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CHARLOTTE, N.C. -- Ruddick Corp., the parent company of regional retailer Harris Teeter as well as the owner of thread and yarn manufacturer American & Efird, Inc., said yesterday that improved operating profit at Harris Teeter helped boost its net income to $19.8 million for the second quarter of fiscal 2006. Harris Teeter's sales jumped 9.1 percent to $715.1 million, aided by a comparable-store sales increase of 3.04 percent.
"We are pleased to have achieved another quarter of strong comparable-store sales," said Thomas W. Dickson, chairman of the board, president, and c.e.o. of Ruddick Corp., in a statement. "In addition, we achieved improved operating results through our focus on customer service and delivery of effective retail pricing and targeted promotional spending programs. We view customer service as one of our best tools in differentiating ourselves from the competition. This high level of service commitment requires us to understand and respond to our customers' preferences. We will continue to invest our time and resources in developing our associates, recruiting new associates, training, and supervision, in order to maintain exceptionally high standards and excellent customer service."
Corporate selling, general, and administrative expenses for the second quarter included a pretax charge of $1.5 million related to new supplemental executive retirement plans approved by the company's board of directors in connection with the retirement of Alan T. Dickson and R. Stuart Dickson from their positions as chairman of the board of directors and chairman of the executive committee of the board of directors, respectively.
For the 26 weeks ended April 2, Harris Teeter's sales rose 9.2 percent to $1.43 billion. The increase in sales was attributable to new store activity, partially offset by store closings and divestitures, and comparable-store sales increases of 3.04 percent for the second quarter and 3.64 percent for the 26-week period. These comparable-store sales improvements were achieved despite the timing of the Easter holiday, which falls in the third quarter of fiscal 2006, but was included in the second quarter of fiscal 2005.
During the first six months of fiscal 2006, Harris Teeter opened four new stores, closed two older stores, divested one older store, and completed the major remodeling of two stores, one of which was expanded in size. Since the second quarter of fiscal 2005, Harris Teeter has opened 13 new stores while closing four older stores and divesting one older store for a net addition of eight stores. The company operates 146 stores in six Southeastern states.
The company said its management remains conservative in its expectations for the remainder of fiscal 2006, however, due to the intensely competitive retail grocery market and the challenging textile and apparel environment.