ANKENY, Iowa — Casey’s General Stores Inc. reported record first-quarter earnings of $61.8 million during its 2016 fiscal first quarter ended July 31. By comparison, the Ankeny-based retailer generated a net profit of $50.1 million in the same quarter a year ago.
“The company is off to an excellent start to the fiscal year with strong sales, margin expansion in prepared foods, and a favorable operating expense environment during the period,” said Casey’s Chairman and CEO Robert J. Myers.
Prepared food and fountain beverages enjoyed the most growth during Casey’s most recent quarter. On a same-store basis, sales in this category increased 10.4 percent year over year, with an average margin of 62.5 percent.
Total prepared food and fountain sales rose 14.8 percent to $223.4 million, and gross profit dollars grew 19.9 percent year over year to $139.7 million.
“Many of our strategic initiatives are focused on driving sales to this category,” said Myers. “Major remodels, 24-hour [store] conversions and pizza delivery continue to deliver impressive sales gains, and lower ingredient and supply costs enabled us to expand our margin.”
GROCERY, FUEL ALSO GROWING
Grocery and other merchandise sales also had a strong 2016 fiscal first quarter, with same-store sales in this category rising 7 percent year over year, with an average margin of 32.6 percent.
Total sales in grocery and other merchandise were up 10 percent year over year to $526.6 million.
At the forecourt, Casey’s same-store gallons sold improved by 3.4 percent with an average margin of 17.5 cents per gallon in its most recent quarter.
“Same-store sales continue to benefit from low retail fuel prices,” revealed Myers. “…Our pricing strategy allows our store managers to respond quickly to local price competition, which helped us maintain volumes and achieve a margin above goal.”
Regarding expansion, Casey’s opened eight new stores, acquired one store and replaced seven existing stores in its latest quarter. The convenience store retailer also had 17 major remodels under construction at the end of the fiscal first quarter, along with 26 new stores and four replacement stores.
Casey’s General Stores Inc. operated 1,887 stores as of July 31.