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Ingles Markets, Incorporated Reports Sales and Net Income for First Quarter Fiscal 2022

Ingles Markets, Incorporated (NASDAQ: IMKTA) today reported increased sales and net income for the three months ended December 25, 2021.

The coronavirus (COVID-19) pandemic was declared a national emergency on March 13, 2020. The pandemic has had a significant impact on the Company’s operations since then. At this time the Company cannot predict the impact of the pandemic on future periods.

Robert P. Ingle II, Chairman of the Board, stated, “We were fortunate to have good sales and overall results for the quarter that includes Thanksgiving and Christmas. Despite supply chain disruptions from the Omicron variant, our associates did an excellent job of meeting customer needs under difficult circumstances.”

First Quarter Results

Net sales totaled $1.39 billion for the quarter ended December 25, 2021, an increase of 16.9% compared with $1.19 billion for the quarter ended December 26, 2020.

Gross profit for the first quarter of fiscal 2022 totaled $350.5 million, or 25.2% of sales. Gross profit for the first quarter of fiscal 2021 was $314.2 million, or 26.4% of sales.

Operating and administrative expenses for the December 2021 quarter totaled $260.1 million compared with $238.2 million for the December 2020 quarter. Most of the increase was due to higher personnel costs that reflect a tight labor market.

Interest expense totaled $5.4 million for the first quarter of fiscal 2022 compared with $6.4 million for the first quarter of fiscal 2021. Total debt at the end of December 2021 was $586.1 million compared with $587.9 million at the end of December 2020.

Net income totaled $66.2 million for the December 2021 quarter compared with $53.8 million for the December 2020 quarter. Basic and diluted earnings per share for Class A Common Stock were $3.57 and $3.48, respectively, for the quarter ended December 25, 2021, compared with $2.73 and $2.66, respectively, for the quarter ended December 26, 2020.

Capital expenditures for the December 2021 quarter totaled $21.3 million compared with $34.2 million for the December 2020 quarter.

The Company has no outstanding borrowings under its $150.0 million line of credit. The Company believes its financial resources, including the line of credit and other internal and anticipated external sources of funds, will be sufficient to meet planned capital expenditures, debt service and working capital requirements for the foreseeable future.

Ingles continues to provide additional pandemic support to its communities, including increased donations to local food banks and purchases from local vendors.

The comments in this press release contain certain forward-looking statements. Ingles undertakes no obligation to publicly release any revisions to any forward-looking statements contained herein to reflect events or circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events, except as required by law. Ingles’ actual results may differ materially from those projected in forward-looking statements made by, or on behalf of, Ingles. Factors that may affect results include changes in business and economic conditions generally in Ingles’ operating area, pricing pressures, increased competitive efforts by others in Ingles’ marketing areas and the availability of financing for capital improvements. A more detailed discussion of these factors may be found in reports filed by the Company with the Securities and Exchange Commission including its 2021 Form 10-K.

Ingles Markets, Incorporated is a leading grocer with operations in six southeastern states. Headquartered in Asheville, North Carolina, the Company operates 198 supermarkets. In conjunction with its supermarket operations, the Company operates neighborhood shopping centers, most of which contain an Ingles supermarket. The Company also owns a fluid dairy facility that supplies Ingles supermarkets and unaffiliated customers. To learn more about Ingles Markets visit ingles-markets.com.

INGLES MARKETS, INCORPORATED

(Amounts in thousands except per share data)

  

Unaudited Financial Highlights

Condensed Consolidated Statements of Income (Unaudited)

  

 

 

Quarter Ended

 

 

 

December 25,

 

 

December 26,

 

 

 

2021

 

 

2020

 

Net sales

 

$

1,391,530

 

 

$

1,190,443

 

Gross profit

 

 

350,544

 

 

 

314,188

 

Operating and administrative expenses

 

 

260,085

 

 

 

238,199

 

(Loss) gain from sale or disposal of assets

 

 

(56

)

 

 

452

 

Income from operations

 

 

90,403

 

 

 

76,441

 

Other income, net

 

 

1,592

 

 

 

692

 

Interest expense

 

 

5,414

 

 

 

6,401

 

Pretax income

 

 

86,581

 

 

 

70,732

 

Income tax expense

 

 

20,392

 

 

 

16,908

 

Net income

 

$

66,189

 

 

$

53,824

 

Basic earnings per common share – Class A

 

$

3.57

 

 

$

2.73

 

Diluted earnings per common share – Class A

 

$

3.48

 

 

$

2.66

 

Basic earnings per common share – Class B

 

$

3.24

 

 

$

2.48

 

Diluted earnings per common share – Class B

 

$

3.24

 

 

$

2.48

 

Additional selected information:

 

 

 

 

 

 

Depreciation and amortization expense

 

$

29,297

 

 

$

29,879

 

Rent expense

 

$

2,632

 

 

$

2,698

 

  

Condensed Consolidated Balance Sheets (Unaudited)

  

 

 

December 25,

 

 

September 25,

 

 

 

2021

 

 

2021

 

ASSETS

 

 

 

 

 

 

Cash and cash equivalents

 

$

27,644

 

 

$

70,313

 

Short term investments

 

 

115,007

 

 

 

5,000

 

Receivables-net

 

 

103,034

 

 

 

95,082

 

Inventories

 

 

389,467

 

 

 

389,953

 

Other current assets

 

 

14,033

 

 

 

15,092

 

Property and equipment-net

 

 

1,358,098

 

 

 

1,370,769

 

Other assets

 

 

70,715

 

 

 

72,135

 

TOTAL ASSETS

 

$

2,077,998

 

 

$

2,018,344

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

Current maturities of long-term debt

 

$

17,596

 

 

$

17,601

 

Accounts payable, accrued expenses and current portion of other long-term liabilities

 

 

290,254

 

 

 

288,497

 

Deferred income taxes

 

 

72,122

 

 

 

72,768

 

Long-term debt

 

 

568,533

 

 

 

571,913

 

Other long-term liabilities

 

 

81,698

 

 

 

84,306

 

Total Liabilities

 

 

1,030,203

 

 

 

1,035,085

 

Stockholders' equity

 

 

1,047,795

 

 

 

983,259

 

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

 

$

2,077,998

 

 

$

2,018,344

 

 

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