Rich Ambury -- Chief Financial Officer

Well, as the end of November, it's a -- the total units that we can buy back is 5.026 million.

Unidentified speaker

I'm not sure if I understand that, though. The $5.5 million was announced in August, and you still got 5.026 million open?

Rich Ambury -- Chief Financial Officer

Well, there is a public part of the plan, which is 2.5 million units, and then there's -- around 2.5 million is still left for the public plan.

Unidentified speaker

OK, so has anything been done on the private side?

Rich Ambury -- Chief Financial Officer

Nothing was done on the private side. Right.

Unidentified speaker

OK. All right. Now I understand. Thank you.

Steven Goldman -- Chief Executive Officer

Welcome, Ed. Enjoy South Carolina.

Operator

[Operator instructions] There appears to be no further questions. I'd like to turn the conference back over to Mr. Goldman for any closing remarks.

Steven Goldman -- Chief Executive Officer

Thank you, Rako, and thank you, everybody, for taking the time for joining us today and for your ongoing interest in Star Group. We look forward to sharing our 2019 fiscal first-quarter results with you in February.

Operator

[Operator signoff]

Duration: 28 minutes

Call Participants:

Steven Goldman -- Chief Executive Officer

Chris Witty -- Investor Relations, Darrow Associates

Rich Ambury -- Chief Financial Officer

Andrew Gadlin -- Odeon Capital Group -- Analyst

Michael Prouting -- 10K Capital LLC -- Analyst

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