LANDOVER, Md. -- Net income at Giant Food here surged in the second quarter and half ended Aug. 10, but sales rose only slightly.
he 24-week half, net income climbed 22.8% to nearly $49 million from $39.9 million.
Sales in the quarter rose 2.1% to $874.4 million from $856.5 million a year ago. A similar gain was reported in the half, with sales up 2.6% to $1.77 billion from $1.73 billion. Same-store sales were virtually flat; excluding the effects of a soft regional economy and cannibalization by four stores opened between November 1995 and January 1996, same-store results would have shown increases of less than 1%, Giant said.
Profitability has risen primarily from improved product mix and buying performance, and profits also are expected to get a boost as sales rebound to normal levels after Labor Day and the implementation of numerous promotional programs, according to Giant. Besides a slow economy, other factors curbing sales included the Olympics, unusually wet and cool weather, and shopper vacations outside the area, the company said.
Giant opened two Super G stores and closed two other units in the quarter. In the 12 months ended Aug. 23, the chain opened nine stores and closed four.