Casey’s General Stores, Inc. has reported a strong start to its fiscal year, attributing much of its success to the increasing demand for food and grocery offerings within its convenience stores. In the first quarter, Casey’s marked a 2.3% year-over-year (YoY) lift in comparable sales and a notable 7% rise in diluted earnings per share (EPS). This impressive performance culminated in a total gross profit of $614.3 million, reflecting a 10.4% increase for the quarter ending July 31.
Darren Rebelez, chairman, president, and CEO of Casey’s, noted that the convenience store chain has “started the fiscal year off on the right foot,” with significant growth in inside sales attributed to hot food items and beverages. The appeal of prepared food has been critical; items like hot sandwiches and bakery products have been standout performers. Furthermore, the operational efficiency has improved, evidenced by a reduction in same-store labor hours for nine consecutive quarters.
Food is becoming a centerpiece of Casey’s business strategy. During the recent quarter, same-store sales for grocery and general merchandise rose by 1.6%, and sales for prepared foods and beverages increased by 4.4%. Notably, the gross margin for grocery and general merchandise jumped to 35.4% from 34.1% the previous year, while the margin for prepared food remained steady at 58.3%. Such numbers underline the retailer’s proficiency in inventory management, supplier negotiations, and appealing product offerings.
Looking ahead for the fiscal year, Casey’s forecasts comparable store sales growth between 3% to 5%, with EBITDA expected to increase by at least 8%. The company is also on the path to expand, projecting to open approximately 270 new stores in fiscal 2025. This growth initiative reflects not just robust financial health but also a commitment to enhancing accessibility to its products across regions.
In a strategic move to enrich its food and beverage program, Casey’s recently hosted its inaugural Innovation Summit in August. The event aimed to identify new and innovative brands to be integrated into its existing product lines. Potential suppliers will be invited for an interactive in-person summit at the company’s headquarters later this October. This approach serves to ensure that Casey’s continually adjusts its offering to meet consumer preferences and market trends.
Founded over 50 years ago and headquartered in Ankeny, Iowa, Casey’s operates more than 2,600 convenience stores across the United States. Such sustained growth has consistently placed the retailer in competitive standings; it ranks No. 36 on Progressive Grocer’s 2024 PG 100 list of the top food and consumables retailers in North America.
As Casey’s embraces these numerous developments, the focus remains on strengthening its core identity as a go-to destination for food and convenience. The current trend of increased grocery sales in convenience formats is not just a passing phase; it underscores a significant shift in consumer shopping behaviors where convenience is paramount. With Casey’s continued investment in innovative food options and strong operational practices, the retailer is well-positioned to capitalize on this ongoing trend.
Casey’s progress serves as a case study for other convenience store chains seeking to elevate their food service offerings. By analyzing consumer habits and investing in food innovation, Casey’s has paved the way for sustained growth in a competitive market.
Casey’s General Stores stands as an example of how diversification into food and groceries can lead to solid fiscal performance, a thriving store expansion plan, and an overall enhancement of customer satisfaction. The future looks bright not just for Casey’s, but for the c-store sector as a whole, given the ongoing evolution in shopping preferences and lifestyle dynamics.
