SALISBURY, N.C. -- Food Lion here said its Kash n' Karry operations improved significantly in the fourth quarter of 1997.
egration into Food Lion resulted in a fourth-quarter loss of less than 1 cent per share.
"We have seen great improvement in the Kash n' Karry operation during the fourth quarter, not only in sales momentum, but also in gross profits and expense control," said Tom Smith, president and chief executive officer of Food Lion. "I am confident that Kash n' Karry will positively contribute to consolidated earnings in 1998."
For the fourth quarter, Food Lion had earnings of $83.0 million, a 25% increase over the year-ago quarter. Sales for the quarter were $3.2 billion.
For the 53-week fiscal year, Food Lion reported earnings of $179 million on sales of $10.2 billion, compared with last year's earnings of $206 million on sales of $9.0 billion.
Same-store sales increased 0.8% in the quarter and 0.6% for the year, Food Lion said. Results were affected by a third-quarter pretax charge of $87.1 million associated with store closings, the company said.
"Our team demonstrated excellent cost control, enabling the company to grow earnings in an environment of relatively flat industry sales and low food-price inflation," Smith said. Food Lion said it plans to open 75 new stores in 1998, including 17 replacement stores, and will remodel and/or expand 133 units. The expenditures will increase square footage by 8%. In 1997, the company added 100 stores through the Kash n' Karry acquisition, opened an additional 64 units, and remodeled or expanded 99 units. Food Lion closed 94 stores, including 61 stores related to its exit from the Southwest.
