Village Super Market, Inc. Reports Results for the Second Quarter Ended January 25, 2020
06 March 2020 - 12:33AM
Village Super Market, Inc. (NASDAQ:VLGEA) today reported its
results of operations for the second quarter ended January 25,
2020.
Net income was $2,005,000 in the 13 weeks ended
January 25, 2020 compared to $7,571,000 in the 13 weeks ended
January 26, 2019. The 13 weeks ended January 25,
2020 includes a non-cash pension charge related to the termination
of a company-sponsored pension plan and other pension settlement
charges of $871,000 (net of tax), pre-opening costs related to the
Stroudsburg, Pennsylvania replacement store that opened on November
1, 2019 of $304,000 (net of tax) and store closure costs and
charges to write off the variable lease obligations related to the
old Stroudsburg store of $365,000 (net of tax). Excluding
these items, net income decreased 53% in the 13 weeks ended
January 25, 2020 compared to the prior year due primarily to
decreased gross profit margins due to price investments and
increased operating and administrative expenses.
Sales were $437,422,000 in the 13 weeks ended
January 25, 2020, an increase of 2.2% compared to the 13 weeks
ended January 26, 2019. Sales increased due to the
opening of the Stroudsburg replacement store on November 1, 2019,
the acquisition of Gourmet Garage on June 24, 2019 and a same store
sales increase of 0.1%. 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 five additional
stores. These increases were partially offset by the impact of one
competitor store opening, decreased promotional spending in
Maryland and the early release of Supplemental Nutrition Assistance
Program ("SNAP") benefits in January 2019. The Company
expects same store sales in fiscal 2020 to range from a .5%
decrease to an increase of 1.0%. 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 26.96% in the 13 weeks ended January 25, 2020 compared to
27.50% in the 13 weeks ended January 26, 2019. Excluding
the impact of the addition of Gourmet Garage, gross profit as a
percentage of sales decreased .83% in the 13 weeks ended
January 25, 2020 compared to the 13 weeks ended
January 26, 2019 due primarily to decreased departmental gross
margin percentages (.67%), decreased patronage dividends and
rebates received from Wakefern (.12%) and higher promotional
spending (.13%), partially offset by decreased warehouse
assessment charges from Wakefern (.05%) and a favorable change in
product mix (.04%). Departmental gross profits decreased due
primarily to price investments, including the ShopRite's Right
Price Promise pricing strategy, a commitment to everyday low prices
on the items customers purchase most frequently, introduced in
October 2019, and decreased pharmacy margins as a result of
continued downward pressure on prescription reimbursement rates
from third party providers.
Operating and administrative expense as a
percentage of sales increased to 24.63% in the 13 weeks ended
January 25, 2020 compared to 23.37% in the 13 weeks ended
January 26, 2019. The 13 weeks ended
January 25, 2020 includes a non-cash pension charge related to
the termination of a company-sponsored pension plan and other
pension settlement charges (.28%), pre-opening costs of the
Stroudsburg, Pennsylvania replacement store (.10%), store closure
costs and charges to write off the variable lease obligations of
the old Stroudsburg store (.12%) and lease costs reclassified from
Depreciation and Amortization and Interest Expense to Operating and
Administrative Expense (.15%) as a result of the adoption of ASU
2016-02, “Leases.”
Excluding these items, operating and
administrative expense as a percentage of sales increased .61% in
the 13 weeks ended January 25, 2020 compared to the 13 weeks
ended January 26, 2019 due primarily to increased payroll
(.49%), increased occupancy costs (.07%) and higher fringe benefit
costs (.11%). These increases were partially offset by decreased
legal and consulting fees (.16%). Payroll increased due
primarily to the addition of Gourmet Garage, higher payroll in the
first full quarter of operations in the Stroudsburg replacement
store, minimum wage increases in New Jersey and continued growth of
ShopRite from Home and expansion to five additional stores.
Fringe benefit costs increased primarily due to increased claim
costs on self-insured medical plans. Occupancy costs
increased due primarily to the addition of Gourmet Garage.
Net income was $4,572,000 in the 26 weeks ended
January 25, 2020 compared to $13,839,000 in the 26 weeks ended
January 26, 2019. The 26 weeks ended January 25,
2020 includes a non-cash pension charge related to the termination
of a company-sponsored pension plan and other pension settlement
charges of $871,000 (net of tax), pre-opening costs related to the
Stroudsburg, Pennsylvania replacement store of $891,000 (net of
tax) and store closure costs and charges to write off the lease
asset and related obligations for the old Stroudsburg store of
$557,000 (net of tax). The 26 weeks ended January 26, 2019
includes a $290,000 (net of tax) gain for Superstorm Sandy
insurance proceeds received. Excluding these items from both
periods, net income decreased 49% in the 26 weeks ended
January 25, 2020 compared to the prior year due primarily to
decreased gross profit margins and increased operating and
administrative expenses.
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 |
|
26 Weeks Ended |
|
January 25, 2020 |
|
January 26, 2019 |
|
January 25, 2020 |
|
January 26, 2019 |
|
|
|
|
|
|
|
|
Sales |
$ |
437,422 |
|
|
$ |
428,128 |
|
|
$ |
844,824 |
|
|
$ |
829,678 |
|
|
|
|
|
|
|
|
|
Cost of sales |
319,475 |
|
|
310,392 |
|
|
613,331 |
|
|
599,830 |
|
|
|
|
|
|
|
|
|
Gross profit |
117,947 |
|
|
117,736 |
|
|
231,493 |
|
|
229,848 |
|
|
|
|
|
|
|
|
|
Operating and administrative
expense |
107,734 |
|
|
100,036 |
|
|
210,874 |
|
|
196,330 |
|
|
|
|
|
|
|
|
|
Depreciation and
amortization |
7,798 |
|
|
7,017 |
|
|
15,237 |
|
|
13,915 |
|
|
|
|
|
|
|
|
|
Operating income |
2,415 |
|
|
10,683 |
|
|
5,382 |
|
|
19,603 |
|
|
|
|
|
|
|
|
|
Interest expense |
(568 |
) |
|
(1,112 |
) |
|
(1,135 |
) |
|
(2,227 |
) |
|
|
|
|
|
|
|
|
Interest income |
1,030 |
|
|
1,305 |
|
|
2,289 |
|
|
2,483 |
|
|
|
|
|
|
|
|
|
Income before income
taxes |
2,877 |
|
|
10,876 |
|
|
6,536 |
|
|
19,859 |
|
|
|
|
|
|
|
|
|
Income taxes |
872 |
|
|
3,305 |
|
|
1,964 |
|
|
6,020 |
|
|
|
|
|
|
|
|
|
Net income |
$ |
2,005 |
|
|
$ |
7,571 |
|
|
$ |
4,572 |
|
|
$ |
13,839 |
|
|
|
|
|
|
|
|
|
Net income per
share: |
|
|
|
|
|
|
Class A common stock: |
|
|
|
|
|
|
|
Basic |
$ |
0.16 |
|
|
$ |
0.59 |
|
|
$ |
0.35 |
|
|
$ |
1.08 |
|
Diluted |
$ |
0.14 |
|
|
$ |
0.53 |
|
|
$ |
0.32 |
|
|
$ |
0.96 |
|
|
|
|
|
|
|
|
|
Class B common stock: |
|
|
|
|
|
|
|
Basic |
$ |
0.10 |
|
|
$ |
0.38 |
|
|
$ |
0.23 |
|
|
$ |
0.70 |
|
Diluted |
$ |
0.10 |
|
|
$ |
0.38 |
|
|
$ |
0.23 |
|
|
$ |
0.70 |
|
|
|
|
|
|
|
|
|
Gross profit as a % of
sales |
26.96 |
% |
|
27.50 |
% |
|
27.40 |
% |
|
27.70 |
% |
Operating and administrative
expense as a % of sales |
24.63 |
% |
|
23.37 |
% |
|
24.96 |
% |
|
23.66 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
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