Supervalu’s Q4 Results Show Sustained Growth

Supervalu Inc., coming off its best quarter in years at the end of 2014, again reported an increase in net sales of more than 10 percent in its fiscal fourth quarter, compared to last year, accounting for $4.36 billion while net earnings from continuing operations hit $36 million.

The Eden Prairie, Minn.-based wholesaler also posted gains in all three of its business units for the second consecutive quarter. Independent Business net sales increased more than 7 percent from last year, accounting for $1.96 billion. Save-A-Lot same-store sales were up nearly 4 percent while same-store sales for the Retail Food segment increased 1 percent.

“We finished the year with a strong quarter, highlighted by positive identical store sales at both Save-A-Lot and Retail Food as well as the transition of the first stores in our important new relationship with Haggen,” said President and CEO Sam Duncan. In December, Supervalu became the primary wholesaler to 64 Haggen stores in Oregon and Washington, following the retailer's acquisition of 146 stores as part of the Safeway/Albertsons merger.

“Overall, fiscal 2015 was a year of strategic investment in all three of our business segments and I’m pleased with how these investments have positioned us for growth in fiscal 2016,” Duncan added.

Gross profit Q4 was 15.1 percent of net sales or $661 million, an increase from last year’s $590 million gross profit. The increase was driven largely by lower logistics costs and a shift in business mix.

Q4 Results - Continuing Operations

Q4 net sales were $4.36 billion compared to $3.95 billion last year, an increase of $411 million, or 10.4 percent. Same-store sales in the Save-A-Lot network were positive 3.6 percent. Identical store sales for corporate stores within the Save-A-Lot network were positive 6.6 percent. Same-store sales in the Retail Food segment were positive 1.1 percent. Total sales within the Independent Business segment increased 7.4 percent.

Independent Business

Q4 Independent Business net sales were $1.96 billion, compared to $1.82 billion last year. Operating earnings in Q4 were $63 million, or 3.2 percent of net sales. Last year’s Independent Business operating earnings in Q4 were $54 million, or 3 percent of net sales, and included $4 million of employee severance costs. When adjusted for this item, Independent Business operating earnings in Q4 2014 were $58 million, or 3.2 percent of net sales.

Save-A-Lot

Q4 Save-A-Lot net sales were $1.14 billion, compared to $999 million last year, an increase of 13.7 percent. Same-store sales for corporate stores within the Save-A-Lot network were positive 6.6 percent.

Save-A-Lot operating earnings were $47 million, or 4.2 percent of net sales, and included $3 million of store closure charges. When adjusted for this item, Save-A-Lot operating earnings in Q4 of fiscal 2015 were $50 million, or 4.4 percent of net sales. Last year’s Save-A-Lot operating earnings were $43 million in the year-ago, or 4.3 percent of net sales. 

Retail Food

Q4 Retail Food net sales were $1.22 billion, compared to $1.09 billion last year, an increase of 12.5 percent. 

Retail Food operating earnings in Q4 were $44 million, or 3.6 percent of net sales. Last year’s Retail Food operating earnings were $38 million, or 3.5 percent of net sales, and included $2 million in employee severance costs. When adjusted for this item, Retail Food operating earnings in Q4 of fiscal 2014 were $40 million, or 3.6 percent of net sales.