CHARLOTTE, N.C. - New stores and a 3.16% increase in comparable-store sales helped drive double-digit percentage gains in third-quarter operating profits and revenues at Harris Teeter, the chain's parent company said.
Ruddick Corp., which also operates the American & Efird thread-making concern, said Harris Teeter has had a net addition of 11 new stores since the third quarter of last year, including several stores it acquired from Winn-Dixie. The company also said it would accelerate expansion in 2007 with the addition of 21 new stores.
Operating profit at Harris Teeter, which had 149 stores at the end of the third quarter on July 2, was up 12.1% over year-ago levels, to $31.4 million, despite a $2.3 million charge for closing two locations that were replaced by acquired Winn-Dixie stores. Sales were up 11.6% at the Harris Teeter division, to $740.6 million, compared with the third quarter of a year ago.
Through the first three quarters, Harris Teeter posted operating profit gains of 12.4%, to $97.5 million, on a 10% gain in sales, to $2.17 billion. The profit gains included a $2.9 million charge for lease accounting.
Comparable-store sales through the first three quarters were up 3.48%.
Ruddick said the sales gains, along with an emphasis on cost controls, helped offset incremental costs for new-store development, bank-card fees and fuel.
The company said it expects to open an additional five new Harris Teeter stores during the fourth quarter for a total of 16 new supermarkets in the current fiscal year. Next year the company plans to boost capital
expenditures by 4%, to $208 million, as it plans to add the 21 new locations. The 2007 expansion plans include two stores in Washington, D.C., and one each in Delaware and Maryland, as the company continues its push northward.
"We are pleased to have achieved another quarter of positive comparable-store sales and improved operating results," said Thomas W. Dickson, chairman, president and chief executive officer, Ruddick Corp., in a prepared statement. "These results were achieved at the same time we have accelerated our store expansion program."
Ruddick said overall net income for the third quarter, including results from American & Efird, was basically even with year-ago results at $17.8 million, on a sales gain of 10.7%, to $830 million. Through three quarters, net income was $54.4 million, up 2.4% over year-ago levels, on a 9.7% increase in sales, to $2.43 billion.
In June Ruddick closed on a new revolving line of credit that provides for financing up to $350 million, replacing a previous $200 million credit facility.