Net sales

SpartanNash Announces Higher Net Sales and Slightly Lower First Quarter Net Profit

Ahead of a landmark shareholder meeting, SpartanNash released its first quarter financial report. For the period ending April 23, the Michigan-based food solutions company reported a 4% increase in net sales to reach $2.76 billion and a slight decrease in net income from the prior year quarter, from $19.5 million to $19.3 million. These earnings were above Wall Street expectations.

Gross profit reached $450.6 million, or 16.3% of net sales, compared to a rate of 15.7% of net sales in the first quarter of 2021. Earnings rose in the company’s food retail business, with same-store sales up 7.2% in the first quarter, which was also a time of soaring inflation. Adjusted EBITDA increased 18.2% from April 2021 to $76.6 million, a first quarter record.

Expenses as a rate of sales increased for the quarter, due to higher labor costs, near-record fuel prices and higher incentive compensation, among other factors. SpartanNash said labor costs in its food and military distribution segments were partially offset by supply chain efficiency.

On that note, the food solutions company highlighted its achievements in the quarter, highlighting progress in its supply chain transformation. “Our team’s focus on operational excellence has helped drive our supply chain transformation initiative,” noted Tony Sarsam, President and CEO. “During the quarter, we achieved over $15 million in fulfillment cost savings, already meeting our full year 2022 fulfillment rate target of $15-30 million in annualized savings on the supply chain. Because we reached this milestone ahead of schedule, we are updating our commitment to a range of annualized savings of $25 million to $35 million by the end of the year. In addition, our full-year outlook and long-term financial goals show a clear growth path for the coming years. »

Sarsam pointed to such growth as the company faces the challenge of two groups of investors who together own a 4.5% stake in the company. These companies, Macellum Advisors GP, LLC and Ancora Holdings Groups, LLC, are recommending changes to SpartanNash’s board of directors and appointing two of their own potential members.

The investor groups and SpartanNash sent respective shareholder letters and issued statements ahead of the June 9 annual meeting, which will be held virtually. Earlier this week, SpartanNash shared independent proxy advisory firm Glass Lewis & Co.’s recommendation to vote for all of the company’s director nominees, and rebutted another advisory firm’s recommendation. , International Shareholder Services Inc., to vote for the candidates of Marcellum and Acora. .

“SpartanNash’s Board of Directors has a proven track record of taking decisive and meaningful action to transform the business, and our preliminary first quarter financial results and fiscal 2022 guidance demonstrated that our strategy is working. Additionally, the company’s new long-term financial goals show a clear path for growth and continued momentum for the next several years,” SpartanNash said in a statement.

Meanwhile, looking ahead to the remainder of 2022, SpartanNash reiterated the fiscal year guidance it shared in May, forecasting net sales to be between $9 billion and $9.3 billion. This is an increase from the previous forecast of $8.9 billion to $9.1 billion. Looking further ahead, the company provided financial targets for 2025, including the intention to improve net sales to over $10 billion and increase adjusted EBITDA by 40%.

SPartanNashThe principal businesses of include the distribution of grocery products to independent and chain retailers, its corporate-owned retail stores and US military commissars and exchanges, as well as the distribution of fresh produce and the processing of fresh food. #41 on The PG 100, Progressive Grocer’s 2022 List of The leading food and consumables retailer in North America, the Grand Rapids, Michigan-based company serves customer sites in all 50 states and the District of Columbia, Europe, Cuba, Puerto Rico, Honduras , Iraq, Kuwait, Bahrain, Qatar and Djibouti. SpartanNash also operates 145 supermarkets and employs 17,500 associates.