GRAND RAPIDS, Mich. — Cautious consumers and warmer winter weather contributed to slower than expected sales at Spartan Stores during the fiscal third quarter, the company said Thursday.
While net sales improved by 1.9% to $782.3 million, the gain came mainly from higher fuel prices, Spartan officials said. Excluding fuel, comparable-store sales declined by 1.2%, reflecting both an economic recovery arriving more slowly than expected in Michigan and weather that was warmer than normal during the period, which ended Dec. 31. Typically, snowfall helps Spartan’s stores serving resort areas of Northern Michigan, while forecasted snow sparks stock-up trips at its other stores.
"There’s no snow on the ground in Northern Michigan and we haven’t had any snow to speak of,” Dennis Eidson, chief executive officer of Spartan, confessed during a conference call. “If you get a snow forecast that we’re going to get three, four, five or more inches of snow, we get a significant rush in volume. We just haven’t had it. Those can be million-dollar events.”
Gross profit margin declined 70 basis points to 20.4% of sales during the quarter, primarily due to a higher mix in fuel sales. Net earnings decreased 31.9% for the 16-week quarter to $4.98 million but adjusted earnings per share of 22 cents exceeded analyst expectations.