Caseys General Stores, Inc.

Ladies and gentlemen, thank you for standing by and welcome to the Q4 FY 2021 Casey's Journal Stores earnings call. At this time, while participants are on a listen-only mode, after the speaker's presentation, there will be a question and answer session. To ask a question during the session, you need to press star 1 on your telephone. If you require any further assistance, please press star then 0. I would now like to turn the call over to Brian Johnson, Senior VP. You may begin, sir.

Thank you. Good morning, and thank you for joining us to discuss the results from our fourth quarter and fiscal year end, April 30, 2021. I'm Brian Johnson, Senior Vice President, Investor Relations and Business Development. With me today is Darren Rebelles, President and Chief Executive Officer, and Steve Bramlage, Chief Financial Officer. Before we begin, I will remind you that certain statements made by us during this investor call may constitute forward-looking statements within the meanings of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include any statements relating to expectations for future periods, possible or assumed future results of operations, financial conditions, liquidity and related sources or needs, the company's supply chain, business and integration strategies, plans and synergies, growth opportunities, performance at our stores, and the potential effects of COVID-19. There are a 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, including but not limited to the integration of the Buchanan Energy Acquisition, our ability to execute on our strategic plan or to realize benefits from the strategic plan, the impact and duration of COVID-19 and related governmental actions, as well as other risks, uncertainties, and factors 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's disclaims any intention or obligation to update or revise forward-looking statements, whether as a result of new information, future events, or otherwise. Now, I'd like to turn the call over to Darren to discuss the fiscal year results. Darren?

Thanks, Brian, and good morning, everyone. The past 12 months with you have been like no other, and that includes our astounding financial results, which we're pleased to share today. Casey's 2021 fiscal year yielded the strongest results in our 53-year history, and I'm humbled to be the one that gets to share how we delivered this phenomenal performance with you today. I want to begin my comments by personally recognizing the over 40,000 people that make our business go every day. We cannot deliver on our purpose to make the lives of our guests and communities better every day without you. This past year, our team members reflected this passion more than ever, before as they remained dedicated to serving our guests in what was arguably the most challenging environment of our lifetimes. We remain committed to the health and safety of our team members who are on the front lines serving local communities. In addition to the many safety measures and incentive pay we've provided throughout the pandemic, we've recently implemented a wellness bonus for fully vaccinated team members and have seen encouraging results from this effort. Beyond our team, as a difficult school year wrapped up this spring, Casey's Cash for Classrooms grant program announced a $1 million contribution to support projects at local schools in our communities. Students, teachers, and families have a brighter future thanks to the support of Casey's and our generous guests. Now let's discuss the results of this past fiscal year. We finished fiscal 21 with an all-time record diluted EPS of $8.38 a share, an 18% increase from the prior year. The company also finished with an all-time high adjusted EBITDA of $729 million. This is a tremendous accomplishment considering the extreme environment the company has navigated through since the start of the pandemic last March. Fuel profitability was a primary driver as our centralized fuel team helped drive a gross profit increase of nearly 24% while offsetting COVID-driven pressures on gallons sold. We finished the year down 8.1% in same-store gallons sold with an all-time high annual fuel margin of 34.9 cents per gallon. Our merchandise team had to be just as agile as they were forced to react to constantly changing guest needs. Grab-and-go and single-serve items were replaced with larger pack sizes, grocery, and PPE needs, as well as higher demand for beer and alcohol as people began to consume more at home versus restaurants and bars. For the year, same-store inside sales were up 4%, led by a 6.6% same-store increase in grocery and other merchandise. Inside margin dipped slightly from the prior year to 40%, due primarily to a mixed shift to higher pack sizes and lower prepared food sales. Fortunately, we're now seeing recovery in our prepared food and fountain business as the world moves toward abnormal traffic patterns. Guest traffic is rising, and we're seeing a resurgence in pizza slices, dispensed beverages, and bakeries, as our guests return to their normal daily routines. The fact that our prepared food business is such a large part of our mix will create a tailwind after the pandemic that not too many of our peers will enjoy. In addition to navigating through a global pandemic and delivering record financial results, the company also did a great job executing on our long-term strategic plan. As a reminder, the three pillars of our strategic plan are reinventing the guest experience, creating capacity through efficiencies, and being where the guest is via disciplined store growth. All three pillars are supported by an investment in our talent. We've made a significant impact on the guest experience, particularly with respect to digital engagement. Our Casey's Rewards program, launched just prior to the pandemic, now includes more than 3.6 million members and continues to grow. We now have over 700 stores that offer DoorDash delivery service and we just recently launched Uber Eats at another 700 stores. Finally, our private label initiative is off to a great start, capitalizing on the brand equity we have built up for over 50 years. We recently eclipsed 3% of grocery and other merchandise sales, significantly outperforming our goal of 2% for fiscal 21. This past year, we stood up several capabilities that will help our company operate more efficiently. Our third distribution center in Joplin, Missouri is now open and operating, servicing over 600 stores and expected to reduce miles driven by approximately 1.8 million miles per year. Our newly formed and centralized procurement team more effectively leverages our company's scale and utilizes contemporary strategic sourcing tactics to drive savings. We now have a dedicated asset protection team that provides loss prevention support throughout the entire organization. And finally, Our centralized fuel team continues to deliver great results. Our performance excelled relative to the industry volumes and profitability in our geography during an extremely volatile time. And we continue to see tremendous growth opportunities in our business and remain bullish on our commitment to add 345 stores over the next three years. We're well on our way as we just recently closed on the largest acquisition in our company's history. The Buchanan Energy Transaction is a perfect strategic fit and we'll pair our outstanding pizza program with their well-located, high-volume stores. We expect the Circle K acquisition in Oklahoma to be completed, or closed, rather, by the end of June. We also built 40 new stores in fiscal 21, despite pandemic delays. Our two-pronged, balanced approach to store growth via organic builds and acquisitions enables us to be selective and disciplined, which we believe is the most effective way to drive shareholder value, and generate a creative EBITDA in returns on capital investment. We've also made great strides this year in building out the capability and diversity of our leadership team. Some of these new capabilities include technology, procurement, human resources, guest insights, and asset protection. Our leadership team has an effective blend of fresh outside perspective alongside veteran Casey's leadership. This mix of talent has been critical for us to execute on the strategic plan during these unprecedented times. I'd now like to turn the call over to Steve Bramlish to cover the fourth quarter in more detail.