Casey’s(US:CASY)2025-09-09 13:32Financial Data and Key Metrics Changes - Diluted EPS reached $5.77 per share, a 19% increase from the prior year [8] - Net income was $215 million, and EBITDA was $414 million, both reflecting a 20% increase from the prior year [8] - Total revenue for the quarter was $4.6 billion, an increase of $469 million, or 11.5% from the prior year [12][17] - Gross profit was $1.11 billion, an increase of $157 million, or 16.5% from the prior year [13] Business Line Data and Key Metrics Changes - Same-store sales increased by 4.3% for the first quarter, with prepared food and dispensed beverage sales up 5.6% [9] - Inside same-store sales were up 3.8%, with an average margin of 35.9%, an increase of approximately 50 basis points from the prior year [10] - Fuel same-store gallons sold increased by 1.7%, with a fuel margin of $0.41 per gallon [10] Market Data and Key Metrics Changes - The Mid-Continent region saw an approximate 3% decline in fuel gallons sold, indicating market share growth for the company [10] - The average retail price of fuel was $3.00 per gallon, down from $3.31 a year ago [13] Company Strategy and Development Direction - The company is in the last year of a three-year strategic plan, focusing on executing high-level operations and growth [8][20] - The company aims for 8-10% EBITDA growth, with half from base business growth and half from store growth [77] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the team's ability to execute and grow the business, highlighting strong performance in prepared food and grocery categories [8][20] - The company plans to update annual guidance during the second quarter earnings call, with August results aligning with expectations [19][60] Other Important Information - The company generated $262 million in free cash flow, compared to $181 million in the prior year [18] - The board maintained the quarterly dividend at $0.57 per share and repurchased approximately $31 million in shares during the quarter [18] Q&A Session Summary Question: Understanding cheese cost benefits - Management indicated that cheese costs were slightly favorable compared to the prior year, with 70% of forward cheese requirements locked for the fiscal year [28] Question: Update on Fuel 3.0 initiative - Fuel 3.0 now accounts for about 8.8% of total fuel procured, with ongoing integration and positive progress [30] Question: Price versus volume in-store - Management noted a 1.5% traffic increase and about 3% from price, primarily driven by tobacco category price increases [33] Question: Health of consumer across income cohorts - Strong performance was observed across all income cohorts, with lower income groups still shopping at healthy levels [38] Question: SEFCO business performance - SEFCO stores are under pressure but improvements are expected as the integration progresses and kitchens are remodeled [72] Question: Prepared food business momentum - Prepared food margins improved due to better procurement and growth in the whole pie business, offsetting Fikes' dilution [49] Question: M&A backdrop - The company is actively exploring small deal M&A opportunities, with ongoing conversations for larger deals [59] Question: Promotional spending levels - Promotional spending has increased, primarily funded by vendor partners, and is aligned with the growth in business and store count [68] Question: SEFCO integration and synergies - Integration is on track, with expectations for synergies to increase as kitchens are remodeled and prepared foods are introduced [71]