Ingles Reports 'Strong Sales Performance' in Q2
Crediting tax reform, a rise in gas sales and Easter’s occurrence in March, Southeastern regional grocer Ingles Markets Inc. reported "strong sales performance" during the second quarter of fiscal 2018.
During the period, which ended March 31, net sales reached $984.6 million, a 4.1 percent increase from the $946.2 million logged last year. Net income totaled $9.3 million for the second quarter of fiscal 2018, compared with $9.2 million for the year-ago period.
Net sales came to $2 billion and net income was $54.4 million for the six months ended March 31, versus $1.93 billion and $23 million, respectively, last year.
Ingles Chairman Robert P. Ingle II also noted: “Our strong sales performance benefited from improvements in our store base and from the variety of products we carry. We listen to our customers and to our associates to ensure we are always focused on improvement.”
For Q2 2018, excluding gasoline sales and the effect of extra 2018 Easter sales, Ingles’ retail grocery comparable-store sales edged up 1.7 percent from the year-ago period. Gas sales, in both dollars and gallons, rose from the prior year’s Q2.
Gross profit for the grocer’s March 2018 quarter was $235.2 million, up from $228.1 million last year. Ingles’ gross profit, as a percentage of sales, was 23.9 percent for the March 2018 quarter compared with 24.1 percent for the March 2017 quarter. Excluding gas sales, retail gross margin rose 15 basis points from the March 2017 to the March 2018 fiscal quarters.
The company’s effective tax rate was 23.8 percent for the March 2018 quarter versus 35.1 percent last year, thanks to the lower maximum corporate federal tax rate enacted in December 2017.
1st Half Performance
For the first half of fiscal 2018, Ingles’ retail comps, excluding the effect of gasoline and extra 2018 Easter sales, rose 1.9 percent. Excluding gas sales, the number of the grocer’s customer transactions was level, while the comparable average transaction size grew 2.6 percent from the year-ago period.
Capital expenditures for Ingles’ March 2018 six-month period totaled $88.8 million, compared with $59.4 million for the year-ago period. According to the company, it’s focusing on stores that have already opened this fiscal year as well as stores scheduled to open later in the year. Ingles also continues to make improvements to its existing store base. The grocer said it expects to spend about $140 million to $160 million on cap ex for the entire fiscal year.
Asheville, N.C.-based Ingles operates 201 supermarkets in six states, as well as operating neighborhood shopping centers, most of which contain an Ingles supermarket. The company also owns a fluid dairy facility that supplies its own supermarkets and unaffiliated customers.