FOOD LION NET UP 13%, SALES 4% IN 2ND QUARTER

SALISBURY, N.C. -- Food Lion here said last week net income increased 13.4% to $34.8 million in the second quarter ended June 18.

at the end of the current second quarter.

Same-store sales increased 2.8% in the quarter, which followed a 3% increase in the first quarter. Food Lion said the timing of the Easter holiday, which fell in the first quarter this year and the second quarter in 1993, negatively impacted the same-store sales result in the current quarter. Net income as a percentage of sales was 1.91%, which Food Lion said placed the chain in the top ranks of grocery chains nationwide.

Food Lion's sales and earnings have been under pressure since late 1992, when "PrimeTime Live" broadcast a report critical of the chain's sanitation procedures.

Tom Smith, chairman, president and chief executive officer, attributed the company's improved performance to, among other things, the decision to close 84 underperforming stores at the beginning of this year. Gross-profit margin increased 65 basis points in the quarter to 20.30% of sales, Food Lion reported. Selling, general and administrative expenses increased 24 basis points to 14.25% of sales.

2nd-QUARTER RESULTS

Qtr. Ended 6/18/94 6/19/93

Sales $1.82 billion $1.75 billion

Change 4.1%

Same-store 2.8%

Net Income $34.8 million $30.7 million

Change 13.4%

Net Inc/Share 7 cents 6 cents

24 Weeks 1994 1993

Sales $3.63 billion $3.41 billion

Change 6.4%

Net Income $66 million $52.6 million

Change 25.4%

Net Inc/Share 14 cents 11 cents