Casey's Sees Soft Fuel Same-Store Sales: Can Growth Plans Aid?
Zacks Investment Research | Feb 12, 2020 08:33PM ET
Casey’s General Stores, Inc. (NASDAQ:CASY) has been grappling with soft fuel gallons same-store sales. We note that fuel sales fell 6.6% during the second quarter of fiscal 2020. Also, fuel gallons same-store sales decreased 1.8% during the same period. This follows declines of 2%, 2.8% and 3.4% witnessed in the preceding three quarters.
Management now envisions fiscal 2020 fuel gallons same-store sales to be down 1% to up 0.5%. Casey's had earlier anticipated fuel gallons same-store to be down 0.5% to up 1%.
Further, elevated operating costs remain a headwind. Operating expenses rose 8.5% in the fiscal second quarter, owing to 84 additional stores from the prior-year period. This follows an increase of 5.7% and 9.6% during thepreceding two quarters. The company continues to anticipate rise in operating expenses of 7-9% for fiscal 2020.
Same-store operating expenses grew 2.6% in the second quarter. Increase in operating expenses comprised the impacts of senior leadership transition costs. For the fiscal year, management expects these costs to have an adverse impact of $6 million or 12 cents per share on earnings.
Shares of the Zacks Rank #3 (Hold) company have dipped 4% in the past three months, underperforming the Zacks Investment Research
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