01—Abstract
Summary
Summary of the 10-K filed June 25, 2021. Cited figures are marked; the original filing is the authoritative source.
Casey's General Stores, Inc. (CASY) reported its fiscal year 2021 results, concluding on April 30, 2021.
The company operates a large network of convenience stores, primarily in Midwestern states, offering a diverse range of products including fresh food, beverages, tobacco, and fuel. Despite a challenging environment influenced by the COVID-19 pandemic, Casey's demonstrated resilience. Total revenue saw a decrease primarily due to lower fuel sales volume and prices, but this was partially offset by growth in grocery and merchandise sales.
Notably, the company achieved record net income, record fuel gross profit, and record diluted earnings per share, driven significantly by a substantial increase in fuel gross profit margin per gallon. This performance was also supported by strategic initiatives like expanding private label offerings, enhancing digital engagement with a growing rewards program, and continued store growth through new constructions and acquisitions. The company also detailed its significant investments in Team Member safety and well-being in response to COVID-19, amounting to $38.4 milliona in fiscal 2021.
Looking ahead, Casey's is focused on executing its long-term strategic plan, which includes accelerating unit growth and improving operational efficiencies. The company also announced substantial post-year-end acquisitions, indicating a continued aggressive growth strategy.
02—Key points
Key Highlights
- Casey's operated 2,243 stores as of April 30, 2021, adding 40 new stores and acquiring 5 others during fiscal year 2021.
- Total revenue for fiscal year 2021 decreased by 5.1% to $8.7 billion, primarily due to a 12.5% decrease in fuel sales driven by lower prices and gallons sold.
- Despite lower revenue, net income increased by 18.6% to $312.9 million, driven by record fuel gross profit per gallon (34.9 cents) and increased store count.
- The company invested $38.4 million in fiscal year 2021 for COVID-19 related health and safety measures for employees and guests.
- Casey's announced significant post-year-end acquisitions, including Buchanan Energy (92 stores) and 48 Circle K stores, signaling a continued aggressive expansion strategy.
- The company expanded its private brand portfolio to over 175 items and added 1.5 million Casey's Rewards members, indicating a focus on private label growth and customer loyalty programs.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2021filed June 25, 2021Financial Statements
FY2021 against FY2020
| Line item | FY2021FY2020 | Change |
|---|---|---|
| Revenue | $8.71B$9.18B | −5.1% |
| Operating Expenses | $1.64B$1.50B | +9.3% |
| Interest Expense | $46.68M$53.42M | −12.6% |
| Net Income | $312.90M$263.85M | +18.6% |
| EPS (Basic) | $8.44$7.14 | +18.2% |
| EPS (Diluted) | $8.38$7.10 | +18.0% |
| Shares Outstanding (Basic) | 37.09M36.96M | +0.4% |
| Shares Outstanding (Diluted) | 37.36M37.19M | +0.5% |
05—Questions
Frequently Asked Questions
How did the COVID-19 pandemic impact Casey's financial performance in fiscal year 2021?
The COVID-19 pandemic led to decreased store traffic and lower demand for certain products, resulting in an 8.1% decrease in same-store fuel gallons and an 8.7% decrease in same-store inside customer traffic. However, record high fuel gross profit margins per gallon, influenced by pandemic-related demand dynamics and effective fuel team management, significantly boosted overall profitability, leading to record net income and diluted earnings per share. The company also incurred $38.4 million in expenses for health and safety measures.
What is Casey's strategy for growth?
Casey's long-term strategic plan focuses on four objectives: reinvigorating hospitality and guest experience, expanding store presence ('be where the guest is') through accelerated unit growth, creating efficiencies, and investing in its people and culture. This includes a mix of new store construction and strategic acquisitions. The company's significant post-year-end acquisitions, such as Buchanan Energy and Circle K stores, demonstrate its commitment to rapid expansion.
How does Casey's differentiate its product offerings?
Casey's differentiates through a focus on prepared foods, particularly its well-known handmade pizza, and a growing selection of private label items. The company expanded its 'Casey's Brand' portfolio to over 175 items in fiscal 2021, aiming to offer greater value to guests. While fuel remains a significant revenue driver, the higher margins from prepared foods and merchandise are crucial to overall profitability.
What are the key risks highlighted in the filing?
Key risks include the ongoing impact of pandemics and disease outbreaks, data security breaches, food safety issues, disruptions to the distribution network, challenges in recruiting and retaining employees, failure to adapt to changing consumer preferences, increased credit card expenses, and volatility in wholesale petroleum costs. Regulatory changes and intense competition within the convenience store industry are also significant concerns.
06—Continue