Economy Still Dampening Sales for Unified

Regional wholesaler Unified Grocers, Inc. said that while the economy is still having a negative impact on sales, it is seeing some regional improvements, particularly in the Pacific Northwest.

"The economic situation is generating mixed results throughout the regions in which we operate," said Al Plamann, president and CEO, Unified Grocers, during an earnings conference call earlier. "In the Pacific Northwest, our upscale retail operators are outperforming other formats and are optimistic about the future. Many of our retailers throughout California, on the other hand, are continuing to experience sales and margin pressure and, in some cases, are aggressively implementing cost control measures.

The Los Angeles-based cooperative reported net sales of $933 million for its second fiscal quarter ended April 2, compared to $959.7 million last year. The wholesaler attributed its sales decrease principally to the ongoing general decline in economic conditions in the western U.S. and the weeks preceding Easter occurring in the third quarter of fiscal 2011 compared to the second quarter of fiscal 2010. The decrease in net sales was partially offset by additional sales generated from new customers in fiscal 2011.

Its earnings for the quarter were $2.3 million, down from $3.1 million last year.

Year-to-date, sales and earnings before patronage dividends decreased to $1.913 billion and 11.5 million, respectively, and net earnings decreased to $5.9 million compared to $6.8 million last year

"These mixed results also apply to inflation, which we believe will play a significant role in our results for the remainder of the year," said Plamann. "While we benefit from inventory gains, these gains often are offset by higher business costs -- such as healthcare -- and also by consumers trading down to lower priced products."

Los Angeles-based Unified Grocers is a retailer-owned wholesale grocery distributor that supplies independent retailers throughout the western United States.