The Fresh Market on Thursday said sales from new stores exceeded expectations and helped the specialty retailer post sales and earnings slightly ahead of analyst estimates during the fiscal second quarter.
Net sales for the period, which ended July 27, increased 19% to $422.2 million, and comparable store sales improved by 2.9% reflecting a 2.7% increase in the number of transactions and a 0.2% increase in average transaction size. Gross margin as a percent of sales decreased slightly to 34% from 34.2% in the same period last year. Net earnings of $11.4 million decreased by 27.1% from the same period a year ago, reflecting impairment and store closing costs for stores in Texas and California.
Adjusted for those expenses, per-share earnings of 36 cents came in a penny ahead of analyst estimates for the quarter.
In a statement, Craig Carlock said new stores helped drive the sales gain, and said the chain would look to increase its store count in the Southeast: “The performance of our new stores exceeded our expectations and we see tremendous expansion opportunities in our core markets. Based on a recent white space analysis, we are raising our store growth potential in the Southeastern United States to double our current store base in this region. We are encouraged by our first half results and believe we are well positioned to achieve our strategic and financial objectives for the year as we further expand our store base and enhance our customer offerings.”
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