Q4 FY2024 Financial Results - Casey’s General Stores Inc

Date: June 13, 2024

Company: Casey’s General Stores Inc (NASDAQ: CASY)

Sector: Consumer Cyclical

Industry: Specialty Retail

Introduction

Good day and thank you for standing by. Welcome to the Q4 fiscal year 2024 Casey’s General Stores earnings conference call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question and answer session. To ask a question during the session, you will need to press star-one-one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star-one-one again. Please be advised that today’s conference is being recorded.

Now, let’s delve into the key highlights of the financial results presented during the call by Brian Johnson, Senior Vice President of Investor Relations and Business Development, Darren Rebelez, Board Chair, President, and CEO, and Steve Bramlage, CFO.

Executive Overview

Brian Johnson, Senior Vice President of Investor Relations and Business Development, opened the call by reminding participants about forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, and the known and unknown risks and uncertainties involved.

Darren Rebelez initiated his segment by thanking the 45,000 Casey’s team members for their relentless commitment in achieving a record fiscal year. He shared that Casey’s purpose is to make life better for guests and communities every day, enriching them with positive impacts.

Key Financial Metrics

• Revenue: $14.86 Billion
• Cost of Revenue: $11.86 Billion
• Gross Profit: $3.00 Billion
• Operating Expenses: $2.29 Billion
• EBITDA: $1.06 Billion
• Operating Income: $709.60 Million
• Net Income: $501.97 Million
• EPS Diluted: $13.43

Performance Analysis

Growth and Expansion: Fiscal ’24 showcased another record year for diluted earnings per share, with EPS finishing at $13.43, a 13% increase YoY. The company generated a record net income of $502M and EBITDA of $1.1B, an 11% rise from the prior year. The focus remained on sustainable growth and community impact, successfully adding 154 new and acquired stores.

Inside Sales

Inside same-store sales were up by 4.4%, with especially robust results in the prepared food and dispensed beverage category, which rose by 6.8%. Grocery and general merchandise same-store sales increased by 3.5%. Inside margin expanded by 110 basis points YoY to 41%, demonstrating efficient handling of commodity volatility while maintaining strong value propositions.

Fuel Sales

Fuel gross profits increased by 4% with total fuel gallons sold rising by 6%. Fuel margin averaged $0.395 per gallon over the year. The company strategically balanced fuel volume and margin, enhancing market share.

Operational Efficiency

Operational efficiency led to an increase in EBITDA and a sustained reduction in same-store labor hours by 1.6%, marking the eighth consecutive quarter of reduction. Despite labor hour reductions, guest satisfaction and team member engagement hit an all-time high.

Community Impact

Casey’s, along with its guests, partners, and team members, donated over $5.7M to community initiatives. An additional $6M was directed to its charitable fund, aiding various community-focused programs.

Capital Allocation and Liquidity

Casey’s maintained a strong balance sheet with liquidity of $1.1B, and no significant maturities due until fiscal 2026. The company's net change in cash for fiscal '24 stood at -$172.39 million, primarily due to investments in property and equipment and acquisitions.

Fiscal Year 2025 Outlook

• Expected EBITDA increase: at least 8%
• Inside same-store sales growth: 3% to 5%
• Inside margin: comparable to fiscal 2024
• Total operating expenses increase: ~6% to 8%
• Net interest expense: ~$56M
• Depreciation and amortization: ~$390M
• Purchase of property and equipment: ~$575M

Closing Remarks

Darren Rebelez concluded by expressing his gratitude to the entire Casey’s team for delivering another record year, emphasizing the fulfillment of their three-year strategic plan and looking forward to fiscal 2025 with substantial optimism and readiness to drive shareholder value.

Thank you for taking the time to review Casey’s Q4 FY2024 Financial Results.