Village Super Market, Inc. Reports Results for the First Quarter Ended October 30, 2021

Rhea-AI Summary

Village Super Market (NASDAQ:VLGEA) reported a strong performance in Q1 2022, ending October 30, 2021. Net income surged by 118% to $7.3 million, with sales rising to $494.2 million, up from $490.1 million year-over-year. Same-store sales grew by 2.3%, driven by food inflation and increased SNAP benefits. Gross profit as a percentage of sales improved slightly to 28.36%. Operating expenses as a percentage of sales decreased to 24.54%, attributed to lower payroll costs despite rising digital sales expenses. The company operates 34 supermarkets across several states.

Positive

• Net income increased 118% to $7.3 million.
• Sales rose to $494.2 million from $490.1 million year-over-year.
• Same-store sales grew 2.3%.
• Gross profit margin improved to 28.36%.

Negative

• Same-store digital sales were flat.
• Closure of the Silver Spring store in February 2021 impacted sales.

SPRINGFIELD, N.J., Dec. 08, 2021 (GLOBE NEWSWIRE) -- Village Super Market, Inc. (NASDAQ:VLGEA) (the "Company" or "Village") today reported its results of operations for the first quarter ended October 30, 2021.

First Quarter Highlights

• Net income of $7.3 million, an increase of 118% compared to $3.4 million in the first quarter of the prior year
• Same store sales increased 2.3%; on a two-year stacked basis same store sales increased 9.1%
• Same store digital sales were flat; on a two-year stacked basis same store digital sales increased 153%
  

First Quarter of Fiscal 2022 Results

Sales were $494.2 million in the 13 weeks ended October 30, 2021 compared to $490.1 million in the 13 weeks ended October 24, 2020. Sales increased due to an increase in same store sales of 2.3% partially offset by the closure of the Silver Spring, Maryland store in February 2021. Increases in transaction counts were partially offset by decreased basket sizes and same store digital sales were flat as we cycled against the initial months following the COVID-19 outbreak in our trade area. Food inflation and increased Supplemental Nutrition Assistance Program ("SNAP") benefits continue to positively impact sales.

New stores and replacement stores are included in same store sales in the quarter after the store has been in operation for four full quarters. Store renovations and expansions are included in same store sales immediately.

Gross profit as a percentage of sales increased to 28.36% in the 13 weeks ended October 30, 2021 compared to 28.15% in the 13 weeks ended October 24, 2020 due primarily to increased departmental gross margin percentages (.68%), a favorable change in product mix (.08%) and lower promotional spending (.03%) partially offset by increased warehouse assessment charges from Wakefern (.57%). Department gross margins increased due primarily to pricing initiatives and improvements in commissary operations.

Operating and administrative expense as a percentage of sales decreased to 24.54% in the 13 weeks ended October 30, 2021 compared to 25.37% in the 13 weeks ended October 24, 2020. The decrease in Operating and administrative expenses is due primarily to lower payroll costs (.89%) and less advertising spending (.11%) partially offset by increased external fees and transportation costs associated with digital sales (.16%). Payroll costs decreased due to productivity initiatives and labor shortages despite minimum wage and demand driven pay rate increases.  

Village Super Market operates a chain of 34 supermarkets in New Jersey, New York, Maryland and Pennsylvania under the ShopRite and Fairway banners and three Gourmet Garage specialty markets in New York City.

Forward Looking Statements

All statements, other than statements of historical fact, included in this Press Release are or may be considered forward-looking statements within the meaning of federal securities law. The Company cautions the reader that there is no assurance that actual results or business conditions will not differ materially from future results, whether expressed, suggested or implied by such forward-looking statements. The Company undertakes no obligation to update forward-looking statements to reflect developments or information obtained after the date hereof. The following are among the principal factors that could cause actual results to differ from the forward-looking statements: risks and uncertainties related to the COVID-19 pandemic, including among others, the duration and severity of the pandemic, shifts in customers buying patterns, disruptions to supply chains, inability of the workforce to work due to illness, quarantine or government mandates, including travel restrictions and stay at home orders, the effectiveness and duration of COVID-19 stimulus packages; general economic conditions; competitive pressures from the Company’s operating environment; the ability of the Company to maintain and improve its sales and margins; the ability to attract and retain qualified associates; the availability of new store locations; risks, uncertainties and challenges associated with the Fairway acquisition, including under-performance relative to our expectations, additional capital requirements, unforeseen expenses or delays, imprecise assumptions or our inability to achieve projected cost savings or other synergies, competitive factors in the marketplace and difficulties integrating the business, including merging company cultures, cultivating brand strategy, expansion of food production and conforming the acquired company's technology, standards, processes, procedures and controls; the availability of capital; the liquidity of the Company; the success of operating initiatives; consumer spending patterns; the impact of changing energy prices; increased cost of goods sold, including increased costs from the Company’s principal supplier, Wakefern; disruptions or changes in Wakefern's operations; the results of litigation; the results of tax examinations; the results of union contract negotiations; competitive store openings and closings; the rate of return on pension assets; and other factors detailed herein and in the Company’s filings with the SEC.

VILLAGE SUPER MARKET, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts) (Unaudited)

	13 Weeks Ended
	October 30, 2021					October 24, 2020
Sales	$	494,211				$	490,136
Cost of sales	354,031					352,173
Gross profit	140,180					137,963
Operating and administrative expense	121,283					124,363
Depreciation and amortization	8,335					8,714
Operating income	10,562					4,886
Interest expense	(970		)			(987		)
Interest income	976					891
Income before income taxes	10,568					4,790
Income taxes	3,240					1,430
Net income	$	7,328				$	3,360
Net income per share:
Class A common stock:
Basic	$	0.56				$	0.26
Diluted	$	0.50				$	0.23
Class B common stock:
Basic	$	0.37				$	0.17
Diluted	$	0.37				$	0.17
Gross profit as a % of sales	28.36			%		28.15			%
Operating and administrative expense as a % of sales	24.54			%		25.37			%

Contact:	John Van Orden, CFO
	(973) 467-2200
	villageinvestorrelations@wakefern.com

FAQ

What were Village Super Market's Q1 2022 financial results?

For Q1 2022, Village Super Market reported net income of $7.3 million and sales of $494.2 million.

How much did net income increase for Village Super Market in Q1 2022?

Net income increased by 118% compared to the same period last year.

What were the same-store sales results for VLGEA in Q1 2022?

Same-store sales increased by 2.3% in Q1 2022.

What is the gross profit margin for Village Super Market in Q1 2022?

The gross profit margin for Q1 2022 was 28.36%.

How did the closure of the Silver Spring store affect Village Super Market's sales?

The closure of the Silver Spring store in February 2021 partially offset the sales increase.