Beats the street
Grand Union Reports Fiscal 1999 and Fourth Quarter Results
WAYNE, N.J.--(BUSINESS WIRE)--May 18, 1999--
EBITDA Increases 68% Over Fiscal 1998
The Grand Union Company (GUCO-NASDAQ) reported today that EBITDA
(earnings before interest, taxes, depreciation, amortization, unusual
and extraordinary items and non-cash pension and LIFO charges) for its
53-week fiscal year ended April 3, 1999, rose 68% to $118.6 million
from $70.6 million in the prior 52-week fiscal year.
EBITDA for the Company's 13-week fourth quarter was $30.1
million, up $8.7 million, or 41%, from $21.4 million in last year's
12-week fourth quarter.
Sales for the year totaled $2.286 billion, an increase of 0.9%
from sales of $2.267 billion last year. For the fourth quarter, sales
totaled $547.2 million, an increase of 8.2% over sales of $505.6
million during the fourth quarter last year. Comparable store sales on
a 13 and 53 week basis improved 0.67% during the fourth quarter and
declined 0.35% for the year.
"Grand Union's operating performance during fiscal 1999 was
strong," noted J. Wayne Harris, Chairman of the Board and Chief
Executive Officer. "The Company produced solid sales, improved gross
margins, substantially increased EBITDA on a year-over-year basis, and
continued to reduce operating and administrative expense. All of this
was accomplished in a year that included a major financial
reorganization and limited resources for capital development. Given
our fiscal 1999 performance, we are now positioned to benefit from a
strong balance sheet and an aggressive capital program."
The Company's EBITDA rate to sales was 5.2% for fiscal 1999
compared to 3.1% the previous fiscal year, and was 5.5% for the
quarter compared to 4.2% last year. Gross margin increased 1.52% from
28.21% during fiscal 1998 to 29.73% during fiscal 1999. Operating and
administrative expense decreased $7.3 million, or 54 basis points, for
the year on a 53 versus 52 week basis.
Comparable store sales during the fourth quarter, Harris said,
were positive in the Company's metro New York/New Jersey operating
divisions for the seventh consecutive quarter.
Implementation of the Company's capital plan is now underway,
Harris said, with approximately 50 projects scheduled this year alone.
The projects include new stores, format conversions, remodels and
enlargements. During the last month of the Company's fiscal year, it
opened a 42,000-square-foot supermarket in Point Pleasant, NJ, that
replaced an older, smaller unit. The store is the first to incorporate
Grand Union's new store design package. "Customers have reacted
enthusiastically to this new store," Harris said.
Last week, the Company broke ground on a new 55,000-square-foot
supermarket in Carlstadt, NJ. "The Carlstadt store will be the first
new 'ground-up' version of our exciting new prototype," Harris said.
"It is expected to be open by the end of this calendar year."
"Our primary new store prototype will be a 55,000 to 60,000
square foot supermarket, which will offer the customer a superior
quality shopping experience and provide the Company with significant
new opportunities for sales and margin enhancement," Harris said.
"Most of our remodels will also include the key elements of our new
store design package."
Capital plans also include substantial improvements to the
Company's technology base to further enhance cost-competitive
operations. Harris said the Company plans to be fully Year 2000
compliant well before the end of this calendar year.
For the 53-week fiscal year, the Company reported net income of
$114.4 million after an extraordinary item of $259 million related to
the extinguishment of debt as a result of the Company's
reorganization. Last year for 52 weeks, the Company reported a net
loss of $304 million. For the 13-week fourth quarter, the Company
reported a net loss of $31.4 million, compared to a net loss of $122
million during the 12-week fourth quarter last year. |
