Competitive grocery market hurts Roundy’s earnings

Milwaukee-based Roundy’s Inc. on Wednesday reported fourth quarter net income of $6.1 million, or 16 cents per share, down from $8.7 million, or 7 cents per share, in the fourth quarter of 2013.

Quarterly revenue was $1.1 billion, up from $853 million in the same period a year ago.

Same-store sales from continuing operations were down 2.3 percent, driven by fewer customer transactions and smaller transaction sizes as Roundy’s deals with competitive store openings in its Wisconsin markets.

Operating and administrative expenses also increased in the fourth quarter, partially as a result of the closure of two Wisconsin stores.
For the full year, Roundy’s reported a net loss of $309.9 million, compared with net income of $34.5 million in 2013.

Full-year revenue was $3.9 billion, up from $3.4 billion in 2013.

2014 same-store sales from continuing operations were down 2.9 percent.

The loss was attributed to a decrease in same-store sales in Wisconsin and start-up costs related to new stores the company is opening in Chicago.

“We are pleased with our improvement in net sales and EBITDA in the fourth quarter of 2014 from the prior year,” said Robert Mariano, chairman, president and chief executive officer of Roundy’s. “The fourth quarter was also our second consecutive quarter of improved same-store sales. Overall, 2014 was a transition year for the company with our investments in Illinois growth and our transition out of the Twin Cities market. Each successive quarter was another building block in creating a solid foundation for the future. While the current operating environment still presents challenges near-term, we remain confident in our ability to implement our strategic operational initiatives designed to optimize our long-term performance.”

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