Smart & Final Grows Sales Despite Loss in Q1
Commerce, Calif.-based Smart & Final Stores Inc. enjoyed net sales growth of 10.5 percent for the first quarter of its 2016 fiscal year.
Net sales for the value-oriented food and everyday staples retailer surpassed $908 million for the 12 weeks ending March 27, versus $822.2 million in the year-ago period.
"Smart & Final Stores' positive momentum has continued with a solid start to 2016. Strong traffic growth contributed to a 2 percent comparable store sales increase in the first quarter despite persistent deflationary headwinds," said David Hirz, president and CEO. "We continue to drive engagement and attract new customers with our successful merchandising and marketing initiatives."
Despite the sales boost, the retailer lost $2 million in Q1, or 3 cents per diluted share, while reporting adjusted net income of $6.3 million, or 8 cents per share. Net income was $4.9 million in the year-ago period. The 290-store chain chalked the loss up to higher store development costs.
New store openings
"Our exciting store development plans are ahead of schedule,” Hirz said. “Next week, we plan to open the last of the 33 acquired former Albertsons and Safeway locations, which were briefly operated under the Haggen banner. With these locations, we're increasing Smart & Final's presence in our important Los Angeles and Orange County markets, as well as doubling our penetration in the California Central Coast and San Diego markets. In all of our markets, we look forward to building deeper community ties and meeting the shopping needs of each unique area."
Net sales for the company’s Smart & Final banner stores were $709.3 million, a 12.8 percent increase as compared to $628.8 million in the same period of 2015. Q1 comparable store sales growth for the Smart & Final banner was 2.5 percent in the first quarter.
Net sales for its Cash & Carry banner stores were $199.1 million, a 3 percent increase as compared to $193.3 million a year ago, with comps up 0.3 percent in Q1.
During Q1, the company opened 14 new Smart & Final Extra stores and completed two relocations of legacy Smart & Final stores to the Smart & Final Extra format stores. As of March 27, the company operated 143 Smart & Final Extra and 92 legacy Smart & Final stores, and 55 Cash & Carry stores.
Smart & Final operates 290 stores in California, Oregon, Washington, Arizona, Nevada and Idaho, with an additional 15 stores in Northwestern Mexico operated through a joint venture.