Sales at Weis Markets slow in third quarter

After a solid first-half finish, Weis Markets got off to a slow second-half start for fiscal 2023 as sales growth decelerated and earnings fell.

In the quarter ended Sept. 30, net sales inched up 0.8% to $1.16 billion from $1.15 billion a year earlier, Sunbury, Pennsylvania-based Weis reported after Monday’s market close. The Mid-Atlantic supermarket chain saw its sales pace tail off sequentially from 3.8% growth in the 2023 second quarter but, on an annual basis, build on an 8.2% uptick in the 2022 third quarter.

Comparable-store sales in Q3 2023 edged up 0.8% ( 1.1% excluding fuel) year over year, compared with increases of 3.5% ( 4.8% excluding fuel) in Q2 and 7.9% ( 6.7% excluding fuel) in Q3 2022. On a two-year stack, Q3 2023 comp sales were up 8.7% ( 7.8% excluding fuel) versus two-year growth of 12.5% ( 9.9% excluding fuel) in the prior-year period.

For the 39-week year to date, net sales rose 2.8% to $3.48 billion from $3.39 billion a year ago. Same-store sales for the period grew by 2.5% ( 3.1% excluding fuel) year over year and by 11.1% ( 9.9% excluding fuel) over two years.

Weis Markets’ sales figures reflect an ongoing relaxation in grocery price inflation from elevated levels last year. The latest data from the U.S. Bureau of Labor Statistics had the food-at-home Consumer Price Index as up 2.4% annually in September, down from 3% in August and 3.6% in July. Those levels had continued a slide from 13% in September, 13.5% in August and 13.1% in July of 2022.

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“Our 2023 results remain in line with our expectations despite a challenging marketplace of ongoing inflation, higher interest rates and declining government benefits,” Chairman, President and CEO Jonathan Weis said in a statement. “We are grateful to our associates for their hard work and commitment to serve our customers and drive efficiencies in our business.”

Weis noted that the grocer continues to see strong customer traction for its “Low, Low Price” savings program, which identifies products with reduced everyday pricing throughout the store via special red shelf tags.

Weis Markets launched “Low, Low Price” in January 2019 across grocery categories and has continued to expand the program, announcing additions such as fresh produce, frozen food and, more recently, the breakfast foods category this past summer. The retailer said in late June that customers had saved over $30 million on store- and national-brand products since the inception of the “Low, Low Price” program.

“During the quarter, we expanded our ‘Low, Low Price’ program, which now offers strong, everyday savings and values on more than 10,000 products,” Weis commented late Monday.

Related:Weis Markets sees Q2 earnings fall despite sales gains

“We also continue to make prudent reinvestments in long-term profitable growth, which benefits all our stakeholders now and in the years ahead,” he added. In late April, Weis Markets had announced an increased capital-expenditures budget of more than $160 million, including new store construction, store expansions and remodels, site acquisitions for future stores, new technology purchases, and distribution facility and transportation fleet upgrades.

At the bottom line, Weis Markets posted 2023 third-quarter net income of $23.2 million, or 86 cents per share, down from $28.7 million, or $1.07 per share, a year ago. Year-to-date net earnings came in at $83.3 million, or $3.10 per share, a decrease from $96.3 million, or $3.58 per share, in the prior-year period.

Currently, Weis Markets operates 197 stores in Pennsylvania, Maryland, Delaware, New Jersey, New York, West Virginia and Virginia, the same number as a year earlier.