Village Super Market, Inc. Sees Q1 Net Income Surge

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Village Super Market, Inc. Sees Q1 Net Income Surge

Village Super Market, Inc. yesterday posted net income for the first quarter of fiscal year 2009 ended Oct. 25, 2008 of $6,367,000, an increase of 48 percent from the year-ago period. Net income increased mainly because of higher sales and improved gross profit and operating expenses as a percentage of sales, noted the ShopRite operator.

Sales were $290,984,000 in quarter, a rise of 10.4 percent from last year. The company attributed the increase primarily to the opening of new stores in Galloway and Franklin, N.J. in October and November 2007, respectively. Same-store sales grew 4.2 percent, as a result of such factors as improved transaction count and average transaction size, and food inflation. These gains were partly offset, however, by lower sales in two locations because of cannibalization from the opening of the Galloway and Franklin stores.

Gross profit rose to 27.3 percent in quarter, compared with 26.6 percent last year, due to improved departmental gross margin percentages, lower promotional spending as a percentage of sales, and improved product mix.

Promotional spending decreased because less of the estimated cost of this year's Thanksgiving loyalty program was allocated to the quarter than in the prior year, as a result of changes in the program timing. Subsequently, the second quarter of fiscal 2009 will include a larger allocation of the Thanksgiving loyalty program than the year-ago period.

First-quarter operating and administrative expense dipped to 22.3 percent from 22.7 percent last year because of reduced payroll costs as a percentage of sales in fiscal 2009 and the prior year, among them store pre-opening costs, partly offset by increased utility costs.

Springfield, N.J.-based Village Super Market operates 25 supermarkets under the ShopRite banner in New Jersey and eastern Pennsylvania.