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First-half sales up at Ingles Markets

Regional grocer reports increase in gross profit

Russell Redman

May 8, 2019

2 Min Read
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A second-quarter gain helped drive solid sales growth in the first half at Ingles Markets, which at the bottom line cycled through a prior-year benefit from federal tax reform.

Ingles said Wednesday that net sales totaled just over $1 billion for the quarter ended March 30, up 1.8% from $984.6 million a year earlier.

Retail grocery comparable-store sales, which exclude fuel, rose 3.4% and reflect increases in customer transactions and basket size, the Asheville, N.C.-based grocer said. Comp-store results also exclude the impact of the calendar shift for Easter, which this year occurred in April and will provide a lift in the third quarter, whereas last year the holiday took place in March and benefited second-quarter results, the retailer noted.

Gross profit came in at $244.3 million, up 3.9% year over year from $235.2 million. As a percentage of sales, gross profit was 24.4% in the 2019 quarter versus 23.9% a year ago.

Ingles posted second-quarter net earnings of $15 million, compared with $9.3 million in the prior-year period. Earnings per share (EPS) for Class A common stock was 76 cents (74 cents diluted) in the 2019 quarter versus 47 cents (46 cents diluted) a year earlier. The company’s Class B common stock had basic and diluted EPS of 69 cents, up from 43 cents in the 2018 period.

Related:Ingles Markets sees year-end gains

“We are pleased with this year’s sales growth brought about by the hard work of our associates,” Chairman Robert Ingle said in a statement. “We continue to make investments in our company that will benefit many future periods.”

In the 2019 first half, Ingles saw net sales rise 3.3% to $2.06 billion from $2 billion a year ago. Comp-store sales climbed 3.8%, excluding gasoline and the impact of the Easter calendar shift, as customer transaction count and size grew during the period.

Gross profit for the six months increased 4.8% to $502.7 million and was 24.4% as a percentage of sales, up from 24% for the 2018 first half.

Net income totaled $37.2 million versus $54.4 million in the 2018 period, which included a $26.7 million deferred tax benefit from federal tax reform. EPS for Class A common stock was $1.88 ($1.83 diluted) in the 2019 half compared with $2.76 cents ($2.69 diluted) a year ago. Ingles’ Class B common stock had basic and diluted EPS of $1.71 cents versus $2.51 in the 2018 period.

As of March 30, Ingles operated 198 supermarkets in North and South Carolina, Georgia, Tennessee, Alabama and Virginia, compared with 201 a year earlier. The company said that, during the 2019 quarter, it sold a former store property for a $3.2 million gain and recognized a $1.4 million reserve for a closed leased store.

Capital expenditures for the 2019 first half were $94.2 million, up from $88.8 million in the prior-year period, and are projected at $140 million to $180 million for the full fiscal year. Ingles said its capital spending includes stores scheduled to open later this year.

About the Author

Russell Redman

Senior Editor
Supermarket News

Russell Redman has served as senior editor at Supermarket News since April 2018, his second tour with the publication. In his current role, he handles daily news coverage for the SN website and contributes news and features for the print magazine, as well as participates in special projects, podcasts and webinars and attends industry events. Russ joined SN from Racher Press Inc.’s Chain Drug Review and Mass Market Retailers magazines, where he served as desk/online editor for more than nine years, covering the food/drug/mass retail sector. 

Russell Redman’s more than 30 years of experience in journalism span a range of editorial manager, editor, reporter/writer and digital roles at a variety of publications and websites covering a breadth of industries, including retailing, pharmacy/health care, IT, digital home, financial technology, financial services, real estate/commercial property, pro audio/video and film. He started his career in 1989 as a local news reporter and editor, covering community news and politics in Long Island, N.Y. His background also includes an earlier stint at Supermarket News as center store editor and then financial editor in the mid-1990s. Russ holds a B.A. in journalism (minor in political science) from Hofstra University, where he also earned a certificate in digital/social media marketing in November 2016.

Russell Redman’s experience:

Supermarket News - Informa
Senior Editor 
April 2018 - present

Chain Drug Review/Mass Market Retailers - Racher Press
Desk/Online Editor 
Sept. 2008 - March 2018

CRN magazine - CMP Media
Managing Editor
May 2000 - June 2007

Bank Systems & Technology - Miller Freeman
Executive Editor/Managing Editor
Dec. 1996 - May 2000

Supermarket News - Fairchild Publications
Financial Editor/Associate Editor
April 1995 - Dec. 1996 

Shopping Centers Today Magazine - ICSC 
Desk Editor/Assistant Editor
Dec. 1992 - April 1995

Testa Communications
Assistant Editor/Contributing Editor (Music & Sound Retailer, Post, Producer, Sound & Communications and DJ Times magazines)
Jan. 1991 - Dec. 1992 

American Banker/Bond Buyer
Copy Editor
Oct. 1990 - Jan. 1991 

This Week newspaper - Chanry Communications
Reporter/Editor
May 1989 - July 1990

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