2014

Stater Bros. Holdings Inc. Announces First Quarter 2011 Results

SAN BERNARDINO, Calif., Feb. 8, 2011 /PRNewswire/ -- Today, Jack H. Brown, Chairman, President and Chief Executive Officer of Stater Bros. Holdings Inc. announced financial results for the first quarter of fiscal 2011 ended December 26, 2010.

(Logo:   http://photos.prnewswire.com/prnh/20110131/LA39292LOGO)

The Company's supermarket sales declined 2.31% in the first quarter of fiscal 2011 compared to the same period of the prior year.  Like store sales decreased 2.31% or $21.3 million for the thirteen weeks ended December 26, 2010 compared to the thirteen weeks ended December 27, 2009.  Consolidated sales in the first quarter of fiscal 2011 were $899.0 million compared to $923.9 million in the first quarter of fiscal 2010, an overall decline of $24.8 million.

During the thirteen week first quarter ended December 26, 2010, the Company early retired $479.9 million of its $525.0 million 8.125% Senior Notes (the "Retired Notes") through a tender offer which was completed on December 13, 2010.  On January 14, 2011, the Company called and retired the remaining outstanding $45.1 million of Retired Notes.  The Company funded the early retirement of the Retired Notes through the issuance of $255.0 million unregistered 7.375% Senior Notes due November 2018, entering into a $145.0 million secured term loan with a consortium of banks and using cash on hand.

In the first quarter of 2011, the Company recognized interest expense of $3.3 million for the write-off of the unamortized portion of deferred offering costs related to the Retired Notes and expensed approximately $1.8 million of tender premium paid in the tender offer.  While the Company incurred more interest expense in the first quarter of fiscal 2011 related to the early retirement of the Retired Notes, its interest expense going forward will be reduced as the Company has reduced its overall debt load and its new issues bear a lower interest rate.

The Company reported net income for the thirteen week first quarter ended December 26, 2010 of $1.3 million compared to net income for the thirteen week first quarter ended December 27, 2009 of $6.7 million.  Net income for first quarter of fiscal 2010 includes an after tax gain of $4.7 million from the Company's dairy asset sale.

Brown said, "As reported, last year's first quarter profits of $6.7 million included an after tax profit of $4.7 million from the sale of the Company's dairy assets.

This year's first quarter profits of $1.3 million include after tax charges of $3.0 million involving one-time costs from our refinancing.  Without those refinancing costs, our profits for the first quarter would have been $4.3 million, approximately."

Brown continued, "We are excited to have been able to reduce our overall debt load and to refinance a significant portion of our debt at lower rates, which will reduce our interest expense.  We will be able to use the savings from our debt reduction to continue to provide our 'Valued Customers' with the value and quality they have come to expect from their Stater Bros. Market.

Our customers continue to face tough economic challenges as our economy continues to have a negative effect on their family budgets.  Our emphasis in these tough economic times is to retain customers by providing value so our customers get the most out of their shopping dollars while providing them with a friendly and satisfying experience on each and every one of their visits to our supermarkets."

Stater Bros. is the largest privately owned Supermarket Chain in Southern California and the largest private employer in both San Bernardino County and Riverside County, with annual sales in 2010 of $3.6 billion.  The Company currently operates 167 Supermarkets, and there are over 18,000 members of the Stater Bros. Supermarket Family.  

STATER BROS ... PROUDLY SERVING SOUTHERN CALIFORNIA FAMILIES FOR 75 YEARS

STATER BROS. HOLDINGS INC.

Condensed Consolidated Balance Sheets

(In thousands)

Unaudited





09/26/10


12/26/10

Assets





Current assets






Cash and cash equivalents

$    325,005


$    218,179



Restricted cash

3,121


3,121



Receivables, net

35,614


42,322



Inventories

203,702


237,065



Other

56,107


54,654








Total current assets

623,549


555,341








Property and equipment, net

644,064


638,300








Deferred debt issuance costs, net

8,074


12,510


Other

47,100


48,757







Total assets

$ 1,322,787


$ 1,254,908













Liabilities and stockholder's equity





Current liabilities






Accounts payable

$    135,642


$    168,122



Accrued expenses and other liabilities

147,972


128,139



Current portion of long-term debt

133,812


52,174








Total current liabilities

417,426


348,435








Long-term debt, less current portion

677,750


679,562


Capital lease obligations, less current portion

2,206


1,776


Other long-term liabilities

152,272


155,738








Total stockholder's equity

73,133


69,397







Total liabilities and stockholder's equity

$ 1,322,787


$ 1,254,908



STATER BROS. HOLDINGS INC.

Condensed Consolidated Statements of Income

(In thousands)

Unaudited








13 Weeks


13 Weeks



Ended


Ended



12/27/09


12/26/10

Sales

$ 923,864


$ 899,037






Gross profit

238,150


238,773






Operating expenses:





Selling, general and





   administrative expenses

205,288


203,518


Gain on sale of dairy assets

(7,950)


-


Depreciation and amortization

12,666


12,444

Total operating expenses

210,004


215,962






Operating profit

28,146


22,811






Interest income

59


259

Interest expense

(17,189)


(20,973)

Other expenses, net

(11)


(92)






Income before income taxes

11,005


2,005






Income taxes

4,294


741






Net income

$     6,711


$     1,264



Contact:  Phillip J. Smith | Executive Vice President and Chief Financial Officer | P.O. Box 150 | San Bernardino, CA 92402 | Phone: (909) 733-5287

SOURCE Stater Bros. Holdings Inc.



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