And with that, Steve, please take over the call.Steven A. Burd All right. Thank you, Melissa. I'm going to talk about net income from continuing operations and just as a reminder, in the fourth quarter, I think or at least in the call, we mentioned that we had put 27 stores on the East Coast, Genuardi's branded stores into discontinued operations and assets for sale. So, the impairment charge we took for doing that is not in these numbers, nor will the gain that we expect to get in the second quarter from the sale of those assets [Audio Gap] in our numbers in the second quarter. So the net income for from continuing operations in the quarter came in at $81.6 million. This compares with earning $25.1 million in 2011. Now I would like to remind everybody that the low number in 2011 was driven in large part by the taxes that we paid by repatriating some money from Canada, bringing it down over $1 billion. So we paid a tax in Canada for doing that of 80 -- or we paid a tax on the Canadian dividend of $80.2 million. So if you really want to compare the net income performance of the 2 years, you need to adjust that $25.1 million for that tax. And the right comparison would be we made $81.6 million this year and we made $105.3 million last year. Now that is just under a $24 million difference, but later in the call, I will explain that there are some reasons for that difference that I think will give you comfort that our net income and our operating profit was essentially flat over those 2 quarters. Expressed as earnings per share, we made $0.30 per share in 2012. This contrasted with $0.29 a share in 2011. Obviously, the share buyback program helped in that $0.01 improvement despite the fact that the net income, as reported, was lower.
By way of some quick highlights, as expected, and in fact, we discussed this in our fourth quarter earnings release, our ID sales were soft for the quarter. This softness in sales resulted from a combination of factors. The first is that we had a calendar shift with respect to New Year's Day. Now, we're unique in that. Other food retailers that report do not experience that same calendar shift. So we always have an opportunity for New Year's Day to be split from New Year's Eve, which is a big business day. Periodically, we have a split across quarters on Easter. And so, we get affected where other retailers do not. So that was a big effect in the quarter.We also had some unusual weather patterns. I think others have talked about that where a general lack of snow this year did affect our sales and did affect our income when compared to last year. And then we continue to have high fuel inflation and high food inflation. I'm going to talk in more detail about food inflation, but it was quite high in the first half of the quarter. And then just as we expected, it really moderated as we moved through the back half of the quarter. But the inflation in food and fuel continues to have a dampening effect on consumer demand. Under the circumstances just described, we were very pleased with our net income and our earnings per share results for the quarter. Almost 80% of the shortfall from last year's first quarter net income is explained by a shift in the holiday and higher interest expense. Now the shift in the holiday, there are 2 facts to consider there. One piece of that is that we started the quarter on New Year's Day, which is a Sunday, but compared to any other Sunday, it's going to be a very slow Sunday as we took in all that business on the last day of the year called New Year's Eve. At the same time, all of the labor costs that we have on that day is going to be with some kind of a premium. And so, those 2 things in combination materially affected the numbers for the quarter in terms of net income. And then the higher interest expense was also a significant factor. But again, that's a good thing because it enabled us to buy back stock. And you'll recall from the investor conference, we're cash accretive on that because the interest that we pay on the borrowed funds to buy the stock is less on an after-tax basis than the dividends we otherwise would be paying on that stock.
The remaining difference in net income is explained by a higher pension expense because we changed the interest rate assumptions and then the weather differences and the small change in the tax rate. But for interest expense, the same factors could be used to reconcile the operating profit from Q2 -- from Q1 of 2011 to Q1 of 2012. So the way we look at it, we essentially were flat in both a net income basis and an operating profit basis. And given the fact that we had flat IDs, we think that's a very good result.Read the rest of this transcript for free on seekingalpha.com