Taking Stock

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Retail Roundup

Village Super Markets, Wakefern’s second largest member (and its only publicly-traded one) posted another strong quarter. In its fourth period ended July 28, theSpringfield,NJmerchant posted an earnings gain of three percent to $9 million (despite continuing losses at its two newMarylandstores). Same store sales increased 1.8 percent. The 29 store retailer also stated that it would spend about $20 million in its next fiscal year for capital expenditures including two replacement stores and three major remodels. This fiscal year, Village produced a sales per square foot of selling space number (SPSFSS) of $1,112, one of the best in the industry among supermarkets…while its square footage per store is about three times that of Village, Costco also produces one of the best SPSFSS figures among all retailers. The Issaquah, WA club operator, which will open on November 10 in Concordville, PA, continued its recent run of strong earnings and stellar same stores sales. In its fourth quarter ended September 2, the nation’s largest club store retailer posted a net income gain of 27.4 percent to $609 million. Overall revenue increased 14.2 percent to $31.5 billion and comp stores sales (ex-gas) jumped an impressive six percent. CFO Richard Galanti told analysts that Costco will increase its cap-ex in fiscal 2013 between 20-33 percent ($1.8-$2 billion) and open 16 new stores, including nine in the U.S., it largest expansion in six years…Mark McGowan, formerly president of Ahold USA’s Stop & Shop New England division and most recently executive VP- supply chain for the big retailer, will be adding new temporary duties. McGowan has been named interim EVP-merchandising. This announcement fills the void left by Jeff Martin, who supervised both merchandising and marketing before his unexpected resignation from Ahold USA last June. Since then, Ahold has split the merchandising and marketing functions with Erik Keptner being named EVP-marketing. McGowan will hold the expanded role strictly on an interim basis as AUSA continues the search for a new leader of its merchandising team…Giant/Landover, another Ahold USA banner, is looking to sell its 760,000 square foot (now vacant) former dry grocery warehouse in Jessup, MD. That dry grocery business was shifted to a C&S depot in York, PA last year and the old Jessup facility seems very saleable given that it is one of the single largest distribution centers in the state of Maryland and can house 340 trailers…Wal-Mart is feeling some labor heat for the first time in decades as small groups of employees have staged walkouts at 28 stores in 12 states in a demand for better wages, and benefits and improved working conditions. Things could get worse in the next six weeks as the UFCW (which is leading the walkout effort) is threatening more job action on Black Friday, the busiest shopping day of the year. And on October 12, Wal-Mart told financial analysts that its 2014 growth plans would mirror those of fiscal 2013. The Behemoth noted it will still open more SuperCenters than “Division I” and Neighborhood Market units next year, but plans to more than double the number of Neighborhood Markets in theU.S.by fiscal 2016. More Wal-Mart news: a potential deal with developer Related Cos. and Wal-Mart to build a new store in southeast Brooklyn (East New York), which would have been the Behemoth’s first NYC store, has apparently fallen through. Now it appears that the anchor for that large 630,000 square foot project will be ShopRite. Also coming to Brooklyn is Aldi, which will occupy the space of a former Pathmark store in theSheepsheadBaysection of the borough. Pathmark will also be closing itsLower Manhattanstore (Cherry Street) in December. Once parent company A&P sells its 16 Food Emporiums inManhattan, The Tea Company will be left with only three stores inNew York City’s most affluent borough.