SCHULTZ REPORTS RECORD NET EARNINGS FOR '97

GREG GATTUSO

SHEBOYGAN, Wis. -- Schultz Sav-O Stores, a wholesaler here that supplies 18 corporate and 68 franchised Piggly Wiggly supermarkets, reported record net earnings and earnings per share in its newly released annual report.

The company said the profitable year was driven by several factors, including:

Completion of the rollout of the Piggly Wiggly Preferred Club Card to all of its stores.

Improvements in corporate retail operations and profitability.

Acquisition of two stores in the Appleton, Wis., market.

Completion of one new-market franchise store, one replacement franchise store, a new-market corporate store, a franchise store converted from another wholesaler, the conversion of a franchise store to a corporate unit, and three franchise expansion projects.

Net earnings were $7.6 million, an increase of 18.1% over earnings of $6.5 million in 1996. Earnings per share increased 17.8% to $1.06, compared with 90 cents last year.

James H. Dickelman, chairman, president and chief executive officer, said the company has had 20 consecutive quarters showing earnings increases.

Sales increased 4.2% to $473 million, benefitting from a 53-week fiscal year, plus one new-store opening and the acquisition of three corporate stores in the fourth quarter.

"I am very proud of the dedicated group of employees and customers that collectively make up the Schultz Sav-O/Piggly Wiggly family," Dickelman said in the annual report. "Again this year, their enthusiasm, experience, creativity and hard work have helped move our company forward in so many areas."

Also in 1997, the company decided to outsource its private-label beverage production, rather than manufacture the product in-house. The move freed up management to focus on marketing and brand-building efforts, Dickelman said.

In addition, Schultz Sav-O Stores announced a 3-for-2 stock split and increased its quarterly cash dividend by 5% to 7 cents per share. The company's stock price rose 66%, from $9.33 to $15.50 by year-end.