Casey's Increases Earnings over 50%

Gasoline--Casey's annual goal is to increase same-store gasoline gallons sold 2% with an average margin of 11 cents per gallon. The quarter's same-store gallons sold were up 3.2% with an average margin of 15.7 cents per gallon. The average retail price per gallon was $2.35, down 38% from the same period a year ago. "We believe lower retail prices were a factor in exceeding our same-store sales goal," stated Myers. "Our gasoline margin continues to benefit from a more responsive pricing environment." Total gallons sold rose to 335.8 million from 318.2 million; gross profit was $52.7 million compared with $49.6 million.

Grocery & Other Merchandise--The Company's goal is to increase same-store sales 8.9% with an average margin of 33.9%. Same-store sales for the quarter were up 6.4%, with an average margin of 34.3% compared to 34% last year. Gross profit rose 9.2% to $102 million. "We are pleased with this category's performance despite experiencing one of the coldest summers on record, which particularly affected beverage and beer sales," said Myers. "The gain in gross profit was primarily due to higher cigarette revenue attributable to the federal excise tax increase, along with an improved pack-versus-carton sales ratio." Total sales were up 8.4% to $297.4 million.

Prepared Food & Fountain--The goal is to increase same-store sales 7.5% with an average margin of 62%. Same-store sales for the quarter were up 6.6% and the average margin was 63.8%, up approximately 330 basis points from the prior year. "Lower cheese costs, which we have locked in through October, helped increase total gross profit in this category over 17% from the same period a year ago," Myers stated. "We expanded our coffee and fountain offerings and continue to roll out our made-to-order sub sandwich program." Total sales for the category increased 11.1% to $95.2 million.

Operating Expenses--For the quarter, operating expenses declined 0.3% to $132.4 million. "Credit card fees and transportation costs combined were down almost $5 million compared to the first quarter a year ago." said Myers. "We are encouraged by the great start to fiscal 2010 and will remain diligent in our efforts to control expenses throughout the year."

Expansion--The goal for fiscal 2010 is to increase the total number of Casey's stores 4%. By the end of the first quarter, the Company opened 5 newly constructed stores and replaced an additional 5 stores. There were no acquired stores opened during the quarter. "We have now incorporated the new store design in 61 locations, with 8 new sites and 13 replacement sites currently under construction," said Myers.

Dividend--At its September meeting, the Board of Directors declared a quarterly dividend of $0.085 per share, reflecting the increase approved in June. The dividend is payable November 16, 2009 to shareholders of record on November 2, 2009.

Casey's General Stores, Inc.
Condensed Consolidated Statements of Earnings
(Dollars in thousands, except per share amounts)
(Unaudited)
                                                Three months ended July 31,
                                                2009               2008
Total revenue                                   $      1,187,940   $      1,567,297
Cost of goods sold (exclusive of depreciation          967,815            1,368,132
and
amortization, shown separately below)
Gross profit                                           220,125            199,165
Operating expenses                                     132,358            132,716
Depreciation and amortization                          17,951             17,484
Interest, net                                          2,704              2,563
Earnings before income taxes                           67,112             46,402
Federal and state income taxes                         22,919             17,617
Net earnings                                    $      44,193      $      28,785
Earnings per common share
Basic                                           $      .87         $      .57
Diluted                                         $      .87         $      .57
Basic weighted average shares outstanding              50,863,579         50,753,995
Plus effect of stock options                           132,723            114,902
Diluted weighted average shares outstanding            50,996,302         50,868,897

Casey's General Stores, Inc.
Condensed Consolidated Balance Sheets
(Dollars in thousands)
(Unaudited)
                                                  July 31,         April 30,
                                                  2009             2009
Assets
Current assets
Cash and cash equivalents                         $     170,780    $     145,695
Receivables                                             9,732            10,888
Inventories                                             115,659          106,528
Prepaid expenses                                        2,094            1,394
Deferred income taxes                                   8,507            11,895
Income taxes receivable                                 --------         8,327
Total current assets                                    306,772          284,727
Other assets, net of amortization                       9,194            8,582
Goodwill                                                50,976           50,976
Property and equipment, net of
accumulated depreciation of $666,922 at
July 31, 2009, and of $652,376 at April 30, 2009        931,677          918,410
Total assets                                      $     1,298,619  $     1,262,695
Liabilities and Shareholders' Equity
Current liabilities
Current maturities of long-term debt              $     25,648     $     28,442
Accounts payable                                        125,754          115,436
Accrued expenses                                        64,937           77,365
Income taxes payable                                    7,889            --------
Total current liabilities                               224,228          221,243
Long-term debt, net of current maturities               156,248          167,887
Deferred income taxes                                   129,792          125,536
Deferred compensation                                   11,697           11,085
Other long-term liabilities                             14,649           15,914
Total liabilities                                       536,614          541,665
Total shareholders' equity                              762,005          721,030
Total liabilities and shareholders' equity        $     1,298,619  $     1,262,695

Certain statements in this news release, including any discussion of management expectations for future periods, constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause actual results to differ materially from future results expressed or implied by those statements. Casey's disclaims any intention or obligation to update or revise forward-looking statements, whether as a result of new information, future events, or otherwise.

Sales and Gross Profit by Product
(Amounts in thousands)
Three months ended                   Grocery & Other  Prepared Food
7/31/09             Gasoline         Merchandise      & Fountain        Other      Total
Sales               $  790,629       $     297,395    $    95,177       $ 4,739    $ 1,187,940
Gross profit        $  52,726        $     101,980    $    60,697       $ 4,722    $ 220,125
Margin                 6.7       %         34.3    %       63.8   %       99.6  %    18.5      %
Gasoline gallons       335,802
Three months ended
7/31/08
Sales               $  1,201,173     $     274,347    $    85,631       $ 6,146    $ 1,567,297
Gross profit        $  49,635        $     93,346     $    51,831       $ 4,353    $ 199,165
Margin                 4.1       %         34.0    %       60.5   %       70.8  %    12.7      %
Gasoline gallons       318,196

Gasoline Gallons                                 Gasoline Margin
Same-store Sales Growth                          (Cents per gallon, excluding credit card fees)
                                      Fiscal                                       Fiscal
       Q1     Q2      Q3      Q4      Year              Q1     Q2     Q3    Q4     Year
F2010  3.2 %                                     F2010  15.7c
F2009  0.5    0.2  %  2.1  %  1.2  %  1.0  %     F2009  15.6   13.7c  9.9c  12.1c  12.9c
F2008  0.3    -1.6    -3.9    -2.5    -2.0       F2008  15.8   13.6   13.5  12.6   13.9

Grocery & Other Merchandise                   Grocery & Other Merchandise
Same-store Sales Growth                       Margin
                                    Fiscal                                           Fiscal
       Q1     Q2      Q3     Q4     Year             Q1      Q2      Q3      Q4      Year
F2010  6.4 %                                  F2010  34.3 %
F2009  4.7    4.9  %  6.5 %  8.0 %  5.9 %     F2009  34.0    33.9 %  32.9 %  33.7 %  33.7 %
F2008  9.1    11.2    5.4    3.6    7.3       F2008  34.0    33.1    31.9    33.2    33.1

Prepared Food & Fountain                        Prepared Food & Fountain
Same-store Sales Growth                         Margin
                                      Fiscal                                           Fiscal
       Q1      Q2      Q3     Q4      Year             Q1      Q2      Q3      Q4      Year
F2010  6.6  %                                   F2010  63.8 %
F2009  12.3    9.3  %  8.1 %  7.2  %  9.1 %     F2009  60.5    60.6 %  61.8 %  62.7 %  61.4 %
F2008  9.5     10.6    8.4    11.2    9.8       F2008  61.7    63.0    63.6    60.9    62.3

Corporate information is available at this Web site: http://www.caseys.com. Earnings will be reported during a conference call on September 9, 2009. The call will be broadcast live over the Internet at 9:30 a.m. CT via the Investor Relations section of our Web site and will be available in an archived format.

SOURCE: Casey's General Stores, Inc.

Casey's General Stores, Inc. 
Bill Walljasper, 515-965-6505