0000726958-25-000101
SEC filingRevenue grew 11.5% to $4.57B, driven by Fikes acquisition and same-store gains; gross margin expanded 110 bps to 24.4%.
For the first quarter of fiscal 2026, Casey's reported total revenue of $4.57 billion, an 11.5% increase from $4.10 billion in the prior-year quarter. The growth was primarily fueled by the Fikes acquisition, which contributed $522 million in additional revenue and added 198 convenience stores and a wholesale fuel network. Organic same-store sales also contributed, with prepared food and dispensed beverage rising 5.6%, grocery and general merchandise up 3.8%, and fuel gallons sold up 1.7%.
Gross profit (revenue less cost of goods sold, exclusive of D&A) improved to $1.11 billion (24.4% of revenue) from $955 million (23.3% of revenue), a 110 basis point expansion. Fuel margins were the largest driver, with fuel revenue less COGS margin improving to 13.7% from 12.3%, supported by higher RIN sales ($6.7 million vs. $4.8 million) and per-gallon margin increasing to 41.0¢ from 40.7¢. Grocery margin also expanded to 35.9% from 35.4% due to product mix, while prepared food margin slightly declined to 58.0% from 58.3% due to the inclusion of lower-margin CEFCO stores.
Operating expenses rose 14.6% to $698 million, with approximately 10% attributable to the 221 additional stores and 1.5% from same-store labor rate increases partially offset by reduced hours. Depreciation and amortization increased 15.4% to $109 million, also driven by store growth. Net interest expense surged 90.9% to $26.9 million due to incremental debt issued to fund the Fikes acquisition. The effective tax rate fell to 22.7% from 24.1% due to higher excess tax benefits from share-based awards. Net income rose 19.5% to $215 million, resulting in diluted EPS of $5.77, up from $4.83.
Prepared Food & Dispensed Beverage revenue grew 13.2% to $458 million, with same-store sales up 5.6% led by whole pizzas and bakery, and an estimated 7.6% benefit from store growth. Grocery & General Merchandise revenue increased 14.6% to $1.23 billion, with same-store sales up 3.8% driven by non-alcoholic beverages and a 10.8% store growth contribution. Fuel revenue rose 7.0% to $2.73 billion as gallons sold jumped 18.0% (139 million gallons) despite a 9.4% decline in average retail price per gallon. Other revenue, primarily wholesale fuel and car wash, surged 120.1% to $150 million due to the Fikes wholesale network. Mix shift toward fuel and other revenue, while dilutive to overall margin, boosted absolute profitability.
Management highlighted elevated fuel profitability but noted potential volatility from oil prices, interest rates, and geopolitical disruptions. The company continues to expand electric vehicle charging stations (230 stations at 47 stores) and renewable fuel offerings (42% of stores sell biodiesel). Store count decreased by 9 during the quarter to 2,895, with 5 new constructions, 2 acquisitions, and 17 closures/divestitures (including all 10 CEFCO stores in Mississippi). The company expects to fund future growth through cash flow, revolving facilities, and potential debt issuance. No specific quantitative guidance was provided for the remainder of fiscal 2026.
As of July 31, 2025, Casey's had cash and cash equivalents of $458.1M, up from $326.7M at April 30, 2025. Total debt (including current maturities and finance leases) was $2.47B, down from $2.51B. Shareholders' equity increased to $3.64B from $3.51B, driven by net income partially offset by dividends and share repurchases. Inventory remained stable at $478.9M.
The notes do not disclose any material purchase commitments or contractual obligations beyond those related to debt and operating leases. Legal contingencies are disclosed, but management believes pending litigation will not have a material adverse effect.
During the three months ended July 31, 2025, Casey's repurchased 69,687 shares for $31.3M. Dividends declared totaled $21.4M ($0.57 per share). The company repaid $42.2M of long-term debt and finance lease obligations. Capital expenditures were $110.0M, primarily for store maintenance and new store construction.
Casey's operates as a single reportable segment. Revenue is categorized into prepared food & dispensed beverage ($192.5M), grocery & general merchandise ($785.9M), fuel ($2,360.1M), and other ($116.2M). Cost of goods sold for each category is disclosed, but operating expenses are not separable by product category. The company operates 2,895 stores across 19 states, primarily in the Midwest.