Casey's annual goal is to increase same-store gasoline gallons sold 2% for the year with an average margin of 11 cents per gallon. Gasoline margins [image-nocss] continued to be strong at 14.3 cents per gallon for the quarter and 15 cents per gallon year to date. Same-store gallons sold were down 0.7% for the quarter and up 1.2% for the year to date. "Inclement weather impacted our same-store gallons during the quarter," said Myers. "However, the retail price environment continues to be responsive to wholesale movements, resulting in a gasoline margin above goal." Total gallons sold for the six months were up 3.8% to 659.5 million gallons and gross profit increased 6.2% to $98.9 million.
For grocery and other merchandise, the annual goal is to increase same-store sales 8.9% with an average margin of 33.9%. Same-store sales for the quarter were up 1.9% with an average margin of 34.1%, up 20 basis points from the second quarter a year ago. Year to date, same-store sales were up 4.1% with an average margin above goal at 34.2%. "Same-store sales in the quarter were affected by poor weather and customers trading down to less-expensive items. Despite these pressures, gross profit for the category is up 7% for the year," said Myers. Year to date total sales were up 6.3% to $573.5 million.
For prepared food and fountain, the company's annual goal is to increase same-store sales 7.5% with an average margin of 62%. Same-store sales were up 3.4% for the quarter and 5% year to date. The average margin for the quarter was 64.6%, up over 400 basis points from the same period a year ago. "We were able to increase gross profit over 15% in the quarter primarily due to lower commodity costs and expanded coffee and fountain offerings," said Myers. Total sales year to date were up 9.5% to $190 million with an average margin of 64.2%.
In the second quarter, operating expenses increased 2.8% to $131 million. Moderate increases in wages, utilities, and insurance were partially offset by the savings in transportation costs and credit card fees as a result of lower retail gasoline prices from a year ago. "We anticipate more challenging comparisons in the latter half of the year given a higher gasoline price environment," said Myers. "However, we believe gains made in gross profit will more than offset this pressure." At midyear, expenses were up 1.3%.
Casey's goal for fiscal 2010 is to increase the total number of stores 4%. At the midyear point, the company had acquired four stores and completed seven new-store constructions. "We are pleased with the recent acquisition environment and have written agreements for an additional 16 locations that are scheduled to close in December," Myers said. "These stores are a perfect fit with our business model and we anticipate them being accretive immediately." The company also replaced 12 locations through the first six months.
Casey's General Stores, based in Ankeny, Iowa, operates 1,483 convenience stores in nine Midwest states.
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