WILLIAMSVILLE, N.Y. — Tops Holding Corp. here said last week that ongoing sales growth at the former Penn Traffic stores it has converted to the Tops banner helped drive same-store sales gains of 3.6%, excluding gasoline, in the first quarter.
The company posted a loss of $2.1 million for the 16-week quarter, which ended April 23, vs. net income of $3.3 million in the year-ago period, which included a $9.9 million income-tax benefit. Operating income, however, increased to $17.6 million in the most recent period, vs. an operating loss of $2.9 million a year ago.
Total sales were up 7.9%, to $717.3 million, reflecting an additional four weeks of operations of the 55 retained Penn Traffic stores acquired last January and the addition of one new Tops store last summer, plus the same-store sales gain. Also impacting the year-over-year results was $33 million in sales reported in the year-ago first quarter from 24 acquired supermarkets that were either sold or closed in 2010.
Rick Mills, senior vice president and chief financial officer, told SN last week that the converted stores are continuing to see double-digit gains in same-store sales week after week.
“There was a lot of money that was spent introducing the rebannered stores, and it was a good strategy, and it worked,” he said.
Mills said the legacy Tops locations saw smaller same-store sales gains, about 0.5%, with traffic off about 3% and average ticket up about 3.5%.
“We are seeing increased basket sizes, partially due to trip consolidation, as the cost of fuel has gone up,” he said.
The company weathered the opening of six new Wal-Mart supercenters in its market late last year, Mills noted, saying the company is “very pleased” with the performance of its stores that compete with those supercenters.
He also said the company has been able to pass along product-cost inflation relatively quickly, which he attributed to the fact that media reports about commodity inflation had prepared consumers ahead of time for the shelf-price increases that were coming.