Summary
For the fiscal first quarter ended July 31, 2017, Casey's General Stores, Inc. reported a decrease in net income to $56.8 million, or $1.46 per diluted share, compared to $67.4 million, or $1.70 per diluted share, in the prior year. This decline was primarily driven by increased operating expenses and depreciation, coupled with a reduction in fuel margins. Despite the earnings dip, total revenue saw a healthy increase of 6.3% to $2.1 billion, bolstered by a 5.4% rise in fuel gallons sold and growth in both grocery and prepared food sales. The company continues its aggressive growth strategy, with significant capital expenditures focused on new store construction, remodels, and acquisitions. Management remains confident in the company's liquidity and ability to fund future operations and growth through operating cash flow, its existing credit line, and recent senior note issuances, including a $250 million issuance in August 2017.
Financial Highlights
46 data points| Revenue | $2.09B |
| Cost of Revenue | $1.62B |
| Gross Profit | $476.70M |
| Operating Expenses | $321.25M |
| Interest Expense | $11.38M |
| Net Income | $56.76M |
| EPS (Basic) | $1.48 |
| EPS (Diluted) | $1.46 |
| Shares Outstanding (Basic) | 38.36M |
| Shares Outstanding (Diluted) | 38.84M |
Key Highlights
- 1Net income decreased by 15.8% to $56.8 million ($1.46/diluted share) compared to $67.4 million ($1.70/diluted share) in the prior year's first quarter, primarily due to increased operating expenses and depreciation, and lower fuel margins.
- 2Total revenue increased by 6.3% to $2.1 billion, driven by a 5.4% increase in fuel gallons sold and growth in same-store sales for grocery and merchandise (+3.1%) and prepared food and fountain (+3.7%).
- 3Operating expenses increased by 10.0%, largely due to the accelerated recognition of compensation expense for the 2017 long-term incentive program, increased store count, and growth program rollouts.
- 4Capital expenditures were substantial at $94.9 million for the quarter, primarily for new store construction, remodels, and acquisitions, with a full-year projection of $500-$600 million.
- 5The company issued $250 million in 3.77% Senior Notes due August 22, 2028, subsequent to the quarter end, to fund future growth.
- 6Cash and cash equivalents increased significantly to $159.1 million at quarter-end from $76.7 million at the start of the quarter, reflecting financing activities.
- 7The company repurchased 718,369 shares of common stock for approximately $78 million during the quarter under its existing share repurchase program.