ITEM 7.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Dollars and gallons in thousands, except per share amounts)
Please read the following discussion of the Company’s financial condition and results of operations in conjunction with the selected historical consolidated financial data and consolidated financial statements and accompanying notes presented elsewhere in this Form 10-K.
Overview
As of April 30, 2025, Casey’s General Stores, Inc. and its direct and indirect wholly-owned subsidiaries operate convenience stores primarily under the names "Casey's" and "Casey’s General Store" (collectively, with the stores below referenced as "GoodStop", "CEFCO", "Bucky's", or "Lone Star Food Store", referred to as "Casey's" or the "Company") throughout 20 states, approximately half of which are located in Iowa, Missouri and Illinois. On November 1, 2024, the Company closed on the acquisition of Fikes Wholesale and Group Petroleum Services (collectively "Fikes"), owner of CEFCO Convenience Stores, which added 198 total stores, including 148 additional stores in Texas, as well as 50 stores in Alabama, Florida, and Mississippi, which are the first stores Casey's has operated in these states. The acquisition also included the Company's first fuel terminal, located in Waco, Texas.
Approximately 71% of all stores were opened in areas with populations of fewer than 20,000 persons. The Company competes on the basis of price, as well as on the basis of traditional features of convenience store operations such as location, extended hours, product offerings, and quality of service. As of April 30, 2025, there were a total of 2,904 stores in operation.
All convenience stores carry a broad selection of food items (which at most stores includes, but is not limited to, freshly prepared foods such as regular and breakfast pizza, donuts, hot breakfast items, and hot and cold sandwiches), beverages, tobacco and nicotine products, health and beauty aids, automotive products, and other non-food items. As of April 30, 2025, 260 store locations offered car washes. In addition, all but six store locations offer fuel for sale on a self-service basis.
As part of the Fikes transaction, the Company expanded its wholesale network where Casey’s manages fuel wholesale supply agreements to certain dealer sites and other wholesale locations. The dealer and wholesale locations are not operated by Casey's and are not included in our overall store count in the table below. Approximately 2% of total revenue for the year-ended April 30, 2025 relates to this fuel wholesale network.
The Company’s business is seasonal, and generally experiences higher sales and profitability during the first and second fiscal quarters (May-October), when the weather is warmer across our footprint and guests tend to purchase greater quantities of fuel and certain convenience items such as beer, sports drinks, water, soft drinks and ice.
The following table represents the roll forward of store growth throughout fiscal 2025:
Store Count
Stores at April 30, 2024
New store construction
Acquisitions
Acquisitions not opened
Prior acquisitions opened
Closed
Stores at April 30, 2025
For further general descriptive information on the Company’s business and operations, see Item 1 , above, which is incorporated herein by reference.
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Long-Term Strategic Plan
The Company announced a three-year strategic plan in June 2023 focused on three enterprise objectives: grow store count, accelerate the food business, and enhance operational efficiency, which are enabled by a strong foundation and Team Member experience. The Company's plan was based on building on our proud heritage and distinct advantages, to become more contemporary through new capabilities, technology, data, and processes. We believe this will best position the Company to address rapidly evolving shifts in consumer habits and other macro retail trends.
The Company made significant progress towards its strategic plan goals during the 2025 fiscal year. Some of the key highlights include:
• Built or acquired 270 additional stores, the largest annual growth in Company history. This included 198 retail stores through the acquisition of Fikes, the largest acquisition in Company history,
• Diluted earnings per share of $14.64, representing an increase 9.0% from the prior year,
• Casey's Rewards members grew to over 9 million at year-end, and
• Same-store labor hours were down year over year, marking twelve consecutive quarters of reduction.
Fuel Profitability
The Company, and the retail fuel industry, has experienced historically high average revenue less cost of goods sold per gallon (excluding depreciation and amortization). Although this has remained relatively consistent, on a longer-term basis, this metric can fluctuate significantly, and sometimes unpredictably, in the short-term. While the Company believes that its average revenue less cost of goods sold per gallon (excluding depreciation and amortization) will remain elevated from historical levels for the foreseeable future, it is possible that increased oil and fuel prices, higher interest rates, macroeconomic conditions and/or continuing conflicts or disruptions involving oil producing countries may materially impact the performance of this metric.
Electric Vehicles and Renewable Fuels
Casey's continues its process of implementing an electric vehicle ("EV") strategy and our management team remains committed to understanding if and how the increased demand for, and usage of, EVs impacts consumer behavior across our store footprint and beyond. As consumer demand for alternative fuel options continues to grow, Casey’s has continued to add EV charging stations across our 20-state footprint. As of April 30, 2025, the Company has 230 charging stations at 47 stores, across 13 states. Our EV growth strategy is currently designed to selectively increase our charging stations at locations within our region where we see higher levels of consumer EV buying trends and demand for EV charging. To date, consumer EV demand within our Midwest footprint has been comparatively lower than the levels along the coasts. As EV demand from our guests increases, we are prepared to strategically integrate charging station options at select stores.
The Company also remains committed to offering renewable fuel options at our stores and continues to expand its alternative fuel options in response to evolving guest needs and as part of its environmental stewardship efforts. Currently, almost all of our stores offer fuel with at least 10% of blended ethanol and 41% of our stores offer biodiesel. Every newly built store has the capability to sell renewable fuels, and we aim to continue growing sales of renewable fuels throughout our footprint.
Fiscal 2025 Compared with Fiscal 2024
Total revenue for fiscal 2025 increased by $1,077,986 (7.3%) since the prior fiscal year, primarily driven by $952,018 of additional revenue from the Fikes acquisition, which included 198 additional convenience stores and a wholesale fuel network. Prepared food and dispensed beverage revenue increased by $150,162 (10.3%), due to an increase in same-store sales of 3.5% and an increase of approximately 6.8% due to store growth. The increase in same-store sales was driven by improved sales of hot sandwiches, bakery, and dispensed beverages. Grocery and general merchandise revenue increased by $416,493 (11.2%), due to an increase in same-store sales of 2.3% and an increase of approximately 8.9% due to store growth. The increase in same-store sales was driven by strong sales of non-alcoholic and alcoholic beverages. Retail fuel revenue increased by $373,962 (4.0%). The increase in the number of gallons sold of 368,183 (13.0%), was partially offset by a decrease in the average retail price per gallon of 7.8%. The increase in gallons sold was primarily attributable to store growth, as same-store gallons sold increased 0.1%. Other revenue increased $137,369 (50.5%) compared to the prior year, driven primarily by an increase in total revenue related to the wholesale fuel network, as a result of the Fikes acquisition.
Total revenue less cost of goods sold (excluding depreciation and amortization) was 23.5% of revenue for fiscal 2025 compared with 22.5% for the prior year. Prepared food and dispensed beverage revenue less related cost of goods sold (excluding depreciation and amortization) decreased to 58.2% of revenue from 58.7% during fiscal 2025 compared to the prior year, driven primarily by the acquisition of Fikes, as the current food offerings at these acquired stores have a lower percentage than a Casey's store. Grocery and general merchandise revenue less related cost of goods sold (excluding depreciation and amortization) increased to 35.0% of revenue from 34.1% during fiscal 2025 compared to the prior year. The current year percentage was positively impacted by product mix.
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Fuel revenue less related cost of goods sold (excluding of depreciation and amortization) was 12.7% of revenue for fiscal 2025 compared with 11.9% for the prior year. Fuel cents per gallon decreased to 38.7 cents in fiscal 2025 from 39.5 cents in fiscal 2024. The Company sold 23.8 million RINs (renewable identification numbers) for $16,664 during fiscal 2025, compared to the sale of 25.9 million RINs fiscal 2024, which generated $33,023 (see Note 1 , below, for a further description of RINs and how they are generated).
Operating expenses increased $263,843 (11.5%) to $2,552,356 in fiscal 2025. Approximately 10% of the increase is due to operating 246 more stores than the comparable period in the prior year, including transaction costs related to the Fikes acquisition. Insurance expense contributed approximately 1% of the increase. Total same-store employee expense contributed to approximately 1% of the increase, as the increases in wage rates were mostly offset by a reduction in same-store labor hours.
Depreciation and amortization expense increased $53,850 (15.4%) to $403,647 in fiscal 2025, primarily due to operating 246 more stores than a year ago.
Interest, net increased $30,510 (57.1%) to $83,951 in fiscal 2025, primarily due to issuing incremental debt of $1,100,000 to partially fund the acquisition of Fikes. For additional discussion, refer to Note 3 .
The effective tax rate decreased to 23.3% in fiscal 2025 from 23.5% in fiscal 2024. The decrease in the effective tax rate was primarily due to a one-time benefit to update the state deferred tax rate following the Fikes acquisition (0.7%) and an increase in excess tax benefits recognized on share-based awards (0.3%). The effect of these favorable items was partially offset by a one-time benefit in the prior year from adjusting the Company’s deferred tax assets and liabilities for state law changes enacted during the year (0.8%).
Net income increased by $44,548 (8.9%) to $546,520 in fiscal 2025 from $501,972 in fiscal 2024. The increase was primarily attributable to higher profitability both inside the store and in fuel. This increase was partially offset by higher operating expenses, depreciation and amortization, interest, net and income tax expense. See discussion in the paragraphs above for the primary drivers for each of these increases.
Please refer to the Form 10-K related to the fiscal year ended April 30, 2024, filed on June 24, 2024, for comparison of Fiscal 2024 to Fiscal 2023.
COMPANY TOTAL REVENUE AND REVENUE LESS COST OF GOODS SOLD (EXCLUDING DEPRECIATION AND AMORTIZATION) BY CATEGORY
Years ended April 30,
Total revenue by category
Prepared food and dispensed beverage
Grocery and general merchandise
Fuel
Other (1)
Revenue less cost of goods sold (excluding depreciation and amortization) by category
Prepared food and dispensed beverage
Grocery and general merchandise
Fuel
Other (1)
(1) The 'Other' category primarily consists of activity related to wholesale fuel and car wash revenue, which are both presented gross of applicable costs, as well as lottery, which is presented net of applicable costs.
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INDIVIDUAL STORE COMPARISONS (1)
Years ended April 30,
Average retail sales
Average retail inside sales (2)
Average revenue less cost of goods sold (excluding depreciation and amortization) on inside sales (2)
Average retail sales of fuel
Average revenue less cost of goods sold (excluding depreciation and amortization) on fuel
Average operating income (3)
Average number of gallons sold
(1) Individual store comparisons include only those stores that had been in operation for at least one full year and remained open on April 30 of the fiscal year indicated.
(2) Inside sales is comprised of sales related to the grocery and general merchandise and prepared food and dispensed beverage categories.
(3) Average operating income represents retail sales less cost of goods sold, operating expenses and depreciation and amortization attributable to a particular store; it excludes interest, federal and state income taxes, and Company operating expenses not attributable to a particular store.
SAME STORE SALES BY CATEGORY (1)
Years ended April 30,
Prepared food and dispensed beverage same-store sales
Grocery and general merchandise same-store sales
Same-store fuel gallons sold
(1) Same-store sales is a common metric used in the convenience store industry. We define same-store sales as the total sales increase (or decrease) for stores open during the full time of the periods being presented. The store must be open for each entire fiscal year being compared. Remodeled stores that remained open or were closed for just a very brief period of time (less than a week) during the period being compared remain in the same store sales comparison. If a store is replaced, either at the same location (razed and rebuilt) or relocated to a new location, it is removed from the comparison until the new store has been open for each entire period being compared. Newly constructed and acquired stores do not enter the calculation until they are open for each entire period being compared.
Use of Non-GAAP Measures
We define EBITDA as net income before net interest expense, income taxes, depreciation and amortization. EBITDA is not considered to be a GAAP measure and should not be considered as a substitute for net income, cash flows from operating activities or other income or cash flow statement data. This measure has limitations as an analytical tool, and should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP. We strongly encourage investors to review our financial statements and publicly filed reports in their entirety and not to rely on any single financial measure.
We believe EBITDA is useful to investors in evaluating our operating performance because securities analysts and other interested parties use this calculation as a measure of financial performance and debt service capabilities, and it is regularly used by management for internal purposes including our capital budgeting process, evaluating acquisition targets, assessing store performance, and awarding incentive compensation.
Because non-GAAP financial measures are not standardized, EBITDA, as defined by us, may not be comparable to similarly titled measures reported by other companies. It therefore may not be possible to compare our use of this non-GAAP financial measure with those used by other companies.
The following table contains a reconciliation of net income to EBITDA for the years ended April 30, 2025, 2024, and 2023, respectively:
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Years ended April 30,
Net income
Interest, net
Depreciation and amortization
Federal and state income taxes
EBITDA
For the year ended April 30, 2025, EBITDA increased 13.3%. The increase was primarily attributable to higher profitability both inside the store and in fuel, which was partially offset by higher operating expenses. See discussion in the preceding sections for the primary drivers for each of these individual changes.
Please refer to the Form 10-K related to the fiscal year ended April 30, 2024, filed on June 24, 2024, for comparison of Fiscal 2024 to Fiscal 2023.
Critical Accounting Policies and Estimates
Critical accounting policies are those accounting policies that management believes are important to the portrayal of our financial condition and results of operations and require management’s most difficult, subjective judgments, often because of the need to estimate the effects of inherently uncertain factors.
Business Combinations
The Company uses the acquisition method of accounting for transactions meeting the definition of a business combination. The acquisitions are recorded in the financial statements by allocating the purchase price to the assets acquired, including intangible assets, and liabilities assumed, based on their estimated fair values at the acquisition date as determined by third party appraisals or internal estimates. The significant assets acquired include buildings, equipment, land, and right-of-use lease assets.
The Company primarily values buildings and equipment using the cost method and land using comparable land sales. The purchase price is determined based upon the fair value of consideration transferred to the seller. Fair values are typically determined using Level 3 inputs (see Note 3 to the consolidated financial statements). Given these estimates often are based upon unobservable inputs, the estimates require significant judgment when determining the overall value and actual results could differ from the estimates originally established.
When acquiring leases in a business combination, we retain the lease classification utilized by the seller if it was determined using acceptable methods under ASC 842 . As part of the allocation of the purchase price in a business combination, lease terms are compared to market terms utilizing an income approach to determine if leases are favorable or unfavorable. Any favorable or unfavorable leasehold interests identified increase (favorable) or reduce (unfavorable) the right-of-use lease asset and are recognized over the life of the related right-of-use asset.
The excess of the cost of the acquisition over the net amounts assigned to the fair value of the assets acquired and the liabilities assumed is recorded as goodwill, if the acquisition is considered to be a business combination. During a one-year period from the acquisition date, amounts are allowed to be provisional for areas that are expected to be adjusted to their final amounts during the measurement period. These provisional adjustments are for when the buyer obtains additional information about the facts and circumstances that existed as of the acquisition date. Subsequent adjustments recorded to provisional balances within the measurement period are recorded in the period in which the adjustment is identified. Acquisition-related transaction costs are recognized in operating expenses as incurred.
Inventory
Inventories, which consist of merchandise and fuel, are stated at the lower of cost or market. For fuel inventories, cost is determined through the use of the first-in, first-out (FIFO) method. For merchandise inventories, cost is determined through the use of the last-in, first-out (LIFO) method. Inventory valued using the LIFO method of inventory requires judgement when making the determination of appropriate indices to be used for determining price level changes.
Long-lived Assets
The Company monitors closed and underperforming stores for an indication that the carrying amount of assets may not be recoverable. If the sum of the expected future undiscounted cash flows is less than the carrying amount of the assets, an impairment loss is recognized to the extent carrying value of the assets exceeds their estimated fair value. Fair value is based on management’s estimate of the price that would be received to sell an asset in an orderly transaction between market participants. The estimate is derived from offers, actual sale or disposition of assets subsequent to year-end, and other
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indications of fair value, which are considered Level 3 inputs (see Note 3 to the consolidated financial statements). In determining whether an asset is impaired, assets are grouped at the lowest level for which there are identifiable cash flows that are largely independent of the cash flows of other groups of assets, which for the Company is generally on a store-by-store basis. The Company incurred impairment charges of $4,080 in fiscal 2025, $4,057 in fiscal 2024, and $3,500 in fiscal 2023. Impairment charges are a component of operating expenses.
Self-insurance
The Company is primarily self-insured for Team Member healthcare, workers’ compensation, general liability, and automobile claims. The self-insurance claim liability for workers’ compensation, general liability, and automobile claims is determined actuarially at each year-end based on claims filed and an estimate of claims incurred but not yet reported. Actuarial projections of the losses are employed due to the potential of variability in the liability estimates. Some factors affecting the uncertainty of claims include the development time frame, settlement patterns, litigation and adjudication direction, and medical treatment and cost trends. The liability is not discounted. The balances of our self-insurance reserves were $74,471 and $57,369 for the years ended April 30, 2025 and 2024, respectively.
Recent Accounting Pronouncements
Refer to Note 1 of the consolidated financial statements for a description of new accounting pronouncements applicable to the Company.
Liquidity and Capital Resources
Due to the nature of our business, cash provided by operations is our primary source of liquidity. The Company finances our inventory purchases primarily from normal trade credit aided by relatively rapid inventory turnover. This turnover allows us to conduct operations without large amounts of cash and working capital. As of April 30, 2025, the Company’s ratio of current assets to current liabilities was 0.92 to 1. The ratio at April 30, 2024 and 2023 was 0.87 to 1 and 0.99 to 1, respectively.
We believe our current $850,000 committed unsecured revolving credit facility, our $50,000 unsecured bank line of credit, current cash and cash equivalents, and the future cash flow from operations will be sufficient to satisfy the working capital needs of our business.
Net cash provided by operating activities was $1,090,854 for the year ended April 30, 2025, compared to $892,953 for the year ended April 30, 2024, an increase of $197,901. Our primary source of operating cash flows is from sales to guests at our stores. The primary uses of operating cash flows are payments to our team members and suppliers, as well as payments for taxes and interest. Cash flow from operations was favorably impacted by improved revenue less cost of goods sold (excluding depreciation and amortization) of $404,492, offset by an increase in operating expenses of approximately $263,843 and an increase in cash paid for interest of approximately $23,149. Refer to “Fiscal 2025 Compared with Fiscal 2024” starting on page 20 for further details on the primary drivers for the changes in revenue, cost of goods sold, operating expenses, and interest. Cash flows from operations can also be impacted by variability in the timing of payments and receipts for certain assets and liabilities, such as wage related accruals, accounts payable, and receivables from credit card companies or our vendors. The increase in operating cash flows, compared to the prior year, was favorably impacted by an increase in operating cash flows of $44,029 due to the timing of inventory purchases, as well as an increase in $29,949 related to receivables, primarily due to the timing of vendor rebate payments in comparison to the prior year.
Cash used in investing activities increased $901,312. During fiscal 2025, the Company expended $1,745,473 for purchases of property and equipment and payments for acquisitions compared to $852,036 for fiscal 2024 related to these activities. The increase in cash used in investing activities was attributable to an increase in acquisition related activity, with the Fikes acquisition closing during the fiscal year. For additional information, please refer to Note 2 . Purchases of property and equipment and payments for acquisitions of businesses typically represent the single largest use of excess Company funds. Management believes that by acquiring, building, and reinvesting in stores, the Company will be better able to drive long-term shareholder value.
Cash provided by financing increased $995,978, from the comparable period of the prior year, primarily due to the proceeds from long-term debt of $1,100,000, which was used to partially fund the Fikes acquisition. For additional information, please refer to Note 2 and Note 3 . Additionally, cash provided by financing was positively impacted by a decrease in share repurchase related activity of $104,164. These increases were offset by a $185,836 increase in payments of long-term debt and finance lease obligations, due to an increase in debt principal payments, notably the full pre-payment of the Senior Notes Series E of $150,000 in the fourth quarter of fiscal 2025.
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As of April 30, 2025, we had long-term debt and finance lease obligations consisting of:
Finance lease liabilities (Note 7 )
3.67% Senior Notes (Series A) due in 7 installments beginning June 17, 2022, and ending June 15, 2028
3.75% Senior Notes (Series B) due in 7 installments beginning December 17, 2022 and ending December 18, 2028
3.65% Senior Notes (Series C) due in 7 installments beginning May 2, 2025 and ending May 2, 2031
3.72% Senior Notes (Series D) due in 7 installments beginning October 28, 2025 and ending October 28, 2031
3.77% Senior Notes (Series F) due August 22, 2028
2.85% Senior Notes (Series G) due August 7, 2030
2.96% Senior Notes (Series H) due August 6, 2032
5.23% Senior notes (Series I) due November 2, 2031
5.43% Senior notes (Series J) due November 2, 2034
Variable rate term loan facility, requiring quarterly installments ending April 21, 2028
Variable rate incremental term loan facility, requiring quarterly installments ending October 30, 2029
Debt issuance costs
Less current maturities
Interest on the 3.67% Senior Notes Series A and 3.75% Senior Notes Series B is payable on the 17th day of each June and December. Principal on the Senior Notes Series A and Series B is payable in various installments beginning June 17, 2022 (Series A) and December 17, 2022 (Series B) through December 2028. We may prepay the 3.67% and 3.75% Senior Notes in whole or in part at any time in an amount of not less than $2,000 at a redemption price calculated in accordance with the Note Agreement dated June 17, 2013, as amended, between the Company and the purchasers of the Senior Notes Series A and Series B.
Interest on the 3.65% Senior Notes Series C is payable on the 2nd day of each May and November, while the interest on the 3.72% Senior Notes Series D is payable on the 28th day of each April and October. Principal on the Senior Notes Series C and Series D is payable in various installments beginning May 2, 2025 (Series C) and October 28, 2025 (Series D) through October 2031. We may prepay the 3.65% and 3.72% Senior Notes in whole or in part at any time in an amount of not less than $2,000 at a redemption price calculated in accordance with the Note Agreement dated May 2, 2016, as amended, between the Company and the purchasers of the Senior Notes Series C and Series D.
Interest on the 3.77% Senior Notes Series F is payable on the 22nd day of each February and August. Principal on the Senior Notes Series F is payable in full on August 22, 2028 (Series F). We may prepay the 3.77% Senior Notes in whole or in part at any time in an amount of not less than $2,000 at a redemption price calculated in accordance with the Note Agreement dated June 13, 2017, as amended, between the Company and the purchasers of the Senior Notes Series F.
Interest on the 2.85% Senior Notes Series G and 2.96% Senior Notes Series H is payable on the 7th day of each February and August. Principal on the Senior Notes Series G and Series H is payable in full on August 7, 2030 (Series G) and August 6, 2032 (Series H), respectively. We may prepay the 2.85% and 2.96% Senior Notes in whole or in part at any time in an amount of not less than $2,000 at a redemption price calculated in accordance with the Note Purchase Agreement dated June 30, 2020, between the Company and the purchasers of the Senior Notes Series G and Series H.
During the year, the Company entered into a note purchase agreement with respect to the issuance of $250,000 aggregate principal amount of senior notes, consisting of: (i) $150,000 aggregate principal amount of 5.23% Senior Notes Series I, due November 2, 2031; and (ii) $100,000 aggregate principal amount of 5.43% Senior Notes Series J due November 2, 2034. The Senior Notes Series I and Series J were issued on October 30, 2024. Interest on the 5.23% Senior Notes Series I and 5.43% Senior Notes Series J is payable on the 2nd day of each May and November. Principal on the Senior Notes Series I and Series J is payable in full on November 2, 2031 (Series I) and November 2, 2034 (Series J), respectively. We may prepay these notes in whole or in part at any time in an amount of not less than $2,000 at a redemption price calculated in accordance with the note
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purchase agreement. The Company used the proceeds of these notes to partially fund the Fikes acquisition (see further discussion of the Fikes acquisition in Note 2 ).
The Company is party to a credit agreement, dated as of April 21, 2023, which provides for term loan borrowings and a committed, unsecured $850,000 revolving credit facility. On October 30, 2024, the Company entered into an amendment to the credit agreement (the “Amendment” and, together with the original credit agreement, the “Credit Agreement”), pursuant to which the Company incurred an incremental term loan in an aggregate principal amount of $850,000 (the “Incremental Term Loan”). See Note 3 for additional information related to the Credit Agreement. The proceeds of the Incremental Term Loan were used to partially fund the Fikes acquisition (see further discussion of the Fikes acquisition in Note 2 ).
Amounts borrowed under the Credit Agreement bear interest at variable rates based upon, at the Company’s option, either: (a) either Term SOFR or Daily Simple SOFR, in each case plus 0.10% (with a floor of 0.00%) for the interest period in effect, plus an applicable margin ranging from 1.10% to 1.70% or (b) an alternate base rate, which generally equals the highest of (i) the prime commercial lending rate announced by the Administrative Agent as its “prime rate”, (ii) the federal funds rate plus 1/2 of 1.00%, and (iii) Adjusted Daily Simple SOFR plus 1.00%, each plus an applicable margin ranging from 0.10% to 0.70% and each with a floor of 1.00%. The applicable margins and facility fee, in each case, are dependent upon the Company’s quarterly Consolidated Leverage Ratio, as defined in the Credit Agreement. We have the right at any time to prepay all or a portion of the outstanding balance without premium or penalty, other than customary “breakage” costs with respect to Term SOFR-based borrowings, with prior notice given.
To date, we have funded capital expenditures primarily through funds generated from operations, the proceeds of the sale of common stock, issuance of debt or other bank financing, and existing cash. Future capital required to finance operations, improvements, and the anticipated growth in the number of stores is expected to come from cash generated by operations, our $850,000 revolving credit facility, our additional $50,000 bank line of credit, and additional long-term debt or other securities as circumstances may dictate. We do not expect such capital needs to adversely affect liquidity.
The table below presents our significant contractual obligations, including interest, at April 30, 2025:
Contractual obligations
Payments due by period
Total
Less than
1 year
1-3 years
3-5 years
More than
5 years
Long-term debt (1)
Finance lease obligations
Operating lease obligations
Deferred compensation
Total
(1) The long-term debt portion of the table above excludes interest payments related to the Company's term loan facility and the incremental term loan facility, due to the variable nature of the required interest payments.
Included in other long-term liabilities on our consolidated balance sheet at April 30, 2025, was a $11,488 obligation for deferred compensation. As the specific payment dates for a portion of the deferred compensation outstanding are unknown due to the unknown retirement dates of many of the participants, the related timing of the payment of the balances have not been reflected in the above “Payments due by period” table. However, known payments of $4,936 are scheduled over the next 5 years, which includes $757 recognized in current liabilities as of April 30, 2025.
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Forward-Looking Statements
This Form 10-K, including but not limited to the Management’s Discussion and Analysis of Financial Condition and Results of Operations, contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. The words “may,” “will,” "should," “believe,” “expect,” “anticipate,” “intend,” “estimate,” “project,” “continue,” and similar expressions are used to identify forward-looking statements. Forward-looking statements represent the Company’s current expectations or beliefs concerning future events and trends that we believe may affect our financial condition, liquidity and related sources and needs, supply chain, results of operations and performance at our stores, business strategy, strategic plans, growth opportunities, integration of acquisitions, acquisition synergies, short-term and long-term business operations and objectives including our long-term strategic plan, wholesale fuel, inventory and ingredient costs and the potential effects of the conflicts in oil producing regions on our business. The Company cautions that these statements are further qualified by important factors that could cause actual results to differ materially from those in the forward-looking statements, including, without limitation, the following risk factors described more completely above in Item 1A entitled “Risk Factors”:
Business Operations; Our business and our reputation could be adversely affected by a cyber or data security incident or the failure to protect sensitive guest, Team Member or supplier data, or the failure to comply with applicable regulations relating to data security and privacy; food-safety issues and foodborne illnesses, whether actual or reported, or the failure to comply with applicable regulations relating to the transportation, storage, preparation or service of food, could adversely affect our business and reputation; we may be adversely impacted by increases in the cost of food ingredients and other related costs; a significant disruption to our distribution network, to the capacity of the distribution centers, or timely receipt of inventory could adversely impact our sales or increase our transaction costs, which could have a material adverse effect on our business; we could be adversely affected if we experience in, or are to recruit, hire or retain, members of our team and other distribution, field and store Team Members; any to anticipate and respond to changes in consumer preferences, or to introduce and promote technology for guest interaction, could affect our financial results; we rely on our information technology systems, and a number of third-party software providers, to manage numerous aspects of our business, and a of these systems could affect our business; increased credit card expenses could lead to higher operating expenses and other costs for the Company; our operations present and risks which may not be fully covered by insurance, if insured; the inherent in the storage and transport of fuel could cause and could to us potentially significant , costs or liabilities; consumer or other could affect our financial condition and results of operations; pandemics or disease outbreaks, responsive actions taken by governments and others to mitigate their spread, and guest behavior in response to these events, have, and may in the future, affect our business operations, supply chain and financial results; and, covenants in our Senior Notes and credit facility agreements require us to comply with certain covenants and meet financial maintenance tests and the to comply with these requirements could have a material impact to us.
Governmental Actions, Regulations, and Oversight : Compliance with and changes in tax laws could adversely affect our performance; we are subject to extensive governmental regulations; governmental action and campaigns to discourage tobacco and nicotine use and other tobacco products may have a material adverse effect on our revenues and gross profit; and, wholesale cost and tax increases relating to tobacco and nicotine products could affect our operating results.
Industry : General economic and political conditions that are largely out of the Company’s control may adversely affect the Company’s financial condition and results of operations; developments related to fuel efficiency, fuel conservation practices, climate change, and changing consumer preferences may decrease the demand for motor fuel; unfavorable weather conditions can adversely affect our business; the volatility of wholesale petroleum costs could adversely affect our operating results; and, the convenience store industry is highly competitive.
Growth Strategies : We may not be able to identify, acquire, and integrate new properties and stores, which could adversely affect our ability to grow our business.
Common Stock : The market price for our common stock has been and may in the future be volatile, which could cause the value of your investment to decline; any issuance of shares of our common stock in the future could have a dilutive effect on your investment; and, Iowa law and provisions in our charter documents may have the effect of preventing or hindering a change in control and adversely affecting the market price of our common stock.
Although we have attempted to list the important factors that presently affect the Company’s business and operating results, we further caution you that other factors we have not identified may in the future prove to be important in affecting our business and results of operations. We ask you not to place undue reliance on any forward-looking statements because they speak only of our views as of the statement dates. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.
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