ANKENY, IOWA — The introduction of thin-crust pizza at Casey’s General Stores earlier this summer has proved to be solid fit for what had been a gap in the menu for the convenience store chain.
Darren M. Rebelez, president and chief executive officer of Casey’s, told analysts during a Sept. 12 conference call to discuss first-quarter results that Casey’s loyalty data showed approximately 16% of thin-crust pizza sales came from new buyers into the pizza category. About 12% of those sales were from new Casey’s guests entirely, he said.
“That’s been really helpful,” Mr. Rebelez said. “And that was really our hypothesis going into the thin-crust (pizza launch), which was that there are certain guests that that’s all they want. And that’s going to be a veto vote in a family if we don’t have that offer. And so far, that’s all played out. And the rewards data would validate that.”
Mr. Rebelez said it’s hard to say whether Casey’s has taken pizza share away from any of its competitors, though.
“So it’s really difficult to say, but I couldn’t tell you that we’ve seen an uptick in promotional activity from competitors since we’ve launched the thin crust,” he said. “I think the other pizza players have struggled a little bit from a velocity standpoint. So I think they’re starting to get a little more promotional anyway, but I haven’t seen any change as a result of what we’ve done.”
Meanwhile, Casey’s hot lunch sandwich segment received a boost from a collaboration with King’s Hawaiian, Torrance, Calif. Mr. Rebelez said the c-store chain’s barbecue brisket sandwich on King’s Hawaiian buns helped spur a 30% increase in sales in the hot lunch sandwich category for Casey’s in the first quarter.Net income in the first quarter ended July 31 totaled $169.24 million, equal to $4.54 per share on the common stock, up 11% from $152.93 million, or $4.11 per share, in the same period a year ago. Total revenue, meanwhile, fell 13% to $3.87 billion from $4.45 billion.