8-KMaterial AgreementsFinancial EventsRegulation FD+1

CASEYS GENERAL STORES INC 8-K Report, Material Agreement (Oct 28, 2016)

Filed October 28, 2016For Securities:CASY

Summary

Casey's General Stores, Inc. (CASY) filed an 8-K on October 28, 2016, reporting on two primary events. First, the company issued $50 million in Senior Notes, Series D, due in 2031, carrying a 3.72% interest rate. This issuance is part of a Note Purchase Agreement originally dated May 2, 2016, and provides the company with long-term debt financing. Second, the company disclosed an inadvertent disclosure of an internal sales estimate made by its Director of Finance. The estimate, a 4.9% same-store sales figure for prepared food and fountain for a portion of fiscal 2017's second quarter, was shared with an analyst. While the company secured confidentiality from the analyst, it is providing the information to all investors to ensure transparency. Investors should note that this estimate only covered a period up to October 16, 2016, and is subject to revision before the official Q2 results are released on December 7, 2016.

Key Highlights

  • 1Issuance of $50 million in 3.72% Senior Notes, Series D, due October 28, 2031.
  • 2The debt issuance is governed by a Note Purchase Agreement dated May 2, 2016.
  • 3Inadvertent disclosure of a preliminary Q2 FY2017 prepared food and fountain same-store sales estimate (4.9%) to an analyst.
  • 4The disclosed estimate only covers sales from August 1, 2016, through October 16, 2016, and is not the final Q2 figure.
  • 5The estimate is subject to revision and completion of financial statements.
  • 6Company is releasing its official Q2 FY2017 financial results on December 7, 2016.
  • 7The company has taken steps to ensure confidentiality of the inadvertent disclosure.

Frequently Asked Questions

The issuance of $50 million in Senior Notes, Series D, is a form of long-term debt financing for Casey's General Stores, Inc. The specific use of proceeds is not detailed in this 8-K, but such issuances typically support general corporate purposes, capital expenditures, or refinancing existing debt.

The 4.9% figure is an internal estimate for prepared food and fountain same-store sales for only a portion of the second fiscal quarter (August 1 to October 16, 2016). It is explicitly stated to be subject to revision based on sales for the remainder of the quarter and normal closing procedures. Therefore, it should not be considered a final or definitive figure for the quarter.

The estimate was inadvertently disclosed by the Director of Finance to an analyst. After learning of the disclosure, the company obtained an oral agreement for confidentiality. However, to ensure fair disclosure to all investors, Casey's elected to publicly furnish the details of the estimate and its limitations.

Casey's General Stores, Inc. expects to release its official financial results for the second fiscal quarter ending October 31, 2016, on December 7, 2016.