VILLAGE SUPER MARKET INC - FORM 10-Q - EX-99.1 - EXHIBIT 99.1 - March 2, 2016

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EX-31.2 - EXHIBIT 31.2 - VILLAGE SUPER MARKET INCvlgea20160123ex-312.htm
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Exhibit 99.1


VILLAGE SUPER MARKET, INC.
REPORTS RESULTS FOR THE SECOND QUARTER ENDED
JANUARY 23, 2016
Contact:
John Van Orden, CFO
 
(973) 467-2200
 
john.vanorden@wakefern.com
Springfield, New Jersey – March 2, 2016 – Village Super Market, Inc. (NSD-VLGEA) today reported its results of operations for the second quarter ended January 23, 2016.

Net income was $6,284,000 in the second quarter of fiscal 2016 compared to $6,603,000 in the second quarter of the prior year. The second quarter of the prior year includes a higher tax rate due to $436,000 of accrued interest and penalties related to the New Jersey tax dispute. Excluding this item from the prior year period, net income decreased 11% in the second quarter of fiscal 2016 compared to the prior year due primarily to a lower gross profit percentage and higher operating and administrative expenses. Partially offsetting these decreases in net income were substantially greater sales in the last week of the quarter due to the impact of Winter Storm Jonas.

Sales were $420,170,000 in the second quarter of fiscal 2016, an increase of 2.2% compared to the second quarter of the prior year.  Same store sales also increased 2.2% due to higher sales in the last week of the second quarter as customers prepared for Winter Storm Jonas, the closing of two competitor stores and continued sales growth in the recently expanded or replaced stores in Stirling, Greater Morristown and Union.  These increases were partially offset by six new competitor store openings, including stores formerly operated by A&P, and deflation in the meat, seafood and dairy departments. Excluding the impact of Winter Storm Jonas, same store sales increased 0.8% in the second quarter. The Company expects same store sales in fiscal 2016 to range from a 0.5% to 1.5% increase.  

Gross profit as a percentage of sales decreased to 26.83% in the second quarter of fiscal 2016 compared to 27.03% in the second quarter of the prior year.

Operating and administrative expense as a percentage of sales increased to 22.67% in the second quarter of fiscal 2016 compared to 22.49% in the second quarter of the prior year. This increase is primarily due to higher fringe benefit costs and payroll. Fringe benefit costs increased due primarily to higher healthcare costs and pension expense. Payroll costs increased due primarily to the addition of Village Food Garden, ShopRite from Home and other services in the expanded Stirling store.

Net income was $10,714,000 in the six-month period of fiscal 2016 compared to $10,481,000 in the six-month period of the prior year. Fiscal 2015 includes a charge to write-off all remaining insurance receivables related to Superstorm Sandy of $1,340 (net of tax) and a higher tax rate due to $840 of accrued interest and penalties related to the New Jersey tax dispute. Excluding these items from the prior year period, net income decreased 15% in the six-month period of fiscal 2016 compared to the prior year primarily due to a lower gross profit percentage and higher operating and administrative expenses. Partially offsetting these decreases in net income were substantially greater sales in the last week of the six-month period due to Winter Storm Jonas.
Village Super Market operates a chain of 29 supermarkets under the ShopRite name in New Jersey, Maryland and northeastern Pennsylvania.
Forward Looking Statements
All statements, other than statements of historical fact, included in this Press Release are or may be considered forward-looking statements within the meaning of federal securities law. The Company cautions the reader that there is no assurance that actual results or business conditions will not differ materially from future results, whether expressed, suggested or implied by such forward-looking statements. The Company undertakes no obligation to update forward-looking statements to reflect developments or information obtained after the date hereof. The following are among the principal factors that could cause actual results to differ from the forward-looking statements: economic conditions; competitive pressures from the Company’s operating environment; the ability of the Company to maintain and improve its sales and margins; the ability to attract and retain qualified associates; the availability of new store locations; the availability of capital; the liquidity of the Company; the success of operating initiatives; consumer spending patterns; the impact of changing energy prices; increased cost of goods sold, including increased costs from the Company’s principal supplier, Wakefern; disruptions or changes in Wakefern's operations; the results of litigation; the results of tax examinations; the results of union contract negotiations; competitive store openings and closings; the rate of return on pension assets; the success of establishing ShopRite’s presence in the Maryland market; and other factors detailed herein and in the Company’s filings with the SEC.


Exhibit 99.1


VILLAGE SUPER MARKET, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts) (Unaudited)
 
13 Weeks Ended
 
26 Weeks Ended
 
January 23,
2016
 
January 24,
2015
 
January 23,
2016
 
January 24,
2015
 
 
 
 
 
 
 
 
Sales
$
420,170

 
$
411,191

 
$
809,699

 
$
790,935

 
 
 
 
 
 
 
 
Cost of sales
307,444

 
300,065

 
591,487

 
577,006

 
 
 
 
 
 
 
 
Gross profit
112,726

 
111,126

 
218,212

 
213,929

 
 
 
 
 
 
 
 
Operating and administrative expense
95,243

 
92,471

 
186,581

 
181,459

 
 
 
 
 
 
 
 
Depreciation and amortization
6,060

 
5,994

 
12,018

 
11,897

 
 
 
 
 
 
 
 
Operating income
11,423

 
12,661

 
19,613

 
20,573

 
 
 
 
 
 
 
 
Interest expense
(1,125
)
 
(1,138
)
 
(2,252
)
 
(2,272
)
 
 
 
 
 
 
 
 
Interest income
565

 
611

 
1,128

 
1,226

 
 
 
 
 
 
 
 
Income before income taxes
10,863

 
12,134

 
18,489

 
19,527

 
 
 
 
 
 
 
 
Income taxes
4,579

 
5,531

 
7,775

 
9,046

 
 
 
 
 
 
 
 
Net income
$
6,284

 
$
6,603

 
$
10,714

 
$
10,481

 
 
 
 
 
 
 
 
Net income per share:
 
 
 
 
 
 
Class A common stock:
 
 
 
 
 
 
 
Basic
$
0.50

 
$
0.53

 
$
0.85

 
$
0.84

Diluted
$
0.44

 
$
0.47

 
$
0.76

 
$
0.74

 
 
 
 
 
 
 
 
Class B common stock:
 
 
 

 
 

 
 

Basic
$
0.32

 
$
0.34

 
$
0.55

 
$
0.54

Diluted
$
0.32

 
$
0.34

 
$
0.55

 
$
0.54

 
 
 
 
 
 
 
 
Gross profit as a % of sales
26.83
%
 
27.03
%
 
26.95
%
 
27.05
%
Operating and administrative expense as a % of sales
22.67
%
 
22.49
%
 
23.04
%
 
22.94
%



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