Village Super Market, Inc. Reports Results for the First Quarter Ended October 26, 2019
December 03 2019 - 7:00AM
Village Super Market, Inc. (NASDAQ:VLGEA) today reported its
results of operations for the first quarter ended October 26,
2019.
Net income was $2,567,000 in the 13 weeks ended
October 26, 2019 compared to $6,269,000 in the 13 weeks ended
October 27, 2018. The 13 weeks ended October 26, 2019
includes pre-opening costs related to the Stroudsburg,
Pennsylvania replacement store of $594,000 (net of tax) and
charges to write off the lease asset related to the old Stroudsburg
store of $191,000 (net of tax). The opening of the Stroudsburg,
Pennsylvania replacement store occurred on November 1, 2019. The 13
weeks ended October 27, 2018 includes a $290,000 (net of tax)
gain for Superstorm Sandy insurance proceeds received. Excluding
these items from both periods, net income decreased 44% in the 13
weeks ended October 26, 2019 compared to the prior year due
primarily to decreased gross profit margins and increased operating
and administrative expenses.
Sales were $407,402,000 in the 13 weeks ended
October 26, 2019, an increase of 1.5% compared to the 13 weeks
ended October 27, 2018. Sales increased due to the
acquisition of Gourmet Garage on June 24, 2019 and a 0.1% increase
in same store sales. Same store sales increased due to
continued sales growth in the Bronx, New York City store opened on
June 28, 2018, recently remodeled or replaced stores and continued
growth of ShopRite from Home including expansion to four additional
stores. These increases were partially offset by the impact of two
competitor store openings, decreased promotional spending in
Maryland and reduced sales in our existing store in Stroudsburg,
Pennsylvania leading up to its closure. The Company expects
same store sales in fiscal 2020 to range from a 2.0% decrease to
flat. New stores and replacement stores are included in
same store sales in the quarter after the store has been in
operation for four full quarters. Store renovations and
expansions are included in same store sales immediately.
Gross profit as a percentage of sales decreased
to 27.87% in the 13 weeks ended October 26, 2019 compared to
27.92% in the 13 weeks ended October 27, 2018. Excluding
the impact of the addition of Gourmet Garage, gross profit as a
percentage of sales decreased .26% in the 13 weeks ended
October 26, 2019 compared to the 13 weeks ended
October 27, 2018 due primarily to decreased departmental gross
margin percentages (.28%), increased warehouse assessment charges
from Wakefern (.05%) partially offset by a favorable change in
product mix (.04%) and decreased LIFO charges (.03%).
Departmental gross profits decreased due primarily to decreased
pharmacy margins as a result of continued downward pressure on
prescription reimbursement rates from third party providers and
price investments, including the introduction in early October 2019
of ShopRite's Right Price Promise pricing strategy, a commitment to
everyday low prices on the items customers purchase most
frequently.
Operating and administrative expense as a
percentage of sales increased to 25.32% in the 13 weeks ended
October 26, 2019 compared to 23.98% in the 13 weeks ended
October 27, 2018. The 13 weeks ended October 26, 2019
includes pre-opening costs related to the Stroudsburg, Pennsylvania
replacements store (.21%), charges to write off the lease asset
related to the old Stroudsburg store (.07%) and lease costs
reclassified from of Depreciation and Amortization and Interest
Expense to Operating and Administrative Expenses (.17%) as a result
of the adoption of ASU 2016-02, “Leases." The 13 weeks ended
October 27, 2018 includes a gain for Sandy insurance proceeds
received (.10%). Excluding these items from both periods,
operating and administrative expense as a percentage of sales
increased .79% in the 13 weeks ended October 26, 2019 compared
to the 13 weeks ended October 27, 2018 due primarily to
increased payroll (.35%), fringe benefit costs (.13%) and occupancy
costs (.19%). Payroll increased due primarily to the addition of
Gourmet Garage and continued growth of ShopRite from Home including
expansion to four additional stores. Fringe benefit costs
increased primarily to increased claim costs on self-insured
medical plans. Occupancy costs increased due primarily to the
addition of Gourmet Garage and increased common area maintenance
charges.
Village Super Market operates a chain of 30
supermarkets under the ShopRite name in New Jersey, Maryland, New
York City and eastern Pennsylvania and three specialty markets
under the Gourmet Garage name in New York City.
Forward Looking Statements
All statements, other than statements of
historical fact, included in this Press Release are or may be
considered forward-looking statements within the meaning of federal
securities law. The Company cautions the reader that there is no
assurance that actual results or business conditions will not
differ materially from future results, whether expressed, suggested
or implied by such forward-looking statements. The Company
undertakes no obligation to update forward-looking statements to
reflect developments or information obtained after the date hereof.
The following are among the principal factors that could cause
actual results to differ from the forward-looking statements:
economic conditions; competitive pressures from the Company’s
operating environment; the ability of the Company to maintain and
improve its sales and margins; the ability to attract and retain
qualified associates; the availability of new store locations; the
availability of capital; the liquidity of the Company; the success
of operating initiatives; consumer spending patterns; the impact of
changing energy prices; increased cost of goods sold, including
increased costs from the Company’s principal supplier, Wakefern;
disruptions or changes in Wakefern's operations; the results of
litigation; the results of tax examinations; the results of union
contract negotiations; competitive store openings and closings; the
rate of return on pension assets; and other factors detailed herein
and in the Company’s filings with the SEC.
VILLAGE SUPER MARKET, INC.CONSOLIDATED STATEMENTS
OF OPERATIONS(In thousands, except per share amounts)
(Unaudited)
|
13 Weeks Ended |
|
October 26, 2019 |
|
October 27, 2018 |
|
|
|
|
Sales |
$ |
407,402 |
|
|
$ |
401,550 |
|
|
|
|
|
Cost of sales |
293,856 |
|
|
289,437 |
|
|
|
|
|
Gross profit |
113,546 |
|
|
112,113 |
|
|
|
|
|
Operating and administrative
expense |
103,140 |
|
|
96,293 |
|
|
|
|
|
Depreciation and
amortization |
7,438 |
|
|
6,898 |
|
|
|
|
|
Operating income |
2,968 |
|
|
8,922 |
|
|
|
|
|
Interest expense |
(567 |
) |
|
(1,116 |
) |
|
|
|
|
Interest income |
1,259 |
|
|
1,178 |
|
|
|
|
|
Income before income
taxes |
3,660 |
|
|
8,984 |
|
|
|
|
|
Income taxes |
1,093 |
|
|
2,715 |
|
|
|
|
|
Net income |
$ |
2,567 |
|
|
$ |
6,269 |
|
|
|
|
|
Net income per
share: |
|
|
Class A common stock: |
|
|
|
Basic |
$ |
0.20 |
|
|
$ |
0.49 |
|
Diluted |
$ |
0.18 |
|
|
$ |
0.43 |
|
|
|
|
|
Class B common stock: |
|
|
|
Basic |
$ |
0.13 |
|
|
$ |
0.32 |
|
Diluted |
$ |
0.13 |
|
|
$ |
0.32 |
|
|
|
|
|
Gross profit as a % of
sales |
27.87 |
% |
|
27.92 |
% |
Operating and administrative
expense as a % of sales |
25.32 |
% |
|
23.98 |
% |
Contact: |
John Van Orden, CFO |
|
(973) 467-2200 |
|
villageinvestorrelations@wakefern.com |
Village Super Market (NASDAQ:VLGEA)
Historical Stock Chart
From Jun 2024 to Jul 2024
Village Super Market (NASDAQ:VLGEA)
Historical Stock Chart
From Jul 2023 to Jul 2024