Spartan Stores' Earnings Hit Record Highs
BYRON CENTER —The acquisition of the Felpausch grocery chain helped Spartan Stores Inc. produce a strong fourth quarter to finish fiscal 2008 with a 36.4 percent increase in net earnings, the company said.
For fiscal 2009, Spartan Chairman and CEO Craig C. Sturken said the company will continue its capital investment program, expecting to spend $60 million to $65 million mostly to upgrade Felpausch stores. Three stores are to be remodeled in the first quarter, two in the second quarter and two more in the third quarter, he said. The company expects to add as many as three “‘fill-in’ or replacement” stores and five fuel centers.
“While the majority of these investments will be directed toward our Felpausch retail stores in order to bring them up to their performance potential, we will also invest in key Family Fare, D&W Fresh Markets and Glen’s Markets where we believe favorable market growth opportunities exist,” Sturken said.
The company has spent $85 million over two years on capital improvements, which he said have been a major spur for sales growth in spite of the limping economy.
For fiscal 2008, Spartan reported consolidated net sales of $2.5 billion, up 12.3 percent over the 2007 fiscal year which included 53 weeks. Comparable stores sales growth was 3.4 percent.
Consolidated net sales in the fourth quarter were the highest in six years, the company reported, increasing to $570.7 million from $520.1 million in last year’s 13-week quarter.
Retail net sales growth of 20.8 percent to $297.4 million was pushed by the Felpausch acquisition and 5.2 percent comparable store sales growth and incremental fuel center sales, Spartan said.
On the distribution side, net sales increased 1.2 percent; however an extra week in the fourth quarter the previous year had inflated sales. Accounting for that, distribution’s net sales were up 9.8 percent.