Giant Food Inc., a Washington based food-drug chain of 178 units, today
announced unaudited sales and earnings for the 12-week and 24-week
periods
ended April 15, 1998 compared with the same period ended April 9,
1997.
While sales growth slowed during the first
quarter of
Giant's fiscal
year, a number of factors led to improved earnings compared with the
previous
year. A year earlier, the Company had introduced aggressive promotional
programs in several of its territories which required substantial
markdowns
in that reporting period. At that time, Giant stated that while such
programs
had
an immediate impact upon earnings, the goal was to build the sales
base. As margins have improved while sales gains have been retained,
earnings
have increased. Improved buying practices have also been a factor in
increasing
margins. On the expense side, however, lower sales growth pushed up
selling,
general, and administrative expenses as a percent of sales. As Giant
enters
the fall season, its planned programs and initiatives are anticipated
to
improve the Company's positioning and performance.
Giant has traditionally held an annual
information
meeting for the shareholders
of its Class A Non-Voting Common Stock which is traded on the American
Stock Exchange. No business is transacted at this meeting which is held
to provide an annual review of the Company's activities for the benefit
of the Class A stockholders. The Company has concluded that such an
information
meeting would be inappropriate in light of the pending cash tender
offer
of Koninklijke Ahold N.V. (Royal Ahold) for all of the Class A
stock.
With regard to the Tender Offer by Ahold,
substantial
progress has been
made regarding store divestitures required by the Federal Trade
Commission.
Based on discussions with the FTC staff, a total of approximately 10
store
locations (comprised of Giant-Landover and Giant of Carlisle stores)
April
be divested. Potential purchasers have been located for the store
locations,
and Giant is awaiting FTC approval of these purchasers. Ahold cannot
proceed
with the acquisition of Giant until it has obtained approval from the
FTC.
Giant is hopeful that it will conclude an agreement with the FTC staff
within the next several weeks and proceed expeditiously towards a final
closing of the transaction.
Giant now operates 178 stores, 141 of which
are
food-drug stores and
three are free-standing drug stores. A year earlier, Giant operated 176
stores, including 133 food-drug stores, and three free-standing drug
stores.
GIANT FOOD INC. FINANCIAL HIGHLIGHTS
Subject to year-end audit
CONSOLIDATED SALES AND EARNINGS
(Dollars in thousands except for per share data)
24 Weeks Ended
April 15, April 9, Change
1998 1997 $ %
Sales $1,947,304 $1,863,718 $83,586 4.5%
Income before income taxes 62,220 37,189 25,031 67.3%
Provision for income taxes 23,475 14,636 8,839 60.4%
Net Income $38,745 $22,553 $16,192 71.8%
Net Income per share $.64 $.38 $.26 68.4%
Earnings per share:
Basic $.64 $.38 $.26 68.4%
Diluted $.64 $.38 $.26 68.4%
Shares used for earnings per share:
Basic (thousands) 60,388 60,037
Diluted (thousands) 60,843 60,375
Supplemental Data:
Effective tax rate 37.7% 39.4%
12 Weeks Ended
April 15, April 9, Change
1998 1997 $ %
Sales $963,639 $934,782 $28,857 3.1%
Income before income taxes 30,200 12,593 17,607 139.8%
Provision for income taxes 11,383 4,953 6,430 129.8%
Net Income $18,817 $7,640 $11,177 146.3%
Earnings per share:
Basic $.31 $.13 $.18 138.5%
Diluted $.31 $.13 $.18 138.5%
Supplemental Data:
Effective tax rate 37.7% 39.3%
GIANT FOOD INC. FINANCIAL HIGHLIGHTS
Subject to year-end audit
CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)
As at
April 15, April 9,
1998 1997
Cash and cash equivalents $47,480 $31,471
Short term investments (A) 192,975 142,262
Inventories 252,789 247,532
Other current assets 90,711 92,913
Total current assets 583,955 514,178
Property, plant & equipment (net) 839,226 837,617
Property under capital leases (net) 113,563 108,784
Other assets 17,602 23,371
$1,554,346 $1,483,950
Current liabilities $363,873 $338,803
Long-term debt-notes and mortgages 25,566 37,518
Long-term debt-obligations under capital leases 152,989 147,623
Other long-term liabilities 87,825 83,103
Total liabilities 630,253 607,047
Shareholders' equity 924,093 876,903
$1,554,346 $1,483,950
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
24 Weeks Ended
April 15, April 9,
1998 1997
Cash flows from operating activities:
Net income $38,745 $22,553
Depreciation and amortization 45,276 45,706
Other adjustments 1,800 750
Net increase in cash from changes in
operating assets & liabilities 43,958 15,241
Net cash provided by operations 129,779 84,250
Cash flows from investing activities:
Increase in short-term investments, net (72,508) (5,084)
Capital expenditures (16,058) (65,216)
Other investing activities, net (1,600) (271)
Net cash used in investing activities (90,166) (70,571)
Cash flows from financing activities:
Dividends paid (23,788) (23,113)
Treasury stock transactions 6,820 3,583
Repayments of long-term debt (4,022) (3,659)
Net cash used in financing activities (20,990) (23,189)
Net change in cash and cash equivalents 18,623 (9,510)
(A) Short term investments are cash investments maturing more than three
months from original investment date.
SOURCE Giant Food Inc. |
