You are here
ANKENY, Iowa -- Casey's General Stores Inc., based here, saw its profit grow 23 percent in the third quarter, though bad weather hampered business.
The chain reported $0.34 in basic earnings per share for the third quarter of fiscal 2010 ended January 31, 2010, compared to $0.28 for the same quarter a year ago. Year to date, basic earnings per share were $1.87 vs. $1.38 for the same period last year.
"The acquisition environment has become more favorable during this fiscal year," stated President and CEO Robert J. Myers. "We surpassed the 1,500 store milestone in the third quarter as we were able to close on several small multi-store transactions."
Casey's annual goal is to increase same-store gasoline gallons sold 2 percent, with an average margin of 11 cents per gallon. For the third quarter, same-store gallons sold were down 2.9 percent, with an average margin of 12.4 cents per gallon.
"We continue to experience a favorable gasoline margin environment," Myers said. "However, in the quarter the average retail price of gasoline was up over 45 percent to $2.52 per gallon compared to $1.73 a year ago. This disparity, combined with adverse weather throughout the Midwest, impacted gallons sold."
For the year, total gallons sold were up 2.8 percent to 969.3 million, with an average margin of 14.2 cents. Same-store gallons for the year were down 0.2 percent.
Inside the store, Casey's annual goal is to increase grocery and other merchandise same-store sales 8.9 percent, with an average margin of 33.9 percent. For the third quarter, same-store sales were up 1.7 percent with an average margin of 32.7 percent. For the nine months, same-store sales were up 3.4 percent with an average margin of 33.7 percent.
"Sales were impacted by customers trading down to less-expensive products, and our margin softened due to the increased contribution of lower-margin items relative to total sales of the category," Myers said in a statement. "That impact, along with the harsh weather, affected the performance of this category." Total sales for the year are up 5.8 percent to $816.1 million.
In the prepared food and fountain category, the goal for fiscal 2010 is to increase same-store sales 7.5 percent, with an average margin of 62 percent. Same-store sales were up 1.4 percent for the quarter and 3.8 percent year to date.
"Despite the poor weather during the quarter, we were able to drive gross profit nearly 8 percent due to an increased contribution from higher-margin items such as pizza and fountain," Myers explained. The margin for the quarter was up 100 basis points to 62.8 percent. Year to date, total sales were $276 million, compared to $254.6 million for the period a year ago, with an average margin of 63.7 percent.
At the nine-month mark, Casey's operating expenses were up 3.2 percent. For the quarter, operating expenses rose 7.5 percent, driven by increases in credit card fees and fuel expense. These two expenses combined were up $3.6 million in the third quarter. "The increases in credit card fees and fuel expense were due to higher fuel prices during the third quarter," Myers stated. "Without these increases, expenses would have been up about 4.5 percent compared to the same period a year ago."
Casey's plans to increase its total number of stores 4 percent this fiscal year. At the end of the third quarter, the company acquired 20 stores and completed 10 new-store constructions. "We are encouraged with the acquisition activity in the third quarter and have written agreements for an additional 15 locations that we anticipate closing on by the end of the fiscal year," Myers said. "We remain optimistic about long-term growth opportunities." The company has also replaced 18 stores during the first nine months of the year.
At its March meeting, the board of directors declared a quarterly dividend of $0.085 per share. The dividend is payable May 17, 2010, to shareholders of record May 3, 2010.
Casey's Extends Title Sponsorship of USMTS National Tour
Casey's Celebrates Opening of New Iowa Store
Casey's Building Bigger, New-Format Store In Missouri