Caseys-signLower gas prices pushed the Ankeny-based Casey’s convenience stores to record earnings in the third quarter. Casey’s chief financial officer, Bill Walljasper, talked about the earnings during a conference call today.

“Diluted earnings per share were $1.01, compared to 33-cents a year ago. Year to date diluted earnings per share were $3.57 compared to $2.73,” Walljasper says. “The record third-quarter earnings is the result of a strong fuel margin environment that most all fuel retailers experienced, and strong fuel sales throughout our business.”

The company was able to profit as the gas prices dropped. “During the third quarter we experienced a declining wholesale fuel cost environment that contributed to a record fuel margin of 22-cents per gallon, compare to 13.6 cents per gallon for the same period a year ago,” Walljasper says. He says the company also benefited from a $5 million increase in the sale of renewable fuel credits, which led to 76-percent increase in its gross fuel profit.

“Lower retail fuel prices and favorable weather comparisons from last year drove same store gallons up two-point-two percent during the quarter. Total gallons sold during the quarter increased 8.6 percent to 446.8 million,” according to Walljasper. Sales of products inside the stores were up, including cigarettes, which Walljasper attributes in part to lower gas prices. “Definitely we have seen over the last quarter to two quarters a shift to more premium brands of cigarettes. We believe it is a function of more discretionary income in our consumers’ pocket, maybe trading up to a premium brand,” Walljasper says.

Sales of other items in the stores, including prepared food, have also been trending up in the last two quarters. “That’s a function of several things — the primary function would be the lower retail fuel price driving customers,” Walljasper says. “But also back in late January and February, we did see a very high Powerball jackpot…anytime we see that type of environment we do see an increase in foot traffic in our stores. But definitely a lower retail fuel price is helping customer traffic.”

Total sales for the year were up 12.7 percent while the gross profit rose 12.6 percent to $435.3 million. Caseys owns more than 1,800 stores in 14 states.