Casey's (CASY) 10-K risk factor changes: FY2016 vs FY2015

We compete with many other convenience store chains, gasoline stations, supermarkets, drugstores, discount stores, club stores, fast food outlets, and mass [removed: merchants.][added: merchants, including retail gasoline companies that have more extensive retail outlets, greater brand name recognition and established fuel supply arrangements.]

[removed: In recent years, several nontraditional] [added: Several non-traditional] retailers such as supermarkets, club stores, and mass merchants have affected the convenience store industry by entering the [removed: fuel] retail [added: fuel] business.

These [removed: nontraditional] [added: non-traditional] fuel retailers have obtained a significant share of the motor fuels market, and their market share is expected to grow.

As a result, our competitors may [added: have a greater ability to bear the economic risks inherent in our industry, and may] be able to respond better to changes in the economy and new opportunities within the industry.

[removed: These competitive pressures] could materially and adversely affect our fuel and merchandise sales and gross profit margins, and therefore could have a material adverse effect on our business, financial condition and results of operations.

Over the past three fiscal years, on average our fuel revenues accounted for approximately [removed: 70%] [added: 66%] of total revenue and our fuel gross profit accounted for approximately 23% of total gross profit.

Significant increases and volatility in wholesale petroleum costs have resulted and could in the future result in significant increases in the retail price of petroleum products and in lower [removed: gasoline] average [removed: margin] [added: fuel margins] per gallon.

This volatility makes it difficult to predict the impact that future wholesale cost fluctuations will have on our operating results and financial [removed: condition.][added: condition in future periods.]

In addition, a shift toward electric, hydrogen, natural gas or other alternative fuel-powered vehicles could fundamentally change the shopping [added: and driving] habits of our customers or lead to new forms of fueling destinations or new competitive pressure.

Any of these outcomes could potentially result in fewer customer visits to our stores, decreases both in fuel and general merchandise sales revenue or [removed: reduce] [added: lower] profit margins, which could have a material adverse effect on our business, financial condition and results of operations.

In addition, new advancements that improve fuel efficiency or other governmental mandates to advance fuel efficiency may result in a [removed: reduciton] [added: reduction] in demand for petroleum-based motor fuel, which again could have a material adverse effect on our business.

Since the interchange fees we pay when credit cards are used to make purchases are based on transaction amounts, higher fuel prices at the pump [added: and higher gallon movement] result in higher credit card expenses.

Total credit card fees paid in fiscal [added: 2016,] 2015, [removed: 2014,] and [removed: 2013,] [added: 2014,] were approximately $100 million, [removed: $95] [added: $100] million, and [removed: $85] [added: $95] million, respectively.

Sales of tobacco products have averaged approximately [removed: 9%] [added: 10%] of our total revenue over the past three fiscal years, and our tobacco gross profit accounted for approximately [removed: 11%] [added: 10%] of total gross profit for the same period.

For example, various petroleum marketing retailers, distributors and refiners [removed: are currently defending] [added: recently defended] class-action claims alleging that the sale of unadjusted volumes of fuel at temperatures in excess of 60 degrees Fahrenheit violates various state consumer protection laws due to the expansion of the fuel with the increase of fuel temperatures.

[removed: In addition, certain] [added: Cyberattacks are rapidly evolving and becoming increasingly sophisticated, and a number of] retailers have [removed: experienced] [added: reported] data breaches [added: in recent months] resulting in [added: the] exposure of sensitive customer data, including payment card information.

While we have invested significant amounts and engaged professional advisers in the protection of our IT systems and [added: incident response programs, and] maintain what we believe are adequate security controls over individually identifiable customer, employee and vendor data provided to us, a breakdown or a breach in our systems that results in the unauthorized release of individually identifiable customer or other sensitive data could nonetheless occur and have a material adverse effect on our reputation, operating results and financial condition.

A successful cyberattack resulting in the loss of sensitive customer, employee or vendor data could [removed: adversely affect our reputation, results of operations, financial condition and liquidity, and could] result in [added: customer] litigation [added: being brought] against us [added: and damage claims made by] or [removed: the imposition] [added: on behalf] of [removed: penalties.][added: the payment card industry and/or affected financial institutions.]

[removed: Economic] [added: Unfavorable economic] conditions, higher fuel prices, and unemployment levels can affect consumer confidence, spending patterns, and miles driven, [removed: where] [added: causing] customers [added: to] “trade down” to lower priced products in certain [removed: categories.][added: categories when these conditions exist.]

The market prices paid to [removed: the Company] [added: us] for [removed: its “renewable identification numbers”, or] [added: our] “RINs”, [removed: as well as the wholesale costs paid by the Company for certain commodities such as cheese, coffee and meat,] can fluctuate widely from period to period and have a significant impact on [removed: the Company’s] [added: our] financial results for a particular period or periods.

Due to the inherent price volatility of RINs, there can be no assurance that [removed: the Company] [added: we] will be able to sell [removed: its] [added: our] RINs in the future at any particular price.

Any significant decline in the market price of RINs, [removed: as well as any increases in the wholesale costs of commodities such as cheese, coffee and meat] could have a material adverse effect on [removed: the Company’s] [added: our] results of operations in a particular period or periods.

From May 1, [removed: 2014] [added: 2015] through April 30, [removed: 2015] [added: 2016] we acquired [removed: 36] [added: five] and opened [removed: 32] [added: four] convenience stores.

Our business is subject to extensive governmental laws and regulations that include but are not limited to [added: those relating to] environmental [added: protection; the preparation, sale] and [added: labeling of food; minimum wage, overtime and other] employment laws and regulations; [removed: health care;] [added: compliance with the Patient Protection and Affordable Care Act and the American with Disabilities Act;] legal restrictions on the sale of alcohol, tobacco, [added: money order] and lottery products; [added: compliance with the Payment Card Industry Data Security Standards and similar requirements; securities laws and Nasdaq listing standards.]

[removed: A] [added: The costs of compliance with these laws and regulations is substantial, and a] violation of or change in such laws and/or regulations could have a material adverse effect on our business, financial condition, and results of operations.

Any appreciable increase in income, overtime pay, or the statutory minimum [added: salary requirements, minimum] wage [removed: rate] [added: rate,] or adoption of mandated healthcare benefits would result in an increase in our labor costs.

Health care reform legislation could have a [added: continued] negative impact on our business.

The Patient Protection and Affordable Care Act (the “PPACA”) as well as other healthcare reform legislation being considered by Congress and various State legislatures may have a [added: continued] negative impact on our business.

Although some of the rules, reforms and regulations required to implement the PPACA have not yet been [removed: adopted,] [added: fully implemented,] such reforms appear likely to significantly increase our employee healthcare-related costs and therefore our operating expenses.

Additionally, negative publicity, regardless of whether the allegations are valid, concerning food quality, food safety or other health concerns, employee relations or other matters related to our [added: prepared food] operations may materially adversely affect demand for our [added: prepared] food [added: offerings] and could result in a decrease in customer traffic to our convenience stores.

[removed: Failure to identify and remediate deficiencies in our internal control over] financial [removed: reporting in a timely manner could prevent us from accurately and timely reporting our financial] results, which could cause us to fail to meet our reporting obligations, lead to a loss of investor confidence and have a negative impact on the trading price of our common stock.

The market price of our common stock will also be affected by our quarterly operating results and [removed: monthly] same store sales results, which may be expected to fluctuate.

[removed: The following are factors that may affect our quarterly results and same store sales:] [added: include] general, regional, and national economic conditions; competition; unexpected costs; changes in retail pricing, consumer trends, and the number of stores we open and/or close during any given period; costs of compliance with corporate governance and Sarbanes-Oxley requirements.

Certain of these non-traditional retailers may use more extensive promotional pricing or discounts, both at the fuel pump and in the convenience store, to encourage in-store merchandise sales and gasoline sales.

This intense competition could adversely affect our revenues and profitability, and have a material adverse impact on our business and results of operations.

These competitive pressures

Our net income is significantly affected by changes in the margins we receive on our retail fuel sales.

In addition, wholesale petroleum prices, fuel gallons sold, fuel gross profits and merchandise sales can be subject to seasonal fluctuations.

Consumer demand for motor fuel typically increases during the summer driving season and typically falls during the winter months.

Travel, recreation and construction activities are usually higher in the summer months in the Midwest, increasing the demand for motor fuel and merchandise that we sell.

For that reason, our fuel volumes are typically higher in the first and second quarters of our fiscal year.

Any significant change in one or more of these factors could materially affect the number of fuel gallons sold, fuel gross profits and overall customer traffic, which in turn could have a material adverse effect on our business, financial condition and results of operations.

Certain of such claims, if resolved against us, could give rise to substantial monetary damages which are not fully covered by our insurance policies and which could adversely affect our reputation, results of operations, financial condition and liquidity.

In certain states, we generate fuel revenues by blending bulk fuel with ethanol and bio-diesel and selling the associated “renewable identification numbers” (“RINs”) that are released in the process.

The market price for RINs fluctuates based on a variety of factors, including but not limited to governmental and regulatory action, perceptions concerning the prospect for changes in the renewable fuels standards or the future availability of RINs, and other market dynamics.

During the past three fiscal years, the average sale price has been $0.57 per RIN.

The wholesale costs we pay for certain other commodities such as cheese and coffee also can fluctuate widely from period to period.

Any significant increase in the wholesale costs of such commodities could have a material adverse impact on our results of operations in a particular period or periods.

We are subject to extensive governmental regulations.

Failure to identify and remediate deficiencies in our internal control over financial reporting in a timely manner could prevent us from accurately and timely reporting our

Some of the factors that may affect our quarterly results and same store sales

Any such breach of our systems, or any failure to secure our systems against such a breach, could expose us to customer litigation, as well as sanctions from the payment card industry.

Cyberattacks are rapidly evolving and becoming increasingly sophisticated.

We are subject to federal and state environmental and other regulations.

requirements related to minimum wage, working conditions, public accessibility, and citizenship.

We believe an immediate 100-basis-point move in interest rates affecting our floating and fixed rate financial instruments as of April 30, [removed: 2015,] [added: 2016,] would have no material effect on pretax earnings.

Casey’s General Stores, Inc. (“Casey’s”) and its wholly owned subsidiaries (Casey’s, together with its subsidiaries, are referred to herein as the “Company” or “we”) operate convenience stores under the name “Casey’s General Store” (hereinafter referred to as “Casey’s Store” or “Stores”) in [removed: fourteen] [added: 14] Midwestern states, primarily in Iowa, Missouri, and Illinois.

The Company also operates [removed: one store] [added: two stores] selling primarily tobacco products.

In addition, all but [removed: one] [added: two] Casey’s [removed: store offers] [added: stores offer] fuel for sale on a self-service basis.

On April 30, [removed: 2015] [added: 2016] there were a total of [removed: 1,878] [added: 1,931] stores in operation.

There were [removed: 45] [added: 51] stores newly constructed [removed: and we closed nine stores] in fiscal [removed: 2015.][added: 2016.]

We also acquired [removed: 36] [added: five] additional stores in fiscal [removed: 2015; 32] [added: 2016; four] of those stores were opened in [removed: 2015, three were permanently closed] [added: fiscal 2016,] and one will be opened during the [removed: 2016] [added: 2017] fiscal year.

We [removed: operate a central warehouse, Casey’s Distribution Center,] [added: opened our second distribution center in Terre Haute, Indiana in February, 2016, from which, combined with our existing distribution center] adjacent to our corporate headquarters in Ankeny, Iowa, [removed: through which] we supply grocery and general merchandise items to our stores.

Casey’s, with executive offices at One Convenience Blvd., Ankeny, Iowa 50021-8045 (telephone [removed: 515-965-6100)] [added: 515-965-6100),] was incorporated in Iowa in 1967.

One of our subsidiaries, Casey’s Marketing Company (Marketing [removed: Company) also operates from the Corporate Headquarters facility and] [added: Company),] was incorporated in Iowa in March 1995.

A second subsidiary, Casey’s Services Company (Services [removed: Company)] [added: Company),] operates from a nearby facility [added: in Ankeny] and was also incorporated in Iowa in March 1995.

A third subsidiary, Casey’s Retail Company, was incorporated in Iowa in 2004 and a fourth subsidiary, CGS Sales Corp., was incorporated in [removed: 2008 and both also operate from the Corporate Headquarters facility.][added: 2008.]

A fifth subsidiary, Tobacco City Inc., was incorporated in Iowa in [removed: 2014 and also operates from the Corporate Headquarters.][added: 2014.]

We currently own most of our real estate, including [removed: the Casey’s Distribution Center,] [added: substantially all of our stores, both distribution centers,] the Services Company facility, and the Corporate Headquarters facility.

Casey’s Retail Company was organized as an Iowa corporation in April 2004, CGS [added: Sales Corp. was organized as an Iowa corporation in 2008, and Tobacco City, Inc. was organized as an Iowa corporation in 2014.]

[removed: The Marketing Company owns and has responsibility for the] operation of stores in Arkansas, Indiana, Iowa, Kentucky, Missouri, Oklahoma, Tennessee and Wisconsin.

The Marketing Company also has responsibility for all of our wholesale operations, including [removed: the Distribution Center.][added: both distribution centers.]

Tobacco City Inc. operates [removed: one store] [added: two stores] in North Dakota.

Stores sell regional brands of dairy and bakery products, and approximately [removed: 87%] [added: 88%] of the stores offer beer.

All but [removed: one] [added: two] Casey’s General Stores offer gasoline or diesel [added: fuel] for sale on a self-service basis.

Gasoline and diesel [added: fuel] are sold under the Casey’s name.

As of April 30, [removed: 2015,] [added: 2016,] the Company was selling donuts prepared on store premises in approximately [removed: 98%] [added: 99%] of our stores in addition to cookies, brownies, and other bakery items.

We began marketing made-from-scratch pizza in 1984, and it [removed: is] [added: was] available in [removed: 1,836] [added: 1,905] stores [removed: (98%)] [added: (99%)] as of April 30, [removed: 2015.][added: 2016.]

Although pizza is our most popular prepared food offering, we continue to expand our prepared food product line, which now includes ham and cheese sandwiches, pork and chicken fritters, sausage sandwiches, chicken tenders, pizza rolls, popcorn chicken, breakfast croissants and biscuits, breakfast pizza, hash browns, quarter-pound hamburgers and cheeseburgers, and potato cheese [removed: bites.][added: bites and other seasonal items.]

In the last three fiscal years, retail sales of nonfuel items have generated about [removed: 30%] [added: 34%] of our total revenue, but they have resulted in approximately 77% of our gross [removed: profits.][added: profit.]

Gross profit margins on prepared food items averaged approximately 61% during the three fiscal years ended April 30, [removed: 2015—substantially] [added: 2016—substantially] higher than the gross profit margin on retail sales of fuel, which averaged approximately [removed: 5%.][added: 7%.]

The [removed: latest] [added: current larger] store design [removed: (O2 style)] measures 39 feet by 103 feet with approximately 2,500 square feet devoted to sales area, 500 square feet to kitchen space, 400 square feet to storage, and 2 large public restrooms.

[removed: The latest] [added: There is also a smaller] store design [added: that is generally designated] for smaller communities [removed: (P style)] [added: that] measures 43 feet by 75 [removed: feet] [added: feet,] with approximately 1,600 square feet devoted to sales area with the remaining areas similar in size.

[removed: We currently] [added: As of April 30, 2016, we] operate approximately [removed: 850] [added: 950] stores on a 24-hour basis.

[removed: We require that all] [added: All] stores maintain a bright, clean interior and provide prompt checkout service.

[removed: Our] store-site selection criteria emphasize the population of the immediate area and daily highway traffic volume.

We can [removed: often] operate [removed: profitably] [added: effectively] at a highway location in a community with a population of as few as 400.

Approximately [removed: 66%] [added: 59%] of Casey’s total revenue for the year ended April 30, [removed: 2015] [added: 2016] was derived from the retail sale of fuel.

The following table summarizes (dollars and gallons in thousands) fuel sales for the three fiscal years ended April 30, [removed: 2015:][added: 2016:]

| | [removed: 2015] [added: 2016] | | | | [removed: 2014] [added: 2015] | | | | [removed: 2013] [added: 2014] | | |

| Number of gallons sold | [removed: 1,816,596] [added: 1,951,814] | | | | [removed: 1,665,600] [added: 1,816,596] | | | | [removed: 1,535,140] [added: 1,665,600] | | |

| Total retail fuel sales | $ | [removed: 5,144,385] [added: 4,214,802] | | | $ | [removed: 5,554,580] [added: 5,144,385] | | | $ | [removed: 5,229,157] [added: 5,554,580] | |

| Percentage of total revenue | [removed: 66.2] [added: 59.2] | | % | | [removed: 70.8] [added: 66.2] | | % | | [removed: 72.1] [added: 70.8] | | % |

| Gross profit percentage (excluding credit card fees) | [removed: 6.8] [added: 9.1] | | % | | [removed: 4.8] [added: 6.8] | | % | | [removed: 4.2] [added: 4.8] | | % |

| Average retail price per gallon | $ | [removed: 2.83] [added: 2.16] | | | $ | [removed: 3.33] [added: 2.83] | | | $ | [removed: 3.41] [added: 3.33] | |

| Average gross profit margin per gallon (excluding credit card fees) | | [removed: 19.33] [added: 19.55] | ¢ | | | [removed: 16.08] [added: 19.33] | ¢ | | | [removed: 14.42] [added: 16.08] | ¢ |

We closed three stores in fiscal 2016.

All subsidiaries other than Services Company operate from the Corporate Headquarters.

The Marketing Company owns and has responsibility for the

Our

Gross profit percentage represents the fuel gross profit divided by the gross fuel sales dollars, so as retail fuel prices fluctuate in a period of consistent gross margin per gallon, the gross profit percentage will also fluctuate in an inverse relationship to fuel price.

The Company has a number of other registered and unregistered trademarks and service marks that are significant to the Company from an operational and branding perspective (e.g. "Casey's Pizza", "Casey's Famous for Pizza", etc.).

Sales Corp. was organized as an Iowa corporation in 2008, and Tobacco City, Inc. was organized as an Iowa corporation in 2014.

In April 2014, we announced plans to build a second distribution center in Terre Haute, Indiana.

This second distribution center (planned to begin operations in February 2016) will enable us to expand our territory while at the same time provide a more efficient distribution system to our existing stores.

regional chains.

For the Fiscal Year Ended April 30, [removed: 2015][added: 2016]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [removed: x]

The aggregate market value of the registrant’s common stock held by non-affiliates as of October 31, [removed: 2014,] [added: 2015,] was approximately [removed: $3.2] [added: $4.1] billion based on the closing sales price [removed: ($81.87] [added: ($106.22] per share) as quoted on the NASDAQ Global Select Market.

| Class | | Outstanding at June [removed: 22, 2015] [added: 21, 2016] |

| Common Stock, no par value per share | | [removed: 38,923,505] [added: 39,135,363] shares |

The information called for by Item 5 of Part II and Items 10, 11, 12, 13 and 15 of Part III is hereby incorporated by reference from the definitive Proxy Statement to be filed with the Securities and Exchange Commission in connection with the Annual Meeting of Shareholders, which will be filed with the Securities and Exchange Commission not later than 120 days after April 30, [removed: 2015.][added: 2016.]

| PART I | ITEM 1. | [removed: [Business](#s610781D5C60234F4EE732463FC2C5E1C)] [added: [Business](#s93A09FCA359D5AF5B602CA893DF7E84B)] | [removed: [4](#s610781D5C60234F4EE732463FC2C5E1C)] [added: [4](#s93A09FCA359D5AF5B602CA893DF7E84B)] |

| | ITEM 1A. | [Risk [removed: Factors](#s9147E77FA38DA84F8EEF2463FC5E7DFA)] [added: Factors](#sE2E3FC987E4A5C6897A226EB6FD1039B)] | [removed: [7](#s9147E77FA38DA84F8EEF2463FC5E7DFA)] [added: [7](#sE2E3FC987E4A5C6897A226EB6FD1039B)] |

| | ITEM 1B. | [Unresolved Staff [removed: Comments](#s1603E858E0211D7998A12463FC80D893)] [added: Comments](#sAC75984F523A50598B152FFA37E25BC8)] | [removed: [13](#s1603E858E0211D7998A12463FC80D893)] [added: [14](#sAC75984F523A50598B152FFA37E25BC8)] |

| | ITEM 2. | [removed: [Properties](#s142281968299C9510CDF2463FCB23405)] [added: [Properties](#sD617E7BE76B554BEA3C0AFC76569AE05)] | [removed: [13](#s142281968299C9510CDF2463FCB23405)] [added: [14](#sD617E7BE76B554BEA3C0AFC76569AE05)] |

| | ITEM 3. | [Legal [removed: Proceedings](#sEC12A3AF213056F25BE12463FCD4FEC0)] [added: Proceedings](#s8668634201555BCF8F4B79F0AE56C673)] | [removed: [14](#sEC12A3AF213056F25BE12463FCD4FEC0)] [added: [14](#s8668634201555BCF8F4B79F0AE56C673)] |

| | ITEM 4. | [Mine Safety [removed: Disclosures](#s09D4A39C94E198708CA52463FD050398)] [added: Disclosures](#s5EB47E764B72512A8D3DEE6475F785DB)] | [removed: [14](#s09D4A39C94E198708CA52463FD050398)] [added: [14](#s5EB47E764B72512A8D3DEE6475F785DB)] |

| PART II | ITEM 5. | [Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity [removed: Securities](#s308E49A49E6E32F16DA32463FD587F17)] [added: Securities](#s5CC6CA838BA05B75B72FD526BDFF4CEC)] | [removed: [15](#s308E49A49E6E32F16DA32463FD587F17)] [added: [15](#s5CC6CA838BA05B75B72FD526BDFF4CEC)] |

| | ITEM 6. | [Selected Financial [removed: Data](#s6AEA5F98C4B49B00D2F12463FD7BC2C7)] [added: Data](#sEAF83F3936A95BE992FDB7287C7717B2)] | [removed: [15](#s6AEA5F98C4B49B00D2F12463FD7BC2C7)] [added: [16](#sEAF83F3936A95BE992FDB7287C7717B2)] |

| | ITEM 7. | [Management’s Discussion and Analysis of Financial Condition and Results of [removed: Operations](#sA1C5EF3684C875D0100E2463FDAD6F90)] [added: Operations](#s4D19C0004DA75E5DAEFE6687BB583F6C)] | [removed: [16](#sA1C5EF3684C875D0100E2463FDAD6F90)] [added: [16](#s4D19C0004DA75E5DAEFE6687BB583F6C)] |

| | ITEM 7A. | [Quantitative and Qualitative Disclosures about Market [removed: Risk](#sFDA10513E5757373354C2463FDCE1F38)] [added: Risk](#s380FDDBA65435E4E9DD1BA1E434C33AC)] | [removed: [26](#sFDA10513E5757373354C2463FDCE1F38)] [added: [26](#s380FDDBA65435E4E9DD1BA1E434C33AC)] |

| | ITEM 8. | [Financial Statements and Supplementary [removed: Data](#sE6B23004AA128024D8A52463FE01B038)] [added: Data](#sE5C8EAE4734351B9980A6F5206526C13)] | [removed: [27](#sE6B23004AA128024D8A52463FE01B038)] [added: [27](#sE5C8EAE4734351B9980A6F5206526C13)] |

| | ITEM 9. | [Changes in and Disagreements with Accountants on Accounting and Financial [removed: Disclosure](#sEBB9A63A8452C0CC152E246401E9250F)] [added: Disclosure](#s9F7EF6EC47805A7F853BC3830A5A484D)] | [removed: [45](#sEBB9A63A8452C0CC152E246401E9250F)] [added: [45](#s9F7EF6EC47805A7F853BC3830A5A484D)] |

| | ITEM 9A. | [Controls and [removed: Procedures](#s42184B5ECFB0F5E89E752464020A3925)] [added: Procedures](#sDB57A0DB62F95E19B5201213CB263233)] | [removed: [45](#s42184B5ECFB0F5E89E752464020A3925)] [added: [45](#sDB57A0DB62F95E19B5201213CB263233)] |

| | ITEM 9B. | [Other [removed: Information](#s3F78B4B1304250AE67462464023B49A4)] [added: Information](#s7A9B9AB7FA3358519B4A32CDA365697F)] | [removed: [46](#s3F78B4B1304250AE67462464023B49A4)] [added: [46](#s7A9B9AB7FA3358519B4A32CDA365697F)] |

| PART III | ITEM 10. | [Directors, Executive Officers and Corporate [removed: Governance](#s094EA4008012778B08302464028F1EBC)] [added: Governance](#s19AF171C15EE5EF193A447A9C814DADC)] | [removed: [47](#s094EA4008012778B08302464028F1EBC)] [added: [47](#s19AF171C15EE5EF193A447A9C814DADC)] |

| | ITEM 11. | [Executive [removed: Compensation](#sB13F152B40DCB1AA685A246402B00F59)] [added: Compensation](#s5AB7CD26331850D09A771529741A0987)] | [removed: [47](#sB13F152B40DCB1AA685A246402B00F59)] [added: [47](#s5AB7CD26331850D09A771529741A0987)] |

| | ITEM 12. | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder [removed: Matters](#s4BC66C595FA83B7DD5AD246402E3373C)] [added: Matters](#sC5EEC2CEA3F554ECA0C95FEF1D97AE9A)] | [removed: [47](#s4BC66C595FA83B7DD5AD246402E3373C)] [added: [47](#sC5EEC2CEA3F554ECA0C95FEF1D97AE9A)] |

| | ITEM 13. | [Certain Relationships and Related Transactions and Director [removed: Independence](#s5967F4AB80759C61B0FA2464030402E2)] [added: Independence](#sF8075971FF3557D6BA8EFB210B552066)] | [removed: [47](#s5967F4AB80759C61B0FA2464030402E2)] [added: [47](#sF8075971FF3557D6BA8EFB210B552066)] |

| | ITEM 14. | [Principal Accountant Fees and [removed: Services](#sD31E6167DCDC9EABF5EE246403356F96)] [added: Services](#s78FD718EADD759D2A78A29501143A5C4)] | [removed: [47](#sD31E6167DCDC9EABF5EE246403356F96)] [added: [47](#s78FD718EADD759D2A78A29501143A5C4)] |

| PART IV | ITEM 15. | [Exhibits and Financial Statement [removed: Schedules](#sCA9CBF84214FC16A26EA24640389A8AD)] [added: Schedules](#sF4111BE3A37A5233A13E8D5ED037912D)] | [removed: [48](#sCA9CBF84214FC16A26EA24640389A8AD)] [added: [48](#sF4111BE3A37A5233A13E8D5ED037912D)] |

10-K 1 casy-2016430x10k.htm 10-K

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10-K 1 casy-2015430x10k.htm 10-K

| | | [Signatures](#sED4375AF068B3AB5A6CF246403AAD694) | [50](#sED4375AF068B3AB5A6CF246403AAD694) |

The previously announced revisions to our financial results regarding an immaterial correction of an error for the fiscal 2015 first quarter and fiscal 2014 are reflected in all year-to-date results and comparisons to prior periods.

We own our corporate headquarters [added: (built in 1990)] and [removed: Distribution Center.][added: both distribution centers.]

Located on an approximately 45-acre site in Ankeny, Iowa, [removed: these adjacent facilities] [added: our corporate headquarters, our first distribution center,] and our vehicle service and maintenance center occupy a total of approximately 375,000 square feet.

[removed: In Fiscal 2015, we completed further expansion of our] [added: This second] distribution center [removed: by adding] [added: has] approximately [removed: 38,000 of additional] [added: 300,000] square feet of warehouse space.

In [removed: April 2014,] [added: February 2016,] we [removed: announced plans to build a] [added: opened our] second distribution center, [removed: to be] located in Terre Haute, Indiana.

On April 30, [removed: 2015,] [added: 2016,] we also owned the land at [removed: 1,857] [added: 1,910] store locations and the buildings at [removed: 1,862] [added: 1,915] locations and leased the land at 21 locations and the buildings at 16 locations.

We also own a building near our corporate headquarters where we operate our construction and support services departments.

The original complex was completed in February 1990 and placed in full service at that time.

In fiscal 2007, we added 98,000 square feet to the Distribution Center, 20,000 square feet of office space, additional paving for truck parking, and necessary drainage and landscaping improvements.

In fiscal 2013, we purchased a nearby service building, which consists of approximately 60,000 square feet of warehouse space and approximately 14,000 square feet of office space.

This second distribution center (planned to begin operations in February 2016) is projected to have approximately 250,000 square feet of warehouse space.

The [removed: 38,886,165] [added: 39,055,570] shares of common stock outstanding at April 30, [removed: 2015] [added: 2016] had a market value of approximately [removed: $3.2] [added: $4.4] billion.

On that date there were [removed: 1,749] [added: 1,690] shareholders of record.

| Calendar [removed: 2013] [added: 2014] | High | | | | Low | | | | Calendar [removed: 2014] [added: 2015] | | High | | | | Low | | | | Calendar [removed: 2015] [added: 2016] | | High | | | | Low | | |

| Q1 | $ | [removed: 59.00] [added: 70.95] | | | $ | [removed: 51.45] [added: 64.84] | | | Q1 | | $ | [removed: 70.95] [added: 94.67] | | | $ | [removed: 64.84] [added: 83.00] | | | Q1 | | $ | [removed: 94.67] [added: 123.75] | | | $ | [removed: 83.00] [added: 98.80] | |

We began paying cash dividends during fiscal 1991.The dividends declared in fiscal [removed: 2015] [added: 2016] totaled [removed: $0.80] [added: $0.88] per share.

The dividends declared in fiscal [removed: 2014] [added: 2015] totaled [removed: $0.72] [added: $0.80] per share.

On June [removed: 5, 2015,] [added: 3, 2016,] the Board of Directors declared a quarterly dividend of [removed: $0.22] [added: $0.24 per share] payable August [removed: 17, 2015] [added: 15, 2016] to shareholders of record on August [removed: 3, 2015.][added: 1, 2016.]

The Board [removed: expects to review] [added: typically reviews] the dividend every year at its June meeting.

The cash dividends declared during the calendar years [removed: 2013-15] [added: 2014-16] were as follows:

| Calendar [removed: 2013] [added: 2014] | Cash dividend declared | | | | Calendar [removed: 2014] [added: 2015] | | Cash dividend declared | | | | Calendar [removed: 2015] [added: 2016] | | Cash dividend declared | | |

| Q1 | $ | [removed: 0.165] [added: 0.180] | | | Q1 | | $ | [removed: 0.180] [added: 0.200] | | | Q1 | | $ | [removed: 0.200] [added: 0.220] | |

| [removed: Q2] [added: Q3] | [removed: 0.180] [added: 0.200] | | | | [removed: Q2] [added: Q3] | | [removed: 0.200] [added: 0.220] | | | | [removed: Q2] | | [removed: 0.220] | | |

| Q2 | $ | 75.79 | | | $ | 64.12 | | | Q2 | | $ | 98.22 | | | $ | 80.94 | | | | | | | | | | | |

| Q3 | $ | 73.09 | | | $ | 65.70 | | | Q3 | | $ | 114.90 | | | $ | 95.30 | | | | | | | | | | | |

| Q4 | $ | 91.42 | | | $ | 71.08 | | | Q4 | | $ | 129.53 | | | $ | 101.36 | | | | | | | | | | | |

| Q2 | 0.200 | | | | Q2 | | 0.220 | | | | Q2 | | 0.240 | | |

| Q4 | 0.200 | | | | Q4 | | 0.220 | | | | | | | | |

| | 0.780 | | | | | | 0.860 | | | | | | | | |

| Q2 | $ | 63.89 | | | $ | 52.84 | | | Q2 | | $ | 75.79 | | | $ | 64.12 | | | | | | | | | | | |

| Q3 | $ | 74.08 | | | $ | 60.47 | | | Q3 | | $ | 73.09 | | | $ | 65.70 | | | | | | | | | | | |

| Q4 | $ | 77.58 | | | $ | 67.80 | | | Q4 | | $ | 91.42 | | | $ | 71.08 | | | | | | | | | | | |

| Q3 | 0.180 | | | | Q3 | | 0.200 | | | | | | | | |

| Q4 | 0.180 | | | | Q4 | | 0.200 | | | | | | | | |

| | 0.705 | | | | | | 0.780 | | | | | | | | |

| | [removed: 2015] [added: 2016] | | | | [removed: 2014] [added: 2015] | | | | [removed: 2013] [added: 2014] | | | | [removed: 2012] [added: 2013] | | | | [removed: 2011] [added: 2012] | | |

| Total revenue | $ | [removed: 7,767,216] [added: 7,122,086] | | | $ | [removed: 7,840,255] [added: 7,767,216] | | | $ | [removed: 7,250,840] [added: 7,840,255] | | | $ | [removed: 6,987,804] [added: 7,250,840] | | | $ | [removed: 5,635,240] [added: 6,987,804] | |

| Cost of goods sold | [removed: 6,327,431] [added: 5,508,465] | | | | [removed: 6,618,239] [added: 6,327,431] | | | | [removed: 6,179,771] [added: 6,618,239] | | | | [removed: 5,987,659] [added: 6,179,771] | | | | [removed: 4,754,173] [added: 5,987,659] | | |

| Gross profit | [removed: 1,439,785] [added: 1,613,621] | | | | [removed: 1,222,016] [added: 1,439,785] | | | | [removed: 1,071,069] [added: 1,222,016] | | | | [removed: 1,000,145] [added: 1,071,069] | | | | [removed: 881,067] [added: 1,000,145] | | |

| Operating expenses | [removed: 960,424] [added: 1,053,805] | | | | [removed: 857,297] [added: 960,424] | | | | [removed: 760,365] [added: 857,297] | | | | [removed: 688,431] [added: 760,365] | | | | [removed: 607,628] [added: 688,431] | | |

| Depreciation and amortization | [removed: 156,111] [added: 170,937] | | | | [removed: 131,160] [added: 156,111] | | | | [removed: 111,823] [added: 131,160] | | | | [removed: 96,552] [added: 111,823] | | | | [removed: 82,355] [added: 96,552] | | |

| Interest, net | [removed: 41,225] [added: 40,173] | | | | [removed: 39,915] [added: 41,225] | | | | [removed: 35,265] [added: 39,915] | | | | [removed: 35,192] [added: 35,265] | | | | [removed: 28,497] [added: 35,192] | | |

| Income before income taxes | [removed: 282,025] [added: 348,706] | | | | [removed: 193,644] [added: 282,025] | | | | [removed: 163,616] [added: 193,644] | | | | [removed: 179,970] [added: 163,616] | | | | [removed: 151,237] [added: 179,970] | | |

| Federal and state income taxes | [removed: 101,397] [added: 122,724] | | | | [removed: 66,824] [added: 101,397] | | | | [removed: 59,802] [added: 66,824] | | | | [removed: 65,276] [added: 59,802] | | | | [removed: 56,614] [added: 65,276] | | |

| Net income | $ | [removed: 180,628] [added: 225,982] | | | $ | [removed: 126,820] [added: 180,628] | | | $ | [removed: 103,814] [added: 126,820] | | | $ | [removed: 114,694] [added: 103,814] | | | $ | [removed: 94,623] [added: 114,694] | |

| Basic earnings per common share | $ | [removed: 4.66] [added: 5.79] | | | $ | [removed: 3.30] [added: 4.66] | | | $ | [removed: 2.71] [added: 3.30] | | | $ | [removed: 3.01] [added: 2.71] | | | $ | [removed: 2.24] [added: 3.01] | |

| Diluted earnings per common share | $ | [removed: 4.62] [added: 5.73] | | | $ | [removed: 3.26] [added: 4.62] | | | $ | [removed: 2.69] [added: 3.26] | | | $ | [removed: 2.99] [added: 2.69] | | | $ | [removed: 2.22] [added: 2.99] | |

| Weighted average number of common shares outstanding—basic | [removed: 38,743] [added: 39,016] | | | | [removed: 38,458] [added: 38,743] | | | | [removed: 38,297] [added: 38,458] | | | | [removed: 38,068] [added: 38,297] | | | | [removed: 42,285] [added: 38,068] | | |

| Weighted average number of common shares outstanding—diluted | [removed: 39,104] [added: 39,422] | | | | [removed: 38,868] [added: 39,104] | | | | [removed: 38,620] [added: 38,868] | | | | [removed: 38,392] [added: 38,620] | | | | [removed: 42,567] [added: 38,392] | | |

| Dividends paid per common share | $ | [removed: 0.80] [added: 0.88] | | | $ | [removed: 0.72] [added: 0.80] | | | $ | [removed: 0.66] [added: 0.72] | | | $ | [removed: 0.60] [added: 0.66] | | | $ | [removed: 0.51] [added: 0.60] | |

| Current assets | $ | [removed: 305,260] [added: 325,885] | | | $ | [removed: 389,558] [added: 305,260] | | | $ | [removed: 278,967] [added: 389,558] | | | $ | [removed: 280,726] [added: 278,967] | | | $ | [removed: 293,887] [added: 280,726] | |

| Total assets | [removed: 2,469,965] [added: 2,726,148] | | | | [removed: 2,304,876] [added: 2,469,965] | | | | [removed: 1,990,168] [added: 2,304,876] | | | | [removed: 1,776,263] [added: 1,990,168] | | | | [removed: 1,610,955] [added: 1,776,263] | | |

| Current liabilities | [removed: 364,889] [added: 387,571] | | | | [removed: 390,889] [added: 364,889] | | | | [removed: 412,806] [added: 390,889] | | | | [removed: 310,186] [added: 412,806] | | | | [removed: 294,500] [added: 310,186] | | |

| Long-term debt, net of current maturities | [removed: 838,245] [added: 822,869] | | | | [removed: 853,642] [added: 838,245] | | | | [removed: 653,081] [added: 853,642] | | | | [removed: 667,930] [added: 653,081] | | | | [removed: 678,680] [added: 667,930] | | |

| Shareholders’ equity | [removed: 875,229] [added: 1,083,463] | | | | [removed: 703,264] [added: 875,229] | | | | [removed: 593,387] [added: 703,264] | | | | [removed: 503,944] [added: 593,387] | | | | [removed: 403,896] [added: 503,944] | | |

The Company primarily operates convenience stores under the name “Casey’s General Store” in [removed: fourteen] [added: 14] Midwestern states, primarily in Iowa, Missouri and Illinois.

On April 30, [removed: 2015,] [added: 2016,] there were a total of [removed: 1,878] [added: 1,931] stores in operation.

All but [removed: one store offers] [added: two stores offer] fuel for sale on a self-serve basis and carry a broad selection of food (including freshly prepared foods such as pizza, donuts and sandwiches), beverages, tobacco products, health and beauty aids, automotive products and other non-food items.

We operate [removed: a central warehouse, the Casey’s Distribution Center, adjacent to our Corporate Headquarters facility in Ankeny, Iowa,] [added: two distribution centers,] through which we supply grocery and general merchandise items to our stores.

At April 30, [removed: 2015,] [added: 2016,] the Company owned the land at [removed: 1,857] [added: 1,910] store locations and the buildings at [removed: 1,862] [added: 1,915] locations, and leased the land at 21 locations and the buildings at 16 locations.

During the fourth quarter of fiscal [removed: 2015,] [added: 2016,] the Company earned [removed: $1.05] [added: $1.19] in diluted earnings per share compared to [removed: $0.54] [added: $1.05] per share for the same quarter a year ago.

Fiscal [removed: 2015] [added: 2016] diluted earnings per share were [removed: $4.62] [added: $5.73] versus [removed: $3.26] [added: $4.62] for the prior year.

During the [removed: 2015] [added: 2016] fiscal year, we acquired [removed: and opened 32] [added: five] convenience stores from other parties and [added: opened four of them, and] completed [removed: 45] [added: 51] new store constructions.

In addition to this activity, the Company also [added: completed 102 major remodels,] replaced [removed: 27] [added: 11] stores and closed [removed: nine] [added: three] stores during the year.

The fourth quarter results reflected a [removed: 3.5%] [added: 4.6%] increase in same-store fuel gallons sold, with an average margin of approximately [removed: 16.9] [added: 17.8] cents per gallon.

The Company’s fourth quarter fuel margin was helped by our ability to sell approximately [removed: 13.9] [added: 12.7] million renewable fuel credits for [removed: $9,700.][added: $9.1 million.]

For the fiscal year, same-store gallons increased [removed: 2.6%] [added: 3.0%] with an average margin of [removed: 19.3] [added: 19.6] cents per gallon.

The Company’s policy is to price to the competition, so the timing of retail price changes is [added: primarily] driven by local competitive conditions.

Same store sales of grocery & other merchandise increased [removed: 9.7%] [added: 7.4%] and prepared foods & fountain increased [removed: 13.5%] [added: 8.2%] during the fourth quarter of fiscal [removed: 2015.][added: 2016.]

The Company believes that reducing energy consumption where feasible is a sound long-term business [removed: strategy.][added: strategy that reduces operating expenses.]

| • | All newly constructed stores use 100 percent high efficiency LED lighting. [added: The Company is also in the process of retrofitting all of our legacy stores with LED lighting. The project is expected to take roughly four to five years to complete.] Also, when we perform a major remodel of an existing store, the fluorescent lighting is replaced with LED lighting. Furthermore, new canopies over the fuel pumps are installed with time systems and photo eyes to help control the canopy lighting. |

| • | Multiple paperless initiatives are going on throughout the [removed: Company, including going to paperless paystubs and W-2’s where state law allows.] [added: Company.] |

| • | [removed: Electric] [added: Our fleet of trucks is updated frequently, and uses electric] fuel tank heaters [removed: have been installed in our fleet of trucks, significantly reducing] [added: to reduce] idle time. Furthermore, timers have been installed that automatically turn off the engine if it is idling for more than ten minutes. |

Total revenue for fiscal 2015 decreased 0.9% to $7,767,216, primarily due to a 15% decrease in the average [added: retail] price of a gallon of [removed: gas] [added: fuel] (an $837,798 decrease), offset by an increase in the number of [added: fuel] gallons sold (which generated an additional $427,603), and an increase in inside sales (grocery & other merchandise and prepared food & fountain) (a $333,299 increase).

[removed: Gallons] [added: Fuel gallons] sold increased 9.1% to 1.8 billion gallons.

One is adjacent to our Corporate Headquarters facility in Ankeny, Iowa.

The other was opened in February 2016 in Terre Haute, Indiana.

For the year, we sold 57.1 million renewable fuel credits for $31.0 million.

Retail fuel sales for the fiscal year were $4,214,802, a decrease of 18.1%.

Fuel gallons sold increased 7.4% to 2.0 billion gallons.

The fuel margin increased to 9.1% in fiscal 2016 from 6.8% in fiscal 2015 primarily due to a steady fall in wholesale costs midyear combined with volatility in wholesale fuel prices, contributing to a stronger margin.

The grocery & other merchandise margin was consistent at 31.9% in fiscal 2016 compared to 32.1% in fiscal 2015.

The majority of all operating expenses are wages and related costs.

Depreciation and amortization expense increased 9.5% to $170,937 in fiscal 2016 from $156,111 in fiscal 2015.

The decrease in the effective tax rate was primarily due to a decrease in state tax expense (approximately 40 basis points) and an increase in favorable permanent differences (approximately 30 basis points).

Net income increased to $225,982 in fiscal 2016 from $180,628 in fiscal 2015.

| | 2016 | | | | 2015 | | | | 2014 | | |

| | 2016 | | | 2015 | | | 2014 | |

| (1) | The decline in same store sales growth for 2016 as compared to 2015 was impacted by the timing of implementation on the continued rollout of pizza delivery and major remodels in 2016, as well as cycling against strong results from the prior year. |

Actuarial projections of the

In April 2015, the FASB issued ASU 2015-03 Interest-Imputation of Interest (Subtopic 835-30) which provides guidance on the presentation of debt issuance costs.

The new standard requires that debt issuance costs be recorded as a reduction from the face amount of the related debt, with amortization recorded as interest expense, rather than recording as a deferred asset.

The guidance is effective for the Company in the first quarter of fiscal 2017 with early adoption permitted.

The guidance is to be retrospectively applied to all prior periods.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements.

ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted.

The Company is currently evaluating the impact of ASU 2016-02.

In March 2016, the FASB issued ASU 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting.

The goal of this update is to simplify several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows.

This update becomes effective for the company beginning May 1, 2017 with early adoption permitted.

The Company is currently evaluating the impact of ASU 2016-09.

See also the adoption of ASU 2015-17 Balance Sheet Classification of Deferred Taxes, discussed in footnote 6 to the financial statements.

| Senior notes | $ | 1,032,001 | | | $ | 55,299 | | | $ | 108,025 | | | $ | 637,249 | | | $ | 231,428 | |

| Capital lease obligations | 15,488 | | | | 868 | | | | 1,746 | | | | 1,761 | | | | 11,113 | | |

| Operating lease obligations | 3,789 | | | | 1,105 | | | | 1,905 | | | | 691 | | | | 88 | | |

| Total | $ | 1,075,575 | | | $ | 57,272 | | | $ | 111,676 | | | $ | 639,701 | | | $ | 242,629 | |

| Loss on early retirement of debt | — | | | | — | | | | — | | | | — | | | | 11,350 | | |

| | |

| --- | --- |

The Company has several energy initiatives designed to reduce operating expenses associated with energy consumption.

This was partially offset by a 2.1% decrease in average fuel prices (amounting to a $109,647 decrease).

Retail fuel sales for the fiscal year were $5,554,580, an increase of 6.2%, and gallons sold increased 8.5% to 1,665,600.

The fuel margin increased to 4.8% in fiscal 2014 from 4.2% in fiscal 2013 primarily due to the increase in the value of the renewable fuel credits sold.

The grocery & other merchandise margin decreased to 32.1% in fiscal 2014 from 32.6% in fiscal 2013 primarily due to the cigarette retail price adjustments made during last fiscal year.

The operating expense ratio also increased to 10.9% of total revenue in fiscal 2014 from 10.5% in the prior year.

Depreciation and amortization expense increased 17.3% to $131,160 in fiscal 2014 from $111,823 in fiscal 2013.

The decrease in the effective tax rate was primarily due to out of period adjustments to correct accumulated variances in deferred taxes ($2,760) in Fiscal 2014.

Net income increased to $126,820 in fiscal 2014 from $103,814 in fiscal 2013.

| (1) | The 3.1% growth in the fuel gallons in 2014 as compared to 2013 was due primarily to the growth in the "fuel saver program." This program, which is primarily with one grocery store chain at present, provides a discount on the retail price of fuel purchased at Casey's stores (or at the fuel outlets owned and operated by the grocery store chain) based on the purchase of selected items at the grocery store. We have recorded fuel sales resulting from the fuel saver program in 11 states covering over 1,300 stores, although most of the activity presently occurs in the state of Iowa. Much of the same store sales impact attributable to a fuel saver program occurs in the first year of operations, as grocery store customers (who may not have purchased fuel at a Casey's store before) become familiar with the program. We hope to establish fuel saver programs with other grocery store chains in other designated market areas in the future. |

| (2) | The increase in same store grocery & other merchandise in 2014 is due primarily to the continued rollout of store initiatives, expanded hours and major store remodels. |

| (3) | The increase in same store prepared food & fountain in 2014 compared to 2013 is due primarily to the continued rollout of the expanded hour, pizza delivery and major store remodel initiatives. |

disposition of assets subsequent to year-end, and other indications of fair value.

In April 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-8, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, to clarify the definition of discontinued operations, limiting it to disposals of components that represent a strategic shift that has or will have a major effect on operations and financial results.

Examples of a strategic shift include disposals of a major geographic area, a major line of business, or a major equity method investment.

The standard was effective prospectively for disposals that occur within annual periods beginning on or after December 15, 2014, and interim periods within those annual periods.

It was adopted by the Company on May 1, 2015.

In April 2015, the FASB proposed to defer the effective date of this guidance by one year, with early adoption permitted on the original effective date

| Senior notes | $ | 1,088,159 | | | $ | 56,157 | | | $ | 109,741 | | | $ | 106,309 | | | $ | 815,952 | |

| Capital lease obligations | 16,477 | | | | 904 | | | | 1,738 | | | | 1,843 | | | | 11,992 | | |

| Operating lease obligations | 3,437 | | | | 910 | | | | 1,641 | | | | 799 | | | | 87 | | |

| Total | $ | 1,133,761 | | | $ | 57,971 | | | $ | 113,120 | | | $ | 108,951 | | | $ | 828,031 | |

We have audited the accompanying consolidated balance sheets of Casey’s General Stores, Inc. and subsidiaries (the Company) as of April 30, [removed: 2015] [added: 2016] and [removed: 2014,] [added: 2015,] and the related consolidated statements of income, shareholders’ equity, and cash flows for each of the years in the three-year period ended April 30, [removed: 2015.][added: 2016.]

We also have audited the Company’s internal control over financial reporting as of April 30, [removed: 2015,] [added: 2016,] based on criteria established in Internal Control—Integrated Framework [removed: (1992)] [added: (2013)] issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying [removed: Management's Annual] [added: Management’s] Report on Internal Control Over Financial Reporting included in Item 9A (Controls and Procedures).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Casey’s General Stores, Inc. and subsidiaries as of April 30, [removed: 2015] [added: 2016] and [removed: 2014,] [added: 2015,] and the results of their operations and their cash flows for each of the years in the three-year period ended April 30, [removed: 2015,] [added: 2016,] in conformity with U.S. generally accepted accounting principles.

Also, in our opinion, [removed: the Company] [added: Casey's General Stores, Inc.] maintained, in all material respects, effective internal control over financial reporting as of April 30, [removed: 2015,] [added: 2016,] based on criteria established in Internal Control—Integrated Framework [removed: (1992)] [added: (2013)] issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

| | [added: 2016 | | | |] 2015 | | | | 2014 | | |

| Cash and cash equivalents [removed: | $] [added: at beginning of year] | 48,541 | | | [removed: $] | 121,641 | | [added: | | 41,271 | | |]

| Receivables | [removed: 22,609] [added: 27,701] | | | | [removed: 25,841] [added: 22,609] | | |

| Inventories | [removed: 197,331] [added: 204,988] | | | | [removed: 204,833] [added: 197,331] | | |

| Prepaid expenses | [removed: 2,025] [added: 3,008] | | | | [removed: 1,478] [added: 2,025] | | |

| Deferred income taxes | [removed: 15,531] [added: —] | | | | [removed: 23,292] [added: 15,531] | | |

| Income taxes receivable | [removed: 19,223] [added: 14,413] | | | | [removed: 12,473] [added: 19,223] | | |

| Total current assets | [removed: 305,260] [added: 325,885] | | | | [removed: 389,558] [added: 305,260] | | |

| Land | [removed: 549,239] [added: 593,043] | | | | [removed: 490,005] [added: 549,239] | | |

| Buildings and leasehold improvements | [removed: 1,136,248] [added: 1,279,258] | | | | [removed: 1,004,263] [added: 1,136,248] | | |

| Machinery and equipment | [removed: 1,503,079] [added: 1,704,379] | | | | [removed: 1,330,697] [added: 1,503,079] | | |

| Leasehold interest in property and equipment | 16,044 | | | | [removed: 16,278] [added: 16,044] | | |

| Less accumulated depreciation and amortization | [removed: 1,185,246] [added: 1,340,249] | | | | [removed: 1,062,278] [added: 1,185,246] | | |

| Net property and equipment | [removed: 2,019,364] [added: 2,252,475] | | | | [removed: 1,778,965] [added: 2,019,364] | | |

| Other assets, net of amortization | [removed: 18,295] [added: 19,222] | | | | [removed: 15,947] [added: 18,295] | | |

| Goodwill | [removed: 127,046] [added: 128,566] | | | | [removed: 120,406] [added: 127,046] | | |

| Total assets | $ | [removed: 2,469,965] [added: 2,726,148] | | | $ | [removed: 2,304,876] [added: 2,469,965] | |

| Current maturities of long-term debt | [removed: 15,398] [added: 15,375] | | | | [removed: 553] [added: 15,398] | | |

| Accounts payable | [removed: 226,577] [added: 241,207] | | | | [removed: 250,807] [added: 226,577] | | |

| Wages and related taxes | [removed: 32,092] [added: 32,026] | | | | [removed: 27,411] [added: 32,092] | | |

| Property taxes | [removed: 23,523] [added: 24,091] | | | | [removed: 22,572] [added: 23,523] | | |

| Insurance | [removed: 31,389] [added: 35,535] | | | | [removed: 28,429] [added: 31,389] | | |

| Other | [removed: 35,910] [added: 39,337] | | | | [removed: 61,117] [added: 35,910] | | |

| Total current liabilities | [removed: 364,889] [added: 387,571] | | | | [removed: 390,889] [added: 364,889] | | |

| Long-term debt, net of current maturities | [removed: 838,245] [added: 822,869] | | | | [removed: 853,642] [added: 838,245] | | |

| Deferred income taxes | [removed: 354,973] [added: 394,934] | | | | [removed: 318,023] [added: 354,973] | | |

| Deferred compensation | [removed: 17,645] [added: 17,813] | | | | [removed: 16,558] [added: 17,645] | | |

| Other long-term liabilities | [removed: 18,984] [added: 19,498] | | | | [removed: 22,500] [added: 18,984] | | |

| Total liabilities | [removed: 1,594,736] [added: 1,642,685] | | | | [removed: 1,601,612] [added: 1,594,736] | | |

| Common stock, no par value, [removed: 38,886,165] [added: 39,055,570] and [removed: 38,507,387] [added: 38,886,165] shares issued and outstanding at April 30, [removed: 2015] [added: 2016] and [removed: 2014,] [added: 2015,] respectively | [removed: 56,274] [added: 72,868] | | | | [removed: 33,878] [added: 56,274] | | |

| Retained earnings | [removed: 818,955] [added: 1,010,595] | | | | [removed: 669,386] [added: 818,955] | | |

| Total shareholders’ equity | [removed: 875,229] [added: 1,083,463] | | | | [removed: 703,264] [added: 875,229] | | |

| Total liabilities and shareholders’ equity | $ | [removed: 2,469,965] [added: 2,726,148] | | | $ | [removed: 2,304,876] [added: 2,469,965] | |

| | [removed: 2015] [added: 2016] | | | | [removed: 2014] [added: 2015] | | | | [removed: 2013] [added: 2014] | | |

| Total revenue | $ | [removed: 7,767,216] [added: 7,122,086] | | | $ | [removed: 7,840,255] [added: 7,767,216] | | | $ | [removed: 7,250,840] [added: 7,840,255] | |

June 27, 2016

| | 2016 | | | | 2015 | | |

| | 3,592,724 | | | | 3,204,610 | | |

| Net income | — | | | — | | | | 225,982 | | | | 225,982 | | |

| Exercise of stock options | 108,100 | | | 3,717 | | | | — | | | | 3,717 | | |

| Issuance of common stock | 32,717 | | | 2,762 | | | | — | | | | 2,762 | | |

| Balance at April 30, 2016 | 39,055,570 | | | $ | 72,868 | | | $ | 1,010,595 | | | $ | 1,083,463 | |

| Net income | $ | 225,982 | | | $ | 180,628 | | | $ | 126,820 | |

| Depreciation and amortization | 170,937 | | | | 156,111 | | | | 131,160 | | |

| Other, net | 132 | | | | (236 | | ) | | (116 | | ) |

In accordance with U.S. GAAP, the Company does not record an asset on the balance sheet related to RINs that have not been validated and contracted.

As of April 30, 2016, there was $128,566 of goodwill.

None of the awards contain performance conditions.

Recent accounting pronouncements

Early application is permitted as of May 1, 2017.

In April 2015, the FASB issued ASU 2015-03 Interest-Imputation of Interest (Subtopic 835-30) which provides guidance on the presentation of debt issuance costs.

The new standard requires that debt issuance costs be recorded as a reduction from the face amount of the related debt, with amortization recorded as interest expense, rather than recording as a deferred asset.

The guidance is effective for the Company in the first quarter of fiscal 2017 with early adoption permitted.

The guidance is to be retrospectively applied to all prior periods.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements.

ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted.

The Company is currently evaluating the impact of ASU 2016-02.

In March 2016, the FASB issued ASU 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting.

The goal of this update is to simplify several aspects of the accounting for share-

based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows.

This update becomes effective for the company beginning May 1, 2017 with early adoption permitted.

The Company is currently evaluating the impact of ASU 2016-09.

See also the adoption of ASU 2015-17 Balance Sheet Classification of Deferred Taxes, discussed in footnote 6 to the financial statements.

| Inventories | $ | 267 | |

| Other assets | 25 | | |

| Goodwill | 1,520 | | |

| | 2016 | | | | 2015 | | |

| Total revenue | $ | 7,132,349 | | | $ | 7,785,111 | |

| Net income | $ | 226,271 | | | $ | 181,051 | |

| | 2016 | | | | 2015 | | |

| | 838,244 | | | | 853,643 | | |

| | $ | 822,869 | | | $ | 838,245 | |

| 2021 | 464 | | | | 569,000 | | | | 569,464 | | |

| Thereafter | 7,151 | | | | 200,000 | | | | 207,151 | | |

| | $ | 9,244 | | | $ | 829,000 | | | $ | 838,244 | |

June 26, 2015

| | 3,204,610 | | | | 2,841,243 | | |

| Notes payable to bank | $ | — | | | $ | — | |

| Balance at April 30, 2012 | 38,140,309 | | | $ | 12,199 | | | $ | 491,745 | | | $ | 503,944 | |

| Net income | — | | | — | | | | 103,814 | | | | 103,814 | | |

| Exercise of stock options | 198,200 | | | 4,721 | | | | — | | | | 4,721 | | |

| Other amortization | 319 | | | | 297 | | | | 195 | | |

| Other, net | (555 | | ) | | (413 | | ) | | (441 | | ) |

Recent accounting pronouncements In April 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-8, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, to clarify the definition of discontinued operations, limiting it to disposals of components that represent a strategic shift that has or will have a major effect on operations and financial results.

Examples of a strategic shift include disposals of a major geographic area, a major line of business, or a major equity method investment.

The standard was effective prospectively for disposals that occur within annual periods beginning on or after December 15, 2014, and interim periods within those annual periods.

It was adopted by the Company on May 1, 2015.

Early application is not permitted.

In April 2015, the FASB proposed to defer the effective date of this guidance by one year, with early adoption permitted on the original effective date.

including intangible assets and liabilities assumed, based on their estimated fair values at the acquisition date.

| Inventories | $ | 2,863 | |

| Goodwill | 6,640 | | |

| Total revenue | $ | 7,794,626 | | | $ | 7,948,786 | |

| Net income | $ | 181,100 | | | $ | 128,265 | |

| | 853,643 | | | | 854,195 | | |

| | $ | 838,245 | | | $ | 853,642 | |

On December 17, 2013, the Company cancelled a $25,000 Promissory Note that was part of its line of credit.

| 2016 | $ | 398 | | | $ | 15,000 | | | $ | 15,398 | |

| Thereafter | 7,616 | | | | 769,000 | | | | 776,616 | | |

| | $ | 9,643 | | | $ | 844,000 | | | $ | 853,643 | |

transferred.

Additional information regarding the Plan is provided in the Company’s 2009 Proxy Statement.

On June 10, 2011, restricted stock units with respect to a total of 9,198 shares were granted to certain employees under the annual incentive compensation program.

The fair value of the Company’s shares on the date of grant was $40.49.

These awards vested on May 1, 2014 and compensation expense was recognized ratably over the vesting period.

This award was granted at no cost to the employee.

On June 23, 2011, stock options totaling 441,000 shares were granted to certain officers and key employees.

Also on the same date, restricted stock units totaling 15,000 shares were granted to the CEO.

The fair value of the Company’s shares on the date of grant was $44.39.

These awards vested on June 23, 2014 and compensation expense was recognized ratably over the vesting period.

These awards were granted at no cost to the employees.

On September 16, 2011, restricted stock units with respect to a total of 14,000 shares were granted to the non-employee members of the Board.

The fair value of the Company’s shares on the date of grant was $47.59.

This award was also granted at no cost to the non-employee members of the Board.

This award vested on May 1, 2012 and compensation expense was recognized ratably over the vesting period.

As of the end of the period covered by this report, an evaluation was performed under the supervision and with the participation of the Company’s Chief Executive Officer and Chief Financial Officer of the effectiveness of the Company’s disclosure controls and [removed: procedures.][added: procedures (as defined in Exchange Act Rule 240.13a-15(e)).]

[removed: On the basis of] [added: Based on] that evaluation, the CEO and CFO have concluded that the Company’s [added: current] disclosure controls and procedures were effective as of April 30, [removed: 2015.][added: 2016.]

The Company's management assessed the effectiveness of the Company's internal control over financial reporting as of April 30, [removed: 2015.][added: 2016.]

In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control - Integrated Framework [removed: (1992).][added: (2013).]

On the basis of the prescribed criteria, management concluded that the Company's internal control over financial reporting was effective as of April 30, [removed: 2015.][added: 2016.]

[removed: As described above, during] [added: During] the second quarter of fiscal 2015, management concluded that there was a material weakness in internal control over financial reporting, and began actively planning for and implementing a remediation plan to address the material weakness.

[added: In connection with the] remediation, management (with the assistance of professional advisors) reviewed and made certain enhancements to our internal control over financial reporting to improve such controls and increase their [removed: efficiency, and expects to undertake additional enhancements during fiscal 2016.][added: efficiency.]

[removed: These inherent limitations include the realities] that judgments in decision-making can be faulty, and that breakdowns can occur because of simple errors or mistakes.

These inherent limitations include the realities

As previously disclosed, management became aware during the second quarter of fiscal 2015 that an immaterial understatement of federal excise tax liability occurred during fiscal years 2012, 2013 and 2014 and the first quarter of fiscal 2015.

A control deficiency was identified with regards to the review and approval of quarterly federal excise tax returns by management with the requisite skill and knowledge, and recognition of the corresponding liability and expense.

The internal controls in place during this time were not responsive to changes in circumstances.

While the control deficiency did not result in a material misstatement to the Company's consolidated financial statements for any period through and including the fiscal year ended April 30, 2014, or the unaudited condensed consolidated financial statements for the first fiscal quarter of fiscal year 2015, it did represent a material weakness as of April 30, 2014, since there existed a reasonable possibility that a material misstatement of the Company's annual or interim financial statements would not be prevented or detected on a timely basis.

The correction of these immaterial errors was recognized in revisions to our consolidated financial statements for the fiscal year ended April 30, 2014, filed on Form 10-K/A (Amendment No. 1) for the fiscal year ended April 30, 2014, and the unaudited condensed consolidated financial statements filed on Form 10-Q/A (Amendment No. 1) for the fiscal quarter ended July 31, 2014.

In connection with the

Those portions of the Company’s definitive Proxy Statement appearing under the captions “Election of Directors,” “Governance of the Company,” “Section 16(a) Beneficial Ownership Reporting Compliance,” and “Executive Officers and Their Compensation” as filed with the Commission pursuant to Regulation 14A within 120 days after April 30, [removed: 2015] [added: 2016] and used in connection with the Company’s [removed: 2015] [added: 2016] Annual Meeting of Shareholders are hereby incorporated by reference.

That portion of the Company’s definitive Proxy Statement appearing under the caption “Executive Officers and Their Compensation” as filed with the Commission pursuant to Regulation 14A within 120 days after April 30, [removed: 2015] [added: 2016] and used in connection with the Company’s [removed: 2015] [added: 2016] Annual Meeting of Shareholders is hereby incorporated by reference.

Those portions of the Company’s definitive Proxy Statement appearing under the captions “Shares Outstanding,” “Voting Procedures,” and “Beneficial Ownership of Shares of Common Stock by Directors and Executive Officers” as filed with the Commission pursuant to Regulation 14A within 120 days after April 30, [removed: 2015] [added: 2016] and used in connection with the Company’s [removed: 2015] [added: 2016] Annual Meeting of Shareholders are hereby incorporated by reference.

That portion of the Company’s definitive Proxy Statement appearing under the captions “Certain Relationships and Related Transactions” and “Governance of the Company” as filed with the Commission pursuant to Regulation 14A within 120 days after April 30, [removed: 2015] [added: 2016] and used in connection with the Company’s [removed: 2015] [added: 2016] Annual Meeting of Shareholders is hereby incorporated by reference.

That portion of the Company’s definitive Proxy Statement appearing under the caption “Independent [removed: Auditor] [added: Registered Public Accounting Firm] Fees” as filed with the Commission within 120 days after April 30, [removed: 2015] [added: 2016] and used in connection with the Company’s [removed: 2015] [added: 2016] Annual Meeting of Shareholders is hereby incorporated by reference.

Consolidated Balance Sheets, April 30, [removed: 2015] [added: 2016] and [removed: 2014][added: 2015]

Consolidated Statements of Income, Three Years Ended April 30, [removed: 2015][added: 2016]

Consolidated Statements of Shareholders’ Equity, Three Years Ended April 30, [removed: 2015][added: 2016]

Consolidated Statements of Cash Flows, Three Years Ended April 30, [removed: 2015][added: 2016]

| [removed: 10.28(b)] [added: 10.28(c)] | Promissory Notes delivered to UMB Bank, n.a. and related Negative Pledge Agreement dated [removed: May 23, 2011] [added: June 9, 2016] (incorporated by reference from the Current [removed: Reports] [added: Report] on Form 8-K filed [removed: May 23, 2011, February 12, 2013 and] June [removed: 18, 2013)] [added: 9, 2016)] |

| 10.39* | Employment Agreement with Robert J. Myers (incorporated by reference from the Current Report on Form 8-K filed April 21, [removed: 2010] [added: 2010)] and Amendment to Employment Agreement (incorporated by reference from the Current Report on Form 8-K filed December 19, [removed: 2012))] [added: 2012)] |

| 31.1 | Certificate of [removed: Robert J. Myers] [added: Terry W. Handley] under Section 302 of Sarbanes-Oxley Act of 2002 |

| 32.1 | Certificate of [removed: Robert J. Myers] [added: Terry W. Handley] under Section 906 of Sarbanes-Oxley Act of 2002 |

| Date: June [removed: 26, 2015] [added: 27, 2016] | By | /s/ Robert J. Myers |

| | [removed: Robert J. Myers,] Chairman and [added: Director] | |

| Date: June [removed: 26, 2015] [added: 27, 2016] | By | /s/ William J. Walljasper |

| | [removed: Chairman and] Chief Executive Officer, Director | |

| Date: June [removed: 26, 2015] [added: 27, 2016] | By | /s/ Johnny Danos |

| Date: June [removed: 26, 2015] [added: 27, 2016] | By | /s/ Diane C. Bridgewater |

| Date: June [removed: 26, 2015] [added: 27, 2016] | By | /s/ Jeffrey M. Lamberti |

| Date: June [removed: 26, 2015] [added: 27, 2016] | By | /s/ Richard Wilkey |

| Date: June [removed: 26, 2015] [added: 27, 2016] | By | /s/ H. Lynn Horak |

| Date: June [removed: 26, 2015] [added: 27, 2016] | By | /s/ William C. Kimball |

| Date: June [removed: 26, 2015] [added: 27, 2016] | By | /s/ Larree M. Renda |

| 31.1 | Certification of [removed: Robert J. Myers] [added: Terry W. Handley] under Section 302 of the Sarbanes-Oxley Act of 2002 |

| 4.11 | Note Purchase Agreement dated as of May 2, 2016 among the Company and the purchasers of the 3.65% Series C Notes and 3.72% Series D Notes (incorporated by reference from the Current Report on Form 8-K filed May 3, 2016) |

| 10.42* | Employment Agreement with Terry W. Handley and related Restricted Stock Units Award Agreement dated April 12, 2016 (incorporated by reference from the Current Report on Form 8-K filed June 6, 2016) |

| Date: June 27, 2016 | By | /s/ Terry W. Handley |

| | Terry W. Handley, President and | |

| Date: June 27, 2016 | By | /s/ William J. Walljasper |

| Date: June 27, 2016 | By | /s/ Terry W. Handley |

| | Terry W. Handley, President and | |

| 32.1 | Certificate of Terry W. Handley under Section 906 of Sarbanes-Oxley Act of 2002 |

| | |

| | |

| Date: June 26, 2015 | By | /s/ Kenneth H. Haynie |

| | Kenneth H. Haynie | |

| | Director | |