Publix Comps Increase by 2.4% in Q1; Margins Dip

So far, so good as Publix Super Markets encounters the COVID bump. The retailer posted a sales gain of 3.9% in its fiscal quarter, helped along by new stores and a 2.4% comparable-store sales increase from last year’s first quarter, which included the early weeks of heavy shopping volumes driven by the onset of the coronavirus pandemic.

For the period, which ended March 27, the Lakeland, Fla.-based supermarket retailer said sales totaled $11.2 billion and net earnings were $1.5 billion—a 124% increase from last year’s first quarter. Net earnings were impacted by unrealized gains in equity securities this quarter vs. a loss last year. Excluding those effects, net earnings dipped by 4.9%.

Effects of lapping heavy volumes last year also showed up in reduced gross margins and operating profits, a filing showed. Gross margins dipped to 28.1% of sales from 28.4% last year, due to a decrease in COVID-related shrink benefits and volume efficiencies. Operating profit was 9% vs. 10.3% last year.

Publix as of March 27 operated 1,269 supermarkets in Florida, Georgia, Alabama, South Carolina, North Carolina, Tennessee and Virginia. In the quarter, it opened eight new supermarkets (including one replacement supermarket) and remodeled 44. Three supermarkets were closed during the period, including the one that was replaced; the other two closed stores will be replaced in a subsequent period.

Effective May 1, Publix’s stock price increased from $60.20 per share to $61.30 per share. Publix stock is not publicly traded and is made available for sale only to current Publix associates and members of its board of directors.

“While our country is taking steps to return to normal, our associates continue to provide the premier service that brings comfort to our customers,” Publix CEO Todd Jones said in a statement. “I want to thank our associates for their extraordinary efforts since the beginning of the pandemic.”