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GRAND RAPIDS, Mich. -- Spartan Stores, Inc. reported earnings of $5.8 million for its 12-week fourth quarter and fiscal 2005 year ended March 26, 2005, compared to $1.7 million during the year-ago period.
Sales were $457.6 million, up from $456.9 million during last year's fourth quarter, while for the year, Spartan showed a net profit of $18.8 million compared to a loss of $6.7 million a year earlier. Sales declined to $2.04 billion from $2.05 billion.
Net earnings from continuing operations tallied $5.3 million, or $0.25 per diluted share, compared to a net loss from continuing operations of $1.5 million, or $0.07 a share in the corresponding period last year, representing the fifth consecutive quarter of improved earnings.
Spartan said its fiscal 2005 cash flow from operations increased more than 115 percent from the prior year's level to $60.6 million; and it attributed its improved financial performance primarily to more favorable retail and distribution gross profit margins, continued cost containment and productivity gains, higher sales volumes at its supermarket operations and the favorable conclusion of an IRS audit that reduced the fourth-quarter tax provision for continuing operations by $1.3 million.
"We are pleased to continue our positive earnings momentum, particularly in our fourth quarter, the lowest volume seasonal period," said Craig C. Sturken, Spartan Stores' chairman, president and c.e.o. Excluding the favorable tax adjustment, Sturkin said this year's quarterly profit remains the best fourth-quarter performance Spartan has reported in more than three years.
"One of the key factors for this performance improvement was the sustained profitability in our retail division for every quarter of fiscal 2005," Sturken said. "We believe our strategy of improving the customer shopping experience is working. By remodeling stores and resetting store merchandise, having convenient locations, improving our product offerings, assortments and selections and, by adding convenient services such as fuel centers and in-store pharmacies, we are differentiating our stores from existing competitors. This distinction is providing the incremental supermarket sales gains we were anticipating."
Spartan Stores, the nation's eighth largest grocery wholesaler with warehouse facilities in Grand Rapids and Plymouth, Mich., distributes more than 40,000 private-label and national brand products to over 300 independent grocery stores in Michigan. It also owns and operates 54 retail supermarkets and 20 deep-discount food and drug stores in Michigan and Ohio, including Family Fare Supermarkets, Glen's Markets, and The Pharm.