- SUPERVALU reports third quarter fiscal 2003 results. Supervalu Inc. reported net sales for the third quarter of $4.7 billion, net earnings of $57.1 million, and diluted earnings per share of $0.43. Total Company earnings before interest, taxes, depreciation and amortization (EBITDA) were $196.7 million compared to $214.0 million last year. As a percent of sales, EBITDA was 4.2 percent compared to 4.6 percent in the prior year.
Jeff Noddle, SUPERVALU chairman and CEO said, "As we announced earlier this month, both segments of our business were impacted by the weak economy as consumers continue to trade down and curtail grocery spending. The soft economy spawned a more competitive promotional environment, as well. In addition, the Company experienced a lack of product cost inflation in its overall market basket of goods and saw specific product cost deflation in meat, deli and dairy categories. When all these factors were combined with sharply rising employee benefit costs, it offset our progress in a number of areas across the Company."
Noddle continued, "Our task is to execute SUPERVALU's long-term strategies yet remain tactical in this challenging economic environment by balancing sales, gross profit and our cost structure. To that end, we continued our progress on such important efforts as the rollout of general merchandise in a new Save-A-Lot store prototype, expansion of our retail store network, and the implementation of efficiency programs in our distribution business. On a more tactical level, we will continue to focus on store level execution, merchandising and service levels while tightening our capital spending levels this year."
For the first 40 weeks of fiscal 2003, Supervalu reported net sales of $15.0 billion, net earnings of $193.1 million, and diluted earnings per share of $1.43. Total Company earnings before interest, taxes, depreciation and amortization (EBITDA) year-to-date were $655.9 million, or 4.4 percent of sales, up 30 basis points from last year as a percent of sales.
For the third quarter, retail sales were $2.3 billion, up 3.5 percent from last year's third quarter, primarily reflecting new store growth.
- McDonald's Corp. has warned that it will post its first-ever quarterly loss for the fourth quarter, a reflection of the heightened competition in the fast food business, the company’s inability to keep pace with changing taste trends, and the resultant loss of sales.
The projected loss comes as the company attempts to develop alternative formats such as the Chipotle Grill for Mexican food, closes unproductive and aging units, and stresses a discount strategy at its traditional McDonald’s stores.
Company CEO Jack Greenberg has already announced his retirement effective in just a few weeks.
- Wal-Mart’s Asda Group in the UK will pay more attention to food in 2003. Published reports say that the company will especially focus on chilled products, including prepared meals and beverages. Extra space will be devoted to these categories, and in some cases the extra space already has been installed for the Christmas season.
- General Mills reports fiscal 2003 second quarter results.
Net sales for the thirteen weeks ended Nov. 24, 2002, grew 60 percent to $2.95 billion including the incremental contribution from the Pillsbury businesses acquired in October 2001. Second-quarter earnings after tax before unusual items grew 46 percent to reach $290 million.
Through the first six months of fiscal 2003, reported net sales increased 64 percent to $5.32 billion. Comparable net sales and unit volume each grew 2 percent in the first half. Earnings after tax before unusual items grew to $501 million, up 31 percent.
- Big finish for holiday shopping season? An online survey conducted by CoolSavings Inc. reveals that:
- 81 percent of respondents have not completed their shopping yet
- 14 percent have yet to start their holiday shopping
- 21 percent have about a quarter of their shopping completed
- 14 percent have about half accomplished
- 32 percent have about three-quarters finished
- 19 percent of consumers surveyed have all of their shopping finished
- KC's View:
Which reminds us, we have to brave the local Wal-Mart this morning for a few last minute gifts for the kiddies. (We haven’t even started looking for gifts for Mrs. Content Guy yet…)
Regarding the McDonald’s story…
In our household, Mickey D’s is less and less an option, having been replaced by Wendy’s, several local pizza joints, and a Chinese restaurant.
The decision often is being made by the kids, and they just don’t seem to like McDonald’s anymore. If this happens elsewhere -- and it seems to be -- then Mickey D’s has big problems.
(However, we’d be thrilled if they brought a Chipotle to the neighborhood…)