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SpartanNash's (SPTN) Earnings Beat in Q1, Sales Rise Y/Y
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SpartanNash Company (SPTN - Free Report) posted a solid earnings performance in the first quarter of 2022 wherein the bottom line beat the Zacks Consensus Estimate and grew year over year.
This presently Zacks Rank #3 (Hold) company posted adjusted earnings from continuing operations of 83 cents a share, outshining the Zacks Consensus Estimate of 65 cents. Also, the bottom line increased 40.7% from 59 cents a share earned in the same quarter a year ago.
Consolidated net sales of $2,763.7 million rose 4% year over year on higher sales across all the segments. Comparable store sales rose to 7.2%, reflecting the momentum in its Retail segment.
Gross profit grew 7.8% year over year to $450.6 million. Also, gross margin expanded 60 basis points (bps) to 16.3% on improved margin rates across the Food Distribution and Military segments. This was somewhat offset by elevated LIFO expenses.
Moreover, adjusted operating earnings came in at $43.3 million, which climbed 33% from $32.5 million reported in the year-ago quarter. Furthermore, adjusted EBITDA grew 18.2% to $76.6 million.
Segmental Analysis
Net sales at Food Distribution rose 49.6% to $1,370.9 million, mainly owing to the inflationary impacts on pricing. We note that the segment accounted for 49.6% of the company’s consolidated sales in the first quarter of 2022.
Retail’s net sales increased 28.3% to $781.3 million in the reported quarter, mainly due to the inflationary pricing. Retail comparable store sales were 7.2%. The retail segment represented 28.3% of total sales in the period.
Finally, net sales at Military, which constituted 22.1% of the overall quarterly sales, were up 4.7% to $611.5 million. This was mainly due to the inflationary pricing, partly offset by reduced case volumes.
Other Financials
SpartanNash ended the quarter with cash and cash equivalents of $16.3 million, net long-term debt of $433.8 million and a total shareholders’ equity of $795.3 million.
Cash generated from operating activities was $10 million during the 16 weeks ended Apr 23, 2022. SPTN had free cash flow of a negative $20 million in the aforementioned period. Moreover, capital expenditures and IT capital totaled $30.3 million in the same period. For 2022, management still projects capital expenditures and IT capital in the band of $100-$110 million.
In the first quarter, management declared cash dividends of $7.7 million, equal to 21 cents a share. It did not buy back shares during the quarter and has roughly $80 million left under its share repurchase programs.
During the first quarter, SpartanNash declared $7.7 million of cash dividends, equal to 21 cents per share. SPTN did not repurchase shares during the quarter and currently has approximately $80 million remaining under its share buyback programs.
Guidance
Following robust quarterly results, management raised guidance for 2022. Net sales are guided in the range of $9-$9.3 billion, higher than the earlier guidance of $8.9-$9.1 billion.
SpartanNash envisioned adjusted EBITDA in the band of $224-$239 million compared with the previous view of $214-$229 million. Adjusted earnings per share are projected in the bracket of $2.17-$2.32, up from $2.10-$2.25 estimated earlier.
Long-Term Goals
Management issued financial targets, which are likely to be accomplished by 2025. It projects net sales of more than $10 billion, indicating growth of at least 12% from the fiscal 2021 figure. Adjusted EBITDA is anticipated to be more than $300 million, suggesting an increase of at least 40% compared with the fiscal 2021 number. SPTN expected adjusted EBITDA margin to be 3% of net sales, showing a rise of 25% from the fiscal 2021 reading.
Price Performance
This grocery retailer’s stock movement shows that its shares have decreased 15.6% in the past six months compared with the industry’s 5.1% decline.
Stocks to Consider
We highlighted three better-ranked stocks in the Retail - Wholesale sector, namely Tecnoglass (TGLS - Free Report) , Boot Barn Holdings (BOOT - Free Report) and Fastenal (FAST - Free Report) .
Tecnoglass engages in manufacturing and selling architectural glass and windows and aluminum products for the residential and commercial construction industries. It currently sports a Zacks Rank #1 (Strong Buy). Shares of TGLS have jumped 12.9% in the past year.
The Zacks Consensus Estimate for Tecnoglass’ current financial-year sales and earnings per share suggests growth of 21.3% and 28.7%, respectively, from the year-ago period's reported figures. TGLS has a trailing four-quarter earnings surprise of 28.3%, on average.
Boot Barn, a lifestyle retail chain devoted to western and work-related footwear, apparel and accessories, currently flaunts a Zacks Rank #1. The company has a trailing four-quarter earnings surprise of 25.2%, on average. Shares of BOOT have rallied 19.8% in the past year.
The Zacks Consensus Estimate for Boot Barn’s current financial-year sales and earnings per share suggests growth of 17% and 4.4%, respectively, from the year-ago period’s reported figures. BOOT has an expected EPS growth rate of 20% for three-five years.
Fastenal, a national wholesale distributor of industrial and construction supplies, currently has a Zacks Rank #2 (Buy). The company has a trailing four-quarter earnings surprise of 5%, on average. Shares of FAST have risen 0.6% in the past year.
The Zacks Consensus Estimate for Fastenal's current financial-year sales and earnings per share suggests growth of 15.4% and 16.3%, respectively, from the year-ago period. FAST has an expected EPS growth rate of 9% for three-five years.
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SpartanNash's (SPTN) Earnings Beat in Q1, Sales Rise Y/Y
SpartanNash Company (SPTN - Free Report) posted a solid earnings performance in the first quarter of 2022 wherein the bottom line beat the Zacks Consensus Estimate and grew year over year.
This presently Zacks Rank #3 (Hold) company posted adjusted earnings from continuing operations of 83 cents a share, outshining the Zacks Consensus Estimate of 65 cents. Also, the bottom line increased 40.7% from 59 cents a share earned in the same quarter a year ago.
Consolidated net sales of $2,763.7 million rose 4% year over year on higher sales across all the segments. Comparable store sales rose to 7.2%, reflecting the momentum in its Retail segment.
Gross profit grew 7.8% year over year to $450.6 million. Also, gross margin expanded 60 basis points (bps) to 16.3% on improved margin rates across the Food Distribution and Military segments. This was somewhat offset by elevated LIFO expenses.
SpartanNash Company Price and EPS Surprise
SpartanNash Company price-eps-surprise | SpartanNash Company Quote
Moreover, adjusted operating earnings came in at $43.3 million, which climbed 33% from $32.5 million reported in the year-ago quarter. Furthermore, adjusted EBITDA grew 18.2% to $76.6 million.
Segmental Analysis
Net sales at Food Distribution rose 49.6% to $1,370.9 million, mainly owing to the inflationary impacts on pricing. We note that the segment accounted for 49.6% of the company’s consolidated sales in the first quarter of 2022.
Retail’s net sales increased 28.3% to $781.3 million in the reported quarter, mainly due to the inflationary pricing. Retail comparable store sales were 7.2%. The retail segment represented 28.3% of total sales in the period.
Finally, net sales at Military, which constituted 22.1% of the overall quarterly sales, were up 4.7% to $611.5 million. This was mainly due to the inflationary pricing, partly offset by reduced case volumes.
Other Financials
SpartanNash ended the quarter with cash and cash equivalents of $16.3 million, net long-term debt of $433.8 million and a total shareholders’ equity of $795.3 million.
Cash generated from operating activities was $10 million during the 16 weeks ended Apr 23, 2022. SPTN had free cash flow of a negative $20 million in the aforementioned period. Moreover, capital expenditures and IT capital totaled $30.3 million in the same period. For 2022, management still projects capital expenditures and IT capital in the band of $100-$110 million.
In the first quarter, management declared cash dividends of $7.7 million, equal to 21 cents a share. It did not buy back shares during the quarter and has roughly $80 million left under its share repurchase programs.
During the first quarter, SpartanNash declared $7.7 million of cash dividends, equal to 21 cents per share. SPTN did not repurchase shares during the quarter and currently has approximately $80 million remaining under its share buyback programs.
Guidance
Following robust quarterly results, management raised guidance for 2022. Net sales are guided in the range of $9-$9.3 billion, higher than the earlier guidance of $8.9-$9.1 billion.
SpartanNash envisioned adjusted EBITDA in the band of $224-$239 million compared with the previous view of $214-$229 million. Adjusted earnings per share are projected in the bracket of $2.17-$2.32, up from $2.10-$2.25 estimated earlier.
Long-Term Goals
Management issued financial targets, which are likely to be accomplished by 2025. It projects net sales of more than $10 billion, indicating growth of at least 12% from the fiscal 2021 figure. Adjusted EBITDA is anticipated to be more than $300 million, suggesting an increase of at least 40% compared with the fiscal 2021 number. SPTN expected adjusted EBITDA margin to be 3% of net sales, showing a rise of 25% from the fiscal 2021 reading.
Price Performance
This grocery retailer’s stock movement shows that its shares have decreased 15.6% in the past six months compared with the industry’s 5.1% decline.
Stocks to Consider
We highlighted three better-ranked stocks in the Retail - Wholesale sector, namely Tecnoglass (TGLS - Free Report) , Boot Barn Holdings (BOOT - Free Report) and Fastenal (FAST - Free Report) .
Tecnoglass engages in manufacturing and selling architectural glass and windows and aluminum products for the residential and commercial construction industries. It currently sports a Zacks Rank #1 (Strong Buy). Shares of TGLS have jumped 12.9% in the past year.
You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Tecnoglass’ current financial-year sales and earnings per share suggests growth of 21.3% and 28.7%, respectively, from the year-ago period's reported figures. TGLS has a trailing four-quarter earnings surprise of 28.3%, on average.
Boot Barn, a lifestyle retail chain devoted to western and work-related footwear, apparel and accessories, currently flaunts a Zacks Rank #1. The company has a trailing four-quarter earnings surprise of 25.2%, on average. Shares of BOOT have rallied 19.8% in the past year.
The Zacks Consensus Estimate for Boot Barn’s current financial-year sales and earnings per share suggests growth of 17% and 4.4%, respectively, from the year-ago period’s reported figures. BOOT has an expected EPS growth rate of 20% for three-five years.
Fastenal, a national wholesale distributor of industrial and construction supplies, currently has a Zacks Rank #2 (Buy). The company has a trailing four-quarter earnings surprise of 5%, on average. Shares of FAST have risen 0.6% in the past year.
The Zacks Consensus Estimate for Fastenal's current financial-year sales and earnings per share suggests growth of 15.4% and 16.3%, respectively, from the year-ago period. FAST has an expected EPS growth rate of 9% for three-five years.