Boston, MA 04/25/2014 (wallstreetpr) – SUPERVALU INC. (NYSE:SVU) reported its fourth quarter (4Q2014) ended in February 22, 2014, with net sales of $3.95 billion and net earnings of $26 million or $0.10 per diluted share. The shares were up by 12% and closed at $7.55 on April 23.
Operational highlights
In 4Q2014, SUPERVALU INC. (NYSE:SVU) posted net sales of $3.95 billion, a marginal increase of 1.4% year over year. Identical store sales were up by 2.1% in the Save-A-Lot network and higher fees earned from Transition Services Agreements (TSA) that offset the declining sales of Independent Business (IB). IB segment represents 46% of total sales during 4Q2014.
Despite high investment to lower the prices, the Company improved its gross profit to $590 million, from $557 million in 4Q2013 to $590 million, due to lower infrastructure costs and increase in TSA fees.
The segment’s adjusted operating earnings increased due to cost reduction initiatives, including lower depreciation and bad debt expense and reported an adjusted EBITDA of $187 million in the fourth quarter.
Cash position
In fiscal 2014, SUPERVALU INC. (NYSE:SVU) reported positive net despite lower cash flow from operation of $120 million resulted from higher working capital and tax payments. The improvement was due to lower levels of capex, proceeds from the issuance of shares and lower debt payments. As of February 22, 2014, SUPERVALU’s cash position was $83 million.
Conclusion
SUPERVALU INC. (NYSE:SVU) is generating ~$17 billion sales from its large network of stores across the U.S. It includes 1,819 independent, 1,330 Save-A-Lot stores and 190 retail grocery stores. The Company continues to review its chain of grocery stores and evaluate their performance and sell to avoid compression in its operating margin. Therefore, the Company is increasing focus over its business segments so to make incremental increase in sales and generate enough cash to increase the shareholder’s value in the future.
