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Casey's Gains Market Share

ANKENY, Iowa -- Casey's General Stores Inc., operator of nearly 1,300 convenience stores, said it exceeded its third-quarter expectations with strong sales of fuel and grocery items.

"Building sales has been our priority, and they were up nearly 9 percent for the nine months, said company chairman Donald Lamberti. "We're achieving healthy growth in market share. The challenge now is to achieve better margins."

Fuel volume had a solid quarter. Total gasoline gallons sold were up 18.4 percent year to date, well above the annual goal of 15 percent, Lamberti said. Management attributed the increase to attractive retail prices in Casey's marketing territories, the addition of 57 corporate stores and an increase in stores with pay-at-the-pump services to 378.

For the year, the average gasoline margin per gallon was 9.5 cents, 1 cent off the annual goal of 10.5 cents and 2.6 cents less than the average margin for the same period a year ago.

"We promise our customers competitive pricing on gasoline and keeping that promise is a key factor in building our business," said Ronald Lamb, president and CEO of Casey's. "So far this year, being true to our word has squeezed us on the margin side.

In-store sales jumped well beyond the company's targeted 15-percent growth. Nine-month inside sales were up 17.8 percent to $601.9 million. The average margin on inside sales was 36.7 percent, below the annual goal of 38.7 percent.

Sales in the grocery and other merchandise category were up 18.7 percent year to date. Prepared food and fountain sales were up 14.3 percent year to date, the company reported.

"Cigarettes, beer, and pop are destination items, so we price them competitively," Lamb said. "Cigarettes, which outpaced all other products in terms of sales growth, have had lower margins this year than in fiscal 2001."

Over net sales rose 8.8 percent to $1.6 billion year to date. Gross profit was up 5.1 percent to $298.6 million.
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