Casey’s Reports Record Year and Remains Optimistic for Fiscal 2010
Casey’s General Stores, Inc. (Nasdaq: CASY) today reported earnings for the fourth quarter and the fiscal year ended April 30, 2009. For the quarter, basic earnings per share from continuing operations were $0.31 compared to $0.28 a year ago. For the year, basic earnings per share were $1.69, up from $1.68 in fiscal 2008. The results include a $9.1 million pre-tax charge related to the previously disclosed settlement of two wage and hour lawsuits. Without the effect of the settlement, earnings would have been approximately $1.80 for the year. “Despite this charge and a very challenging economy, we were able to achieve record earnings and we anticipate continuing our strong performance in fiscal 2010,” said President and CEO Robert J. Myers.
Gasoline—Casey’s annual goal in fiscal 2009 was to increase same-store gasoline gallons sold 2% with an average margin of 10.8 cents per gallon. For the year, same-store gallons were up 1% with an average margin of 12.9 cents per gallon. “The high retail price environment held same-store gallons in check during the first half of the fiscal year,” said Myers. “However, same-store gallons improved during the second half of the year as retail prices declined.” Same-store gallons sold were up 1.2% for the fourth quarter with an average margin of 12.1 cents.
Grocery and Other Merchandise—The Company’s goal was to increase same-store sales 7% with an average margin of 33.2%. For the fiscal year, same-store sales rose 5.9% with an average margin of 33.5%; up 40 basis points from a year ago. Gains made in the cigarette area and the continued popularity of high-margin beverages were significant contributors to the growth. “We are pleased with this category’s performance over the past several years and remain encouraged about future growth opportunities,” stated Myers. For the quarter, same-store sales increased 8% with an average margin of 32.9%.
Prepared Food and Fountain—Casey’s annual goal was to increase same-store sales 6.8% with a margin of 61.2%. Same-store sales increased 9.1% during fiscal 2009, with an average margin of 61.4%. “The Company benefited from strategic price increases implemented early in the year and was successful in negotiating a forward buy that locked in our cheese cost through October 2009,” said Myers. “In fiscal 2010 we intend to maintain the momentum by expanding our coffee and fountain selections, introducing new menu items and continuing the roll-out of our made-to-order sub sandwich program.” Total sales for the year were up 11.2% to $335.6 million. Same-store sales in the fourth quarter rose 7.2%, with a margin of 62.7%; up 180 basis points from the fourth quarter a year ago.
Operating Expenses—For the fiscal year, operating expenses increased 6.2%. In the fourth quarter, operating expenses were up 7.1%. Without the effect of the lawsuit settlement, operating expenses would have been up only 4.3% for the year and down 0.6% in the quarter. “Lower fuel prices during the second half of the year helped reduce our transportation costs and credit card fees,” stated Myers.
Expansion—The goal for fiscal 2009 was to increase the total number of stores 4%. For the year, the Company increased the store count by approximately 2%, with 16 new store constructions and 16 acquired stores. “In addition to unit growth, we continue to replace and remodel existing locations to meet the changing needs of our customers,” stated Myers. “During fiscal 2009 we replaced 14 stores and completed 2 remodels utilizing the features of our new store design.”
Fiscal 2010 Goals—Myers shared four corporate performance goals for fiscal 2010:
* Increase same-store gasoline gallons sold 2% with an average margin of 11 cents per gallon.
* Increase same-store grocery and other merchandise sales 8.9% with an average margin of 33.9%.
* Increase same-store prepared food and fountain sales 7.5% with an average margin of 62%.
* Increase the total number of stores by 4%.
Dividends—At its June meeting, the Board of Directors increased the quarterly dividend to $0.085 per share. The dividend is payable August 17, 2009 to shareholders of record on August 3, 2009.
Market Data 
Markets 
AI
