Roundy’s reports mixed results on day of Kroger announcement

MILWAUKEE — Roundy’s reported a net loss of $8.6 million from continuing operations for the 13 weeks ended Oct. 3 on Wednesday, the day Kroger announced its acquisition of the midwest grocer. Net sales from continuing operations decreased 0.2% to $971.8 million. 

 

Same-store sales from continuing operations decreased 3.4%, which was due to a 4.2% decrease in the number of customer transactions, partially offset by a 0.8% increase in the average transaction size.

 

“Our third quarter results were disappointing as sales and EBITDA did not meet our expectations,” Robert Mariano, Roundy's chairman, president and CEO, said. “The sales shortfall was primarily due to continued competitive store openings in our Wisconsin markets. Despite a very competitive pricing environment, we were pleased to maintain our gross margin rate compared to the prior year. We remain committed to our strategic initiatives, improving execution, and profitably growing sales across all of our markets.”

 

Net sales for the company’s Wisconsin markets were $619 million for the third quarter 2015, a decrease of $50.4 million, or 7.5%, from $669.4 million for the third quarter 2014. The decrease primarily reflects the closure of three stores during the fourth quarter of 2014 and one store during the second quarter of 2015 and a decrease in same-store sales, the company said. Same-store sales decreased 3.7%, due to a 4.1% decrease in the number of customer transactions, partially offset by a 0.4% increase in the average transaction size. 

 

Net sales for the company’s Illinois market were $352.8 million for the third quarter 2015, an increase of $48.4 million, or 15.9%, from $304.4 million for the third quarter 2014. The increase primarily reflects the benefit of new stores in Illinois, partially offset by a 2.6% decrease in same-store sales. The decrease in same-store sales was due to a 4.2% decrease in the number of customer transactions, partially offset by a 1.6% increase in the average transaction size. Same-store sales were negatively impacted by the cannibalization effect of new and acquired store openings in the Illinois market. In addition, same-store sales have been negatively impacted by the reopening of a significant number of former Dominick’s stores that were initially closed in early 2014 and are now operated by other competitors.