GRAND RAPIDS, Mich. Spartan Stores on Wednesday reported a decline of 0.1% in consolidated net sales of $781.9 million for the 16 weeks ending Jan. 3. Retail segment sales actually increased through the third quarter, Spartan reported, due to 3.3% comparable stores sales growth excluding fuel. However, that increase was partially offset by lost retail sales from the sale of four retail stores to distribution segment customers and closure of a single store since the third quarter last year, and lower sales related to the company's marginally profitable pharmacy distribution program.
Third-quarter operating earnings improved by double digits for the 12th consecutive quarter, the company reported, increasing 17.4% to $17.9 million. "We are very pleased to be extending our track record of double-digit profit growth, particularly in the present economic climate," stated Dennis Eidson, Spartan's CEO. "Our operating earnings growth is being driven by our retail store acquisitions and capital investment program. We are especially pleased to be reporting our 10th consecutive quarter of retail comparable store sales growth. As consumers continue to shift their purchasing toward value-oriented products and services, our private label, fuel rewards, $4.00 generic prescription program and other consumer-centric offerings are gaining traction by better serving consumers' needs."
Across the company’s retail outlets, total third-quarter net sales increased 1.8% to $384 million. Third-quarter retail operating earnings increased 58% to $6.8 million.
"Our focus on the consumer has allowed us to achieve sustained and positive financial results, and has helped to strengthen our market position and customer loyalty,” Eidson said. “We continue to be very pleased with the results of our capital program, particularly at our acquired Felpausch stores. Recognizing the difficult economic circumstances facing today's budget conscious consumers, we have been working to bring even more value to our customers through our extensive private label products, the launching of our $4.00 generic prescription program in our Grand Rapids market and exciting deep discounted fuel promotions,” he said.
"We expect comparable retail store sales to increase in the low single digits during the remainder of fiscal 2009, but be below our third-quarter results due to the cycling of sales from stores remodeled last year,” Eidson added. “This expectation also excludes the effect of the Easter holiday sales, which contributed 1.2% to comparable stores sales in last year's fourth quarter. There is no Easter holiday included in fiscal 2009.”