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Casey's Reports Strong Second Quarter Sales

Gasoline - The Company's annual goal is to increase same-store gasoline gallons sold 1% with an average margin of 13.5 cents per gallon. For the second quarter, same-store gallons sold were up 3.6% with an average margin of 14.9 cents per gallon. "We anticipate the favorable gasoline environment to continue throughout the 3^rd quarter," said Myers. Same-store gallons sold for the year increased 2.5% with an average margin of 15.7 cents, while gross profit rose nearly 13%. For the year, total gallons sold were up 8% to 712.1 million.

Grocery & Other Merchandise - Casey's annual goal is to increase same-store sales 6% with an average margin of 33.9%. For the quarter, same-store sales rose 6.9% with an average margin of 32.9%. For the six months ended October 31, 2010, same-store sales were up 4.2% with an average margin of 32.9%. "More favorable weather and increased promotional initiatives helped drive sales during the second quarter," stated Myers. "Competitive cigarette pricing continued in the second quarter, putting pressure on the margin. However, we were pleased with the overall gain in gross profit dollars." Total sales for the year are up 9.2% to $626.1 million.

Prepared Food & Fountain - The goal for fiscal 2011 is to increase same-store sales 8.9% with an average margin of 63.1%. Same-store sales were up 7.2% for the quarter and 4.8% year to date. The average margin for the quarter was 62.7%; down from a record high margin in the same period a year ago primarily due to a rise in commodity prices. "We benefited from value-oriented promotions throughout the quarter driving total sales by 13% and increasing gross profit 9.6%," said Myers. "Despite the challenging economy, we are encouraged by the continued strong performance of this category." Year to date, total sales were up 10.3% to $209.6 million compared to $190 million with an average margin of 63.2%.

Operating Expenses - For the quarter, operating expenses increased 17% to $153.3 million. Excluding expenses associated with the unsolicited hostile offer by Couche-Tard, expenses increased 10.8%. "The increase was driven by a $2.5 million increase in credit card fees and expenses associated with operating more stores this quarter compared to the same period a year ago," stated Myers.

Expansion - The annual goal is to increase the total number of stores 4-6%. At the mid-year point, the Company had acquired 10 stores and completed 8 new-store constructions. "We anticipate completing 74 more acquisitions during the third fiscal quarter and remain optimistic about our long-term opportunities," said Myers. "In addition to acquisitions, we are on pace to build a total of 20 new stores and replace 15 stores by the end of the fiscal year." The Company also completed 12 major remodels during the first six months of the year.

Dividend - At its December meeting, the Board of Directors declared a quarterly dividend of $0.135 per share. The dividend is payable February 15, 2011 to shareholders of record on February 1, 2011.

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.

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