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Nash Finch Cites ‘Challenging’ Q2

MINNEAPOLIS — Stock in Nash Finch dropped to a 52-week low in afternoon trading Thursday after the company said competitive pressure and slowing inflation triggered a “challenging” second quarter.

A goodwill writedown of $132 million contributed to a net loss of $85 million in the quarter, which ended June 16, Nash Finch said. Excluding the writedown, which was related to aligning market value to declining stock price, quarterly net earnings decreased 25.6% to $9 million, and adjusted EBITDA totaled $27.8 million or 2.5% of sales compared with $34.4 million or 3.1% of sales in the same period a year ago.

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Total sales dipped 0.6% to $1.1 billion, and comparable-store sales were down 1.5%.

“It’s fair to say this quarter was slightly more challenging than we hoped,” Alec Covington, Nash Finch’s chief executive officer, said during a conference call discussing results. Covington said escalating competitive pressure in the military sales segment weighed on profits, and distribution margins were adversely affected by a slowdown in food price inflation.

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Stock in Nash Finch was down by nearly 8% Thursday afternoon.

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