IMKTA
$43.17
Ingles Markets
($.55)
(1.26%)
Earnings Details
3rd Quarter June 2019
Thursday, August 8, 2019 7:30:00 AM
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Summary

Ingles Markets (IMKTA) Recent Earnings

Ingles Markets (IMKTA) reported 3rd Quarter June 2019 earnings of $1.16 per share on revenue of $1.1 billion.. Revenue grew 2.7% on a year-over-year basis.

Ingles Markets Inc is a supermarket chain in the Southeast United States. It operates in two lines of business: retail grocery sales, and shopping center rentals & fluid dairy.

Results
Reported Earnings
$1.16
Earnings Whisper
-
Consensus Estimate
Reported Revenue
$1.06 Bil
Revenue Estimate
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Ingles Markets, Incorporated Reports Results for Third Quarter and Nine Months of Fiscal 2019

ASHEVILLE, N.C.--(BUSINESS WIRE)--Ingles Markets, Incorporated (NASDAQ: IMKTA) today reported sales and net income for the three and nine months ended June 29, 2019. Net sales totaled $1.06 billion and net income totaled $23.5 million for the third quarter ended June 29, 2019, compared with $1.03 billion and $24.5 million, respectively, for the third quarter of fiscal year 2018.

Net sales totaled $3.13 billion and net income totaled $60.7 million for the nine months ended June 29, 2019, compared with $3.03 billion and $78.9 million, respectively, for the nine months ended June 30, 2018.

The three-month period ended June 2019 benefitted from extra Easter sales. Easter occurred in April 2019 and benefitted third quarter 2019 sales. Easter occurred in March 2018, in the Company’s second fiscal 2018 quarter.

Last year’s third quarter and nine-month net income benefitted from reductions in income tax expense caused by the December 2017 decrease in income tax rates and by changes in certain tax calculation methods. These tax expense reductions totaled $10.6 million for the three months ended June 2018 and $37.3 million for the nine months ended June 2018. June 2019 year three-month pretax income totaled $31.8 million compared with $18.5 million of June 2018 three-month pretax income. June 2019 nine-month pretax income totaled $79.2 million compared with $56.1 million of June 2019 nine-month pretax income.

Robert P. Ingle II, Chairman of the Board, stated, “Our strong sales growth continues to drive operating results and provide capital for the ongoing improvement of our store base.”

Third Quarter Results

Net sales increased by $27.5 million, or 2.7%, to $1.06 billion for the three months ended June 29, 2019, from $1.03 billion for the three months ended June 30, 2018. Excluding gasoline sales and the effect of this year’s extra Easter sales, retail grocery comparable store sales increased 4.3% over the comparative fiscal third quarter.

Gross profit for the June 2019 quarter increased 6.2% to $258.9 million, compared with $243.9 million for the third quarter of last fiscal year. Gross profit, as a percentage of sales, was 24.4% for the June 2019 quarter compared with 23.6% for the June 2018 quarter. Operating and administrative expenses for the June 2019 quarter totaled $216.5 million, compared with $214.7 million for the June 2018 quarter. Most of the increase was due to higher personnel and other costs incurred to support increased sales.

Interest expense totaled $11.7 million for the three-month period ended June 29, 2019, and $12.0 million for the three-month period ended June 30, 2018. Total debt at the end of June 2019 was $854.7 million, compared with $887.8 million at the end of June 2018. The Company has had lower line of credit usage and interest rates have been relatively stable.

Net income totaled $23.5 million for the three-month period ended June 29, 2019, compared with $24.5 million for the three-month period ended June 30, 2018. Basic and diluted earnings per share for Class A Common Stock were $1.19 and $1.16, respectively, for the quarter ended June 29, 2019, compared with $1.24 and $1.21, respectively, for the quarter ended June 30, 2018. Basic and diluted earnings per share for Class B Common Stock were each $1.08 for the quarter ended June 29, 2019, and $1.13 for the quarter ended June 30, 2018.

Nine Month Results

Nine month fiscal 2019 and 2018 sales totaled $3.13 billion and $3.03 billion, respectively. Excluding gasoline, retail grocery comparable store sales increased 3.9%.

Gross profit for the nine months ended June 29, 2019, increased 5.2% and totaled $761.7 million, compared with $723.7 million for the first nine months of last fiscal year. Gross profit, as a percentage of sales, was 24.4% for the June 2019 nine-month period compared with 23.9% for the June 2018 nine-month period. Operating and administrative expenses totaled $651.6 million for the nine months ended June 29, 2019, and $635.2 million for the nine months ended June 30, 2018. Interest expense slightly increased to $35.9 million for the nine-month period ended June 29, 2019, compared with $35.6 million for the nine-month period ended June 30, 2018.

Net income totaled $60.7 million for the nine-month period ended June 29, 2019, compared with $78.9 million for the nine-month period ended June 30, 2018. Basic and diluted earnings per share for Class A Common Stock were $3.07 and $2.99, respectively, for the nine months ended June 29, 2019, compared with $4.00 and $3.90, respectively, for the nine months ended June 30, 2018. Basic and diluted earnings per share for Class B Common Stock were each $2.80 for the nine months ended June 29, 2019, compared with $3.64 of basic and diluted earnings per share for the nine months ended June 30, 2018.

Capital expenditures for the June 2019 nine-month period totaled $123.2 million, compared with $120.5 million for the June 2018 nine-month period. Capital expenditures are focused on stores that have already opened this fiscal year as well as stores scheduled to open later this year. The Company also continues to make ongoing improvements to the existing store base. Capital expenditures for the entire fiscal year are expected to be approximately $140 million to $180 million.

The Company currently has $165.3 million available under its $175.0 million line of credit. The Company believes its financial resources, including the line of credit and other internal and anticipated external sources of funds, will be sufficient to meet planned capital expenditures, debt service and working capital requirements for the foreseeable future.

The comments in this press release contain certain forward-looking statements. Ingles undertakes no obligation to publicly release any revisions to any forward-looking statements contained herein to reflect events or circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events, except as required by law. Ingles’ actual results may differ materially from those projected in forward-looking statements made by, or on behalf of, Ingles. Factors that may affect results include changes in business and economic conditions generally in Ingles’ operating area, pricing pressures, increased competitive efforts by others in Ingles’ marketing areas and the availability of financing for capital improvements. A more detailed discussion of these factors may be found in reports filed by the Company with the Securities and Exchange Commission including its 2018 Form 10-K and 2019 Forms 10-Q.

Ingles Markets, Incorporated is a leading supermarket chain with operations in six southeastern states. Headquartered in Asheville, North Carolina, the Company operates 199 supermarkets. In conjunction with its supermarket operations, the Company operates neighborhood shopping centers, most of which contain an Ingles supermarket. The Company also owns a fluid dairy facility that supplies Company supermarkets and unaffiliated customers. The Company's Class A Common Stock is traded on The NASDAQ Stock Market's Global Select Market under the symbol IMKTA. For more information, visit Ingles' website at www.ingles-markets.com.

 
 

INGLES MARKETS, INCORPORATED

(Amounts in thousands except per share data)

 

Unaudited Financial Highlights

Condensed Consolidated Statements of Income (Unaudited)

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

June 29,

 

June 30,

 

June 29,

 

June 30,

 

 

2019

 

2018

 

 

2019

 

2018

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

1,062,262

 

$

1,034,769

 

 

$

3,125,943

 

$

3,033,117

 

Gross profit

 

 

258,940

 

 

243,891

 

 

 

761,651

 

 

723,738

 

Operating and administrative expenses

 

 

216,463

 

 

214,718

 

 

 

651,614

 

 

635,188

 

Gain from sale or disposal of assets

 

 

876

 

 

605

 

 

 

3,525

 

 

671

 

Income from operations

 

 

43,353

 

 

29,778

 

 

 

113,562

 

 

89,221

 

Other income, net

 

 

129

 

 

648

 

 

 

1,474

 

 

2,466

 

Interest expense

 

 

11,655

 

 

11,956

 

 

 

35,864

 

 

35,621

 

Income tax (benefit) expense

 

 

8,317

 

 

(6,014

)

 

 

18,509

 

 

(22,859

)

Net income

 

$

23,510

 

$

24,484

 

 

$

60,663

 

$

78,925

 

 

 

 

 

 

 

 

 

 

Basic earnings per common share – Class A

 

$

1.19

 

$

1.24

 

 

$

3.07

 

$

4.00

 

Diluted earnings per common share – Class A

 

$

1.16

 

$

1.21

 

 

$

2.99

 

$

3.90

 

Basic earnings per common share – Class B

 

$

1.08

 

$

1.13

 

 

$

2.80

 

$

3.64

 

Diluted earnings per common share – Class B

 

$

1.08

 

$

1.13

 

 

$

2.80

 

$

3.64

 

 

 

 

 

 

 

 

 

 

Additional selected information:

 

 

 

 

 

 

 

 

Depreciation and amortization expense

 

$

27,986

 

$

28,418

 

 

$

83,593

 

$

84,628

 

Rent expense

 

$

3,024

 

$

3,272

 

 

$

9,312

 

$

9,678

 

 

Condensed Consolidated Balance Sheets (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

June 29,

 

 

 

Sept. 29,

 

 

 

 

2019

 

 

 

2018

 

 

ASSETS

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

18,553

 

 

 

$

10,537

 

 

Receivables-net

 

 

77,810

 

 

 

 

70,057

 

 

Inventories

 

 

368,088

 

 

 

 

372,196

 

 

Other current assets

 

 

11,222

 

 

 

 

43,954

 

 

Property and equipment-net

 

 

1,335,184

 

 

 

 

1,303,044

 

 

Other assets

 

 

28,176

 

 

 

 

25,123

 

 

TOTAL ASSETS

 

$

1,839,033

 

 

 

$

1,824,911

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

Current maturities of long-term debt

 

$

12,876

 

 

 

$

12,848

 

 

Accounts payable, accrued expenses and
current portion of other long-term liabilities

 

 

 

 

 

 

 

 

218,408

 

 

 

 

247,290

 

 

Deferred income taxes

 

 

79,105

 

 

 

 

74,461

 

 

Long-term debt

 

 

841,837

 

 

 

 

852,740

 

 

Other long-term liabilities

 

 

41,402

 

 

 

 

42,158

 

 

Total Liabilities

 

 

1,193,628

 

 

 

 

1,229,497

 

 

Stockholders' equity

 

 

645,405

 

 

 

 

595,414

 

 

TOTAL LIABILITIES AND

 

 

 

 

 

 

 

 

STOCKHOLDERS' EQUITY

 

$

1,839,033

 

 

 

$

1,824,911

 

 

 

Ron Freeman
Chief Financial Officer
(828) 669-2941 (Ext. 223)

Source: Ingles Markets, Incorporated