ANKENY, Iowa -- Casey's General Stores Inc. has reported earnings per share from continuing operations of 57 cents for the first quarter of fiscal 2009 ended July 31, 2008. Total sales rose 22.4% from the previous first quarter to $1.6 billion, and gross profit increased 5.7% to $199 million. "The results include a charge of $2.6 million related to flood damages. If these costs were eliminated, our earnings would have exceeded the record high 59 cents we reported a year ago," said president and CEO Robert J. Myers. "We achieved excellent growth in a challenging economy, and our results give [image-nocss] us a solid start toward our fiscal 2009 performance goals."
Gasoline
Casey's annual goal is to increase same-store gasoline gallons sold 2% with an average margin of 10.8 cents per gallon. The quarter's same-store gallons sold were up 0.5% with an average margin of 15.6 cents per gallon, close to the previous first quarter's all-time high of 15.8 cents. The average retail price per gallon was $3.77, up 26.1% from the same period a year ago. Myers said, "Customer counts remained positive, but high retail prices continued to have an impact on gallons sold." Total gallons sold rose to 317.9 million from 313.4 million; gross profit was $49.6 million compared with $49.5 million.
Grocery & Other Merchandise
The company's goal is to increase same-store sales 7% with an average margin of 33.2%. The quarter's same-store sales were up 4.7%, total sales were up 5.5% to $274 million, and the average margin was above goal at 34%. Gross profit rose 5.7% to $93.3 million. "Despite increased cost pressures, we were able to maintain the margin we achieved the previous first quarter," said Myers. "We were encouraged by the traffic inside our stores, especially in light of the adverse weather that held back sales in the first part of the quarter."
Prepared Food & Fountain
The goal is to increase same-store sales 6.8% with an average margin of 61.2%. Same-store sales were up 12.3%, total sales rose 13.4% to $85.6 million, and the average margin was 60.5%. "Casey's prepared foods are destination items for our customers, and we make sure our warmers are full of the products they want when they want them," Myers said. "Higher prices for cheese and other commodities affected our margin; nevertheless, we increased gross profit 11.3% to $51.8 million. We are confident of our core strategies for managing this category. We will continue to test new menu offerings and marketing initiatives throughout the year and use point-of-sale data to assess their impact."
Operating Expenses
Though credit-card fees rose over 34%, the company held its increase in operating expenses to 8.9%. "Without the flood damages, operating expenses would have been up only 6.8%," said Myers. "We are pleased that our ongoing focus on containing costs is keeping the increase in single digits."
Expansion
The goal for fiscal 2009 is to increase the total number of Casey's stores 4%. By the end of the first quarter, the company had opened 7 stores. All of the openings were acquisitions of existing stores. "We know acquisitions are a cost- effective way to grow, and we will continue to pursue these opportunities," Myers said. "New-store construction will accelerate in the coming months as we roll out our new store design, developed specifically to accommodate more customer traffic, make our service areas more appealing, and enhance the sale of high-margin items."
The Ankeny, Iowa-based retailer owns and operates more than 1,450 c-stores in Iowa, Illinois, Indiana, Kansas, Minnesota, Missouri, Nebraska, South Dakota and Wisconsin. It operates primarily in smaller communities with populations of less than 5,000.
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