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4-Traders Homepage  >  Equities  >  Nasdaq  >  Casey's General Stores Inc    CASY

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CASEYS GEN NPV : Casey's Acquires 64 Stores in the Third Quarter; Positioned Well for Future Growth

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03/07/2011 | 10:05pm CET

Casey's General Stores, Inc. (Nasdaq: CASY) today reported $0.34 in basic earnings per share for the third quarter of fiscal 2011 ended January 31, 2011, compared to $0.34 for the same quarter a year ago. Year to date, basic earnings per share were $1.64 versus $1.87 for the same period last year. The results include approximately $27.4 million in expenses pertaining to the Company's recapitalization plan completed in the second quarter, as well as the unsolicited hostile offer and related actions by Alimentation Couche-Tard Inc., of which $1.7 million was recorded in the third quarter. Without those expenses, basic earnings per share would have been $0.37 for the quarter and $2.06 year to date. Earnings in the quarter were impacted by compressed margins due to a competitive cigarette environment, rising commodity costs and increased operating expenses related to store openings. ?Although rebranding a large number of stores in such a short period of time put a temporary strain on our operations, we are encouraged with our ability to drive same store customer traffic nearly 5%, resulting in double digit sales increases across all lines of our business,? stated President and CEO Robert J Myers. ?We believe we are gaining market share and the Company is positioned well for future revenue and earnings growth.?

Gasoline – The Company's annual goal is to increase same-store gasoline gallons sold 1% with an average margin of 13.5 cents per gallon. For the third quarter, same-store gallons sold were up 3.5% with an average margin of 13.9 cents per gallon. ?This category has exceeded our expectations in both gallon growth and margin throughout the first nine months of the fiscal year,? said Myers. Same-store gallons sold for the year increased 2.8% with an average margin of 15.1 cents, while gross profit rose 16.5%. For the year, total gallons sold were up 9.3% to 1.1 billion.

Grocery & Other Merchandise – Casey's annual goal is to increase same-store sales 6% with an average margin of 33.9%. For the nine months ended January 31, 2011, same-store sales were up 4.6% with an average margin of 32.3%. For the quarter, same-store sales rose 5.8% with an average margin of 30.9%. The Company experienced double digit sales growth across all major areas of this category in the third quarter, producing a 13.8% total increase in grocery and other merchandise revenue. The margin was affected by a competitive cigarette pricing environment, promotional activity in some beverage items and a larger LIFO charge primarily due to higher cigarette costs. The LIFO charge in the third quarter was approximately $1.1 million higher than the prior year's third quarter. ?Even though the cigarette environment continues to be challenging, we experienced same store unit movement increases during the third quarter despite a national average decline,? said Myers. ?Cigarettes are an important destination item in the convenience store industry. Being competitive and maintaining market share is imperative for long-term sales growth for other products.? Despite these items along with commodity pressures, gross profit in the third quarter was up 7.7%. Total sales for the year are up 10.6% to $902.2 million.

Prepared Food & Fountain – The goal for fiscal 2011 is to increase same-store sales 8% with an average margin of 63.1%. For the quarter, same-store sales were up 10.5% with an average margin of 62.1%, down from the same period a year ago primarily due to a rise in commodity prices. ?Sales rose 16.5% during the quarter, which drove an increase in gross profit over 15%,? said Myers. ?We are pleased with the gains we have been able to achieve in prepared foods despite escalating commodity pressures, and we remain optimistic about the continued performance of this category.? For the nine months, same store sales were up 6.5% with an average margin of 62.9%. Year to date, total sales were up 12.2% to $309.8 million compared to $276 million.

Operating Expenses – At the nine month mark, operating expenses increased 16.8% to $457.2 million. Excluding $16 million of expenses related to the unsolicited hostile offer by Couche-Tard, expenses would have increased 12.7%. For the quarter, operating expenses were up 18.5%, driven by an increase in credit card fees, fuel expense and insurance. These three combined were up approximately $6.3 million. ?We anticipated that the record number of stores acquired in the third quarter would impact operating expenses,? said Myers. ?However, we still expect these stores to be highly accretive to earnings in their first full year of operation, and provide even further earnings enhancements long-term when we implement our food service program.?

Expansion – The annual goal is to increase the total number of stores 4-6%. Year to date, the Company acquired 74 stores and completed 14 new-store constructions. ?We are pleased with the recent acquisition environment and we have written agreements for an additional 20 locations that we expect to complete in the next 6 months,? said Myers. The Company also replaced 9 locations during the first nine months of the year and completed 39 major remodels.

Dividend – At its March meeting, the Board of Directors declared a quarterly dividend of $0.135 per share. The dividend is payable May 16, 2011 to shareholders of record on May 2, 2011.

             
 

Casey's General Stores, Inc.

Condensed Consolidated Statements of Earnings

(Dollars in thousands, except share and per share amounts)

(Unaudited)

 

Three months ended January 31,

Nine months ended January 31,

2011 2010 2011 2010
Total revenue $ 1,374,199 $ 1,114,377 $ 4,085,745 $ 3,457,281
Cost of goods sold (exclusive of
depreciation and amortization,
shown separately below) 1,171,668 937,777 3,421,866 2,854,192
Gross profit 202,531 176,600 663,879 603,089
Operating expenses 151,506 127,883 457,155 391,254
Depreciation and amortization 20,769 18,368 60,373 54,846
Interest, net 8,908 2,748 19,630 8,159
Loss on early retirement of debt ---------- ---------- 11,350 ----------
Earnings before income taxes 21,348 27,601 115,371 148,830
Federal and state income taxes 8,473 10,359 43,518 53,803
Net earnings $ 12,875 $ 17,242 $ 71,853 $ 95,027
 
Earnings per common share
 
Basic $ .34 $ .34 $ 1.64 $ 1.87
 
Diluted $ .34 $ .34 $ 1.63 $ 1.86
 
 
Basic weighted average shares
outstanding 37,938,394 50,914,462 43,727,582 50,892,629
Plus effect of stock options 305,056 185,024 272,828 146,903
Diluted weighted average shares
outstanding 38,243,450 51,099,486 44,000,410 51,039,532
 
     

Casey's General Stores, Inc.

Condensed Consolidated Balance Sheets

(Dollars in thousands)

(Unaudited)

 

January 31,

April 30,

2011 2010
Assets
Current assets
Cash and cash equivalents $ 64,446 $ 151,676
Receivables 16,203 12,111
Inventories 134,721 124,951
Prepaid expenses 1,578 1,129
Deferred income taxes 11,062 9,417
Income taxes receivable 36,501 10,801
Total current assets     264,511       310,085
Other assets, net of amortization 11,736 10,232
Goodwill 86,422 57,547
Property and equipment, net of
accumulated depreciation of $760,421 at
January 31, 2011, and of $706,994 at April 30, 2010 1,171,586 1,010,911
Total assets   $ 1,534,255     $ 1,388,775
 
Liabilities and Shareholders' Equity
Current liabilities
Notes payable $ 9,000 $ ----------
Current maturities of long-term debt 1,319 24,577
Accounts payable 159,252 145,334
Accrued expenses 87,993 70,975
Total current liabilities     257,564       240,886
Long-term debt, net of current maturities 678,864 154,754
Deferred income taxes 182,595 141,229
Deferred compensation 13,555 12,788
Other long-term liabilities 16,508 14,799
Total liabilities 1,149,086 564,456
 
Total shareholders' equity 385,169 824,319
   
Total liabilities and shareholders' equity   $ 1,534,255     $ 1,388,775
 

Certain statements in this news release, including any discussion of management expectations for future periods, constitute ?forward-looking statements? within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause actual results to differ materially from future results expressed or implied by those statements. Casey's disclaims any intention or obligation to update or revise forward-looking statements, whether as a result of new information, future events, or otherwise.

 
Sales and Gross Profit by Product
(Amounts in thousands)
         
Nine months ended Grocery & Other Prepared Food
1/31/11 Gasoline Merchandise & Fountain Other Total
 
Sales $ 2,855,413 $ 902,181 $ 309,754 $ 18,397 $ 4,085,745
Gross profit $ 159,762 $ 291,065 $ 194,697 $ 18,355 $ 663,879
Margin 5.6 % 32.3 % 62.9 % 99.8 % 16.2 %
Gasoline gallons 1,059,146
 
Nine months ended
1/31/10
 
Sales $ 2,350,541 $ 816,074 $ 276,042 $ 14,624 $ 3,457,281
Gross profit $ 137,176 $ 275,356 $ 175,976 $ 14,581 $ 603,089
Margin 5.8 % 33.7 % 63.7 % 99.7 % 17.4 %
Gasoline gallons     969,268                  
 
         
Gasoline Gallons Gasoline Margin
Same-store Sales Growth (Cents per gallon, excluding credit card fees)
          Fiscal           Fiscal
Q1 Q2 Q3 Q4 Year Q1 Q2 Q3 Q4 Year
F2011 1.5 % 3.6 % 3.5 % F2011

16.4

¢

14.9

¢

13.9

¢

F2010 3.2 -0.7 -2.9 0.2 % -0.1 % F2010 15.7 14.3 12.4

13.1

¢

13.9

¢

F2009   0.5     0.2     2.1     1.2     1.0   F2009   15.6     13.7     9.9     12.1     12.9
 
         
Grocery & Other Merchandise Grocery & Other Merchandise
Same-store Sales Growth Margin
          Fiscal           Fiscal
Q1 Q2 Q3 Q4 Year Q1 Q2 Q3 Q4 Year
F2011 2.0 % 6.9 % 5.8 % F2011 32.8 % 32.9 % 30.9 %
F2010 6.4 1.9 1.7 3.1 % 3.3 % F2010 34.3 34.1 32.7 33.1 % 33.6 %
F2009   4.7     4.9     6.5     8.0     5.9   F2009   34.0     33.9     32.9     33.7     33.7  
 
         
Prepared Food & Fountain Prepared Food & Fountain
Same-store Sales Growth Margin
          Fiscal           Fiscal
Q1 Q2 Q3 Q4 Year Q1 Q2 Q3 Q4 Year
F2011 2.4 % 7.2 % 10.5 % F2010 63.8 % 62.7 % 62.1 %
F2010 6.6 3.4 1.4 5.3 % 4.2 % F2010 63.8 64.6 62.8 64.1 % 63.8 %
F2009   12.3     9.3     8.1     7.2     9.1   F2009   60.5     60.6     61.8     62.7     61.4  
 

Corporate information is available at this Web site: http://www.caseys.com. Earnings will be reported during a conference call on March 8, 2011. The call will be broadcast live over the Internet at 9:30 a.m. CST via the Investor Relations section of our Web site and will be available in an archived format.

Casey's General Stores, Inc.
Bill Walljasper, 515-965-6505


© Business Wire 2011
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Financials ($)
Sales 2017 7 654 M
EBIT 2017 379 M
Net income 2017 216 M
Debt 2017 879 M
Yield 2017 0,74%
P/E ratio 2017 21,68
P/E ratio 2018 19,24
EV / Sales 2017 0,73x
EV / Sales 2018 0,64x
Capitalization 4 734 M
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Mean consensus OUTPERFORM
Number of Analysts 13
Average target price 136 $
Spread / Average Target 12%
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Managers
NameTitle
Terry W. Handley President & Chief Executive Officer
Robert J. Myers Chairman
William J. Walljasper Chief Financial Officer, Senior VP & Head-IR
Rich T. Schappert Vice President-Information Technology
Johnny A. Danos Independent Non-Employee Class III Director
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