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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended September 25, 2003

Commission File Number 33-72574

THE PANTRY, INC.

(Exact name of registrant as specified in its charter)

P.O. Box 1410

1801 Douglas Drive

Sanford, North Carolina

27331-1410

(Address of principal executive offices)

Registrant’s telephone number, including area code: (919) 774-6700

Securities registered pursuant to Section 12(b) of the Act:

NONE

Securities registered pursuant to Section 12(g) of the Act:

common stock, $.01 par value

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

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. ¨

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

The aggregate market value of the voting common stock held by non-affiliates of the registrant as of March 27, 2003 was $15,415,625.

As of December 9, 2003, there were issued and outstanding 19,743,615 shares of the registrant’s common stock.

THE PANTRY, INC.

INDEX TO ANNUAL REPORT ON FORM 10-K

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PART I

Item 1.     Business

General

We are the leading convenience store operator in the southeastern United States and the third largest independently operated convenience store chain in the country based on store count. As of December 1, 2003, we operated 1,392 stores in ten states under several banners including The Pantry^®, Kangaroo Express^™, Golden Gallon^®, and Lil Champ Food Store^®. On October 16, 2003, we acquired 138 stores operating under the Golden Gallon^® banner. Our stores offer a broad selection of merchandise, gasoline and ancillary products and services designed to appeal to the convenience needs of our customers.

Operations

The following charts set forth revenues and gross profit, respectively, for fiscal 2003 from our merchandise and gasoline operations as well as commissions, each as a percentage of total revenues or total gross profit, respectively, for fiscal 2003:

Merchandise Operations.    In fiscal 2003, our merchandise sales were 36.3% of total revenues. The following table highlights certain information with respect to our merchandise sales for the last five fiscal years:

The increase in average merchandise sales per store in fiscal 2003 is primarily due to the fiscal 2003 comparable store merchandise sales increase of 2.1% and the closure of 34 underperforming stores.

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Based on merchandise purchase and sales information, we estimate category sales as a percentage of total merchandise sales for the last five fiscal years as follows:

As of December 1, 2003, we operated 226 quick service restaurants within 201 of our locations. In 127 of these stores, we offer products from nationally branded food franchises including Subway^®, Hardee’s^®, TCBY^®, Church’s^®, Dairy Queen^®, Bojangles^® and Krystal^®. In addition, we offer a variety of proprietary food service programs featuring breakfast biscuits, fried chicken, deli, pizza, tacos and other hot food offerings in 99 of our locations.

We purchase over 50% of our merchandise, including most tobacco and grocery items, from a single wholesale grocer, McLane. We have a distribution services agreement with McLane pursuant to which McLane is the primary distributor of traditional grocery products to our stores. We purchase the products at McLane’s cost plus an agreed upon percentage, reduced by any promotional allowances and volume rebates offered by manufacturers and McLane. In addition, we receive per store service allowances from McLane which are amortized over the remaining term of the agreement, which expires in October 2008. We purchase the balance of our merchandise from a variety of other distributors under contract terms of up to four years. We do not have written contracts with a number of these vendors.

Gasoline Operations.    We purchase our gasoline from major oil companies and independent refiners. At our locations, we offer a mix of branded and private brand gasoline based on an evaluation of local market conditions. Of the 1,365 stores that sold gasoline as of December 1, 2003, 977 (including locations operated by third parties selling under these brands) or 71.6% were branded under the Amoco^®, BP^®, Chevron^®, Citgo^®, Shell^®, Mobil^®, Exxon^® or Texaco^® brand names. In conjunction with our acquisition of Golden Gallon^®, we added 137 gas selling locations, of which 113 sell gas under national brands. We purchase our branded gasoline and diesel fuel from major oil companies under supply agreements. The fuel is purchased at the stated rack price, or market price, quoted at each terminal as adjusted per applicable contracts. The initial terms of these supply agreements range from three to ten years and generally contain minimum annual purchase requirements as well as provisions for various payments to us based on volume of purchases and vendor allowances. We purchase the balance of our gasoline from a variety of independent fuel distributors. There are approximately 30 gasoline terminals in our operating areas, allowing us to choose from more than one distribution point for most of our stores. Our inventories of gasoline (both branded and private branded) turn approximately every five days.

Gasoline supply agreements typically contain provisions relating to, among other things, payment terms, use of the supplier’s brand names, compliance with the supplier’s requirements, minimum use of credit cards,

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insurance coverage, and compliance with legal and environmental requirements. As is typical in the industry, gasoline suppliers generally can terminate the supply contracts if, among other reasons, we do not comply with a reasonable and important requirement of the relationship, we fail to make payments which are due, or the supplier withdraws from marketing activities in the area in which we operate, and in connection with fraud, criminal misconduct, bankruptcy or insolvency involving our company. In some cases, gasoline suppliers have the right of first refusal to acquire assets used by us to sell their branded gasoline.

We have begun our brand consolidation project, which we believe will enable us to provide a more consistent operating identity while helping us in our efforts to optimize our gasoline gallon growth and gross profit dollars. In addition, we have recently consolidated and re-negotiated our principal gasoline supply contracts, enabling us to better leverage our purchasing power among fewer, but more significant, suppliers.

In fiscal 2003, our gasoline revenues were 62.7% of total revenues. The following table highlights certain information regarding our gasoline operations for the last five fiscal years:

The increase in average gallons sold per store in fiscal 2003 is primarily due to the 0.7% increase in comparable store gallon growth, the closure of 34 under performing stores and our continued efforts to re-brand or re-image our gasoline facilities. In fiscal 2003, the gasoline markets were volatile with domestic crude oil hitting a low in November 2002 of approximately $25 per barrel and highs in March 2003 of approximately $38 per barrel. Generally, we attempt to pass along wholesale gasoline cost changes to our customers through retail price changes. However, our ability to pass along wholesale cost changes is influenced by gasoline market conditions and the retail prices offered by our competitors. We make no assurances that significant volatility in gasoline wholesale prices will not negatively affect gasoline gross margins or demand for gasoline within our markets.

As of December 1, 2003, we owned the gasoline operations at 1,354 locations and at 11 locations had gasoline operations that were operated under third-party arrangements. At company-operated locations, we own the gasoline storage tanks, pumping equipment and canopies, and retain 100% of the gross profit received from gasoline sales. In fiscal 2003, these locations accounted for approximately 99% of total gallons sold. Under third-party arrangements, an independent gasoline distributor owns and maintains the gasoline storage tanks and pumping equipment at the site, prices the gasoline and pays us approximately 50% of the gross profit. In fiscal 2003, third-party locations accounted for approximately 1% of the total gallons we sold. We are phasing out third-party arrangements because our company-operated locations are more profitable.

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Commission Income.    In fiscal 2003, our commission income represented 1.0% of our total revenue and 5.2% of our gross profit. Our commission income is derived from lottery ticket sales, money orders, car wash, public telephones, ATMs, amusement and video gaming and other ancillary product and service offerings. This category is an important aspect of our merchandise operations because we believe it attracts new customers as well as provides additional services for existing customers. The following table highlights certain information regarding commissions and the sources of commissions from services for the last five fiscal years:

Store Locations.    As of December 1, 2003, we operated 1,392 convenience stores located primarily in growing markets, coastal/resort areas and along major interstates and highways. Approximately 40% of our total stores are strategically located in coastal/resort areas such as Jacksonville, Orlando/Disney World, Myrtle Beach, Charleston, St. Augustine, Hilton Head and Gulfport/Biloxi that attract a large number of tourists who we believe value convenience shopping. Additionally, approximately 18% of our total stores are situated along major interstates and highways which benefit from high traffic counts and customers seeking convenient fueling locations, including some stores in coastal or resort areas. Almost all of our stores are freestanding structures averaging approximately 2,400 square feet and provide ample customer parking. The following table shows the geographic distribution by state of our stores for each of the last five