UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) |
February 4, 2013 |
INGLES MARKETS, INCORPORATED |
(Exact name of registrant as specified in its charter) |
North Carolina |
0-14706 |
56-0846267 |
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
P.O. Box 6676, Asheville, NC |
28816 |
|
(Address of principal executive offices) |
(Zip Code) |
Registrant’s telephone number, including area code |
(828) 669-2941 |
N/A |
(Former name or former address, if changed since last report.) |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
⃞ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
⃞ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
⃞ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
⃞ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 2.02 Results of Operations and Financial Condition.
On February 4, 2013, Ingles Markets, Incorporated ("IMKTA") issued a press release announcing financial information for its first quarter ended December 29, 2012. The press release is attached as Exhibit 99.1 to this Form 8-K.
Item 9.01 Financial Statements and Exhibits.
(d) |
Exhibits. |
|||
Exhibit Number |
Description of Exhibit |
|||
99.1 |
Press release issued February 4, 2013 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
|
INGLES MARKETS, INCORPORATED |
||
|
(Registrant) |
||
Date: |
February 4, 2013 |
||
|
|
By: |
/s/ Ronald B. Freeman |
Ronald B. Freeman |
|||
Chief Financial Officer |
EXHIBIT INDEX
Exhibit |
Description |
99.1 |
Press Release dated February 4, 2013 |
Exhibit 99.1
Ingles Markets, Incorporated Reports Increased Sales and Net Income for First Quarter Fiscal 2013
Net Sales Up 1.6% to $932.8 Million – Net Income Up 9.2% to $11.6 Million
ASHEVILLE, N.C.--(BUSINESS WIRE)--February 4, 2013--Ingles Markets, Incorporated (NASDAQ: IMKTA) today reported a 1.6% increase in net sales to $932.8 million for its first fiscal quarter ended December 29, 2012. Net income rose 9.2% to $11.6 million for the December 2012 quarter compared with net income of $10.6 million for the quarter ended December 2011.
Commenting on the results, Chief Executive Officer Robert P. Ingle II said, “We are off to a good start for fiscal 2013, our 50th year. The holiday season was very competitive for our industry, and we responded well.”
Financial Results
Net sales rose 1.6% to $932.8 million for the quarter ended December 29, 2012, compared with $918.2 million for the quarter ended December 24, 2011. For the comparable December 2012 and 2011 quarters and excluding gasoline sales, grocery segment comparable store sales increased 1.5%, weekly customer visits increased 1.4% and the average transaction amount was essentially unchanged.
Gross profit for the first quarter of fiscal 2013 rose $6.2 million to $207.9 million compared with the first quarter of fiscal 2012. Gross profit as a percentage of sales rose to 22.3% for the first quarter of fiscal 2013 compared with 22.0% for the first quarter of fiscal 2012.
Total operating expenses were $174.8 million for the first quarter of fiscal 2013 compared with $171.8 million for the comparable fiscal 2012 quarter. Operating and administrative expenses as a percentage of sales, excluding gasoline sales and associated operating expenses, were 21.7% and 21.6% for the three months ended December 29, 2012, and December 24, 2011, respectively.
Net rental income, gains/losses on asset disposals, and other income totaled approximately $1.0 million and $1.4 million for the December 2012 and 2011 quarters, respectively. There were no individually significant trends or transactions for either first fiscal quarter.
Interest expense increased $0.6 million for the three-month period ended December 29, 2012, to $15.6 million from $15.0 million for the three-month period ended December 24, 2011. Total debt at December 29, 2012 was $877.0 million compared to $882.5 million at December 24, 2011. Interest on the bonds that funded construction of the new distribution center was capitalized prior to its opening in mid-2012. For the three months ended December 29, 2012, this interest was expensed. The Company currently has lines of credit totaling $175.0 million with $84.8 million borrowed and $9.5 million of unused letters of credit issued at December 29, 2012. The Company believes its financial resources, including these lines 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. The Company’s $575 million of senior notes with a yield of 9.5% become callable at a price of 104.438% of par on May 15, 2013.
Income tax expense as a percentage of pre-tax income was 37.4% in the December 2012 quarter compared to 35.2% in the December 2011 quarter. The lower tax rate for the December 2011 quarter benefited from certain tax incentives related to hiring and investing during the recent economic downturn, but had expired for this year’s first fiscal quarter.
Net income for the December 2012 quarter increased 9.2% to $11.6 million compared with net income of $10.6 million for the December 2011 quarter. Basic and diluted earnings per share for the Company’s publicly traded Class A common stock were $0.50 and $0.48 per share, respectively, for the December 2012 quarter compared with $0.45 and $0.43 per share, respectively, for the December 2011 quarter.
Capital expenditures totaled $28.1 million for the three-month period ended December 29, 2012. Most of these capital expenditures were related to remodeling projects in a number of the Company’s stores and to new store construction. Capital expenditures totaled $63.7 million for the three-month period ended December 24, 2011. This unusually high amount included costs for construction of the new distribution facility.
Ingles’ capital expenditure plans for fiscal year 2013 include investments of approximately $100 million to $130 million. The majority of the Company’s fiscal 2013 capital expenditures will be dedicated to continued improvement of its store base.
During the December 2012 fiscal quarter the Company declared a special dividend of $0.66 per Class A and $0.60 per Class B share of common stock and accelerated the quarterly dividend of $0.165 per Class A and $0.15 per Class B share of common stock that normally would have been declared and paid during January 2013. These dividends were paid December 31, 2012. These actions were in response to tax increases on dividends that were enacted effective January 1, 2013.
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 2012 Form 10-K and Form 10-Q for the quarter ended December 29, 2012.
Ingles Markets, Incorporated is a leading supermarket chain with operations in six southeastern states. Headquartered in Asheville, North Carolina, the Company operates 203 supermarkets. In conjunction with its supermarket operations, the Company also operates 69 neighborhood shopping centers, all but 12 of which contain an Ingles supermarket. The Company’s Class A Common Stock is traded on The NASDAQ Stock Market’s Global Select Market under the symbol IMKTA. For more information, visit Ingles’ website at www.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 29, | December 24, | |||||
2012 | 2011 | |||||
Net sales | $ | 932,791 | $ | 918,238 | ||
Gross profit | 207,870 | 201,728 | ||||
Operating and administrative expenses | 174,846 | 171,809 | ||||
Rental income, net | 316 | 428 | ||||
Gain from sale or disposal of assets | 122 | 15 | ||||
Income from operations | 33,462 | 30,363 | ||||
Other income, net | 583 | 1,004 | ||||
Interest expense | 15,560 | 15,009 | ||||
Income taxes | 6,918 | 5,760 | ||||
Net income | $ | 11,568 | $ | 10,597 | ||
Basic earnings per common share – Class A | $ | 0.50 | $ | 0.45 | ||
Diluted earnings per common share – Class A | $ | 0.48 | $ | 0.43 | ||
Basic earnings per common share – Class B | $ | 0.45 | $ | 0.41 | ||
Diluted earnings per common share – Class B | $ | 0.45 | $ | 0.41 | ||
Additional selected information: | ||||||
Depreciation and amortization expense | $ | 23,623 | $ | 22,122 | ||
Rent expense | $ | 3,546 | $ | 3,384 | ||
Condensed Consolidated Balance Sheets (Unaudited) | ||||||
December 29, | September 29, | |||||
2012 | 2012 | |||||
ASSETS | ||||||
Cash and cash equivalents | $ | 9,449 | $ | 4,683 | ||
Receivables-net | 61,450 | 61,519 | ||||
Inventories | 345,421 | 329,615 | ||||
Other current assets | 29,143 | 30,387 | ||||
Property and equipment-net | 1,200,711 | 1,197,138 | ||||
Other assets | 15,303 | 18,767 | ||||
TOTAL ASSETS | $ | 1,661,477 | $ | 1,642,109 | ||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||
Current maturities of long-term debt | $ | 50,412 | $ | 49,928 | ||
Accounts payable, accrued expenses and current portion of other long-term liabilities | 245,999 | 256,224 | ||||
Deferred income taxes | 82,789 | 84,120 | ||||
Long-term debt | 826,587 | 785,240 | ||||
Other long-term liabilities | 9,709 | 9,183 | ||||
Total Liabilities | 1,215,496 | 1,184,695 | ||||
Stockholders' equity | 445,981 | 457,414 | ||||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 1,661,477 | $ | 1,642,109 |
CONTACT:
Ingles Markets, Incorporated
Ron Freeman, 828-669-2941
(Ext. 223)
Chief Financial Officer