ANKENY — The Ankeny-based Casey’s convenience store chain reports a strong second quarter.
Company President and CEO Darrin Rebellez (Reh-bell-ez) spoke about the results during a conference call Tuesday. “Inside sales remains strong, driving inside gross profit dollars up 10% percent to $553 million. The company generated $159 million in net income, an increase of 15%,” he says.
He says inside sales were up 6.2% for the quarter driven by strong performance in the prepared food and dispensed beverages. The gallons of fuel sold were flat, but the company’s gross profit on fuel increased by nearly $309 million as they made more than 42 cents on each gallon sold. “This quarter marks the tenth quarter in a row with fuel margins about 34 and a half cents per gallon, and five of the last six quarters have been over 40 cents per gallon,” Rebellez says.
He says the number of people coming into the stores has remained good. Rebellez says three quarters of their customers have an income of $50,000 or more. “We are in a very low cost of living geography. In fact, the most expensive state we operate in is ranked 27th in the cost of living so that $50,000 tends to go a long way,” he says. “So with that cohort of guests 75 percent, so we’re really not seeing any change in consumption behavior.”
Rebellez says there has been an impact on the other 25% of customers. “We’ve seen a couple of things. They’re gravitating more towards our private label, their cigarette purchases have been impacted, both in Unit velocity and in just what they are buying. When they do buy,” Rebellez says.
He says they are buying cheaper cigarettes, and lower priced gas that is mixed with ethanol.
The company built or acquired 59 stores in the quarter and recently closed the deal on 22 stores in Texas, which is now the 17th state where they operate.