Nash Finch Q1 Sales Down Nearly 7%
Minneapolis-based grocery distributor Nash Finch Co. reported total company sales for the first quarter of 2011 were $1.10 billion, compared to $1.18 billion in the prior-year quarter, a decrease of 6.8 percent.
“We are pleased with the year-over-year increase in our first quarter consolidated EBITDA and the improvements in consolidated EBITDA from each of our business segments, as well as the improvement in EBITDA as a percentage of sales,” said Alec Covington, Nash Finch president and CEO. “While the overall top line continues to be a challenge, we have focused on improving profitability through initiatives to increase margins, improve productivity and contain expenses.”
Net earnings for Q1 2011 were $7.5 million, or 57 cents per diluted share, as compared to net earnings of $7.9 million, or 59 cents per share, in the prior year quarter.
The military segment net sales decreased 0.4 percent in Q1 compared to last year. The company said this reflects a larger portion of military sales occurring from consignment sales, which are not included in reported net sales. The year-over-year increase in consignment sales was approximately $5.7 million during the quarter. Including the impact of consignment sales, comparable military sales increased 0.6 percent in Q1.
“I am impressed by the hard work and dedication of our military segment associates who maintained their high level of service to our military customers while bringing new facilities on line,” Covington said. “Our Bloomington [Minn.] facility was operational in less than three months, and we have already enjoyed new business captures.”
Q1 sales for the combined food distribution and retail segment decreased by 12.1 percent as compared to the prior year quarter. Total segment comparable sales were down 7.1 percent after excluding $34.5 million of sales attributable to the previously announced transition of a portion of a food distribution customer buying group to another supplier during 2010. The decrease in comparable sales was primarily due to a reduction in sales to existing wholesale customers in addition to a same-store sales decline of 3 percent in Nash Finch’s retail stores.
Total debt at the end of Q1 2011 increased by $23.3 million to $337.7 million since the end of fiscal 2010. The company continues to focus on effectively managing its balance sheet and is currently in compliance with all of its debt covenants.