October 24, 2012

Spartan Stores Q2 net sales surges

US-based grocery distributor and retailer Spartan Stores has reported a 0.3% rise in net sales to $621.6m for the second quarter ended 15 September 2012, compared to $619.6m for the same quarter in 2011.

By admin-demo

US-based grocery distributor and retailer Spartan Stores has reported a 0.3% rise in net sales to $621.6m for the second quarter ended 15 September 2012, compared to $619.6m for the same quarter in 2011.

The firm has posted net income of $10.31m for the second quarter 2012, as against $10.28m in the corresponding period for the previous year.

Spartan Stores adjusted earnings before interest, taxes, depreciation and amortization (adjusted EBITDA) for the quarter was $29.0m, or 4.7% of net sales, compared to $31.1m, or 5% of net sales in the earlier year.

The firm’s operating expenses in the second quarter 2012 were $111.3m, or 17.9% of net sales, compared to $112.8m, or 18.2% of net sales in the same period of the 2011.

Gross profit margin for the period was 21%, compared to 21.4% in the same period last year.

The decline in gross profit margin was due to reduced inflation-driven inventory gains in both the retail and distribution segments, investments associated with the second phase of their ‘Price Freeze’ and ‘Yes Is Even More’ promotional campaigns in the retail segment, as well as, a higher mix of lower margin distribution and fuel sales.

According to the firm, operating expenses were driven by the continuous productivity improvements in the distribution segment, lower employee-related expenses.

Spartan’s president and chief executive officer Dennis Eidson said the company will continue to make strategic promotional and capital investments to drive higher volumes, while focusing on improving profitability.

"We remain focused on all aspects of our business in order to drive sales and are encouraged by the initial benefits of our recent pricing and promotional efforts, as well as the new Valu Land store format," Eidson added.

Spartan Stores operates 97 company-owned stores located in Michigan, including Family Fare Supermarkets, Glen’s Markets, D&W Fresh Markets, VG’s Food and Pharmacy, and Valu Land.