ANKENY, Iowa -- Casey's General Stores Inc. late yesterday reported 51 cents in basic earnings per share for the second quarter of fiscal 2011 ended October 31, 2010. The results include approximately $19.4 million in expenses pertaining to the company's recapitalization plan completed in the second quarter as well as the unsolicited hostile offer and related actions by Laval, Quebec-based Alimentation Couche-Tard Inc.
Without those expenses, basic earnings per share would have been 81 cents compared to 66 cents for the same quarter a year ago, up 22.7%. Year to date, [image-nocss] basic earnings per share were $1.27 versus $1.53 for the same period last year. Excluding expenses related to the hostile offer and recapitalization plan, mid-year basic earnings per share would have been $1.62.
(Click here for previous CSP Daily News coverage of Casey's fending off Couche-Tard's hostile acquisition attempt.)
"We are pleased with the second-quarter results driven by strong sales increases across all categories," said president and CEO Robert J. Myers. "We expect additional revenue growth as we close on more acquisitions during the third quarter."
Gasoline: The company's annual goal is to increase same-store gasoline gallons sold 1% with an average margin of 13.5 cents per gallon. For the second quarter, same-store gallons sold were up 3.6% with an average margin of 14.9 cents per gallon.
"We anticipate the favorable gasoline environment to continue throughout the third quarter," said Myers.
Same-store gallons sold for the year increased 2.5% with an average margin of 15.7 cents, while gross profit rose nearly 13%. For the year, total gallons sold were up 8% to 712.1 million.
Grocery & Other Merchandise: Casey's annual goal is to increase same-store sales 6% with an average margin of 33.9%. For the quarter, same-store sales rose 6.9% with an average margin of 32.9%. For the six months ended October 31, 2010, same-store sales were up 4.2% with an average margin of 32.9%.
"More favorable weather and increased promotional initiatives helped drive sales during the second quarter," said Myers. "Competitive cigarette pricing continued in the second quarter, putting pressure on the margin; however, we were pleased with the overall gain in gross profit dollars."
Total sales for the year are up 9.2% to $626.1 million.
Prepared Food & Fountain: The goal for fiscal 2011 is to increase same-store sales 8.9% with an average margin of 63.1%. Same-store sales were up 7.2% for the quarter and 4.8% year to date. The average margin for the quarter was 62.7%; down from a record high margin in the same period a year ago primarily due to a rise in commodity prices.
"We benefited from value-oriented promotions throughout the quarter driving total sales by 13% and increasing gross profit 9.6%," said Myers. "Despite the challenging economy, we are encouraged by the continued strong performance of this category."
Year to date, total sales were up 10.3% to $209.6 million compared to $190 million with an average margin of 63.2%.
Operating Expenses: For the quarter, operating expenses increased 17% to $153.3 million. Excluding expenses associated with the unsolicited hostile offer by Couche-Tard, expenses increased 10.8%.
"The increase was driven by a $2.5 million increase in credit card fees and expenses associated with operating more stores this quarter compared to the same period a year ago," Myers said.
Expansion: The annual goal is to increase the total number of stores 4% to 6%. At the mid-year point, the company had acquired 10 stores and completed eight new-store constructions.
"We anticipate completing 74 more acquisitions during the third fiscal quarter and remain optimistic about our long-term opportunities," said Myers. "In addition to acquisitions, we are on pace to build a total of 20 new stores and replace 15 stores by the end of the fiscal year."
The company also completed 12 major remodels during the first six months of the year, it said.
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