Casey’s(US:CASY)2025-06-10 13:32Financial Data and Key Metrics Changes - Fiscal year 2025 saw diluted earnings per share increase by 9% to $14.64, with net income reaching a record $547 million and EBITDA at $1.2 billion, up 13% from the previous year [8][19] - Total inside sales grew by 10.9%, with same-store sales up 2.6%, while prepared food and dispensed beverage sales increased by 10.3% [9][13] - Inside margin expanded by 50 basis points year-over-year to 41.5%, driven by effective vendor partnerships [9][10] Business Line Data and Key Metrics Changes - Total prepared food and dispensed beverage sales rose by 9.7% to $392 million, while grocery and general merchandise sales increased by 13.5% to $1.02 billion [13][14] - Same-store prepared food and beverage sales were up 1.5%, with an average margin of 57.8%, despite a 30 basis point decline from the previous year [14] - Same-store grocery and general merchandise sales increased by 1.8%, with an average margin of 34.8%, up 40 basis points year-over-year [15] Market Data and Key Metrics Changes - Fuel gross profit increased by 11%, with total fuel gallons sold up 13% and an average fuel margin of 38.7 cents per gallon [10][19] - Retail fuel sales rose by $162 million, primarily due to a 17.8% increase in total gallons sold, despite a 9% decline in average retail price [17] Company Strategy and Development Direction - The company emphasized a two-pronged approach of building and acquiring stores, achieving the largest store growth year in its history with 35 new builds and 235 units acquired [7][8] - The strategic plan focuses on accelerating food business, growing unit numbers, and enhancing operational efficiency, with a target of opening at least 80 stores in fiscal year 2026 [24][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the business model's strength and durability, anticipating EBITDA growth of 10% to 12% in fiscal year 2026 [21] - The company expects same-store sales growth of 2% to 5% and operating expenses to increase by approximately 8% to 10% [21][22] Other Important Information - The effective tax rate for the quarter was 23%, compared to 22.4% in the prior year, with net interest expense rising to $27.9 million due to financing associated with acquisitions [19][18] - The company plans to allocate approximately $125 million for share repurchases in fiscal year 2026, funded entirely by operating cash flow [21][85] Q&A Session Summary Question: Fuel margins performance and synergies - Management noted that fuel margins exceeded expectations due to effective pricing management and improved procurement capabilities [31][32] Question: Same-store sales outlook for fiscal year 2026 - Management expressed comfort with the guidance range, attributing conservatism to current economic conditions and customer behavior [42][43] Question: Impact of illicit vape on sales - Management acknowledged a negative impact from illicit vape but noted strong growth in nicotine alternatives [52][53] Question: Operating expenses guidance - Management indicated that operating expenses would see mid-teen increases in the first half of fiscal year 2026, primarily due to the integration of acquired stores [60][62] Question: Share buyback strategy - Management clarified that the $125 million share buyback would be funded by operating cash flow, with no debt draw required [81][85]