SpartanNash Announces Third Quarter Fiscal 2024 Results
Updates Fiscal 2024 Guidance and Provides Preview of Fiscal 2025
Retail Segment Sales Increased 1.9% Supported by Inorganic Growth
GRAND RAPIDS, Mich.,
"Our team made significant progress on our strategic plans this past quarter, while sustaining profitability in a complex environment," said
Third Quarter Fiscal 2024 Highlights (1)
- Net sales decreased 0.6% to
$2.25 billion , driven by lower volume in the Wholesale segment, partially offset by an increase in volume in the Retail segment.- Wholesale segment net sales decreased 1.6% to
$1.58 billion primarily due to reduced case volumes in both the independent retailers and national accounts customer channels. - Retail segment net sales increased 1.9% to
$674.6 million , while comparable store sales were down 0.7%. Incremental sales from the recently acquired Metcalfe's Market stores more than offset lower consumer demand trends.
- Wholesale segment net sales decreased 1.6% to
- Net earnings were
$0.32 per diluted share in both the current and prior year quarters.- Increased Wholesale segment gross margin rates, including benefits from the merchandising transformation, and lower corporate administrative costs, as well as reduced LIFO expense were offset by lower case volumes, higher restructuring charges, increased healthcare costs, and increased Retail segment store labor.
- Adjusted EPS(2) of
$0.48 , compared to$0.54 . Adjusted EBITDA(3) of$60.5 million , compared to$60.9 million . These measures exclude, among other items, restructuring charges and the impact of the LIFO provision.
Other Fiscal 2024 Highlights (4)
- Cash generated from operating activities of
$123.3 million compared to$95.7 million . The 28.8% increase in cash from operating activities is due primarily to ongoing working capital management initiatives. - Net long-term debt(5) to adjusted EBITDA(5) ratio of 2.4x compared to 2.2x at the end of the second quarter.
- Capital expenditures and IT capital(6) of
$106.3 million compared to$90.3 million . - Returned
$37.7 million to shareholders through$15.1 million in share repurchases and$22.6 million in dividends.
|
(1) |
All comparisons are for the third quarter of 2024 compared with the third quarter of 2023, unless otherwise noted. |
|
(2) |
A reconciliation of net earnings to adjusted earnings from continuing operations, as well as per diluted share ("adjusted EPS"), a non-GAAP financial measure, is provided in Table 3. |
|
(3) |
A reconciliation of net earnings to adjusted EBITDA, a non-GAAP financial measure, is provided in Table 2. |
|
(4) |
All comparisons are for the fiscal year-to-date 2024 compared with the fiscal year-to-date 2023, unless otherwise noted. |
|
(5) |
A reconciliation of long-term debt and finance lease obligations to net long-term debt and Net Earnings to Adjusted EBITDA, non-GAAP financial measures, are provided in Table 4. |
|
(6) |
A reconciliation of purchases of property and equipment to capital expenditures and IT capital, a non-GAAP financial measure, is provided in Table 5. |
Fiscal 2024 Outlook
Based on the Company's performance to date and the current outlook for the remainder of fiscal 2024, the Company is updating its guidance to reflect current trends and market conditions. The following table provides the Company's updated guidance for fiscal 2024:
|
|
Fiscal 2023 |
|
|
Previous Fiscal 2024 Outlook |
|
|
Updated Fiscal 2024 Outlook |
|
||||||||||||||||
|
(In millions, except adjusted EPS(2)) |
Actual |
|
|
Low |
|
|
High |
|
|
Low |
|
|
High |
|
||||||||||
|
Total net sales |
$ |
|
9,729 |
|
|
$ |
|
9,500 |
|
|
$ |
|
9,700 |
|
|
$ |
|
9,500 |
|
|
$ |
|
9,700 |
|
|
Adjusted EBITDA(3) |
$ |
|
257 |
|
|
$ |
|
255 |
|
|
$ |
|
270 |
|
|
$ |
|
252 |
|
|
$ |
|
257 |
|
|
Adjusted EPS(2) |
$ |
|
2.18 |
|
|
$ |
|
1.85 |
|
|
$ |
|
2.10 |
|
|
$ |
|
1.85 |
|
|
$ |
|
1.95 |
|
|
Capital expenditures and IT capital(6) |
$ |
|
127 |
|
|
$ |
|
135 |
|
|
$ |
|
145 |
|
|
$ |
|
135 |
|
|
$ |
|
140 |
|
Guidance incorporates the Company's long-term strategic initiatives, including all transformational programs and tuck-in acquisitions.
Considering the impact of current market conditions tempered by ongoing investments in growth, in fiscal 2025 the Company expects low-single-digit topline growth and mid-single-digit adjusted EBITDA growth compared to fiscal 2024. The Company plans to provide its full fiscal 2025 outlook when it announces its fourth quarter and fiscal 2024 results in
Conference Call & Supplemental Earnings Presentation
The Company will host a conference call to discuss its quarterly results with additional comments and details on
A supplemental quarterly earnings presentation will also be available on the Company's website at spartannash.com/investor-presentations.
About
Forward-Looking Statements
The matters discussed in this press release and in the Company's website-accessible conference calls with analysts and investor presentations include "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended ("Exchange Act"), about the plans, strategies, objectives, goals or expectations of the Company. These forward-looking statements may be identifiable by words or phrases indicating that the Company or management "expects," "projects," "anticipates," "plans," "believes," "intends," or "estimates," or that a particular occurrence or event "may," "could," "should," "will" or "will likely" result, occur or be pursued or "continue" in the future, that the "outlook," "trend," "guidance" or "target" is toward a particular result or occurrence, that a development is an "opportunity," "priority," "strategy," "focus," that the Company is "positioned" for a particular result, or similarly stated expectations. Undue reliance should not be placed on these forward-looking statements, which speak only as of the date made. Forward-looking statements are necessarily based on estimates and assumptions that are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which, with respect to future business decisions, are subject to change. These uncertainties and contingencies may affect actual results and could cause actual results to differ materially. These risks and uncertainties include the Company's ability to compete in an extremely competitive industry; the Company's dependence on certain major customers; the Company's ability to implement its growth strategy and transformation initiatives; the Company's ability to implement its growth strategy through acquisitions and successfully integrate acquired businesses; disruptions to the Company's information security network, including security breaches and cyber-attacks; impacts to the availability and performance of the Company's information technology systems; changes in relationships with the Company's vendor base; changes in product availability and product pricing from vendors; macroeconomic uncertainty, including rising inflation, potential economic recession, and increasing interest rates; difficulty attracting and retaining well-qualified Associates and effectively managing increased labor costs; failure to successfully retain or manage transitions with executive leaders and other key personnel; impacts to the Company's business and reputation due to an increasing focus on environmental, social and governance matters; customers to whom the Company extends credit or for whom the Company guarantees loans may fail to repay the Company; changes in the geopolitical conditions; disruptions associated with severe weather conditions and natural disasters, including effects from climate change; disruptions associated with disease outbreaks; the Company's ability to manage its private brand program for
INVESTOR CONTACT:
Head of Investor Relations
kayleigh.campbell@spartannash.com
MEDIA CONTACT:
Adrienne Chance
SVP and Chief Communications Officer
press@spartannash.com
|
SPARTANNASH COMPANY AND SUBSIDIARIES |
|||||||||||||||||||
|
|
|||||||||||||||||||
|
|
12 Weeks Ended |
|
|
40 Weeks Ended |
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
(In thousands, except per share amounts) |
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||||||
|
Net sales |
$ |
|
2,250,681 |
|
|
$ |
|
2,264,248 |
|
|
$ |
|
7,287,700 |
|
|
$ |
|
7,484,036 |
|
|
Cost of sales |
|
|
1,896,032 |
|
|
|
|
1,916,709 |
|
|
|
|
6,139,704 |
|
|
|
|
6,337,449 |
|
|
Gross profit |
|
|
354,649 |
|
|
|
|
347,539 |
|
|
|
|
1,147,996 |
|
|
|
|
1,146,587 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative |
|
|
324,061 |
|
|
|
|
322,796 |
|
|
|
|
1,045,851 |
|
|
|
|
1,059,787 |
|
|
Acquisition and integration, net |
|
|
272 |
|
|
|
|
2,130 |
|
|
|
|
3,212 |
|
|
|
|
2,259 |
|
|
Restructuring and asset impairment, net |
|
|
5,397 |
|
|
|
|
(458) |
|
|
|
|
17,272 |
|
|
|
|
1,371 |
|
|
Total operating expenses |
|
|
329,730 |
|
|
|
|
324,468 |
|
|
|
|
1,066,335 |
|
|
|
|
1,063,417 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating earnings |
|
|
24,919 |
|
|
|
|
23,071 |
|
|
|
|
81,661 |
|
|
|
|
83,170 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other expenses and (income) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net |
|
|
9,915 |
|
|
|
|
9,280 |
|
|
|
|
33,943 |
|
|
|
|
30,218 |
|
|
Other, net |
|
|
(216) |
|
|
|
|
(786) |
|
|
|
|
(1,814) |
|
|
|
|
(2,510) |
|
|
Total other expenses, net |
|
|
9,699 |
|
|
|
|
8,494 |
|
|
|
|
32,129 |
|
|
|
|
27,708 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings before income taxes |
|
|
15,220 |
|
|
|
|
14,577 |
|
|
|
|
49,532 |
|
|
|
|
55,462 |
|
|
Income tax expense |
|
|
4,300 |
|
|
|
|
3,450 |
|
|
|
|
14,152 |
|
|
|
|
13,530 |
|
|
Net earnings |
$ |
|
10,920 |
|
|
$ |
|
11,127 |
|
|
$ |
|
35,380 |
|
|
$ |
|
41,932 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings per basic common share |
$ |
|
0.33 |
|
|
$ |
|
0.33 |
|
|
$ |
|
1.05 |
|
|
$ |
|
1.22 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings per diluted common share |
$ |
|
0.32 |
|
|
$ |
|
0.32 |
|
|
$ |
|
1.03 |
|
|
$ |
|
1.20 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
33,580 |
|
|
|
|
34,020 |
|
|
|
|
33,847 |
|
|
|
|
34,262 |
|
|
Diluted |
|
|
34,102 |
|
|
|
|
34,523 |
|
|
|
|
34,266 |
|
|
|
|
34,967 |
|
|
SPARTANNASH COMPANY AND SUBSIDIARIES |
|||||||||
|
|
|||||||||
|
|
|
|
|
|
|
||||
|
(In thousands) |
2024 |
|
|
2023 |
|
||||
|
Assets |
|
|
|
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
$ |
|
17,510 |
|
|
$ |
|
17,964 |
|
|
Accounts and notes receivable, net |
|
|
490,131 |
|
|
|
|
421,859 |
|
|
Inventories, net |
|
|
557,955 |
|
|
|
|
575,226 |
|
|
Prepaid expenses and other current assets |
|
|
74,167 |
|
|
|
|
62,440 |
|
|
Total current assets |
|
|
1,139,763 |
|
|
|
|
1,077,489 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Property and equipment, net |
|
|
668,927 |
|
|
|
|
649,071 |
|
|
Goodwill |
|
|
190,023 |
|
|
|
|
182,160 |
|
|
Intangible assets, net |
|
|
101,817 |
|
|
|
|
101,535 |
|
|
Operating lease assets |
|
|
259,890 |
|
|
|
|
242,146 |
|
|
Other assets, net |
|
|
107,013 |
|
|
|
|
103,174 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets |
$ |
|
2,467,433 |
|
|
$ |
|
2,355,575 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Shareholders ' Equity |
|
|
|
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
|
|
|
|
Accounts payable |
$ |
|
513,577 |
|
|
$ |
|
473,419 |
|
|
Accrued payroll and benefits |
|
|
70,516 |
|
|
|
|
78,076 |
|
|
Other accrued expenses |
|
|
65,432 |
|
|
|
|
57,609 |
|
|
Current portion of operating lease liabilities |
|
|
42,355 |
|
|
|
|
41,979 |
|
|
Current portion of long-term debt and finance lease liabilities |
|
|
9,747 |
|
|
|
|
8,813 |
|
|
Total current liabilities |
|
|
701,627 |
|
|
|
|
659,896 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term liabilities |
|
|
|
|
|
|
|
|
|
|
Deferred income taxes |
|
|
85,660 |
|
|
|
|
73,904 |
|
|
Operating lease liabilities |
|
|
245,270 |
|
|
|
|
226,118 |
|
|
Other long-term liabilities |
|
|
26,611 |
|
|
|
|
28,808 |
|
|
Long-term debt and finance lease liabilities |
|
|
626,957 |
|
|
|
|
588,667 |
|
|
Total long-term liabilities |
|
|
984,498 |
|
|
|
|
917,497 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Commitments and contingencies |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders ' equity |
|
|
|
|
|
|
|
|
|
|
Common stock, voting, no par value; 100,000 shares authorized; 33,755 and 34,610 shares outstanding |
|
|
452,024 |
|
|
|
|
460,299 |
|
|
Preferred stock, no par value, 10,000 shares authorized; no shares outstanding |
|
|
— |
|
|
|
|
— |
|
|
Accumulated other comprehensive (loss) income |
|
|
(325) |
|
|
|
|
796 |
|
|
Retained earnings |
|
|
329,609 |
|
|
|
|
317,087 |
|
|
Total shareholders ' equity |
|
|
781,308 |
|
|
|
|
778,182 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and shareholders ' equity |
$ |
|
2,467,433 |
|
|
$ |
|
2,355,575 |
|
|
SPARTANNASH COMPANY AND SUBSIDIARIES |
||||||||||||
|
|
||||||||||||
|
|
|
|
|
40 Weeks Ended |
|
|||||||
|
(In thousands) |
|
|
|
|
|
|
|
|
||||
|
Cash flow activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities |
|
|
|
$ |
|
123,255 |
|
|
$ |
|
95,680 |
|
|
Net cash used in investing activities |
|
|
|
|
|
(110,652) |
|
|
|
|
(82,003) |
|
|
Net cash used in financing activities |
|
|
|
|
|
(13,057) |
|
|
|
|
(25,209) |
|
|
Net decrease in cash and cash equivalents |
|
|
|
|
|
(454) |
|
|
|
|
(11,532) |
|
|
Cash and cash equivalents at beginning of the period |
|
|
|
|
|
17,964 |
|
|
|
|
29,086 |
|
|
Cash and cash equivalents at end of the period |
|
|
|
$ |
|
17,510 |
|
|
$ |
|
17,554 |
|
|
SPARTANNASH COMPANY AND SUBSIDIARIES |
|||||||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||||||
|
Table 1: Sales and Operating Earnings by Segment |
|||||||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||||||
|
|
12 Weeks Ended |
|
|
40 Weeks Ended |
|
||||||||||||||||||||||||||
|
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
|
Wholesale Segment: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales |
$ |
|
1,576,082 |
|
|
70.0 |
% |
|
$ |
|
1,602,000 |
|
|
70.8 |
% |
|
$ |
|
5,144,731 |
|
|
70.6 |
% |
|
$ |
|
5,321,048 |
|
|
71.1 |
% |
|
Operating earnings |
|
|
21,054 |
|
|
|
|
|
|
|
18,153 |
|
|
|
|
|
|
|
79,123 |
|
|
|
|
|
|
|
66,020 |
|
|
|
|
|
Retail Segment: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales |
|
|
674,599 |
|
|
30.0 |
% |
|
|
|
662,248 |
|
|
29.2 |
% |
|
|
|
2,142,969 |
|
|
29.4 |
% |
|
|
|
2,162,988 |
|
|
28.9 |
% |
|
Operating earnings |
|
|
3,865 |
|
|
|
|
|
|
|
4,918 |
|
|
|
|
|
|
|
2,538 |
|
|
|
|
|
|
|
17,150 |
|
|
|
|
|
Total: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales |
$ |
|
2,250,681 |
|
|
100.0 |
% |
|
$ |
|
2,264,248 |
|
|
100.0 |
% |
|
$ |
|
7,287,700 |
|
|
100.0 |
% |
|
$ |
|
7,484,036 |
|
|
100.0 |
% |
|
Operating earnings |
|
|
24,919 |
|
|
|
|
|
|
|
23,071 |
|
|
|
|
|
|
|
81,661 |
|
|
|
|
|
|
|
83,170 |
|
|
|
|
Non-GAAP Financial Measures
In addition to reporting financial results in accordance with GAAP, the Company also provides information regarding adjusted earnings from continuing operations, as well as per diluted share ("adjusted EPS"), net long-term debt, capital expenditures and IT capital, and adjusted earnings before interest, taxes, depreciation and amortization ("adjusted EBITDA"). These are non-GAAP financial measures, as defined below, and are used by management to allocate resources, assess performance against its peers and evaluate overall performance. The Company believes these measures provide useful information for both management and its investors. The Company believes these non-GAAP measures are useful to investors because they provide additional understanding of the trends and special circumstances that affect its business. These measures provide useful supplemental information that helps investors to establish a basis for expected performance and the ability to evaluate actual results against that expectation. The measures, when considered in connection with GAAP results, can be used to assess the overall performance of the Company as well as assess the Company's performance against its peers. These measures are also used as a basis for certain compensation programs sponsored by the Company. In addition, securities analysts, fund managers and other shareholders and stakeholders that communicate with the Company request its financial results in these adjusted formats.
Current year adjusted earnings from continuing operations, and adjusted EBITDA exclude, among other items, LIFO expense, organizational realignment, severance associated with cost reduction initiatives, operating and non-operating costs associated with the postretirement plan amendment and settlement and a non-operating benefit associated with a pension refund from an annuity provider. Current year organizational realignment includes consulting and severance costs associated with the Company's change in its go-to-market strategy as part of its long-term plan, which relates to the reorganization of certain functions. Costs related to the postretirement plan amendment and settlement include operating and non-operating expenses associated with amortization of the prior service credit related to the amendment of the retiree medical plan, which are adjusted out of adjusted earnings from continuing operations. Postretirement plan amendment and settlement costs also include operating expenses related to payroll taxes which are adjusted out of all non-GAAP financial measures. The pension refund from an annuity provider is related to a terminated pension plan and is a non-operating benefit which is adjusted out of adjusted earnings from continuing operations. Prior year adjusted earnings from continuing operations, and adjusted EBITDA exclude, among other items, LIFO expense, organizational realignment, severance associated with cost reduction initiatives and a non-routine settlement related to a legal matter resulting from a previously closed operation that was resolved during the prior year and operating and non-operating costs associated with the postretirement plan amendment and settlement.
Each of these items are considered "non-operational" or "non-core" in nature.
The Company is unable to provide a full reconciliation of the GAAP to non-GAAP measures used in the Fiscal 2024 Outlook section of this press release without unreasonable effort because it is not possible to predict certain adjustment items with a reasonable degree of certainty since they are not yet known or quantifiable, and do not relate to the Company's normal operating activities. These adjustments may include, among other items, restructuring and asset impairment activity, acquisition and integration costs, severance, costs related to the postretirement plan amendment and settlement, and organizational realignment costs, and the impact of adjustments to the LIFO inventory reserve. This information is dependent upon future events, which may be outside of the Company's control and could have a significant impact on its GAAP financial results for fiscal 2024.
|
Table 2: Reconciliation of Net Earnings to Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization |
|||||||||||||||||||
|
|
|||||||||||||||||||
|
|
12 Weeks Ended |
|
|
40 Weeks Ended |
|
||||||||||||||
|
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Net earnings |
$ |
|
10,920 |
|
|
$ |
|
11,127 |
|
|
$ |
|
35,380 |
|
|
$ |
|
41,932 |
|
|
Income tax expense |
|
|
4,300 |
|
|
|
|
3,450 |
|
|
|
|
14,152 |
|
|
|
|
13,530 |
|
|
Other expenses, net |
|
|
9,699 |
|
|
|
|
8,494 |
|
|
|
|
32,129 |
|
|
|
|
27,708 |
|
|
Operating earnings |
|
|
24,919 |
|
|
|
|
23,071 |
|
|
|
|
81,661 |
|
|
|
|
83,170 |
|
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIFO expense |
|
|
1,517 |
|
|
|
|
6,606 |
|
|
|
|
5,046 |
|
|
|
|
22,445 |
|
|
Depreciation and amortization |
|
|
24,159 |
|
|
|
|
23,042 |
|
|
|
|
78,147 |
|
|
|
|
75,245 |
|
|
Acquisition and integration, net |
|
|
272 |
|
|
|
|
2,130 |
|
|
|
|
3,212 |
|
|
|
|
2,259 |
|
|
Restructuring and asset impairment, net |
|
|
5,397 |
|
|
|
|
(458) |
|
|
|
|
17,272 |
|
|
|
|
1,371 |
|
|
Cloud computing amortization |
|
|
1,748 |
|
|
|
|
1,259 |
|
|
|
|
5,606 |
|
|
|
|
3,685 |
|
|
Organizational realignment, net |
|
|
240 |
|
|
|
|
2,681 |
|
|
|
|
1,915 |
|
|
|
|
4,710 |
|
|
Severance associated with cost reduction initiatives |
|
|
279 |
|
|
|
|
39 |
|
|
|
|
420 |
|
|
|
|
311 |
|
|
Stock-based compensation |
|
|
2,519 |
|
|
|
|
2,461 |
|
|
|
|
8,139 |
|
|
|
|
10,073 |
|
|
Stock warrant |
|
|
184 |
|
|
|
|
319 |
|
|
|
|
700 |
|
|
|
|
1,279 |
|
|
Non-cash rent |
|
|
(655) |
|
|
|
|
(531) |
|
|
|
|
(2,281) |
|
|
|
|
(2,094) |
|
|
(Gain) loss on disposal of assets |
|
|
(92) |
|
|
|
|
258 |
|
|
|
|
(48) |
|
|
|
|
304 |
|
|
Legal settlement |
|
|
— |
|
|
|
|
— |
|
|
|
|
— |
|
|
|
|
900 |
|
|
Postretirement plan amendment and settlement |
|
|
— |
|
|
|
|
— |
|
|
|
|
99 |
|
|
|
|
94 |
|
|
Adjusted EBITDA |
$ |
|
60,487 |
|
|
$ |
|
60,877 |
|
|
$ |
|
199,888 |
|
|
$ |
|
203,752 |
|
|
Wholesale: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating earnings |
$ |
|
21,054 |
|
|
$ |
|
18,153 |
|
|
$ |
|
79,123 |
|
|
$ |
|
66,020 |
|
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIFO expense |
|
|
1,153 |
|
|
|
|
4,411 |
|
|
|
|
3,861 |
|
|
|
|
16,734 |
|
|
Depreciation and amortization |
|
|
12,747 |
|
|
|
|
12,151 |
|
|
|
|
41,126 |
|
|
|
|
39,165 |
|
|
Acquisition and integration, net |
|
|
71 |
|
|
|
|
65 |
|
|
|
|
2,048 |
|
|
|
|
189 |
|
|
Restructuring and asset impairment, net |
|
|
6,824 |
|
|
|
|
(293) |
|
|
|
|
6,792 |
|
|
|
|
688 |
|
|
Cloud computing amortization |
|
|
1,098 |
|
|
|
|
834 |
|
|
|
|
3,622 |
|
|
|
|
2,499 |
|
|
Organizational realignment, net |
|
|
148 |
|
|
|
|
1,673 |
|
|
|
|
1,194 |
|
|
|
|
2,939 |
|
|
Severance associated with cost reduction initiatives |
|
|
131 |
|
|
|
|
39 |
|
|
|
|
230 |
|
|
|
|
296 |
|
|
Stock-based compensation |
|
|
1,711 |
|
|
|
|
1,621 |
|
|
|
|
5,572 |
|
|
|
|
6,615 |
|
|
Stock warrant |
|
|
184 |
|
|
|
|
319 |
|
|
|
|
700 |
|
|
|
|
1,279 |
|
|
Non-cash rent |
|
|
(246) |
|
|
|
|
— |
|
|
|
|
(789) |
|
|
|
|
(138) |
|
|
(Gain) loss on disposal of assets |
|
|
(108) |
|
|
|
|
24 |
|
|
|
|
(127) |
|
|
|
|
(11) |
|
|
Legal settlement |
|
|
— |
|
|
|
|
— |
|
|
|
|
— |
|
|
|
|
900 |
|
|
Postretirement plan amendment and settlement |
|
|
— |
|
|
|
|
— |
|
|
|
|
62 |
|
|
|
|
59 |
|
|
Adjusted EBITDA |
$ |
|
44,767 |
|
|
$ |
|
38,997 |
|
|
$ |
|
143,414 |
|
|
$ |
|
137,234 |
|
|
Retail: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating earnings |
$ |
|
3,865 |
|
|
$ |
|
4,918 |
|
|
$ |
|
2,538 |
|
|
$ |
|
17,150 |
|
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIFO expense |
|
|
364 |
|
|
|
|
2,195 |
|
|
|
|
1,185 |
|
|
|
|
5,711 |
|
|
Depreciation and amortization |
|
|
11,412 |
|
|
|
|
10,891 |
|
|
|
|
37,021 |
|
|
|
|
36,080 |
|
|
Acquisition and integration, net |
|
|
201 |
|
|
|
|
2,065 |
|
|
|
|
1,164 |
|
|
|
|
2,070 |
|
|
Restructuring and asset impairment, net |
|
|
(1,427) |
|
|
|
|
(165) |
|
|
|
|
10,480 |
|
|
|
|
683 |
|
|
Cloud computing amortization |
|
|
650 |
|
|
|
|
425 |
|
|
|
|
1,984 |
|
|
|
|
1,186 |
|
|
Organizational realignment, net |
|
|
92 |
|
|
|
|
1,008 |
|
|
|
|
721 |
|
|
|
|
1,771 |
|
|
Severance associated with cost reduction initiatives |
|
|
148 |
|
|
|
|
— |
|
|
|
|
190 |
|
|
|
|
15 |
|
|
Stock-based compensation |
|
|
808 |
|
|
|
|
840 |
|
|
|
|
2,567 |
|
|
|
|
3,458 |
|
|
Non-cash rent |
|
|
(409) |
|
|
|
|
(531) |
|
|
|
|
(1,492) |
|
|
|
|
(1,956) |
|
|
Loss on disposal of assets |
|
|
16 |
|
|
|
|
234 |
|
|
|
|
79 |
|
|
|
|
315 |
|
|
Postretirement plan amendment and settlement |
|
|
— |
|
|
|
|
— |
|
|
|
|
37 |
|
|
|
|
35 |
|
|
Adjusted EBITDA |
$ |
|
15,720 |
|
|
$ |
|
21,880 |
|
|
$ |
|
56,474 |
|
|
$ |
|
66,518 |
|
|
Table 2: Reconciliation of Net Earnings to Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization, continued |
|||||||||||||
|
|
|||||||||||||
|
|
52 Weeks Ended |
|
|
|
|
|
|
|
|
|
|
||
|
(In thousands) |
2023 |
|
|
|
|
|
|
|
|
|
|
||
|
Net earnings |
$ |
|
52,237 |
|
|
|
|
|
|
|
|
|
|
|
Income tax expense |
|
|
17,888 |
|
|
|
|
|
|
|
|
|
|
|
Other expenses, net |
|
|
36,587 |
|
|
|
|
|
|
|
|
|
|
|
Operating earnings |
|
|
106,712 |
|
|
|
|
|
|
|
|
|
|
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIFO expense |
|
|
16,104 |
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
98,639 |
|
|
|
|
|
|
|
|
|
|
|
Acquisition and integration, net |
|
|
3,416 |
|
|
|
|
|
|
|
|
|
|
|
Restructuring and asset impairment, net |
|
|
9,190 |
|
|
|
|
|
|
|
|
|
|
|
Cloud computing amortization |
|
|
5,034 |
|
|
|
|
|
|
|
|
|
|
|
Organizational realignment, net |
|
|
5,239 |
|
|
|
|
|
|
|
|
|
|
|
Severance associated with cost reduction initiatives |
|
|
318 |
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation |
|
|
12,536 |
|
|
|
|
|
|
|
|
|
|
|
Stock warrant |
|
|
1,559 |
|
|
|
|
|
|
|
|
|
|
|
Non-cash rent |
|
|
(2,599) |
|
|
|
|
|
|
|
|
|
|
|
Loss on disposal of assets |
|
|
259 |
|
|
|
|
|
|
|
|
|
|
|
Legal settlement |
|
|
900 |
|
|
|
|
|
|
|
|
|
|
|
Postretirement plan amendment and settlement |
|
|
94 |
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA |
$ |
|
257,401 |
|
|
|
|
|
|
|
|
|
|
Notes: Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("adjusted EBITDA") is a non-GAAP operating financial measure that the Company defines as net earnings plus interest, discontinued operations, depreciation and amortization, and other non-cash items including share-based payments (equity awards measured in accordance with ASC 718, Stock Compensation, which include both stock-based compensation to employees and stock warrants issued to non-employees) and the LIFO provision, as well as adjustments for items that do not reflect the ongoing operating activities of the Company.
Adjusted EBITDA and adjusted EBITDA by segment are not measures of performance under GAAP and should not be considered as a substitute for net earnings, cash flows from operating activities and other income or cash flow statement data. The Company's definitions of adjusted EBITDA and adjusted EBITDA by segment may not be identical to similarly titled measures reported by other companies.
|
Table 3: Reconciliation of Net Earnings to |
|||||||||||||||||||||
|
|
|||||||||||||||||||||
|
|
12 Weeks Ended |
|
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
per diluted |
|
|
|
|
|
|
per diluted |
|
|
||||||||
|
(In thousands, except per share amounts) |
Earnings |
|
|
share |
|
|
|
Earnings |
|
|
share |
|
|
||||||||
|
Net earnings |
$ |
|
10,920 |
|
|
$ |
|
0.32 |
|
|
|
$ |
|
11,127 |
|
|
$ |
|
0.32 |
|
|
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIFO expense |
|
|
1,517 |
|
|
|
|
|
|
|
|
|
|
6,606 |
|
|
|
|
|
|
|
|
Acquisition and integration, net |
|
|
272 |
|
|
|
|
|
|
|
|
|
|
2,130 |
|
|
|
|
|
|
|
|
Restructuring and asset impairment, net |
|
|
5,397 |
|
|
|
|
|
|
|
|
|
|
(458) |
|
|
|
|
|
|
|
|
Organizational realignment, net |
|
|
240 |
|
|
|
|
|
|
|
|
|
|
2,681 |
|
|
|
|
|
|
|
|
Severance associated with cost reduction initiatives |
|
|
279 |
|
|
|
|
|
|
|
|
|
|
39 |
|
|
|
|
|
|
|
|
Postretirement plan amendment and settlement |
|
|
— |
|
|
|
|
|
|
|
|
|
|
(762) |
|
|
|
|
|
|
|
|
Pension refund from annuity provider |
|
|
(239) |
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
|
|
|
|
|
Total adjustments |
|
|
7,466 |
|
|
|
|
|
|
|
|
|
|
10,236 |
|
|
|
|
|
|
|
|
Income tax effect on adjustments (a) |
|
|
(1,895) |
|
|
|
|
|
|
|
|
|
|
(2,600) |
|
|
|
|
|
|
|
|
Total adjustments, net of taxes |
|
|
5,571 |
|
|
|
|
0.16 |
|
|
|
|
|
7,636 |
|
|
|
|
0.22 |
|
|
|
Adjusted earnings from continuing operations |
$ |
|
16,491 |
|
|
$ |
|
0.48 |
|
|
|
$ |
|
18,763 |
|
|
$ |
|
0.54 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
40 Weeks Ended |
|
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
per diluted |
|
|
|
|
|
|
per diluted |
|
|
||||||||
|
(In thousands, except per share amounts) |
Earnings |
|
|
share |
|
|
|
Earnings |
|
|
share |
|
|
||||||||
|
Net earnings |
$ |
|
35,380 |
|
|
$ |
|
1.03 |
|
|
|
$ |
|
41,932 |
|
|
$ |
|
1.20 |
|
|
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIFO expense |
|
|
5,046 |
|
|
|
|
|
|
|
|
|
|
22,445 |
|
|
|
|
|
|
|
|
Acquisition and integration, net |
|
|
3,212 |
|
|
|
|
|
|
|
|
|
|
2,259 |
|
|
|
|
|
|
|
|
Restructuring and asset impairment, net |
|
|
17,272 |
|
|
|
|
|
|
|
|
|
|
1,371 |
|
|
|
|
|
|
|
|
Organizational realignment, net |
|
|
1,915 |
|
|
|
|
|
|
|
|
|
|
4,710 |
|
|
|
|
|
|
|
|
Severance associated with cost reduction initiatives |
|
|
420 |
|
|
|
|
|
|
|
|
|
|
311 |
|
|
|
|
|
|
|
|
Postretirement plan amendment and settlement |
|
|
(1,458) |
|
|
|
|
|
|
|
|
|
|
(2,411) |
|
|
|
|
|
|
|
|
Pension refund from annuity provider |
|
|
(239) |
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
|
|
|
|
|
Legal settlement |
|
|
— |
|
|
|
|
|
|
|
|
|
|
900 |
|
|
|
|
|
|
|
|
Total adjustments |
|
|
26,168 |
|
|
|
|
|
|
|
|
|
|
29,585 |
|
|
|
|
|
|
|
|
Income tax effect on adjustments (a) |
|
|
(6,698) |
|
|
|
|
|
|
|
|
|
|
(7,525) |
|
|
|
|
|
|
|
|
Total adjustments, net of taxes |
|
|
19,470 |
|
|
|
|
0.57 |
|
|
|
|
|
22,060 |
|
|
|
|
0.63 |
|
|
|
Adjusted earnings from continuing operations |
$ |
|
54,850 |
|
|
$ |
|
1.60 |
|
|
|
$ |
|
63,992 |
|
|
$ |
|
1.83 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) |
The income tax effect on adjustments is computed by applying the effective tax rate, before discrete tax items, to the total adjustments for the period. |
|
|
52 Weeks Ended |
|
|
|||||||
|
|
|
|
|
|||||||
|
|
|
|
|
per diluted |
|
|
||||
|
(In thousands, except per share data) |
Earnings |
|
|
share |
|
|
||||
|
Net earnings |
$ |
|
52,237 |
|
|
$ |
|
1.50 |
|
|
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
LIFO expense |
|
|
16,104 |
|
|
|
|
|
|
|
|
Acquisition and integration, net |
|
|
3,416 |
|
|
|
|
|
|
|
|
Restructuring and asset impairment, net |
|
|
9,190 |
|
|
|
|
|
|
|
|
Organizational realignment, net |
|
|
5,239 |
|
|
|
|
|
|
|
|
Severance associated with cost reduction initiatives |
|
|
318 |
|
|
|
|
|
|
|
|
Legal settlement |
|
|
900 |
|
|
|
|
|
|
|
|
Postretirement plan amendment and settlement |
|
|
(3,174) |
|
|
|
|
|
|
|
|
Total adjustments |
|
|
31,993 |
|
|
|
|
|
|
|
|
Income tax effect on adjustments (a) |
|
|
(8,218) |
|
|
|
|
|
|
|
|
Total adjustments, net of taxes |
|
|
23,775 |
|
|
|
|
0.68 |
|
|
|
Adjusted earnings from continuing operations |
$ |
|
76,012 |
|
|
$ |
|
2.18 |
|
|
|
|
|
|
(a) |
The income tax effect on adjustments is computed by applying the effective tax rate, before discrete tax items, to the total adjustments for the period. |
Notes: Adjusted earnings from continuing operations, as well as per diluted share ("adjusted EPS"), is a non-GAAP operating financial measure that the Company defines as net earnings plus or minus adjustments for items that do not reflect the ongoing operating activities of the Company and costs associated with the closing of operational locations.
Adjusted earnings from continuing operations is not a measure of performance under GAAP and should not be considered as a substitute for net earnings, cash flows from operating activities and other income or cash flow statement data. The Company's definition of adjusted earnings from continuing operations may not be identical to similarly titled measures reported by other companies.
|
Table 4: Reconciliation of Long-Term Debt and Finance Lease Obligations to Net Long-Term Debt and Net Earnings to Adjusted EBITDA |
|||||||||
|
|
|||||||||
|
(In thousands) |
|
|
|
|
|
||||
|
Current portion of long-term debt and finance lease liabilities |
$ |
|
9,747 |
|
|
$ |
|
9,754 |
|
|
Long-term debt and finance lease liabilities |
|
|
626,957 |
|
|
|
|
586,427 |
|
|
Total debt |
|
|
636,704 |
|
|
|
|
596,181 |
|
|
Cash and cash equivalents |
|
|
(17,510) |
|
|
|
|
(25,242) |
|
|
Net long-term debt |
$ |
|
619,194 |
|
|
$ |
|
570,939 |
|
|
|
Rolling 52- Weeks Ended |
|
|||||||
|
(In thousands, except for ratio) |
|
|
|
|
|
||||
|
Net earnings |
$ |
|
45,685 |
|
|
$ |
|
45,892 |
|
|
Income tax expense |
|
|
18,510 |
|
|
|
|
17,660 |
|
|
Other expenses, net |
|
|
41,008 |
|
|
|
|
39,803 |
|
|
Operating earnings |
|
|
105,203 |
|
|
|
|
103,355 |
|
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
LIFO (benefit) expense |
|
|
(1,295) |
|
|
|
|
3,794 |
|
|
Depreciation and amortization |
|
|
101,541 |
|
|
|
|
100,424 |
|
|
Acquisition and integration, net |
|
|
4,369 |
|
|
|
|
6,227 |
|
|
Restructuring and asset impairment, net |
|
|
25,091 |
|
|
|
|
19,236 |
|
|
Cloud computing amortization |
|
|
6,955 |
|
|
|
|
6,466 |
|
|
Organizational realignment, net |
|
|
2,444 |
|
|
|
|
4,885 |
|
|
Severance associated with cost reduction initiatives |
|
|
427 |
|
|
|
|
187 |
|
|
Stock-based compensation |
|
|
10,602 |
|
|
|
|
10,544 |
|
|
Stock warrant |
|
|
980 |
|
|
|
|
1,115 |
|
|
Non-cash rent |
|
|
(2,786) |
|
|
|
|
(2,662) |
|
|
(Gain) loss on disposal of assets |
|
|
(93) |
|
|
|
|
257 |
|
|
Postretirement plan amendment and settlement |
|
|
99 |
|
|
|
|
99 |
|
|
Adjusted EBITDA |
$ |
|
253,537 |
|
|
$ |
|
253,927 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net long-term debt to adjusted EBITDA ratio |
|
|
2.4 |
|
|
|
|
2.2 |
|
Notes: Net long-term debt is a non-GAAP financial measure that is defined as long-term debt and finance lease obligations plus current maturities of long-term debt and finance lease obligations less cash and cash equivalents. The Company believes both management and its investors find the information useful because it reflects the amount of long-term debt obligations that are not covered by available cash and temporary investments. Net long-term debt is not a substitute for GAAP financial measures and may differ from similarly titled measures of other companies.
|
Table 5: Reconciliation of Purchases of Property and Equipment to |
||||||||||||
|
|
||||||||||||
|
|
|
|
|
40 Weeks Ended |
|
|||||||
|
(In thousands) |
|
|
|
|
|
|
|
|
||||
|
Purchases of property and equipment |
|
|
|
$ |
|
97,867 |
|
|
$ |
|
86,212 |
|
|
Plus: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cloud computing spend |
|
|
|
|
|
8,401 |
|
|
|
|
4,065 |
|
|
Capital expenditures and IT capital |
|
|
|
$ |
|
106,268 |
|
|
$ |
|
90,277 |
|
|
|
|
|
|
52 Weeks Ended |
|
|
|
|
||
|
(In thousands) |
|
|
|
|
|
|
|
|||
|
Purchases of property and equipment |
|
|
|
$ |
|
120,330 |
|
|
|
|
|
Plus: |
|
|
|
|
|
|
|
|
|
|
|
Cloud computing spend |
|
|
|
|
|
7,040 |
|
|
|
|
|
Capital expenditures and IT capital |
|
|
|
$ |
|
127,370 |
|
|
|
|
Notes: Capital expenditures and IT capital is a non-GAAP financial measure calculated by adding spending related to the development of cloud computing applications to capital expenditures, the most directly comparable GAAP measure. Cloud computing spend only includes costs incurred during the application development phase and does not include ongoing costs of hosting or maintenance associated with these applications, which are expensed as incurred. The Company believes it is a useful indicator of the Company's investment in its facilities and systems as it transitions to more cloud-based IT systems. Capital expenditures and IT capital is not a substitute for GAAP financial measures and may differ from similarly titled measures of other companies.
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