Difficult Retail Environment Makes for Less Than Stellar Q3 2016 for Supervalu
Difficult Retail Environment Makes for Less Than Stellar Q3 2016 for Supervalu
MINNEAPOLIS, MN - Supervalu has reported falling earnings in Q3 2016 financial report this week, and Wall Street has responded in the form of plunging stock prices.
Supervalu’s revenue fell 2.6 percent to $4.11 billion from $4.23 billion a year prior, citing increased competition as the reasons for the decline. Adjusted net earnings from continuing operations were $46 million, down from $49 million from Q3 2015.
Sam Duncan, President CEO, Supervalu
"Although third quarter adjusted EBITDA was in-line with our operating plan, we continue to operate in a challenging environment," said President and CEO Sam Duncan, who is planning to retire in February of this year. "Improving sales is a primary focus as we look to complete the fiscal year."
Q3 sales for Save-A-Lot net also fell 1.5 percent over Q3 2015 from $1.09 billion last year to $1.07 billion now, the report stated.
Rumors that Supervalu would be selling or spinning off its Save-A-Lot business have been circulating for some time now, with the company filing documents just last week that detailed more in-depth plans behind the potential game plan. According to the filing with the Securities and Exchange Commission, Supervalu shareholders would own approximately 80% of the newly separated company.
“We believe that separating Save-A-Lot from Supervalu so that it can operate as an independent, publicly traded company is in the best interests of both Supervalu and Save-A-Lot,” said Duncan. "We believe Supervalu will be able to focus on providing wholesale distribution services to independent retail customers and operating its five regionally based traditional-format grocery banners."
Other highlights from the Supervalu's Q3 2016 report include:
- Consolidated operating earnings of $101 million
- Adjusted EBITDA of $182 million for Q3 fiscal 2016
- Gross profit for the third quarter was $601 million, or 14.6 percent of net sales
- Selling and administrative expenses were $494 million
- Includes charges and costs of $10 million for the potential separation of Save-A-Lot, store closure impairments, and employee severance.
Credited to Google Finance.
Supervalu has been struggling with competition the majority of this year, it seems. The company's stock fell an entire 4 points, from 9.08 in January 14, 2015, to 5.08 in after hours trading on January 13.
Stay tuned to AndNowUKnow as we continue to follow any and all further updates.
