Competition, Economy Slow Sales at Gelson’s

LOS ANGELES — Increased competition and a slowing economy contributed to a sales decline of 2.7% during the second quarter that ended June 28 for Gelson’s Markets, parent company Arden Group here said Wednesday. The upscale chain said that rising costs for food and fuel “may have caused some of our customers to make some or all of their purchases from our competitors,” as sales fell to $116.6 million and same-store sales declined by 2.7%. Gelson’s said net income of $6.6 million, improved by 1.7%, and operating income increased 4% to $10.6 million, which the company attributed in part to decreased expenses for union health and pension plans, offset some by increased direct labor costs. For the 26-week period, net income increased 1.4% to $13.1 million on sales of $235.4 million, a 2% revenue decline.

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