10-QPeriod: Q2 FY2024

CASEYS GENERAL STORES INC Quarterly Report for Q2 Ended Oct 31, 2023

Filed December 11, 2023For Securities:CASY

Summary

Casey's General Stores, Inc. reported a solid third quarter for fiscal year 2024, with total revenue increasing by 2.2% to $4.06 billion, driven by growth in grocery, general merchandise, and prepared food segments, alongside a slight increase in fuel gallons sold. Net income saw a significant jump of 15.4% to $158.8 million, or $4.24 per diluted share, compared to the prior year. This performance was bolstered by improved in-store profitability and a higher fuel margin, despite increased operating expenses and depreciation. The company continued its strategic expansion, adding 60 new stores through acquisitions during the first half of the fiscal year, bringing the total store count to 2,592. While total revenue for the first six months decreased due to lower fuel prices, profitability within the stores improved, as evidenced by strong same-store sales growth in prepared foods and beverages (6.1%) and grocery/general merchandise (1.7%). The company is also proactively addressing future trends by expanding its electric vehicle charging infrastructure and offering renewable fuel options.

Financial Highlights

44 data points
Beta

Revenue

$4.06B

Net Income

$158.78M

3.9% Net Margin

EPS (Diluted)

$4.24

Total Assets

$6.23B

Cash & Equivalents

$409.89M

Free Cash Flow

$145.60M

Financial Statements
Beta
Revenue$4.06B
Operating Expenses$579.70M
Interest Expense$12.31M
Net Income$158.78M
EPS (Basic)$4.27
EPS (Diluted)$4.24
Shares Outstanding (Basic)37.23M
Shares Outstanding (Diluted)37.43M

Key Highlights

  • 1Total revenue for the third quarter of fiscal 2024 increased by 2.2% to $4.06 billion, compared to $3.98 billion in the prior year.
  • 2Net income for the quarter rose significantly by 15.4% to $158.8 million, leading to diluted earnings per share of $4.24, up from $3.67 in the prior year.
  • 3Same-store sales increased by 1.7% for grocery and general merchandise, and 6.1% for prepared food and dispensed beverages.
  • 4The company acquired 60 new stores during the first six months of the fiscal year, expanding its footprint to 2,592 locations.
  • 5Revenue less cost of goods sold as a percentage of revenue improved to 21.8% for the quarter, up from 20.4% in the prior year, driven by better in-store margins.
  • 6The company's EBITDA and Adjusted EBITDA increased by 12.6% and 11.1% respectively for the third quarter, demonstrating improved operational performance.
  • 7Cash provided by operating activities was $481.8 million for the six months ended October 31, 2023, slightly down from $486.1 million in the prior year, impacted by inventory changes and accrued expenses.

Frequently Asked Questions

The increase in net income was primarily driven by higher profitability within the store segments (prepared food, beverages, grocery, and general merchandise) and a higher fuel margin, which more than offset increased operating expenses and depreciation and amortization.

Casey's is pursuing growth through a combination of building new stores and executing strategic acquisitions. They acquired 60 stores in the first six months of the fiscal year and are actively working to integrate them into their brands. They are also expanding their services, such as installing EV charging stations and offering renewable fuels.

While fuel revenue for the six-month period decreased due to lower prices, the company's fuel margin per gallon has remained elevated compared to historical averages. They are closely monitoring fuel price volatility and its potential impact on performance, but have seen strong revenue less cost of goods sold for fuel.

Casey's has a strong liquidity position with significant cash on hand and available credit facilities. They primarily fund operations through cash flow from operations and have a manageable debt structure, including senior notes and finance lease obligations. They are also actively repurchasing shares under their share repurchase program.