Casey's General Stores, Inc. (NASDAQ:CASY) Q3 2016 Earnings Conference Call - Final Transcript

Mar 08, 2016 • 10:30 am ET

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Casey's General Stores, Inc. (NASDAQ:CASY) Q3 2016 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good day, ladies and gentlemen, and welcome to the Casey's General Stores Third Quarter Fiscal Year 2016 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. [Operator Instructions] As a reminder, this conference is being recorded.

I would now like to introduce your host for today's conference, Mr. Bill Walljasper, Chief Financial Officer. Mr. Walljasper, you may begin.

Executive
Bill Walljasper

Good morning and thank you for joining us to discuss Casey's results for the quarter ended January 31st. I'm Bill Walljasper, Chief Financial Officer. Bob Myers, Chairman and Chief Executive Officer, is also here.

Before we begin, I'll remind you that certain statements made by us during this investor call may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include any statements relating to our possible or assume future results of operations, business strategies, growth opportunities and performance improvements at our stores. There are number of known and unknown risks, uncertainties, and other factors that may cause our actual results to differ materially from any future results expressed or implied by those forward-looking statements, which are described in our most recent Annual Report on Form 10-K and quarterly reports on Form 10-Q as filed with the SEC and available on our website.

Any forward-looking statements made during this call reflect our current views as of today with respect to future events and Casey disclaims any intention or obligation to update or revise forward-looking statements whether as a result of new information, future events, or otherwise. As a reminder, we will release February same-store sales on Tuesday, March 15. We'll take a few minutes to summarize the quarter and then open it up for questions.

I hope all of you've seen, diluted earnings per share in the third quarter were $0.97 compared to $1.01 a year-ago. Year-to-date, diluted earnings per share were $4.54 compared to $3.57 a year ago. Earnings per share were down in the quarter from the prior year primarily due to a lower fuel margin, this period compared to a record quarterly margin a year ago. Nearly $0.04 decrease in fuel margin, quarter over quarter represented approximately $0.30 on diluted earnings per share in the quarter. EBITDA in the third quarter was down slightly as a result of this. However, EBITDA, year-to-date was up nearly 19%.

In the fuel category, we experienced decline in wholesale fuel cost environment late in the third quarter, as well as an elevated RIN value that contributed to our fuel margins ahead of our annual goal. The margin was $0.181 per gallon compared to the record fuel margin of $0.22 per gallon last year in the same period. During the quarter we sold 15.2 million RINs for $9.2 million. This represented about a $0.02 favorable impact to the fuel margin. Recently RINs are trading around $0.70. Last year in the fourth quarter the average RINs sold were