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    Penn Traffic Boosts Q4 Balance Sheet, but Losses Continue

    The Penn Traffic Co., which owns and operates 82 P&C, Quality and BiLo supermarkets in the northeastern United States, reported revenues from continuing operations of $872.3 million for the fiscal 2009 ended Jan. 31, 2009, vs. $896.0 million during the year prior, reflecting a reduction in the company’s store count, as well as the lower volume and traffic trends that the company believes have affected much of the grocery industry.

    The Penn Traffic Co., which owns and operates 82 P&C, Quality and BiLo supermarkets in the northeastern United States, reported revenues from continuing operations of $872.3 million for the fiscal 2009 ended Jan. 31, 2009, vs. $896.0 million during the year prior, reflecting a reduction in the company’s store count, as well as the lower volume and traffic trends that the company believes have affected much of the grocery industry. Fiscal 2009 same-store sales decreased 1.7 percent, compared with fiscal 2008.

    The company’s loss from continuing operations was $34.1 million, or $4.04 per share, in fiscal 2009, vs. $29.2 million, or $3.45 per share, in fiscal 2008. Excluding considerably higher fiscal 2009 tax expense, year-over-year loss from continuing operations was essentially flat.

    Penn Traffic posted a $26.8 million gain from its fourth-quarter 2009 wholesale business segment divestiture, which has been classified for accounting purposes as discontinued operations. Including net gains and losses from discontinued operations, the company logged net losses of $17.6 million, or $2.13 per share, in fiscal 2009, compared with $41.7 million, or $4.92 per share, in the prior fiscal year.

    “We closed fiscal 2009 with a substantially improved balance sheet and a cost structure more closely aligned with what our business requires to deliver value to our customers,” said Penn Traffic president and CEO Gregory J. Young. “At the same time, we continue to make targeted investments to enhance our top-line performance. While we spent more than $5 million on capital expenditures during fiscal 2009, we expect our operating performance to fund an even higher level of investment in the business during fiscal 2010. These investments are targeted to make our stores more attractive to customers, enhance the quality and availability of our products, and improve the efficiency and effectiveness of our operations.”

    Gross profit was $267.0 million, or 30.6 percent of revenues, in fiscal 2009, vs. $278.8 million, or 31.1 percent of revenues last year. Selling and administrative expenses were $286.0 million, or 32.8 percent of revenues, in fiscal 2009, compared to $296.0 million, or 33.0 percent, in the year-ago period. The company’s operating loss for the 12 months of fiscal 2009 was $22.6 million, compared with $18.0 million in fiscal 2008.

    The grocer’s revenues from continuing operations were $218.0 million in the fourth quarter of fiscal 2009 ended Jan. 31, vs. $223.3 million in the year-ago period. Fourth-quarter fiscal 2009 same-store sales decreased 3.3 percent from last year.

    The company’s loss from continuing operations was $14.4 million, or $1.70 per share, in the fourth quarter, compared with $9.2 million, or $1.09 per share, in the year-ago period. Including the $26.8 million gain from Penn Traffic’s wholesale business segment divestiture and other gains and losses from discontinued operations, the company recorded net income of $3.8 million, or 43 cents per share, in the fourth quarter of fiscal 2009. In the fourth quarter of fiscal 2008, the company’s net loss was $19.8 million, or $2.34 per share.

    Fourth-quarter gross margin from continuing operations remained steady at 30.0 percent of revenues for fiscal 2009 and 2008. Gross profit was $65.4 million in the fourth quarter of fiscal 2009, vs. $67.0 million during the same period last year. Selling and administrative expenses were $70.0 million, or 32.1 percent of revenues, in the quarter, compared with $72.8 million, or 32.6 percent, in the year-ago period.

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