Sales and Profits Jump for Ingles in Q1, Aiding Debt Reduction

Ingles Markets said sales in its fiscal first quarter jumped by 10.4% and profits soared as it continues to reap the benefits of consumer behavior changes associated with the pandemic.

The Asheville, N.C.-based retailer, which operates 197 Ingles supermarkets in the Southeast, said sales for the quarter ending Dec. 26 totaled $1.19 billion. Gross profits of $314.2 million represented 26.4% of sales, up from 23.9% of sales in last year’s first quarter. Net earnings of $53.8 million, or $2.66 per diluted share, increased by 204% in the quarter.

“We are pleased with our results, and we all continue to work hard to provide a safe and reliable shopping environment for our associates and customers,” said Robert P. Ingle II, chairman of the board. “We are also honored to participate in the COVID-19 vaccine distribution.”

Ingles has used its recent financial windfall to strengthen its balance sheet, taking advantage of low interest rates to refinance loans and pay down debt. The company has reduced its total debt to $587.9 million at the end of the quarter vs. $850 million at the same point in 2019. During the most recent quarter Ingles incurred $3.7 million of debt extinguishment costs associated with $155 million of early repayment of debt.

Capital expenditures for the quarter totaled $34.2 million compared with $31.1 million for the December 2019 quarter. Ingles said its investment is focused on stores that opened this fiscal year as well as stores scheduled to open later.