Casey’s will add 150-plus stores in fiscal 2024; enters 17th state
Casey’s General Stores’ second-quarter profit rose 15% as the company continues to expand and enter new markets.
The convenience store retailer said it expects to add “at least” 150 stores in fiscal 2024, more than the originally planned 110. Casey's, which built or acquired 59 stores in the quarter, recently entered Texas, its 17th state, with its acquisition of 22-store Lone Star Food Stores from W. Douglass Distributing Ltd. The acquisition closed in November.
In June, Casey’s unveiled a strategic growth plan that included a goal of adding 350 stores by the end of fiscal year 2026, with the expansion including both organic growth and acquisitions.
The company’s net income rose 15% to $158.8 million, or $4.24 a share, for the quarter ended Oct. 31. Analysts expected earnings of $3.97 a share.
Revenue rose 2% to $4.06 billion from $3.98 billion a year earlier.
Total inside sales rose 6.2%, driven by strong performance in the prepared food and dispensed beverage category, including whole pizza pies, bakery, and dispensed beverages as well as non-alcoholic and alcoholic beverages in the grocery and general merchandise category. Inside same-store sales increased 2.9%.
Total fuel gallons sold increased 4.0%, primarily due to the store count increase. Same-store fuel gallons were flat (0.0%) compared to prior year with a fuel margin of 42.3 cents per gallon.
“Due to the hard work of our team, Casey's delivered an outstanding second quarter highlighted by strong inside and fuel gross profit growth,” said Darren Rebelez, chairman, president and CEO. “Inside same-store sales were driven by prepared food and dispensed beverage, with whole pies and bakery performing exceptionally well. Our fuel team continues to do an excellent job finding the right balance between gallon growth and gross profit margin, as evidenced by another strong fuel margin quarter while same-store gallons were flat.”
Casey’s same-store operating expenses excluding credit card fees were up 2.1%, favorably impacted by a 2% reduction in same-store labor hours.
“The team continued to effectively manage the stores by reducing same-store labor hours while growing the business at the same time,” said Rebelez.
At October 31, 2023, the company had approximately $1.3 billion in available liquidity, consisting of approximately $410 million in cash and cash equivalents on hand and $900 million in available borrowing capacity on existing lines of credit.
Casey’s ended the quarter with 2,592 stores.