Weis Q1 Sales Up, Profits Down
Weis Markets reported a first-quarter sales gain of 4.2 percent to $596 million, and a 3.9 percent same-store sales jump, vs. the year-ago period. At the same time, net income declined to $9 million, vs. $13.4 million in 2007, while basic and diluted earnings slid to 34 cents per share, vs. 50 cents in 2007.
Calling the 13-week first quarter ended March 29, 2008 "the perfect retail storm, with a combination of factors significantly impacting our gross margins," Norman S. Rich, Weis Markets' c.e.o., cited inflation and rising commodity costs as the chief culprits against earnings during the period.
"We continue to see considerable wholesale food inflation," said Rich. "Food commodity prices are increasing at a faster pace than retail prices paid by our customers. At the same time, due to an uncertain economy and the high cost of gasoline, our customers are more
cautious in their spending. In addition, we continue to maintain our aggressive pricing and promotional program throughout our markets."
Weis Markets' earnings were also affected in the first quarter by increases of 35.4 percent in diesel fuel costs and 18 percent in higher health insurance costs.
In March David P. Hepfinger joined Weis as president and c.o.o. He previously was s.v.p./retailing and administration for the Golub Corp., which runs 116-store Price Chopper.
At Weis' annual shareholders meeting earlier this week, the company's vice chairman, Jonathan H. Weis, said the company would invest nearly $80 million in its capital expenditure program, a 23 percent increase over expenditures made in 2007. The company currently has 19 major projects in various stages of completion, including three new stores, two replacement units, nine additions, and five remodels.
Weis Markets operates 156 stores in Pennsylvania, Maryland, New Jersey, New York, and West Virginia.
Calling the 13-week first quarter ended March 29, 2008 "the perfect retail storm, with a combination of factors significantly impacting our gross margins," Norman S. Rich, Weis Markets' c.e.o., cited inflation and rising commodity costs as the chief culprits against earnings during the period.
"We continue to see considerable wholesale food inflation," said Rich. "Food commodity prices are increasing at a faster pace than retail prices paid by our customers. At the same time, due to an uncertain economy and the high cost of gasoline, our customers are more
cautious in their spending. In addition, we continue to maintain our aggressive pricing and promotional program throughout our markets."
Weis Markets' earnings were also affected in the first quarter by increases of 35.4 percent in diesel fuel costs and 18 percent in higher health insurance costs.
In March David P. Hepfinger joined Weis as president and c.o.o. He previously was s.v.p./retailing and administration for the Golub Corp., which runs 116-store Price Chopper.
At Weis' annual shareholders meeting earlier this week, the company's vice chairman, Jonathan H. Weis, said the company would invest nearly $80 million in its capital expenditure program, a 23 percent increase over expenditures made in 2007. The company currently has 19 major projects in various stages of completion, including three new stores, two replacement units, nine additions, and five remodels.
Weis Markets operates 156 stores in Pennsylvania, Maryland, New Jersey, New York, and West Virginia.