JACKSONVILLE, Fla. -- Winn-Dixie Stores here said the switch to central procurement and labor reductions at store level helped boost earnings while business disruptions from retrofit activities and elimination of unprofitable departments pushed sales down for the second quarter and 28 weeks ended Jan 10.
ring costs, increased 17.1% to $52 million.
In April, Winn-Dixie initiated a restructuring plan that called for retrofits at approximately 650 stores during fiscal 2001, at a net cost of $88.6 million. The company said restructuring charges totaled $22.9 million for the quarter and $28.4 million for the year-to-date, with 537 locations undergoing retrofit activity during the quarter.
Including the restructuring costs, the company said net income was $12.2 million for the quarter, compared with a loss of $18.8 million a year ago, and $21.6 million for the 28 weeks, up 558% from $3.3 million a year ago.
Al Rowland, president and chief executive officer, said gross profits have been improving as the chain's central procurement operation "begins to overcome the startup process, and labor reduction from 217 completed retrofits helped reduce operating expenses."
He said comparable store sales were impacted by elimination of such unprofitable sales departments as melon bars, salad bars and dry cleaners; a reduction in the number of 24-hour stores; and construction disruptions from retrofit activities.
