Spartan Stores Reports 6.4% Decrease in Third-quarter Sales
GRAND RAPIDS, Mich. - Spartan Stores Inc. on Monday reported that sales for its fiscal 2002 third quarter, which ended Jan. 5, 2002, decreased 6.4 percent to $1.06 billion from $1.14 billion in last year's third quarter. Same-store sales for the retail grocery segment were 5.2 percent lower for the quarter, and operating margin declined to 0.7 percent from 1.8 percent in the prior-year period due principally to a decrease in the company's Ohio market retail-store sales.
The company said third-quarter pretax earnings from continuing operations included a $0.7 million provision for bad debt related to Kmart's filing of Chapter 11. Net earnings from continuing operations for the quarter were at break-even compared with net earnings of $7.0 million, or $0.36 per diluted share, last year.
"Clearly we are very disappointed with the third-quarter financial results," said Spartan's chairman, president and CEO, James B. Meyer. "The competitive environment in our Ohio market has been challenging, but we are firmly committed to improving our store performance and are treating it with utmost priority. We are resolute in our commitment to a value strategy and delivering top-quality products and services to our customers. Our desire is to create and maintain a pleasant shopping experience at all of our stores and we are improving the physical facilities where needed, to levels comparable with the best stores in our Ohio market."
Meyer said the company is taking actions to improve performance in its Ohio stores, including implementation of an automated labor-scheduling program, further improving its in-stock performance standards, and rapidly employing best-store merchandising and other practices from its top-performing stores.
"These actions, along with broader company initiatives focused on improving our distribution network efficiency, category management practices, and reducing corporate overhead costs, are expected to improve our annualized net earnings between $5 and $10 million. We are in the beginning stages of many initiatives that will help drive and sustain future sales and earnings growth," Meyer said.
The company also announced the election of Ken Stevens to its board of directors. Stevens was recently named chief operating officer of Intimate Brands retail operation, The Bath and Body Works, and served as chairman and CEO of Bank One Retail Group, president and chief operating officer of the Taco Bell Division of PepsiCo, and a partner at McKinsey & Company.
Spartan Stores Inc., based in Grand Rapids, Mich., 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 more than 40,000 private-label and national brand products to more than 350 independent grocery stores and serves as a wholesale distributor to 6,600 convenience stores.
The company said third-quarter pretax earnings from continuing operations included a $0.7 million provision for bad debt related to Kmart's filing of Chapter 11. Net earnings from continuing operations for the quarter were at break-even compared with net earnings of $7.0 million, or $0.36 per diluted share, last year.
"Clearly we are very disappointed with the third-quarter financial results," said Spartan's chairman, president and CEO, James B. Meyer. "The competitive environment in our Ohio market has been challenging, but we are firmly committed to improving our store performance and are treating it with utmost priority. We are resolute in our commitment to a value strategy and delivering top-quality products and services to our customers. Our desire is to create and maintain a pleasant shopping experience at all of our stores and we are improving the physical facilities where needed, to levels comparable with the best stores in our Ohio market."
Meyer said the company is taking actions to improve performance in its Ohio stores, including implementation of an automated labor-scheduling program, further improving its in-stock performance standards, and rapidly employing best-store merchandising and other practices from its top-performing stores.
"These actions, along with broader company initiatives focused on improving our distribution network efficiency, category management practices, and reducing corporate overhead costs, are expected to improve our annualized net earnings between $5 and $10 million. We are in the beginning stages of many initiatives that will help drive and sustain future sales and earnings growth," Meyer said.
The company also announced the election of Ken Stevens to its board of directors. Stevens was recently named chief operating officer of Intimate Brands retail operation, The Bath and Body Works, and served as chairman and CEO of Bank One Retail Group, president and chief operating officer of the Taco Bell Division of PepsiCo, and a partner at McKinsey & Company.
Spartan Stores Inc., based in Grand Rapids, Mich., 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 more than 40,000 private-label and national brand products to more than 350 independent grocery stores and serves as a wholesale distributor to 6,600 convenience stores.