Casey's General Stores, Inc. : Casey's Third Quarter Sales Remain Strong During Difficult Weather

Casey's General Stores, Inc. (Nasdaq symbol CASY) today reported diluted earnings per share of $0.38 for the third quarter of fiscal 2014 ended January 31, 2014, compared to $0.40 for the same quarter a year ago. Year to date, diluted earnings per share were $2.87 compared to $2.26 a year ago. "Third quarter sales were strong throughout all of our categories despite challenging weather during the quarter," stated Chairman and CEO Robert J. Myers. "Our same-store fuel sales are exceeding industry-wide trends and gross profit from inside the store was up over 11% for both the quarter and year."

Gasoline - The goal for fiscal 2014 is to increase same-store gallons sold 1.5% with an average margin of 15 cents per gallon. For the third quarter, same-store gallons sold were up 3.8% with an average margin of 14.4 cents per gallon. The Company sold 12.2 million renewable fuel credits for $3.4 million in the quarter. "The fuel saver program is in its second year and continues to significantly impact our fuel sales," said Myers. "Fuel margins dipped below goal in the third quarter due to a less volatile wholesale cost environment as well as the seasonal decline we usually experience this time of year." Total gallons sold for the year were up 9.1% with an average margin of 17.8 cents per gallon. Year to date, same-store gallons were up 3.7%.

Grocery and Other Merchandise - The Company's annual goal is to increase same-store sales 5% with an average margin of 32.3%. For the quarter, same-store sales were up 6.5% with an average margin of 31.1%. "Sales were strong throughout the entire grocery and other merchandise category during the third quarter," said Myers. "Beer and beverages are performing especially well due predominately to our increased cooler capacity in our newer store designs." For the nine months ended January 31, 2014, same-store sales were up 7.5% with an average margin of 32.1%. Total sales for the year were up 11.7% and gross profit increased 9% to $386.5 million.

Prepared Food and Fountain - Casey's annual goal is to increase same-store sales 9% with an average margin of 62%. For the third quarter, same-store sales were up 10.7% with an average margin of 60.8%. "In addition to the operating initiatives such as 24-hour expansion, pizza delivery, and major remodels contributing to sales, we also experienced strong prepared food sales in our unchanged group of stores," said Myers. "Our margin benefited from a favorable product mix shift, as pizza sales increased as a percentage of the total category. This offset higher input costs of meat, cheese and supplies when compared to prior year's third quarter." Total sales for the category were up 16.4% year to date, and gross profit increased 15.1% to $305.1 million.

Operating Expenses - Year to date, operating expenses increased 13.7% to $647.2 million. For the third quarter, operating expenses were up 13.1%. "The majority of the operating expense increase for both the quarter and year was due to new, acquired, and replaced stores, along with the various operating initiatives that have been rolled out to existing stores," stated Myers. "Included in the results was approximately $1.6 million combined for additional snow removal and a loss from a store that was destroyed by a fire."

Expansion - The annual goal is to build or acquire 70 to 105 (4-6%) stores and replace 20 existing locations. Through the first nine months, the Company has built 26 new stores and acquired an additional 24. The Company also completed 19 replacement stores as well as 25 major remodels. "Casey's recently announced it signed a purchase agreement to acquire 24 Stop-n-Go stores located in North Dakota and Minnesota," said Myers. "Although this transaction is expected to close in the next fiscal year, we believe it is indicative of an active acquisition environment right now, and we are excited about the opportunities to build and buy new stores." The Company currently has 25 new stores and 15 replacement stores under construction, as well as 32 stores under contract to acquire, including the Stop-n-Go chain. The Company also has 43 new sites and 33 replacement sites under contract to purchase.

Dividend - At its March meeting, the Board of Directors declared a quarterly dividend of $0.18 per share. The dividend is payable May 15^th, 2014 to shareholders of record on May 1^st, 2014.

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.

Corporate information is available at this Web site: http://www.caseys.com. Earnings will be reported during a conference call on March 11, 2014. 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