Lower gas prices have had an impact on the Ankeny-based Casey’s convenience store chain. Casey’s chief financial officer, Bill Walljasper, talked about the impact today in a conference call on the company’s second quarter financial report.
“During the second quarter we experienced a strong fuel-margin environment resulting in an average margin of 19.5-cents-per-gallon, compared to 16-cents-per-gallon in the same period a year ago. Year-to-date, the fuel margin is 16.2-cents-per-gallon, well ahead of our annual goal,” Walljasper says.
Walljasper was asked if the lower fuel prices have left customers with more money to spend inside the stores, and he says in the short term that appears to be the case. “Discretionary income in our customers has increased because of lower retail prices,” Walljasper says. “And even subsequent to the second quarter we have seen retail prices drop significantly. Right now in our Ankeny area we are below $2.40 per gallon. And we definitely have seen an increase in gallons-per-transaction with respect to the lower retail fuel prices.”
He says total fuel gallons sold were up 8.7 percent for the quarter. He says the fuel saver program they run with Hy-Vee also help push fuel sales along with the gas price drop. The sale of products inside the stores were up 13.6 percent, led in part by the increased sales of cigarettes and other tobacco products. “Premium cigarettes are really as I mentioned, are really moving, and that could be a function of having more dollars in our customers pockets and they are trading to those types of brands,” Walljasper says. He says they saw around a 4 percent increase in customer traffic in stores in October as gas prices were dropping — which he says is the highest it has been in the last year.
The company says the earnings per share of stock in the second quarter were up 27 cents compared to the same quarter one year ago at $1.28 a share. Walljasper says the strong gas sales and margins help offset some of the increases in the commodities used to make their food products.
The leader of the Iowa Lottery said earlier this week that a drop in gas prices is one of the reasons for an increase in scratch ticket sales.