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Roundy’s Inc. reported a 13.8 percent increase in net sales for the first quarter of its 2015 fiscal year, yet losses are still dogging the Midwestern grocer despite the continuing success of its Chicago-area Mariano's banner.
Q1 net sales from continuing operations came in at $981.9 million; net loss from continuing operations was $400,000.
“We achieved our targeted EBITDA and gross margin rate for the first quarter, which were the result of improved operational efficiencies in both our Wisconsin and Illinois stores. Due to softer than anticipated March and Easter sales, our same-store sales were below our expectations,” said Robert A. Mariano, chairman, president and CEO of Roundy’s. “We remain committed to improving financial performance across all of our banners. Our team has embarked on a number of initiatives aimed at managing expenses and further improving our operating efficiencies and execution.”
Same-store sales from continuing operations declined 1.6 percent, which Roundy's blamed on a 1.9 percent decrease in the number of customer transactions, partially offset by a 0.3 percent increase in average transaction size.
Net sales for the company’s Wisconsin markets were $646.7 million in Q1, a decrease of $16.8 million, or 2.5 percent, from the year-ago period, chalked up to the closure of three stores during the fourth quarter of 2014. Same-store sales decreased 0.1 territory percent in this territory.
In the company's Illinois market, Q1 net sales were $335.2 million, an increase of $136 million, or 68.2 percent from a year ago. The increase primarily reflects new and acquired stores in Illinois, partially offset by a 6.4 percent decrease in same-store sales, which Roundy's says were negatively impacted by the cannibalization effect of new and acquired store openings in the Illinois market, along with the re-opening of a significant number of former Dominick’s stores that were initially closed in early 2014 and are now operated by other competitors.
Gross profit for Q1 increased 13.5 percent to $261.6 million over a year ago; gross profit as a percentage of net sales was 26.6 percent, compared to 26.7 percent a year ago.
Milwaukee-based Roundy’s operates 150 retail grocery stores and 100 pharmacies under the Pick ’n Save, Copps, Metro Market and Mariano’s retail banners in Wisconsin and Illinois.