CASY

How will the partnership with NCR Atleos' Allpoint Network affect Casey’s revenue and profitability?

Created August 06, 2025 at 07:42 PM

Short answer:

The Allpoint partnership is not a direct cash‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑‑****

Full answer:

1. What the partnership actually does

Allpoint Network is a surcharge‑free ATM network that lets any Allpoint‑cardholder (e.g., cards issued by a large set of partner banks) withdraw cash at participating locations without paying a per‑transaction fee.
Casey’s stores in Wisconsin, Ohio, Tennessee, Arkansas, Nebraska, Kentucky and Oklahoma will host NCR Atleos‑managed ATMs that are part of this network.
The ATMs are owned/operated by NCR Atleos, not by Casey’s, and the service is provided at no surcharge to the cardholder.

2. Direct revenue impact on Casey’s

Item	Effect	Reasoning
ATM‑related fee income	Zero or negligible	Because the network is surcharge‑free, Casey’s does not collect a per‑withdrawal fee from customers. The ATMs are managed by Atleos, which likely handles any interchange or network fees.
Rental/Revenue‑share from Atleos	Potential modest cash‑flow	In many similar agreements, the retailer receives a fixed rental payment or a small percentage of interchange revenue for providing space and utilities. The press release does not disclose the exact terms, but any such payment would be a modest, steady line‑item.
Cost of hosting the ATMs	Incremental operating cost	Utilities, floor‑space, security monitoring and minor maintenance are borne by Casey’s. These costs are relatively low compared with the size of its store‑level operating budget.
Net direct ATM profit	Likely small positive or breakeven	The combination of a modest rental/revenue‑share and low incremental cost means the direct profit from the ATM function alone is expected to be modest, but not negative.

3. Indirect (and likely larger) impact on overall store performance

Channel	How the partnership influences it	Expected effect on revenue & profitability
Foot‑traffic & store visits	Surcharge‑free cash access draws Allpoint cardholders who otherwise would have to travel to a bank‑owned ATM or pay a fee elsewhere. Convenience‑seeking shoppers are more likely to stop in for a quick purchase (fuel, snacks, groceries, impulse items).	Higher same‑store sales – incremental transaction volume, especially on high‑margin items (fuel, prepared foods, impulse goods).
Customer‑acquisition & loyalty	Being part of a national, surcharge‑free network positions Casey’s as a “cash‑friendly” destination, reinforcing its brand among price‑sensitive consumers and enhancing loyalty program cross‑selling (e.g., Casey’s Fuel Card, Rewards).	Higher repeat‑purchase rates and greater basket size over time, improving gross margin and net income per store.
Cross‑selling of financial products	Some retailers bundle ATM access with co‑branded prepaid cards or “store‑issued” debit cards. If Casey’s eventually offers its own branded card linked to the Allpoint network, interchange revenue could be captured.	Potential new revenue stream (interchange fees) that can be sizable once adoption scales.
Data & analytics	Atleos’ platform provides transaction‑level data on ATM usage patterns, which Casey’s can leverage for better inventory and staffing decisions.	Cost efficiencies (lower labor, optimized inventory) that improve operating margin.
Brand differentiation	Few convenience‑store chains have nationwide surcharge‑free ATM access. This differentiates Casey’s from rivals (e.g., 7‑Eleven, Circle K) and can support premium pricing on certain SKUs.	Margin uplift on selected product lines.

4. Bottom‑line estimate (high‑level)

Metric	Approximation (based on comparable industry data)
Incremental store‑level sales	0.5 %–1.5 % lift in same‑store sales in the first 12 months (driven by added foot‑traffic and impulse purchases). For a typical Casey’s store with ~ $5 M annual sales, that equals $25k–$75k per store.
Incremental gross profit	Assuming a 30 % gross margin on the incremental sales, gross profit rises by $7.5k–$22.5k per store.
Net profit impact	Subtracting modest incremental costs (ATM utilities, security, possible rent/revenue‑share ≈ $2k–$5k per store) leaves a $5k–$17k net profit boost per store in the first year.
Corporate‑level effect	With ~ 2,300 Casey’s locations, the aggregate net profit uplift could be in the $10–$40 M range annually—a modest but meaningful addition to the bottom line, especially when compared to the company’s total net income (which runs in the low‑hundreds‑of‑millions).

Key takeaway: The partnership is not a high‑margin, direct‑revenue generator like a traditional surcharge‑fee ATM network, but it is a traffic‑and‑sales catalyst. By offering surcharge‑free cash access, Casey’s can attract more customers, increase basket size, and strengthen its brand, all of which translate into a positive net‑profit contribution that is likely to be in the single‑digit‑percent range of total earnings.

5. Risks & Sensitivities

Risk	Why it matters	Potential mitigation
Low adoption of Allpoint cards in the seven states	If the cardholder base is small, foot‑traffic lift may be muted.	Casey’s can promote the network in‑store, partner with local banks to increase card issuance, and bundle ATM access with its own loyalty program.
Higher than expected operating costs	Utilities, security, or lease terms could rise, eroding the modest profit margin.	Negotiate cost‑pass‑through caps with Atleos; monitor energy usage; share cost‑savings with other store initiatives.
Regulatory or compliance changes	New AML/KYC rules for third‑party ATMs could impose additional reporting burdens.	Ensure Atleos handles compliance centrally; keep a compliance liaison to monitor regulatory updates.
Technology integration issues	Downtime of Atleos‑managed ATMs could frustrate customers and hurt store reputation.	Include service‑level agreements (SLAs) with Atleos for uptime; have backup cash‑dispensing options (e.g., traditional bank ATMs) in high‑traffic locations.

6. Strategic Outlook

Short‑term (0‑12 months): Expect a modest lift in same‑store sales and a small net‑profit boost as the network rolls out and customers become aware of the surcharge‑free convenience.
Mid‑term (1‑3 years): As the Allpoint brand expands and more banks adopt the network, the foot‑traffic effect should compound. Casey’s could explore co‑branded prepaid or debit cards that route interchange revenue back to the retailer, turning the ATM presence into a direct financial‑services profit center.
Long‑term (3 + years): If the partnership evolves into a broader “cash‑plus‑digital” ecosystem (e.g., integrating mobile‑wallet top‑ups at the ATM), Casey’s could capture new data‑monetization opportunities and cross‑sell ancillary services (bill‑pay, money‑transfer), further diversifying its revenue mix beyond traditional retail.

7. Bottom line for investors & management

Revenue impact: Primarily incremental same‑store sales rather than ATM‑fee revenue. Anticipated uplift is modest but positive.
Profitability impact: Net‑profit improvement in the low‑single‑digit‑percent range of total earnings, driven by higher gross profit on additional sales and minimal incremental costs.
Strategic value: Enhances Casey’s customer‑centric positioning, brand differentiation, and potential platform for future financial‑services offerings—a foundation for longer‑term, higher‑margin revenue streams.

Conclusion: The Allpoint partnership should boost Casey’s top‑line through added traffic and lift the bottom line modestly, while also laying the groundwork for future, higher‑margin financial‑services revenue. The net effect is a positive contribution to earnings that aligns with Casey’s broader strategy of being a convenient, cash‑friendly destination for consumers across its seven‑state footprint.