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PENN TRAFFIC ANNOUNCES SECOND QUARTER NET INCOME OF $995,000 BEFORE EXTRAORDINARY ITEM

 PENN TRAFFIC ANNOUNCES SECOND QUARTER NET INCOME OF $995,000
 BEFORE EXTRAORDINARY ITEM
 JOHNSTOWN, Pa., Sept. 1 /PRNewswire/ -- The Penn Traffic Company (AMEX: PNF) announced today that for the second quarter ended Aug. 1, 1992, it achieved net income of $995,000 before extraordinary charge, compared to a loss of $2,012,000 before extraordinary charge, a year ago.
 The corresponding per share amounts are earnings of $.12 per share for the second quarter of fiscal 1993 compared to a loss of $.33 per share last year. Operating income was $33,062,000, or 5.0 percent above the prior year and cash flow (EBDIAT) for the quarter also increased to a record $50,575,000, 4.6 percent greater than the prior year. Sales decreased slightly in the second quarter.
 Gary D. Hirsch, chairman of the board, stated, "These second quarter results reflect the continuing strong financial performance of the company. The second quarter sales and results were adversely affected by abnormally cold and wet weather in many of the resort communities served by P&C and Quality Markets stores. Nevertheless, the strength of our overall operations allowed us to achieve record second quarter results, continuing our trend of substantial bottom-line improvement. During the second quarter, we opened new stores in Meadville, Pa., (48,000 square feet) and Williamsport, Pa., (53,000 square feet) and completed the enlargement of our store in Herkimer, N.Y., to 50,000 square feet as well as the remodeling of our largest Big Bear Plus Store in Stubenville, Ohio, (135,000 square feet). During August, we completed an additional five major capital projects including three new stores. The success of our merchandising programs during this quarter has confirmed our confidence in a strong second half performance for our company."
 Claude Incaudo, president and chief executive officer, stated, "Initial results for August reflect an improvement in same store sales and total revenues. As we enter the fall and the adverse summer weather abates, we expect to see a significant improvement in sales. In addition to our strong financial performance in the second quarter, we satisfactorily negotiated contracts at our Riverside (3 years), Quality Markets (4 years) and P&C (4 years) operations demonstrating that we can obtain responsible labor agreements that reflect the valuable contributions of our employees while recognizing the need to moderate total payroll and benefit costs during these periods of nominal food price inflation."
 The Penn Traffic Company is one of the leading food retailers in the eastern United States, operating 189 supermarkets in upstate New York, western Pennsylvania, central Ohio and northern West Virginia, under the names of P&C Foods, Quality Markets, Riverside Markets, Bi-Lo Foods, Big Bear and Big Bear Plus. Additionally, the company operates wholesale food distribution businesses serving 125 licensed franchises and 136 independent operators and a discount general merchandise business with 18 stores. Grand Union, in which Penn Traffic holds an 18 percent equity interest, operates 304 supermarkets and food stores under the Grand Union and Big Star trade names in eight eastern states.
 Penn Traffic trades on the American Stock Exchange under the symbol PNF.
 EXHIBIT I
 THE PENN TRAFFIC COMPANY
 Second Quarter Earnings Report(A)
 Unaudited
 Period 13 Weeks 13 Weeks 26 Weeks 26 Weeks
 Ended 8/1/92 8/3/91 8/1/92 8/3/91
 Net sales(B) $688,415 $699,390 $1,362,006 $1,363,165
 Operating cash flow
 (EBDIAT)(C) 50,575 48,336 96,098 90,268
 Operating income 33,062 31,485 61,694 56,591
 Net income (loss)
 before extraord. item
 and preferred
 dividends 1,244 (1,191) (766) (5,024)
 Extraord. charge
 (net of tax
 benefit)(D) (72) (900) (6,296) (900)
 Preferred divs. (249) (821) (497) (1,643)
 Net income (loss)
 applicable to common
 stock 923 (2,912) (7,559) (7,567)
 Primary income (loss)
 per common share:
 Income (loss) before
 extraord. item (after
 preferred divs.)(E) $0.12 $(0.33) $(0.16) $(1.15)
 Extraord. charge (0.01) (0.15) (0.76) (0.16)
 Net income (loss)
 applicable to common
 stock $0.11 $(0.48) $(0.92) $(1.31)
 Avg. number of
 common shares
 outstanding(E) 8,487,700 6,038,806 8,258,113 5,797,269
 (A) In thousands of dollars, except for per share data and average common shares outstanding.
 (B) "Same store sales" for the company's supermarkets decreased 2.5 percent during the second quarter and .7 percent for the 26 weeks.
 (C) EBDIAT or operating cash flow is earnings before interest, depreciation, amortization, LIFO provision and taxes.
 (D) The $6,296,000 extraordinary charge (net of $4,166,000 income tax benefit) and the $900,000 extraordinary charge (net of $614,000 income tax benefit) for the 26 weeks ended Aug. 1, 1992, and Aug. 3, 1991, respectively, resulted from the retirement of certain indebtedness at prices higher than face value and the write-off of related deferred financing costs.
 (E) The company's outstanding options are excluded from the calculation of income (loss) per common share for the 26 weeks ended Aug. 1, 1992, and the 13 and 26 weeks ended Aug. 3, 1991, due to the antidilutive effect. However, the options are dilutive for the 13 weeks ended Aug. 1, 1992, and are included in the calculation of primary earnings per common share for that period. Fully diluted earnings per share for the 13 weeks ended Aug. 1, 1992, are not presented since fully diluted earnings per share and primary earnings per share are the same.
 EXHIBIT II
 THE PENN TRAFFIC COMPANY
 Consolidating Statement of Operations(A)
 13 Weeks Ended Aug. 1, 1992
 Unaudited
 13 weeks 13 weeks
 Ended Ended
 8/1/92 8/3/91
 RDQ P&C Big Bear Elim. Consol. Consol.
 Sales &
 revenues:
 Net sales
 & service
 fees(B) $199,880 $234,065 $260,966 $(6,496) $688,415 $699,390
 Other
 revenues 3,013 5,920 2,085 -- 11,018 10,029
 Total
 revenues 202,893 239,985 263,051 (6,496) 699,433 709,419
 Cost & oper.
 expenses:
 Cost of
 sales
 (including
 buying &
 occupancy
 costs) 162,071 191,631 202,223 (6,496) 549,429 561,564
 Selling &
 admin.
 expenses 30,181 37,685 49,009 67 116,942 116,370
 Oper. income 10,641 10,669 11,819 (67) 33,062 31,485
 Int. expense 6,576 10,029 11,997 -- 28,602 29,931
 Income (loss)
 before income
 taxes &
 extraord.
 item 4,065 640 (178) (67) 4,460 1,554
 Prov. for
 income taxes 1,994 922 300 -- 3,216 2,745
 Income (loss)
 before
 extraord.
 item 2,071 (282) (478) (67) 1,244 (1,191)
 Extraord.
 charge (net
 of tax
 benefit)(C) (72) -- -- -- (72) (900)
 Net imcome
 (loss) 1,999 (282) (478) (67) 1,172 (2,091)
 Preferred
 dividends -- -- (304) 55 (249) (821)
 Net income
 (loss)
 applicable
 to common
 stock $1,999 $(282) $(782) $(12) $923 $(2,912)
 Supplemental
 data:
 EBDIAT(D) 14,750 16,444 19,381 -- 50,575 48,336
 Deprec. &
 amort. 4,109 5,679 6,762 67 16,617 15,771
 LIFO prov. -- 96 800 -- 896 1,080
 (A) In thousands of dollars.
 (B) "Same store sales" for RDQ, P&C and Big Bear supermarkets decreased 3.6 percent, 4.5 percent and .2 percent, respectively, during the second quarter.
 (C) The $72,000 extraordinary charge (net of $47,000 income tax benefit) and the $900,000 extraordinary charge (net of $614,000 income tax benefit) for the 13 weeks ended Aug. 1, 1992, and Aug. 3, 1991, respectively, resulted from the retirement of certain indebtedness at prices higher than face value and the write-off of related deferred financing costs.
 (D) EBDIAT or operating cash flow is earnings before interest, depreciation, amortization, LIFO provision and taxes.
 EXHIBIT III
 THE PENN TRAFFIC COMPANY
 Consolidating Statement of Operations(A)
 26 Weeks Ended Aug. 1, 1992
 Unaudited
 26 Weeks 26 Weeks
 Ended Ended
 8/1/92 8/3/91
 RDQ P&C Big Bear Elim. Consol. Consol.
 Sales &
 revenues:
 Net sales &
 service
 fees(B) $390,312 $460,468 $523,272 $(12,046) $1,362,006 $1,363,165
 Other
 revenues 5,746 12,130 4,108 -- 21,984 20,393
 Total
 revenues 396,058 472,598 527,380 (12,046) 1,383,990 1,383,558
 Cost & oper.
 expenses:
 Cost of
 sales
 (including
 buying &
 occupancy
 costs) 317,324 377,154 407,376 (12,046) 1,089,808 1,100,883
 Selling &
 admin.
 expenses 58,974 75,269 98,217 28 232,488 226,084
 Operating
 income 19,760 20,175 21,787 (28) 61,694 56,591
 Interest
 expense 13,475 20,091 24,219 -- 57,785 59,004
 Income (loss)
 before income
 taxes &
 extraord.
 item 6,285 84 (2,432) (28) 3,909 (2,413)
 Provision
 for income
 taxes 2,908 1,374 393 -- 4,675 2,611
 Income (loss)
 before
 extraord.
 item 3,377 (1,290) (2,825) (28) (766) (5,024)
 Extraord.
 charge (net
 of tax
 benef.)(C)(6,093) -- (203) -- (6,296) (900)
 Net loss (2,716) (1,290) (3,028) (28) (7,062) (5,924)
 Preferred
 dividends -- -- (607) 110 (497) (1,643)
 Net (loss)
 income
 applicable
 to common
 stock $(2,716) $(1,290) $(3,635) $82 $(7,559) $(7,567)
 Supplemental
 data:
 EBDIAT(D) 27,913 31,721 36,364 100 96,098 90,268
 Deprec. &
 amort. 8,153 11,350 13,477 128 33,108 31,203
 LIFO prov. -- 196 1,100 -- 1,296 2,474
 (A) In thousands of dollars.
 (B) "Same store sales" for Big Bear supermarkets increased 1.3 percent for the 26 weeks. "Same store sales" for RDQ and P&C decreased 1.6 percent and 2.7 percent, respectively, for the 26 weeks.
 (C) The $6,296,000 extraordinary charge (net of $4,166,000 income tax benefit) and the $900,000 extraordinary charge (net of $614,000 income tax benefit) for the 26 weeks ended Aug. 1, 1992, and Aug. 3, 1991, respectively, resulted from the retirement of certain indebtedness at prices higher than face value and the write-off of related deferred financing costs.
 (D) EBDIAT or operating cash flow is earnings before interest, depreciation, amortization, LIFO provision and taxes.
 -0- 9/1/92
 /CONTACT: Gary D. Hirsch, chairman of the board, 212-370-0040, or Claude J. Incaudo, president and chief executive officer, 315-453-0382, both of Penn Traffic Company/
 (PNF) CO: The Penn Traffic Company ST: Pennsylvania IN: REA SU: ERN


CD-CC -- PG011 -- 5614 09/01/92 17:02 EDT
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