Smart & Final Q2 profits stay flat; plans 12 new stores

Commerce, Calif. – Smart & Final Stores Inc. reported net income of $11 million in the second quarter of fiscal 2015, essentially flat compared to $11.1 million in the year-earlier period. Higher expenses related to higher sales volumes, increased store support costs, additional marketing expense, and public company costs inhibited profit growth.



Smart & Final plans to open 12 new stores and complete several renovations in the second half of the fiscal year. This includes six new Smart & Final Extra stores, one new Cash & Carry store, and three conversions of legacy Smart & Final stores to the Extra format, including one store relocation, in the third quarter. In the fourth quarter, Smart & Final plans to open five additional new Smart & Final Extra stores and one new Cash & Carry store, as well as complete two additional conversions of legacy Smart & Final stores to the Extra format, including one store relocation.



In the second quarter, net sales were $905.1 million, a 9% increase as compared to $828.1 million in the same period of 2014. Net sales growth was driven by a 3.5% increase in same-store sales and from the net sales contribution of new stores.



"Smart & Final Stores had strong total sales growth of over 9% in the second quarter, led by solid growth in comparable store sales and the contribution from new stores," said Dave Hirz, president and CEO. "While our average transaction size was impacted by deflation in a few product categories during the second quarter, gross margin rates remained strong and comparable transaction counts grew.”