MINNEAPOLIS -- Supervalu here said last week that roughly half the new distribution business the company picked up in the second quarter (a total of $400 million in annualized sales) came from former customers of its principal rival, Fleming, Dallas.
During a conference call with analysts following the release of the company's results for the second quarter ended Sept. 7, Jeff Noddle, Supervalu's chairman, president and chief executive officer, noted that the company had in the quarter started shipping to 22 additional SuperTarget stores (bringing the total number of SuperTargets it supplies up to 59) as well as to Clemens Family Markets, a 19-store chain based in Kulpsville, Pa.
"A good portion of the Target business did come from a win that we had with Fleming in negotiations several months ago," Noddle said. "We just started shipping that at the end of the quarter. Clemens also came from Fleming."
Noddle said Supervalu renewed its distribution agreement with Ukrop's Super Markets, Richmond, Va..
Also, Supervalu recently said it completed the acquisition of four Superfresh supermarkets in Maryland and Virginia from A&P, Montvale, N.J. The terms were not disclosed.
However, the accumulation of old and new distribution business was not enough to lift Supervalu's net sales, which fell 4.3% to $4.5 billion for the quarter and 11.2% to $10.3 billion for the first half.
Comparable-store sales declined 0.8% in the quarter, while net income rose 16.1% to $58.8 million and earnings per share were 44 cents vs. 38 cents in second-quarter 2001. Distribution sales were down 15.4% to $2.2 billion in the quarter, while retail sales rose 4.2%.
In the first half, comp-store sales declined 1%, while net income rose 26.5% to $136 million and earnings per share were $1.02 vs. 81 cents in first half 2001. Distribution sales for the half declined 22.4% to $5.3 billion, while retail sales were virtually flat, rising just 1.6% to $5.1 billion.
