Pathmark Stores, Carteret, N.J., said it is beginning a prosperous new chapter in its corporate history less than a year after emerging from Chapter 11 bankruptcy protection.
"We have prevailed where most companies have failed," Jim Donald, Pathmark president, chairman and chief executive officer told the Credit Suisse First Boston Food & Drug Retailing Conference in New York.
Pathmark emerged from bankruptcy in September. The company had filed for Chapter 11 protection in July, after Ahold backed out of an agreement to by the chain in December 1999, allegedly because of the number of stores the Federal Trade Commission wanted it to divest.
The prepackaged bankruptcy restructuring relieved Pathmark $1 billion in debt, giving the chain funds to invest in new stores and upgrades.
"The future has never been brighter for Pathmark," he said. He cited several reasons for his optimism, including:
A strong franchise name.
Excellent store locations.
Store productivity that exceeds industry norms.
Large average store size.
Donald said the company is succeeding by concentrating on its core business, lowering its operating expenses, spending its capital budget "wisely" and stepping up its focus on customer service.
Capital issues were addressed last year as the company "took a year off without building new stores," said Frank Vitrano, Pathmark executive vice president, treasurer and chief financial officer told the conference. This year it intends to build nine, he added.
