ANKENY, Iowa - Casey's General (NASDAQ:CASY) Stores, Inc. (NASDAQ:CASY) reported a mixed third quarter, surpassing analyst expectations for adjusted earnings per share (EPS) but falling short on revenue. The convenience store chain posted an EPS of $2.33, exceeding the consensus estimate of $2.13. However, revenue for the quarter was $3.33 billion, missing the anticipated $3.53 billion.
Despite the earnings beat, Casey's shares declined 2.93% in after-market trading, signaling investor concern primarily due to the revenue shortfall. The company's inside same-store sales saw a 4.1% increase compared to the previous year, contributing to an 11.3% rise in inside gross profit to $501.5 million. This growth was driven by strong performance in prepared food and dispensed beverage categories, with whole pies and hot sandwiches highlighted as particularly successful offerings.
Fuel sales, however, painted a different picture. Same-store fuel gallons dipped by 0.4%, and total fuel gross profit decreased by 2.0% to $257.2 million compared to the prior year. Operating expenses also rose by approximately 10%, partly due to the addition of 167 new stores since last year.
Casey's President and CEO, Darren Rebelez, attributed the solid inside sales and gross profit growth to the company's focus on prepared food and beverages, as well as effective cost navigation in a rising cost environment.
Looking ahead, Casey's reaffirmed its fiscal 2024 outlook, expecting same-store inside sales to grow between 3.5% to 5% and inside margin to improve to approximately 40% to 41%. The company anticipates same-store fuel gallons sold to range from a 1% decrease to a 1% increase. Operating expenses are projected to rise by 6% to 8%, with same-store operating expenses, excluding credit card fees, expected to increase by about 3%. EBITDA growth is forecasted to align with the strategic plan's goal of 8% to 10%, and the company plans to add at least 150 stores during the fiscal year.
Rebelez expressed confidence in the company's strategy, noting that the quarter's results were solid and highlighted by inside gross profit growth. Casey's aims to continue its expansion and has set aside at least $100 million for share repurchases throughout the fiscal year.
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