took in March to fund acquisitions in fiscal 2008. The private placement had a favorable rate of 5.72% and was oversubscribed—a testament to Casey’s financial strength and ability to fund future operational activities. We still have plenty of debt capacity should additional opportunities arise.”

We’ve set our capital expenditure budget for fiscal 2008. We’re planning to spend about $72 million for acquisitions and new-store constructions, approximately $50 million on remodels and replacements, and around $5 million each on technology and transportation updates.

We know there’s great interest in the return on invested capital. Our ROIC for fiscal 2007 was 9.4%, down from fiscal 2006’s due to the additional $100 million of debt, the smaller gas margin, and a one-time accounting adjustment under the SEC’s Staff Accounting Bulletin No. 108. “I’m confident,” Walljasper said, “we’ll see incremental earnings growth in fiscal 2008 from the kitchen additions to the HandiMart stores and the finished remodels of the Gas ‘N Shop stores.” 		operating Expenses








CEO Bob Myers reported that we didn’t achieve our goal of holding the percentage increase in operating expenses to less than the percentage increase in gross profit. Several factors had a negative impact: the reduction in gross profit contribution from the gasoline category, the increased costs for wages and utilities, and the significant rise in operating expenses related to an $8.2 million jump in credit card fees.

Myers also said we have the same goal for fiscal 2008: to hold the percentage increase in operating expenses to less than the percentage increase in gross profit. During the year, we’ll concentrate on total inside gross profit dollars to measure the effect 		capital Structure








of operational and marketing decisions on the components over which we have the most control. We’ll save approximately $1 million by doing credit card clearing in house.

We will continue sharing the specifics of our financial performance with investors so they can track our evolving Company story. It’s one more way of being a convenience store and a whole lot more.
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