WILLIAMSVILLE, N.Y. — Tops Holding Corp.  here is planning to open a small-format store focused on upscale and specialty foods, including an emphasis on natural and organic product, according to local reports.
The store, to be called Orchard Fresh, would open in Buffalo, N.Y., early next year, Buffalo Business First reported. The article also stated that the store could be a template for future expansion.
Tops could not be reached for comment.
Separately, the company said its third-quarter same-store sales and overall profits were down vs. year-ago results, due in part to the conversion of some drugs to generic equivalents and a one-time labor-cost benefit in the 2011 period.
The company, which is parent of the 150-store Tops Friendly Markets chain in New York, Pennsylvania and Vermont, posted net income of $4.7 million for the 12-week period that ended Oct. 6, down about 27% from the year-ago third quarter. Sales were flat at about $538.4 million, and same-store sales, excluding gas, were down 1.3%.
Read more: Tops Cites Impact of Generic Rx on Q3 Sales 
The conversion of certain popular drugs to generic equivalents has an estimated impact of 75 basis points, or $3.7 million, on same-store sales, the company said.
In addition, Tops sold or closed five former Penn Traffic stores in late 2011 and early 2012, which had contributed $3.5 million in sales (excluding gas) during the year-ago period. The recent quarter includes one week of sales from the 21 stores acquired from GU Markets.
Operating income for the third quarter was $18.4 million, or 3.4% of net sales, down from 3.9% of net sales in the prior-year period. The company experienced a $2.4 million reduction in expenses in the year-ago quarter after an adjustment related to a labor contract.
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