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Casey's General Stores, Inc. (CASY - Free Report) came up with fourth-quarter fiscal 2024 results, wherein the top and bottom lines not only beat the Zacks Consensus Estimate but also improved year over year. The company demonstrated strength in inside same-store sales, underscoring its ability to engage customers effectively. Furthermore, it registered another strong quarter of fuel margin.
A Closer Look at Results
Casey's, one of the leading convenience store chains in the United States, posted quarterly earnings of $2.34 per share, which surpassed the Zacks Consensus Estimate of $1.70 and increased from earnings of $1.49 reported in the prior-year period.
Total revenues of $3,600 million came ahead of the Zacks Consensus Estimate of $3,482 million and increased 8.2% year over year.
Total inside sales jumped 11.9% to $1,257.4 million during the quarter. Inside same-store sales increased 5.6% compared with a 6.5% rise registered in the year-ago period. This was driven by a stellar performance in hot sandwiches and dispensed beverages in the prepared food and dispensed beverage category, as well as non-alcoholic and alcoholic beverages in the grocery and general merchandise category. We had expected inside same-store sales to increase 4.4%.
Casey's General Stores, Inc. Price, Consensus and EPS Surprise
Gross profit increased 16% year over year to $798.1 million during the quarter. Gross margin expanded 150 basis points to 22.2%.
The total inside gross profit increased 16.2% to $517.6 million. Meanwhile, the inside margin increased 160 basis points to 41.2% due to a mix shift, modest retail price adjustments and strong cost of goods management.
EBITDA increased 31.9% year over year to $219 million during the quarter under discussion, whereas EBITDA margin expanded 110 basis points to 6.1%. This can be attributed to higher inside and increased fuel gross profit, partly offset by higher operating expense due to operating 137 additional stores.
This Zacks Rank #4 (Sell) company witnessed an increase of 11% in operating expenses of $579 million. We had estimated a 9% increase in operating expenses.
Performance of Categories
Prepared Food & Dispensed Beverage sales rose 13.6% to $356.9 million, faring better than our estimated growth of 12.2%. Same-store sales increased 8.8% compared with 4.9% in the year-ago quarter. The Prepared Food & Dispensed Beverage margin increased to 58.1% from 56.8% in the year-ago period.
Grocery & General Merchandise sales rose 11.2% to $900.5 million during the quarter, faring better than our projected growth rate of 8.8%. Same-store sales increased 4.3% compared with 7.1% growth in the year-ago quarter. Grocery & General Merchandise margin increased to 34.4% from 33% in the year-ago period.
We note that Fuel sales increased 6.5% year over year to $2,276.6 million during the quarter. Fuel gallons sold jumped 9.3% to 695 million due to an increase in store count. We had anticipated an increase of 4.9% in fuel gallons sold.
Fuel gallons same-store sales rose 0.9%. We note that the fuel margin increased to 36.5 cents per gallon from 34.6 cents per gallon in the prior year period.
Store Update
As of Apr 30, 2024, the company operated 2,658 stores. Casey's expects to add at least 100 stores in fiscal 2025.
Other Financial Aspects
Casey's ended the quarter with cash and cash equivalents of $206.5 million, long-term debt and finance lease obligations (net of current maturities) of $1,582.8 million and shareholders’ equity of $3,015.4 million.
During the quarter, Casey's repurchased shares worth approximately $15 million. The company has $295 million remaining under its existing share repurchase authorization. The board of directors approved a 16% hike in the quarterly dividend to 50 cents a share. This marked the 25th straight year of dividend increase.
FY25 Outlook
For fiscal 2025, Casey's estimates inside same-store sales to increase between 3% and 5% and inside margin comparable to fiscal 2024. Management foresees same-store fuel gallons sold between negative 1% and positive 1%. It expects fiscal 2025 EBITDA growth to be at least 8%.
The company anticipates total operating expenses to increase approximately 6% to 8%. It expects to invest roughly $575 million in fiscal 2025.
Shares of Casey's have advanced 17.4% in the past six months, in line with the industry.
Picks You Can’t Miss Out On
Here, we have highlighted three top-ranked stocks, namely Vital Farms (VITL - Free Report) , Ollie's Bargain Outlet (OLLI - Free Report) and Tractor Supply Company (TSCO - Free Report)
Vital Farms offers a range of produced pasture-raised foods. It currently sports a Zacks Rank #1 (Strong Buy). VITL has a trailing four-quarter average earnings surprise of 102.1%. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Vital Farms’ current financial-year sales and earnings suggests growth of 22.5% and 59.3%, respectively, from the year-ago reported numbers.
Ollie's Bargain, the extreme-value retailer of brand-name merchandise, currently carries a Zacks Rank #2 (Buy). OLLI has a trailing four-quarter earnings surprise of 10.4%, on average.
The Zacks Consensus Estimate for Ollie's Bargain’s current financial-year sales and earnings implies growth of around 7.9% and 13.1%, respectively, from the year-ago reported numbers.
Tractor Supply Company, which operates as a rural lifestyle retailer, currently carries a Zacks Rank #2. TSCO has a trailing four-quarter earnings surprise of 2.7%, on average.
The Zacks Consensus Estimate for Tractor Supply Company’s current financial-year sales and earnings calls for growth of around 3% and 2.5%, respectively, from the year-ago reported numbers.
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Casey's (CASY) Q4 Earnings Top, Inside Same-Store Sales Rise
Casey's General Stores, Inc. (CASY - Free Report) came up with fourth-quarter fiscal 2024 results, wherein the top and bottom lines not only beat the Zacks Consensus Estimate but also improved year over year. The company demonstrated strength in inside same-store sales, underscoring its ability to engage customers effectively. Furthermore, it registered another strong quarter of fuel margin.
A Closer Look at Results
Casey's, one of the leading convenience store chains in the United States, posted quarterly earnings of $2.34 per share, which surpassed the Zacks Consensus Estimate of $1.70 and increased from earnings of $1.49 reported in the prior-year period.
Total revenues of $3,600 million came ahead of the Zacks Consensus Estimate of $3,482 million and increased 8.2% year over year.
Total inside sales jumped 11.9% to $1,257.4 million during the quarter. Inside same-store sales increased 5.6% compared with a 6.5% rise registered in the year-ago period. This was driven by a stellar performance in hot sandwiches and dispensed beverages in the prepared food and dispensed beverage category, as well as non-alcoholic and alcoholic beverages in the grocery and general merchandise category. We had expected inside same-store sales to increase 4.4%.
Casey's General Stores, Inc. Price, Consensus and EPS Surprise
Casey's General Stores, Inc. price-consensus-eps-surprise-chart | Casey's General Stores, Inc. Quote
Margins & Expenses
Gross profit increased 16% year over year to $798.1 million during the quarter. Gross margin expanded 150 basis points to 22.2%.
The total inside gross profit increased 16.2% to $517.6 million. Meanwhile, the inside margin increased 160 basis points to 41.2% due to a mix shift, modest retail price adjustments and strong cost of goods management.
EBITDA increased 31.9% year over year to $219 million during the quarter under discussion, whereas EBITDA margin expanded 110 basis points to 6.1%. This can be attributed to higher inside and increased fuel gross profit, partly offset by higher operating expense due to operating 137 additional stores.
This Zacks Rank #4 (Sell) company witnessed an increase of 11% in operating expenses of $579 million. We had estimated a 9% increase in operating expenses.
Performance of Categories
Prepared Food & Dispensed Beverage sales rose 13.6% to $356.9 million, faring better than our estimated growth of 12.2%. Same-store sales increased 8.8% compared with 4.9% in the year-ago quarter. The Prepared Food & Dispensed Beverage margin increased to 58.1% from 56.8% in the year-ago period.
Grocery & General Merchandise sales rose 11.2% to $900.5 million during the quarter, faring better than our projected growth rate of 8.8%. Same-store sales increased 4.3% compared with 7.1% growth in the year-ago quarter. Grocery & General Merchandise margin increased to 34.4% from 33% in the year-ago period.
We note that Fuel sales increased 6.5% year over year to $2,276.6 million during the quarter. Fuel gallons sold jumped 9.3% to 695 million due to an increase in store count. We had anticipated an increase of 4.9% in fuel gallons sold.
Fuel gallons same-store sales rose 0.9%. We note that the fuel margin increased to 36.5 cents per gallon from 34.6 cents per gallon in the prior year period.
Store Update
As of Apr 30, 2024, the company operated 2,658 stores. Casey's expects to add at least 100 stores in fiscal 2025.
Other Financial Aspects
Casey's ended the quarter with cash and cash equivalents of $206.5 million, long-term debt and finance lease obligations (net of current maturities) of $1,582.8 million and shareholders’ equity of $3,015.4 million.
During the quarter, Casey's repurchased shares worth approximately $15 million. The company has $295 million remaining under its existing share repurchase authorization. The board of directors approved a 16% hike in the quarterly dividend to 50 cents a share. This marked the 25th straight year of dividend increase.
FY25 Outlook
For fiscal 2025, Casey's estimates inside same-store sales to increase between 3% and 5% and inside margin comparable to fiscal 2024. Management foresees same-store fuel gallons sold between negative 1% and positive 1%. It expects fiscal 2025 EBITDA growth to be at least 8%.
The company anticipates total operating expenses to increase approximately 6% to 8%. It expects to invest roughly $575 million in fiscal 2025.
Shares of Casey's have advanced 17.4% in the past six months, in line with the industry.
Picks You Can’t Miss Out On
Here, we have highlighted three top-ranked stocks, namely Vital Farms (VITL - Free Report) , Ollie's Bargain Outlet (OLLI - Free Report) and Tractor Supply Company (TSCO - Free Report)
Vital Farms offers a range of produced pasture-raised foods. It currently sports a Zacks Rank #1 (Strong Buy). VITL has a trailing four-quarter average earnings surprise of 102.1%. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Vital Farms’ current financial-year sales and earnings suggests growth of 22.5% and 59.3%, respectively, from the year-ago reported numbers.
Ollie's Bargain, the extreme-value retailer of brand-name merchandise, currently carries a Zacks Rank #2 (Buy). OLLI has a trailing four-quarter earnings surprise of 10.4%, on average.
The Zacks Consensus Estimate for Ollie's Bargain’s current financial-year sales and earnings implies growth of around 7.9% and 13.1%, respectively, from the year-ago reported numbers.
Tractor Supply Company, which operates as a rural lifestyle retailer, currently carries a Zacks Rank #2. TSCO has a trailing four-quarter earnings surprise of 2.7%, on average.
The Zacks Consensus Estimate for Tractor Supply Company’s current financial-year sales and earnings calls for growth of around 3% and 2.5%, respectively, from the year-ago reported numbers.