Casey's is continuing to focus on implementing its ongoing cost-reduction measures and managing its operating expenses. The company expects the cumulative savings of store-level operating expenditures to be $200 million by full-year 2021, it said.
“We have identified and implemented numerous cost-reduction measures focused primarily on labor, our largest category of controllable expenses,” said Handley. “We have also optimized prior initiatives, pizza delivery and 24-hour stores, and enhanced our ability to monitor and adjust these programs across the store base, including new stores.”
As a result of these initiatives, Casey’s has achieved “a significant and measurable” reduction in the store-level operating expenses. In stores not affected by recent growth programs, it has reduced operating expense growth from 9.6% in third-quarter fiscal 2017 to 2.9% in third-quarter fiscal 2018.
The company expects to achieve cumulative store-level operating expense savings of approximately $200 million from fourth-quarter fiscal 2018 to fiscal 2021, which it plans to reinvest in the key initiatives.
“We are also exploring other opportunities to further reduce expenses,” Handley said. “We are currently implementing a new fleet-management system that improves distribution efficiency and reduces cost. Also, in anticipation of the increased sales volume generated by our initiatives and new stores, we are conducting a holistic evaluation of our distribution system to identify optimization opportunities, with a focus on cost and efficiency.”