Spartan Stores, Inc., (Nasdaq:SPTN) a leading regional grocery distributor and retailer, today reported financial results for its 12-week second quarter ended September 10, 2011.
Second Quarter Results
Consolidated net sales for the 12-week second quarter increased 2.9 percent to $619.6 million compared to $602.1 million in the same period last year. Both the distribution and retail segments reported increased sales during the quarter.
Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (Adjusted EBITDA) for the quarter increased 3.8 percent to $31.1 million, or 5.0 percent of net sales, compared to $30.0 million, or 5.0 percent of net sales in the year-ago period.“The consolidated net sales increase combined with our management team’s focus on tightly managing the controllable aspects of our business enabled us to report both improved earnings from continuing operations, excluding unusual items, and Adjusted EBITDA as compared to the same period last year,” stated Dennis Eidson, Spartan’s President and Chief Executive Officer. “Our efforts to provide the consumer with a quality shopping experience are paying off as we have improved nearly every key driver of overall consumer satisfaction, specifically with our focus on fresh excellence. These efforts, combined with our chain-wide loyalty card, will enable us to provide even more value and to have a better connection to the consumer than ever before.” Second quarter gross profit margin decreased 110 basis points to 21.4 percent from 22.5 percent in the same period last year. The decline was primarily due to a higher mix of distribution and fuel sales, a lower fuel gross margin rate and an increased LIFO expense of approximately $2.3 million this year versus last year. The increased LIFO expense was due to higher inflation in this year’s second quarter and a $1.5 million LIFO credit generated in last year’s second quarter as a result of lower inventories from the warehouse consolidation initiative.