Casey’s(US:CASY)2023-09-12 15:53Financial Data and Key Metrics Changes - Diluted EPS finished at $4.52 per share, an 11% increase from the prior year [6] - Net income increased by 11% to $169 million, and EBITDA rose by 8% to $316 million [6] - Total revenue for the quarter was $3.8 billion, a decrease of 13% from the prior year due to lower retail fuel prices [33] - Gross profit was $878 million, an increase of 5% from the prior year [36] Business Line Data and Key Metrics Changes - Inside sales increased by 8% to $1.4 billion, with same-store sales up 5.4% [10][33] - Grocery and general merchandise sales rose by 8% to $997 million, with a margin of 34.1% [30][34] - Prepared food and dispensed beverage sales increased by 8.5% to $373 million, with a margin of 58.2%, up 260 basis points from the prior year [29][34] - Fuel margin was $0.416 per gallon, down from the previous year's high [11] Market Data and Key Metrics Changes - Same-store gallons sold increased by 0.4%, with a fuel margin of $0.416 per gallon [31] - The average retail price of fuel was $3.40 per gallon, down from $4.49 a year ago [35] Company Strategy and Development Direction - The company launched a thin crust pizza offering, which has been successful and aligns with its three-year strategic plan [7] - The company is focused on M&A opportunities, with a pending acquisition of 63 stores from EG Group expected to close this calendar year [17][21] - The company aims to leverage its balance sheet for disciplined yet opportunistic growth [25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of the business model and the ability to achieve strategic objectives [9] - The company noted that the operating environment has been relatively stable, with no significant macro events affecting margins [8] - Management indicated that they will revisit the annual outlook following the second quarter earnings call [18] Other Important Information - Total operating expenses increased by 3.2% or $17.6 million, primarily due to unit growth [12] - The company maintained a quarterly dividend of $0.43 per share [15] - The company repurchased approximately $30 million of stock during the quarter [16] Q&A Session All Questions and Answers Question: Fuel margins and underlying drivers - Management noted that fuel margins were stronger than expected and attributed this to a normal environment with no significant volatility [56] Question: Inside sales performance - Management highlighted strong performance in prepared foods, particularly with the new thin crust pizza, and noted growth across various categories [64] Question: Private label performance - Management reported a 10% unit share and over 10% gross profit share in private label products, with strong growth expected to continue [23][106] Question: M&A opportunities - Management confirmed they have the financial flexibility and appetite for more acquisitions, with a focus on identifying suitable opportunities in the market [62] Question: Operating expenses and optimization - Management discussed ongoing efforts to optimize store operations, resulting in improved engagement scores among team members and guests [101][120]