MILAN, Ill. -- Eagle Food Centers here said a glut of competitive openings resulted in lower sales for the year and fourth quarter ended Feb. 1.
The company also said it had net income for both periods, including its first year-end profit in three years.
Fiscal 1996 had 52 weeks and a 13-week fourth quarter, while fiscal 1995 had 53 weeks, with a 14-week fourth quarter.
Net income for the year was $3.2 million, compared with a net loss of $18.7 million a year ago, which included charges for refinancing its revolving credit facility and an accounting charge related to a writedown on impaired assets.
Sales for the year declined 0.9% to $1.015 billion, while same-store sales rose 1.7%.
For the 13-week fourth quarter net income was $531,000, compared with a net loss of $6.3 million a year ago, including an accounting charge for store closings and asset re-evaluation in both periods.
Sales for the quarter fell 7.8% to $260.8 million, while same-store sales declined 1.7%.
Bob Kelly, president and chief executive officer of the 92-store chain, said the company's improved operating results for the year were due to higher gross margins, an improved sales mix and reduced expenses. "We had 15 competitors open during the year, mostly in the second half, affecting 21 of our stores, and we are pleased with our strong operating results in the face of this competition," he said.
The company said it anticipates another 15 competitive openings this year, including six in the first half and nine in the second half.
Herb Dotterer, senior vice president and chief financial officer, said fiscal 1997 is off to a poor start, with same-store sales down approximately 3% for the first six weeks of the first quarter. "Sales are very soft, and while we're not alone in finding ourselves in that situation, it's not much solace," he told securities analysts in a conference call.
