ANKENY, Iowa
,
June 7, 2023
(press release)
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Fourth Quarter 2023 Key Highlights Fiscal Year 2023 Key Highlights “Casey's closed out its three-year strategic plan with another record fiscal year for its shareholders, highlighted by 19% EBITDA growth and 31% diluted EPS growth," said Darren Rebelez, President and CEO. “Inside same-store sales performed well, up 6.5%, or 13.6% on a two-year stack basis, led by alcoholic and non-alcoholic beverages, as well as strong performance in pizza and bakery. We continued to strike the right balance between fuel gallon volume and gross profit margin throughout the year to drive fuel gross profit up 15.7% from the prior year. The team did a tremendous job managing cost as same-store operating expense excluding credit-card fees were only up 2.8% versus the prior year. Finally, we are busy operating 81 new stores, finishing the year with 2,521 stores. As we look to discuss our next strategic plan on June 27th, I am proud of the hard work and dedication of the Casey's team, and we are well positioned to continue delivering long-term shareholder value.” Earnings Three Months Ended April 30, Twelve Months Ended April 30, 2023 2022 2023 2022 Net income (in thousands) $ 56,092 $ 59,777 $ 446,691 $ 339,790 Diluted earnings per share $ 1.49 $ 1.60 $ 11.91 $ 9.10 Adjusted EBITDA (in thousands) $ 166,917 $ 165,506 $ 959,335 $ 800,040 Fourth quarter adjusted EBITDA was up slightly versus the prior year primarily due to higher inside gross profit partially offset by higher operating expense and lower fuel gross profit. Net income and Diluted EPS were down compared to the same period a year ago, as the slight increase in adjusted EBITDA was more than offset by a higher tax rate and higher depreciation expense. ______________________________ 1 EBITDA and Adjusted EBITDA are reconciled later in the document Inside Three Months Ended April 30, Twelve Months Ended April 30, 2023 2022 2023 2022 Inside sales (in thousands) $ 1,124,060 $ 1,037,315 $ 4,768,337 $ 4,345,627 Inside same-store sales 6.5 % 5.2 % 6.5 % 6.6 % Grocery and general merchandise same-store sales 7.1 % 4.3 % 6.3 % 6.3 % Prepared food and dispensed beverage same-store sales 4.9 % 7.6 % 7.1 % 7.4 % Inside gross profit (in thousands) $ 445,549 $ 409,040 $ 1,904,856 $ 1,739,829 Inside margin 39.6 % 39.4 % 39.9 % 40.0 % Grocery and general merchandise margin 33.0 % 32.5 % 33.6 % 32.7 % Prepared food and dispensed beverage margin 56.8 % 56.9 % 56.6 % 59.2 % Total inside sales were up 8.4% for the quarter and total inside gross profit was up 8.9%. Inside same-store sales were up 6.5%, or 12.0% on a two-year stack basis, driven by strong performance in non-alcoholic and alcoholic beverages in the grocery and general merchandise category as well as bakery and hot food in the prepared food and dispensed beverage category. Inside margin was up 20 basis points for the quarter primarily due to mix shift to higher margin items like grab and go beverages in the grocery and general merchandise category as well as increased private label penetration versus the prior year. Fuel 2 Three Months Ended April 30, Twelve Months Ended April 30, 2023 2022 2023 2022 Fuel gallons sold (in thousands) 635,916 621,118 2,672,366 2,579,179 Same-store gallons sold 0.0 % 1.5 % (0.8 ) % 4.4 % Fuel gross profit (in thousands) $ 219,746 $ 224,637 $ 1,074,913 $ 928,868 Fuel margin (cents per gallon, excluding credit card fees) 34.6 ¢ 36.2 ¢ 40.2 ¢ 36.0 ¢ Same-store gallons sold were flat for the quarter. Fuel gross profit was down 2.2% due to a decrease of 1.6 cents per gallon partially offset by a 2.4% increase in total fuel gallons sold. The Company did not sell any renewable fuel credits (RINs) in the fourth quarter, while $1.1 million in RINs were sold in the same period last year. Operating Expenses Three Months Ended April 30, Twelve Months Ended April 30, 2023 2022 2023 2022 Operating expenses (in thousands) $ 521,729 $ 490,904 $ 2,119,942 $ 1,961,473 Credit card fees (in thousands) $ 51,287 $ 53,208 $ 217,714 $ 202,584 Same-store operating expense excluding credit card fees 2.7 % 8.0 % 2.8 % 8.9 % Total operating expenses increased 6.3% for the fourth quarter. Approximately 1.5% of the increase is due to operating 69 more stores than a year ago. Approximately 2% of the increase was related to same-store operations. Finally, approximately 1% of the change is related to an increase in accrued costs for incentive compensation due to strong financial performance. Same-store employee expense was flat as the increase in employee wage rate was offset by a 3.3% reduction in same-store labor hours. Expansion Store Count April 30, 2022 2,452 New store construction 34 Acquisitions 47 Acquisitions not opened (4) Prior acquisitions opened 2 Closed (10) April 30, 2023 2,521 ______________________________ 2 Fuel category does not include wholesale fuel activity, which is included in Other. Liquidity On April 21, 2023, the Company refinanced its credit facility with an unsecured $1.1 billion facility that includes an $850 million revolving line of credit and $250 million term loan, each with a five-year maturity. At April 30, the Company had approximately $1.3 billion in available liquidity, consisting of approximately $379 million in cash and cash equivalents on hand and $875 million in undrawn borrowing capacity on existing lines of credit. Share Repurchase The Company has $400 million remaining under its existing share repurchase authorization. There were no repurchases made against that authorization in the fourth quarter. Dividend At its June meeting, the Board of Directors voted to increase the quarterly dividend by 13% to $0.43 per share, which is the 24th consecutive year increasing the dividend. The dividend is payable August 15, 2023 to shareholders of record on August 1, 2023. Fiscal 2024 Outlook Casey's expects the following performance during fiscal 2024. The Company expects inside same-store sales to increase 3% to 5% and to improve inside margin to approximately 40% to 41%. The Company expects same-store fuel gallons sold to be between negative 1% to positive 1%. Total operating expenses are expected to increase approximately 5% to 7%. The Company expects to add approximately 110 stores in fiscal 2024. Net interest expense is expected to be approximately $55 million. Depreciation and amortization is expected to be approximately $340 million and the purchase of property and equipment is expected to be approximately $500 to $550 million. The tax rate is expected to be approximately 24% to 26% for the year. Casey’s General Stores, Inc. and Subsidiaries Condensed Consolidated Statements of Income (Dollars in thousands, except share and per share amounts) (Unaudited) Three Months Ended April 30, Twelve Months Ended April 30, 2023 2022 2023 2022 Total revenue $ 3,328,701 $ 3,458,942 $ 15,094,475 $ 12,952,594 Cost of goods sold (exclusive of depreciation and amortization, shown separately below) 2,640,949 2,802,199 12,022,069 10,189,880 Operating expenses 521,729 490,904 2,119,942 1,961,473 Depreciation and amortization 80,631 77,866 313,131 303,541 Interest, net 12,800 15,291 51,815 56,972 Income before income taxes 72,592 72,682 587,518 440,728 Federal and state income taxes 16,500 12,905 140,827 100,938 Net income $ 56,092 $ 59,777 $ 446,691 $ 339,790 Net income per common share Basic $ 1.50 $ 1.61 $ 11.99 $ 9.14 Diluted $ 1.49 $ 1.60 $ 11.91 $ 9.10 Basic weighted average shares 37,283,677 37,170,941 37,266,851 37,158,898 Plus effect of stock compensation 290,000 197,800 252,844 197,800 Diluted weighted average shares 37,573,677 37,368,741 37,519,695 37,356,698 Casey’s General Stores, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (Dollars in thousands) (Unaudited) April 30, 2023 April 30, 2022 Assets Current assets Cash and cash equivalents $ 378,869 $ 158,878 Receivables 120,547 108,028 Inventories 376,085 396,199 Prepaid expenses 22,107 17,859 Income taxes receivable 23,347 44,071 Total current assets 920,955 725,035 Other assets, net of amortization 192,153 187,219 Goodwill 615,342 612,934 Property and equipment, net of accumulated depreciation of $2,620,149 at April 30, 2023 and $2,425,709 at April 30, 2022 4,214,820 3,980,542 Total assets $ 5,943,270 $ 5,505,730 Liabilities and Shareholders’ Equity Current liabilities Current maturities of long-term debt and finance lease obligations $ 52,861 $ 24,466 Accounts payable 560,546 588,783 Accrued expenses 313,718 291,429 Total current liabilities 927,125 904,678 Long-term debt and finance lease obligations, net of current maturities 1,620,513 1,663,403 Deferred income taxes 543,598 520,472 Insurance accruals, net of current portion 32,312 27,957 Other long-term liabilities 159,056 148,382 Total liabilities 3,282,604 3,264,892 Total shareholders’ equity 2,660,666 2,240,838 Total liabilities and shareholders’ equity $ 5,943,270 $ 5,505,730 Casey’s General Stores, Inc. and Subsidiaries Condensed Consolidated Statements of Cash Flows (Dollars in thousands) (Unaudited) Twelve months ended April 30, 2023 2022 Cash flows from operating activities: Net income $ 446,691 $ 339,790 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 313,131 303,541 Amortization of debt issuance costs 1,789 2,527 Stock-based compensation 47,024 37,976 Loss (gain) on disposal of assets and impairment charges 6,871 (1,201 ) Deferred income taxes 23,126 82,721 Changes in assets and liabilities: Receivables (12,519 ) (33,025 ) Inventories 24,090 (76,730 ) Prepaid expenses (4,248 ) (6,376 ) Accounts payable (9,483 ) 165,893 Accrued expenses 20,292 23,574 Income taxes 20,652 (35,716 ) Other, net 4,535 (14,233 ) Net cash provided by operating activities 881,951 788,741 Cash flows from investing activities: Purchase of property and equipment (476,568 ) (326,475 ) Payments for acquisitions of businesses, net of cash acquired (85,569 ) (901,638 ) Proceeds from sales of property and equipment 17,103 70,118 Net cash used in investing activities (545,034 ) (1,157,995 ) Cash flows from financing activities: Proceeds from long-term debt — 450,000 Repayments of long-term debt (40,970 ) (188,537 ) Payments of debt issuance costs (3,940 ) (1,149 ) Proceeds from exercise of stock options — 133 Payments of cash dividends (55,617 ) (51,212 ) Tax withholdings on employee share-based awards (16,399 ) (17,648 ) Net cash (used in) provided by financing activities (116,926 ) 191,587 Net increase (decrease) in cash and cash equivalents 219,991 (177,667 ) Cash and cash equivalents at beginning of the period 158,878 336,545 Cash and cash equivalents at end of the period $ 378,869 $ 158,878 SUPPLEMENTAL DISCLOSURES OF CASH FLOWS INFORMATION Twelve months ended April 30, 2023 2022 Cash paid during the period for: Interest, net of amount capitalized $ 56,799 $ 54,499 Income taxes, net 90,398 49,565 Noncash investing and financing activities: Purchased property and equipment in accounts payable 27,905 46,659 Summary by Category (Amounts in thousands) Three months ended April 30, 2023 Fuel Grocery & Prepared Food Other Total Revenue $ 2,137,815 $ 809,838 $ 314,222 $ 66,826 $ 3,328,701 Gross profit $ 219,746 $ 266,969 $ 178,580 $ 22,457 $ 687,752 10.3 % 33.0 % 56.8 % 33.6 % 20.7 % Fuel gallons sold 635,916 Three months ended April 30, 2022 Revenue $ 2,344,630 $ 744,043 $ 293,272 $ 76,997 $ 3,458,942 Gross profit $ 224,637 $ 242,065 $ 166,975 $ 23,066 $ 656,743 9.6 % 32.5 % 56.9 % 30.0 % 19.0 % Fuel gallons sold 621,118 Summary by Category (Amounts in thousands) Twelve months ended April 30, 2023 Fuel Grocery & Prepared Food Other Total Revenue $ 10,027,310 $ 3,445,777 $ 1,322,560 $ 298,828 $ 15,094,475 Gross profit $ 1,074,913 $ 1,156,451 $ 748,405 $ 92,637 $ 3,072,406 10.7 % 33.6 % 56.6 % 31.0 % 20.4 % Fuel gallons sold 2,672,366 Twelve months ended April 30, 2022 Revenue $ 8,312,038 $ 3,141,527 $ 1,204,100 $ 294,929 $ 12,952,594 Gross profit $ 928,868 $ 1,027,477 $ 712,352 $ 94,017 $ 2,762,714 11.2 % 32.7 % 59.2 % 31.9 % 21.3 % Fuel gallons sold 2,579,179 Fuel Gallons Fuel Margin Same-store Sales (Cents per gallon, excluding credit card fees) Q1 Q2 Q3 Q4 Fiscal Q1 Q2 Q3 Q4 Fiscal F2023 (2.3 )% 0.3 % (0.5 )% 0.0 % (0.8 )% F2023 44.7 ¢ 40.5 ¢ 40.7 ¢ 34.6 ¢ 40.2 ¢ F2022 9.0 2.5 5.7 1.5 4.4 F2022 35.1 34.7 38.3 36.2 36.0 F2021 (14.6 ) (8.6 ) (12.1 ) 6.4 (8.1 ) F2021 38.2 35.3 32.9 33.0 34.9 Grocery & General Merchandise Grocery & General Merchandise Same-store Sales Margin Q1 Q2 Q3 Q4 Fiscal Q1 Q2 Q3 Q4 Fiscal F2023 5.5 % 6.9 % 5.8 % 7.1 % 6.3 % F2023 33.9 % 33.3 % 34.0 % 33.0 % 33.6 % F2022 7.0 6.8 7.7 4.3 6.3 F2022 33.0 33.3 32.0 32.5 32.7 F2021 3.6 6.6 5.4 12.5 6.6 F2021 32.2 33.3 30.7 31.8 32.0 Prepared Food & Dispensed Beverage Prepared Food & Dispensed Beverage Same-store Sales Margin Q1 Q2 Q3 Q4 Fiscal Q1 Q2 Q3 Q4 Fiscal F2023 8.4 % 10.5 % 5.0 % 4.9 % 7.1 % F2023 55.6 % 56.7 % 57.3 % 56.8 % 56.6 % F2022 10.8 4.1 7.4 7.6 7.4 F2022 61.0 60.6 58.0 56.9 59.2 F2021 (9.8 ) (3.6 ) (5.0 ) 13.4 (2.1 ) F2021 59.7 60.1 60.6 60.1 60.1 RECONCILIATION OF NET INCOME TO EBITDA AND ADJUSTED EBITDA We define EBITDA as net income before net interest expense, income taxes, depreciation and amortization. Adjusted EBITDA further adjusts EBITDA by excluding the gain or loss on disposal of assets as well as impairment charges. Neither EBITDA nor Adjusted EBITDA are considered GAAP measures, and should not be considered as a substitute for net income, cash flows from operating activities or other income or cash flow statement data. These measures have limitations as analytical tools, and should not be considered in isolation or as substitutes for analysis of our results as reported under GAAP. We strongly encourage investors to review our financial statements and publicly filed reports in their entirety and not to rely on any single financial measure. We believe EBITDA and Adjusted EBITDA are useful to investors in evaluating our operating performance because securities analysts and other interested parties use such calculations as a measure of financial performance and debt service capabilities, and they are regularly used by the Company for internal purposes including our capital budgeting process, evaluating acquisition targets, assessing performance, and awarding incentive compensation. Because non-GAAP financial measures are not standardized, EBITDA and Adjusted EBITDA, as defined by us, may not be comparable to similarly titled measures reported by other companies. It therefore may not be possible to compare our use of these non-GAAP financial measures with those used by other companies. The following table contains a reconciliation of net income to EBITDA and Adjusted EBITDA for the three and twelve months ended April 30, 2023 and 2022: (In thousands) Three Months Ended April 30, Twelve Months Ended April 30, 2023 2022 2023 2022 Net income $ 56,092 $ 59,777 $ 446,691 $ 339,790 Interest, net 12,800 15,291 51,815 56,972 Depreciation and amortization 80,631 77,866 313,131 303,541 Federal and state income taxes 16,500 12,905 140,827 100,938 EBITDA $ 166,023 $ 165,839 $ 952,464 $ 801,241 Loss (gain) on disposal of assets and impairment charges 894 (333 ) 6,871 (1,201 ) Adjusted EBITDA $ 166,917 $ 165,506 $ 959,335 $ 800,040 NOTES: This release contains statements that may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including those related to expectations for future periods, possible or assumed future results of operations, financial conditions, liquidity and related sources or needs, business and/or integration strategies, plans and synergies, supply chain, growth opportunities, performance at our stores. There are a number of known and unknown risks, uncertainties, and other factors that may cause our actual results to differ materially from any results expressed or implied by these forward-looking statements, including but not limited to the execution of our strategic plan, the integration and financial performance of acquired stores, wholesale fuel, inventory and ingredient costs, distribution challenges and disruptions, the impact and duration of the conflict in Ukraine or other geopolitical disruptions, as well as other risks, uncertainties and factors which are described in the Company’s most recent annual report on Form 10-K and quarterly reports on Form 10-Q, as filed with the Securities and Exchange Commission and available on our website. Any forward-looking statements contained in this release represent our current views as of the date of this release with respect to future events, and Casey’s disclaims any intention or obligation to update or revise any forward-looking statements in the release whether as a result of new information, future events, or otherwise. Corporate information is available at this website: https://www.caseys.com. Earnings will be reported during a conference call on June 7, 2023. The call will be broadcast live over the Internet at 7:30 a.m. CDT. To access the call, go to the Events and Presentations section of our website at https://investor.caseys.com/events-and-presentations/default.aspx. No access code is required. A webcast replay of the call will remain available in an archived format on the Events and Presentations section of our website at https://investor.caseys.com/events-and-presentations/default.aspx for one year after the call. Investor Relations Contact: M edia Relations Contact:
General
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Beverage
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Brian Johnson (515) 965-6587
Katie Petru (515) 446-6772
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