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It has been about a month since the last earnings report for Casey's General Stores (CASY). Shares have lost about 6.6% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Casey's due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Casey’s Q2 Earnings Top Estimates, Inside Same-Store Sales Grow 4%
Casey's reported second-quarter fiscal 2025 results, wherein the bottom line improved year over year and beat the Zacks Consensus Estimate. The top line declined year over year and missed the consensus mark. The company demonstrated strength in inside same-store sales, underscoring its ability to engage customers effectively.
Casey’s inside same-store sales growth was propelled by the prepared food and dispensed beverage segment, with hot sandwiches and cold dispensed beverages standing out as top performers. The company also witnessed robust strong inside gross profit growth. CASY also concluded the Fikes buyout during the fiscal quarter.
Casey's Quarterly Performance: Key Insights
CASY, one of the leading convenience store chains in the United States, posted quarterly earnings of $4.85 per share, which surpassed the Zacks Consensus Estimate of $4.24 and increased 14% from $4.24 reported in the prior-year period.
Total revenues of $3.9 billion missed the Zacks Consensus Estimate of $4 billion and decreased 2.9% year over year.
Total inside sales jumped 9% year over year to $1.47 billion in the fiscal quarter. This was due to strong performances in the prepared food and dispensed beverage categories, which included hot sandwiches and dispensed beverages as well as non-alcoholic and alcoholic beverages in the grocery and general merchandise segment. Inside same-store sales increased 4% compared with a 2.9% rise registered in the year-ago period.
Insight Into CASY’s Margins & Expenses Performance
Gross profit rose 8.2% year over year to $958.6 million in the fiscal quarter. The gross margin expanded 250 basis points to 24.3%.
The total inside gross profit increased 12% year over year to $619.7 million. Meanwhile, the inside margin increased 110 basis points to 42.2% due to the product mix and asset protection initiatives.
EBITDA increased 14.1% year over year to $348.9 million in the quarter under discussion, whereas the EBITDA margin expanded 130 basis points to 8.8%. This can be attributed to higher inside and fuel gross profit, partially offset by increased operating expenses due to operating 93 additional stores.
The company witnessed a rise of 5.2% in operating expenses of $609.7 million. This rise was caused by the operation of 93 additional stores compared with the same period last year, which accounted for about 4% of the increase. An additional 1% of the rise came from same-store employee expenses, where higher labor rates were partially offset by reduced same-store labor hours.