MINNEAPOLIS -- Nash Finch Co. here said a wholesale acquisition last year helped boost sales to record levels for the second quarter ended June 20.
st year's record-setting quarterly volume to $982.8 million but fell 0.2% to $1.92 billion for the half, while same-store sales rose 0.3% for the quarter and fell 0.3% for the half.
Ron Marshall, president and chief executive officer, said he attributed the modest sales gains to business added from United-A.G. Cooperative, Omaha, Neb., which Nash Finch acquired in June 1997.
The company said net income dropped 44.1% to $3.6 million for the quarter and 92.9% to $674,000 for the half. Year-to-date earnings include an extraordinary charge of $5.6 million taken in the first quarter for debt refinancing.
Earnings before income taxes, depreciation and amortization were $24.2 million, or 2.5% of sales, for the quarter, compared with $29.5 million, or 3% of sales, a year ago; for the half, before the extraordinary charge, EBITDA was $46.7 million, or 2.4% of sales, compared with $53.8 million, or 2.8% of sales, a year ago.
Marshall said the company was "extremely disappointed" with overall profitability for the quarter. He said the company posted "a modest sales gain, which was encouraging, given the year-to-year decline we saw in the first quarter. The areas in which we operate are highly competitive, however, and sales gains are very challenging."
According to Marshall, the volume gains from United-A.G. were offset by flat sales in the company's military division -- which represented an improvement over sales declines in the first quarter, he noted -- combined with declines in corporate retail sales due to the closing or sale of 15 stores since the end of last year's second quarter, which were partially offset by the opening or purchase of seven stores in the same period.
Prior to the end of the second quarter, Nash Finch said, it completed the purchase of five grocery stores from Harris Supermarkets, Greenville, N.C., and sold three units in North Dakota -- two conventional stores in Minot and a warehouse store in Bismarck -- to Miracle Mart, a new customer based in Mandan, N.D.