Arden Group, Inc. Announces Second Quarter Earnings
August 08 2013 - 11:47AM
Business Wire
Arden Group, Inc. (Nasdaq:ARDNA) today released its sales and
income figures for the second quarter ended June 29, 2013.
Arden Group, Inc. is the parent company of Gelson’s Markets
which currently operates 16 full-service supermarkets in Southern
California carrying both perishable and grocery products.
ARDEN GROUP, INC. AND CONSOLIDATED SUBSIDIARIES SECOND
QUARTER EARNINGS RELEASE (UNAUDITED)
Thirteen Weeks Ended
Twenty-Six Weeks Ended
June 29,
June 30,
June 29,
June 30,
(In Thousands,
Except Share, Per Share & Footnote Data)
2013
2012
2013
2012
Sales (a) $ 111,031 $ 107,699 $ 224,686 $ 214,926
Operating income (b) 8,185 8,236 15,528 13,133 Interest, dividend
and other income (expense), net (7 ) 25 (2 )
48 Income before income taxes 8,178 8,261 15,526 13,181
Income tax provision 3,332 3,366 6,326
5,370 Net income $ 4,846 $ 4,895 $ 9,200
$ 7,811 Basic and diluted net income per common share $ 1.58
$ 1.59 $ 3.00 $ 2.54
Basic and diluted weighted average common
shares outstanding
3,071,000 3,071,000 3,071,000 3,071,000 (a) Same store sales
from the Company’s 16 supermarkets (excluding the Pasadena location
which was closed June 15, 2013) were $107,994,000 during the second
quarter of 2013 compared to $104,207,000 in the second quarter of
2012, an increase of 3.6%. The increase in same store sales is due
to an increase in the number of transactions, as well as inflation,
but was partially offset by a shift in holiday sales. Easter and
Passover sales occurred in the second quarter of 2012 but fell into
the first quarter of 2013. For the twenty-six weeks ended June 29,
2013, same store sales (which also excludes the Northridge location
which was closed on February 25, 2012, in addition to the Pasadena
store mentioned above) were $218,050,000 compared to $206,294,000
in the same period of 2012, an increase of 5.7%. The year-to-date
increase in same store sales is the result of inflation, as well as
an increase in the number of transactions in 2013 compared to the
prior year. In September 2012, Gelson’s entered into a lease
for a supermarket location in the marina area of Long Beach,
California. Gelson’s took possession of the property on March 1,
2013. Gelson’s is in the process of extensively remodeling the site
and currently anticipates opening a new Gelson’s supermarket at
that location in late 2013. (b) Operating income in the
second quarter of 2013 decreased slightly primarily due to higher
stock appreciation rights (SARs) compensation expense and the
timing of the Easter and Passover holidays as described above. The
Company recorded SARs compensation expense of $670,000 in the
second quarter of 2013 due to an increase in SARs fair value since
the beginning of the quarter and additional vesting. Conversely, in
the second quarter of 2012, the Company reversed $170,000 of SARs
compensation expense recognized in prior periods. Operating income
also decreased due to an increase in the United Food &
Commercial Workers International Union (UFCW) health and welfare
and pension contribution rates at various times throughout 2012 and
2013. The negative impact of higher SARs compensation expense and
union benefits costs on operating income was offset by the positive
impact of higher sales. Operating income in the first half
of 2013 and 2012 reflects the impact of two store closures – the
Pasadena and Northridge locations. Closing costs of $170,000 and
$1,906,000 related to the closing of the Pasadena and Northridge
stores were accrued in the first half of 2013 and 2012,
respectively. Excluding the costs related to store closings,
operating income increased by 4.4% in the first half of 2013
compared to the same period of 2012. This increase is the result of
higher sales, slightly improved gross margins and a decrease in
store expense as a percent of sales. The decrease in store expense
as a percent of sales is due to an increase in sales without a
comparable increase in expense, as well as the closing of
unprofitable locations. The increase in operating income was
partially offset by an increase in SARs compensation expense,
increased UFCW benefit contribution rates and a UFCW bonus of
approximately $768,000 paid in March 2013. The Company recorded
SARs compensation expense of $1,110,000 in the first half of 2013.
Conversely, in the first half of 2012, the Company reversed
$434,000 of SARs compensation expense recognized in prior periods.
The Private Securities Litigation Reform Act of 1995 provides a
safe harbor for forward-looking statements made by or on behalf of
the Company. Certain statements contained in this Current Report on
Form 8-K are forward-looking statements. These statements discuss,
among other things, the opening of a new location which may or may
not be accomplished. These forward-looking statements reflect the
Company’s current plans and expectations and are based on
information currently known to the Company. The Company cautions
readers that any forward-looking statements contained in this
Current Report involve risks and uncertainties and are subject to
change. The Company does not undertake any obligation to update
forward-looking statements.
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