SCARBOROUGH, Maine -- Hannaford Bros. here said sales increased 5.8% and same-store sales turned positive in the first quarter ended April 2.
Net income totaled $11.1 million in the quarter, an increase of 13.2% if the effect of an accounting change is excluded from last year's first quarter. Net in the year-ago quarter included a $2.1 million credit for accounting changes.
The same-store sales increase of 2.1% (if the number is adjusted for the timing of the Easter holiday, it was a 0.9% increase) reversed six consecutive quarters of negative same-store sales movement.
Hugh G. Farrington, president and chief executive officer, said the quarter's same-store sales increase continued a same-store improvement trend that began in November. (Same-store sales, however, fell 0.6% in last year's fourth quarter.) Farrington also said Hannaford's lower gross-margin in the quarter was more than offset by lower selling, general and administrative expenses.
Gross margins fell 55 basis points to 24.22% of sales. SGA expense declined 68 basis points to 19.73% of sales.
Farrington said Hannaford firmly believes it must continue to offset lower gross margins with expense reductions if the company is to remain competitive.