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JACKSONVILLE, Fla. -- Maintaining an optimistic attitude during challenging times, the chief executive of bankrupt retailer Winn-Dixie Stores, Inc. here said yesterday in filings with the U.S. Securities and Exchange Commission that he's pleased with the progress the company is making and hopes to exit bankruptcy by June.
Peter Lynch's comments came as the retailer reported a 2.9 percent increase in identical store sales for the first eight weeks of its 2006 fiscal year -- a welcome improvement from the 4.5 percent decline in identical store sales in the third and fourth quarters of fiscal 2005.
Despite the enthusiasm, however, Winn-Dixie clearly has work to do, which Lynch acknowledged. Its net sales for the second quarter were $1.675 billion compared to $1.736 billion in the same period during fiscal 2005. Its total net loss was $554 million.
Winn-Dixie said the borrowing availability under its debtor-in-possession ("DIP") financing has improved from the end of fiscal 2005 through the November monthly operating period, to approximately $182.2 million as of Nov. 16, 2005, from $170.7 million as of June 29, 2005.
Meanwhile, the company has completed a major strategic restructuring program, in which it exited 326 stores, along with three distribution centers and six manufacturing facilities. With these actions completed, the company said it now has in place the right store footprint and infrastructure to achieving its turnaround objective.
The retailer hopes to operate 575 stores across Florida, Alabama, Louisiana, Georgia, and Mississippi and 12 in the Bahamas, according to a separate filing with the SEC.
"We are very pleased with the progress we are making," said Lynch. "Although it may not be immediately obvious from our financial reports, we have generally met or exceeded our internal performance objectives so far in fiscal 2006. Clearly, the operational improvements we have been implementing are beginning to pay off, thanks to the dedication and loyalty of our associates and the continued support of our customers and suppliers. To be sure, there is still a lot of hard work and challenges ahead for our company, but we believe we are making steady improvement and building momentum."
Lynch added that he thinks shoppers are noticing the change. "In addition to the recent improvement in our identical store sales, we are seeing increased anecdotal evidence that our turnaround efforts are succeeding. We are receiving more and more letters, emails and phone calls from customers who are noticing that we are getting better all the time. They see an improved attitude and energy level among our associates and better and fresher merchandise on our shelves."