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Penn Traffic Reports Higher Net Earnings in First Quarter

SYRACUSE, N.Y. - Penn Traffic Co. on Wednesday reported higher net earnings in the first quarter, due in part to slightly stronger same-store sales, improved profit margins, cost-cutting measures, and a decrease in interest expense.

Syracuse, N.Y.-based Penn Traffic, which operates about 215 stores including Big Bear and P&& Foods and Quality Markets, reported net income of $1.1 million, or 6 cents a share, compared with $200,000, or 1 cent a share in the year-earlier quarter, which was adjusted to reflect amortization of excess reorganization value. Excluding the adjustment, it had a net loss of $$27.1 million, or $1.35 a share, a year ago.

Sales at stores open at least a year increased 0.6 percent in the first quarter, while total revenues slipped 0.5 percent to $576.4 million.

"We are pleased with our same-store sales performance in the first quarter, which was achieved despite a challenging economic and competitive environment," said Joseph V. Fisher, Penn Traffic's president and CEO. "We continue to make steady progress in growing our sales and earnings, which is a tribute to the enthusiasm and determination with which our management and associates are implementing our long-term business strategies."

Penn Traffic said it will continue to make cost cuts during fiscal 2003, with a focus on reducing stolen perishable goods and supply chain costs. The company announced that by the end of the year, it expects to open new stores in Corning and Rome, N.Y., and Zanesville, Ohio, all of which will replace existing facilities, as well as an incremental new store in the Syracuse suburb of Fayetteville, N.Y. The company also expects to begin construction of two other new stores during the current fiscal year.
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