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GRAND RAPIDS, Mich. - Spartan Stores Inc. on Thursday reported financial results for its fiscal 2002 second quarter, which ended September 15, 2001.
Sales for fiscal 2002's 12-week second quarter increased 7.5 percent to $841.1 million from $782.3 million for fiscal 2001's 12-week second quarter. The sales increase was the result of additional sales from the acquisitions of Food Town and Prevo's Family Markets. For the retail grocery segment, same-store sales declined 2.4 percent for the quarter.
"Our overall business fundamentals remain sound," said Spartan's chairman, president, and CEO, James B. Meyer. "We are pleased with our retail store performance in Michigan, but Ohio continues to be a challenge. As we anticipated, the competitive pressure that developed in our Ohio market during the first quarter extended into the second quarter. As a result, we have modified our marketing and merchandising programs in that market and will also accelerate our Ohio store-remodeling program. Although the tragic events on September 11 had an adverse effect on sales during the last week of the quarter, we have seen a return to normal sales levels in recent weeks."
Gross margin for the fiscal 2002 second quarter increased to 17.9 percent from 15.6 percent a year ago, largely because of a higher mix of retail sales and more favorable terms on recently negotiated supply contracts. Selling, general and administrative expenses, including depreciation and amortization, rose to 15.8 percent of sales from 13.2 percent last year. This increase was due to the higher costs associated with operating retail stores and an initial shortfall in vendor funding of the grocery distribution marketing program that began late in the first quarter.
"Our aggressive retail and distribution business strategy requires an enormous corporate-wide effort, and, although we have made considerable progress, significant opportunities remain before us," stated Meyer.
Based in Grand Rapids, Michigan, Spartan Stores, Inc. owns and operates 102 supermarkets and 25 deep-discount drug stores in Michigan and Ohio, including: Ashcraft's Markets, Family Fare Supermarkets, Food Town, Glen's Markets, Great Day Food Centers, Prevo's Family Markets and The Pharm. The company also distributes private-label and national brand products to more than 350 independent grocery stores and serves as a wholesale distributor to 6,600 convenience stores.