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Milwaukee-based Roundy’s Inc. enjoyed a boost in net sales for its second quarter as well as its fiscal year to date while trimming losses from continuing operations.
Roundy's continues to be challenged by overall same-store sales, and growth of its Illinois operations - anchored by the company's popular Mariano's Fresh Market banner - far outpaces that of its Wisconsin market.
Net sales rose 5.9 percent to $998.3 million for the 13 weeks ending July 4. Adjusted net loss from continuing operations for the same period was $1.1 million, or 2 cents per common share, compared to $1.2 million and 3 cents per share a year ago.
Year to date, net sales are up 9.7 percent to $1.98 billion; adjusted YTD net less is $1.4 million, or 3 cents a share, compared to $2 million for the year-ago period.
“During the second quarter of 2015, we exceeded our net sales and same-store sales targets and we achieved our EBITDA target for the quarter,” said Robert Mariano, chairman, president and CEO of Roundy’s. “We remain committed to achieving sustainable top-line growth by strengthening our brands in Wisconsin and expanding our growth banner, Mariano’s, in Illinois. Our Mariano’s banner celebrated its five-year anniversary with the opening of our 32nd Mariano’s store in June.”
Roundy's same-store sales slip; Illinois over Wisconsin
Q2 same-store sales decreased 3.9 percent, blamed on a 4.9 percent decrease in the number of customer transactions, partially offset by a 1 percent increase in the average transaction size.
Net sales for the company’s Wisconsin markets were $648.2 million in Q2, a decrease of $23.5 million, or 3.5 percent, from $671.7 million a year ago. The decrease primarily reflects the closure of three stores during the fourth quarter of 2014, a decrease in same-store sales and the Easter holiday calendar shift, partially offset by the benefit of a new store. Same-store sales, which Roundy's says continue to be negatively impacted by competitive store openings, decreased 2.9 percent. Year to date, Wisconsin net sales slipped 3 percent to nearly $1.295 billion; same-store sales decreased 1.5 percent.
Meanwhile, net sales for the grocer's Illinois market were $350.1 million in Q2, an increase of $78.9 million, or 29.1 percent, from $271.2 million a year ago. The increase primarily reflects the benefit of new and acquired stores in Illinois, partially offset by a 6.4 percent decrease in same-store sales. "Same-store sales were negatively impacted by the cannibalization effect of new and acquired store openings in the Illinois market," Roundy's reported. "In addition, same-store sales have been negatively impacted by the reopening of a significant number of former Dominick’s stores that were initially closed in early 2014 and are now operated by other competitors." Year to date, Illinois net sales rose nearly 46 percent to $685.3 million; same-store sales dipped 6.4 percent.
Q2 gross profit increased 5.9 percent to $263.7 million, from $249 million in the same period last year. Gross profit as a percentage of net sales was flat at 26.4 percent for the second quarter of 2015 and 2014.
In Q3, Roundy's anticipates net sales of $975 million to $985 million, and expects same-store sales to decrease 2.25 to 3.25 percent.
Founded in Milwaukee in 1872, 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.