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Winn-Dixie posts consecutive quarterly same-store sales increases

BY Michael Johnsen

JACKSONVILLE, Fla. — Winn-Dixie’s transformational remodel initiative is setting the stage for a strong 2012, the company reported Tuesday morning during its first-quarter conference call.

Winn-Dixie Stores posted its second consecutive quarter of greater-than 3% improvements in same-store sales, heralding good results to come as the Southeast grocer continues 17 transformational remodels through the rest of the year, realizes greater utilization of its Fuelperks! rewards program in new Florida markets Tampa and Orlando and continues to improve in-stock performance with its computer-generated ordering system.

"We successfully grand-opened two more transformational remodeled stores that are generating promising financial results and building brand equity in their respective markets," Winn-Dixie chairman, president and CEO Peter Lynch said, bringing the number of remodeled stores in operation to five. The transformational remodels — which expands the selling space and incorporates upscale fresh departments inlcuding produce, deli, meat and seafood — generate between $400 and $500 in sales-per-sq.-ft., Lynch told analysts Tuesday morning — "substantially higher than our existing base of about $300 [in sales-per-sq.-ft.]." In the one transformational store that has cycled past its grand re-opening, sales increases are in the double digits, Lynch said.

Winn-Dixie plans to roll out some of the learnings gleaned from the transformational remodels across its store base under the direction of Larry Appel, SVP retail operations, Lynch added, especially across its fresh offerings.

Ultimately, Lynch is confident Winn-Dixie can institute its transformational format across 60% of its store base, or 290 stores.

Winn-Dixie posted net sales for the first quarter ended Sept. 21 of $1.6 billion, an increase of 3.1%, compared with the same period in the prior fiscal year. Identical-store sales increased 3.3%, compared with the same period in the prior year, which was driven in part by a 5.5% increase in basket size and partially offset by a 2.1% decrease in transaction count.

First quarter same-store sales were positively impacted by continued retail inflation, favorable results from the company’s Fuelperks! rewards program and computer generated ordering initiative, and an increase in sales in remodeled stores, partially offset by competitive activities and general market factors, Winn-Dixie reported.

Winn-Dixie reported a net loss of $24.1 million, or 43 cents per diluted share, for the first quarter of fiscal 2012, an improvement from the net loss of $76.8 million, or $1.39 per diluted share, for the same period in the prior fiscal year.

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Mintel: Pet products industry to see continued growth

BY Allison Cerra

CHICAGO — Expect to see the pet products industry grow more than 30% over the next five years, a new Mintel report released this week suggested.

Because more than three-quarters (76%) of dog or cat owners consider their pets to be part of the family, products that go beyond basic necessities (i.e., food), such as apparel, toys, treats, veterinary care and grooming, are expected to help the industry grow 33% by 2016. What’s more, pet food has gone beyond its basic purpose to become "functional," in order to offer four-legged companions additional health benefits. According to Mintel research, pet food that offered a "functional" claim has increased by 130% from 2006 to 2010.

"To maintain and continue such strong sales is an impressive feat in our tough economy and truly speaks to owners’ commitment to their pets and manufacturers’ ability to develop products that resonate with pet owners," Mintel senior analyst Fiona O’Donnell said. "We are noticing that innovations in the pet industry are mirroring innovations in human markets and since many owners consider pets as family members, this is not surprising.

"Despite the difficult economy, 50% of pet owners make unplanned toy and treat purchases for their pets and another 16% say they have cut back on extra household expenses in order to afford pet-related care … showing the true commitment of pet-parents," O’Donnell added.

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Sears, Kmart to ‘reward’ shoppers just in time for holiday season

BY Antoinette Alexander

HOFFMAN ESTATES, Ill. — With the holiday season just around the corner, Sears Holdings is aiming to make shopping more rewarding by offering five times the Shop Your Way Rewards points — equal to 5% back — on all qualifying purchases.

The offer, which is available to all Sears credit cardholders who also are Shop Your Way Rewards members, begins immediately at both Sears and Kmart stores, and will continue year-round at Kmart. Sears is providing the offer until Jan. 28, 2012.

"We know budgets are tight, so we want to reward our customers by offering them ways to stretch their dollar," Sears Holdings SVP and president of marketing Dave Friedman said. "We believe this program will help families get more out of every visit to Sears and Kmart when they use their Sears card."

The retailer is hoping that the five times the Shop Your Way Rewards points will prove particularly helpful this holiday season. According to the National Retail Federation, the average person will spend an additional $130.43 on holiday gifts this season to take advantage of sales and discounts on apparel, electronics, home goods and other items for themselves and family members, up from $112.20 last year.

"We’re presenting creative, money-saving options to our customers," added Friedman. "We want to reward them for their loyalty to both Sears and Kmart by helping them get the most out of their shopping experiences during the holidays and beyond."

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