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CHARLOTTE, N.C. -- Ruddick Corp., the parent company of Harris Teeter, said yesterday that the chain's first-quarter sales jumped 9.3 percent to $716.1 million, thanks to new store activity. The operator also posted a comparable store sales increase of 4.25 percent for the quarter.
The quarterly gains were partially offset by store closings and divestitures.
Operating profit at Harris Teeter increased by 14.4 percent to $33.3 million in the first quarter, while operating profit as a percent of sales improved by 20 basis points, to 4.65 percent.
Net new store growth, and effective retail pricing and targeted promotional spending programs helped drive comp gains, said Ruddick Corp. Those sales gains have helped the retailer offset incremental costs associated with new store development program, and increased utility and employee benefit costs.
"Our focus on customer service and our delivery of effective retail pricing and targeted promotional spending programs has resulted in another quarter of increased comparable store sales and improved operating results," said Thomas W. Dickson, president and c.e.o. of Ruddick Corp., in a statement. "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 invest a lot of time and resources in order to deliver excellent customer service."
Harris Teeter operates 144 stores in six Southeastern states. Inclusive of six acquired Winn-Dixie stores that are currently being remodeled, the company plans to open 18 new stores and complete the remodeling on seven stores during the remainder of fiscal 2006. The chain expects to close three existing stores simultaneously with the opening of the former Winn-Dixie stores.
Harris Teeter expects the new store development program for fiscal 2006 to render an approximate 12 percent increase in retail square footage, bettering an 8 percent increase in fiscal year 2005. Currently, Harris Teeter expects to spend approximately $210 million for capital expenditures in fiscal 2007, which include stores in the Northern Virginia market, where its presence is expanding.