Ingles Markets Inc. on Monday reported record sales of $3.74 billion for fiscal 2013, its 49th consecutive year of sales growth. Net income for the fourth quarter totaled $15.6 million, 17.2 percent higher than net income of $13.3 million for the fourth quarter of fiscal 2012. For the full fiscal years, net income was $20.8 million in 2013 compared with $43.4 million in 2012.
The full year and fourth quarter of fiscal 2013 contained 52 weeks and 13 weeks, respectively, compared with 53 weeks and 14 weeks for the full year and fourth quarter of fiscal 2012. Adjusting for the difference in weeks, total sales, less gasoline, increased 1.8 percent in the fourth quarter of fiscal 2013 and 2.1 percent for the fiscal 2013 compared with the comparable periods in fiscal 2012.
“We have increased sales every year since the company’s founding and completed a refinancing this year that positions the company for future sales and profitability growth,” CEO Robert P. Ingle II. “That wouldn’t be possible without listening to what our customers want and by having dedicated associates fulfilling those needs.”
Fourth quarter results
Net sales totaled $948.9 million for the quarter ended Sept. 28, compared with $993.9 million for the comparable quarter in fiscal 2012. Comparing the 13 weeks of the fourth fiscal quarter of 2013 with the corresponding 13 calendar weeks of the previous year quarter, grocery segment comparable store sales, excluding gasoline, increased 1.3 percent. The growth in grocery segment sales benefited from increases in average weekly customer visits and in the average purchase amount compared with the fourth quarter of fiscal 2012. Adjusting for the difference in weeks, gallons of gasoline sold increased while the average price per gallon dropped slightly.
Gross profit for the fourth quarter of fiscal 2013 totaled $210.3 million, compared with $219.4 million for the fourth quarter of fiscal 2012. Gross profit as a percentage of sales was 22.2 percent and 22.1 percent for the 2013 and 2012 fourth quarters, respectively. Grocery segment gross margins, excluding gasoline, were 26.3 percent for the current-year quarter and 26.0 percent for the fourth quarter of fiscal 2012.
Net income for the September 2013 quarter rose to $15.6 million, compared with net income of $13.3 million for the September 2012 quarter. Operating and administrative expenses for the September 2013 quarter totaled $178.9 million. Operating and administrative expenses as a percentage of sales were 18.9 percent for the fourth quarter of fiscal 2013, compared with 18.6 percent for the fourth quarter of fiscal 2012. The largest line item increases were personnel costs and depreciation related to improvements in the company’s store base and to the opening of the new 839,000-s.f. distribution center in June 2012. Ingles operated 203 stores and approximately 11.0 million s.f. of store space at the end of fiscal 2013 and at the end of fiscal 2012. During fiscal 2013, the company opened one new store and closed one store. The company’s other store improvement capital projects this year did not result in increased square footage, but improved merchandising, convenience and the range of products offered to customers, according to the North Carolina-based grocer.
Annual results
The company reports that net sales were a record $3.74 billion for the fiscal year ended September 2013, an increase of $20.2 million, or 0.5 percent, from $3.72 billion for the fiscal year ended September 2012. Fiscal year 2013 was Ingles’ 49th consecutive year of record sales. Comparing the 52 calendar weeks of fiscal 2013 with the corresponding 52 calendar weeks of the previous year, grocery segment comparable store sales increased 1.8 percent, excluding gasoline sales where the retail-per-gallon price was approximately 1.6 percent lower. The number of customer transactions increased 1.7 percent and the average transaction size was essentially unchanged, excluding gasoline sales.
Gross profit for the fiscal year ended Sept. 28 increased $7.0 million, or 0.9 percent, to $827.8 million, or 22.1 percent of sales, compared with $820.8 million, also 22.1 percent of sales, for the fiscal year ended Sept. 29, 2012. The increase in grocery segment gross profit dollars was primarily due to the higher sales volume despite the extra week in fiscal 2012. Grocery segment gross profit as a percentage of total sales, excluding gasoline, was 26.1 percent and 25.9 percent for fiscal 2013 and 2012, respectively.
Net income for fiscal 2013 totaled $20.8 million, compared with net income of $43.4 million for fiscal 2012.
Operating expenses increased $8.9 million in fiscal 2013 compared with fiscal 2012 and were 18.9 percent of sales for fiscal 2013, compared with 18.8 percent of sales for fiscal 2012. Excluding gasoline sales and associated gasoline operating expenses (primarily payroll), operating expenses were 22.1 percent of sales for fiscal 2013, compared with 21.9 percent for fiscal 2012. Payroll represented the largest cost increase. Capital expenditures totaled $101.5 million and $180.6 million for fiscal 2013 and 2012, respectively. The largest capital expenditure in fiscal 2012 was for the completion of the new distribution facility, including expenditures for related vehicles and equipment.
