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PENN TRAFFIC RECORDS 14.3 PERCENT INCREASE IN OPERATING INCOME

 JOHNSTOWN, Pa., May 27 /PRNewswire/ -- The Penn Traffic Company (AMEX: PNF) announced today record first quarter results.
 For the 13 weeks ended May 1, 1993, Penn Traffic achieved record first quarter operating income of $31.6 million and cash flow of $52.0 million. These amounts are 14.3 percent and 14.2 percent greater than the prior year's results, respectively.
 For the 13 weeks ended May 1, 1993, net income before extraordinary charge and preferred dividends was $419,000 compared to a loss of $1,943,000 in the first quarter of the prior year. Preferred dividends were $159,000 in the current quarter compared to $248,000 in the first quarter a year ago. This results in net income per share (before extraordinary item) of $.03 per share compared to a loss of $.27 per share in the prior year. In addition, first quarter results for fiscal 1994 include a $17,602,000 extraordinary charge relating to the early retirement of debt. Prior year results have been restated to reflect the adoption of Statement of Financial Accounting Standard No. 109, "Accounting for Income Taxes."
 Claude J. Incaudo, Penn Traffic president and chief executive officer, said, "We are very pleased with our strong first quarter performance. Our total revenues increased 11.3 percent, with same store sales ahead .7 percent. During the second quarter we expect to see further improvements in both sales growth rates. We have confidence in the continued success of our merchandising strategies and our capital investment program."
 Gary D. Hirsch, chairman of the board of Penn Traffic, said, "During the first quarter, the company opened two new stores in the Buffalo marketplace, further strengthening our number two position there. Additionally, we opened a replacement store in Carthage, N.Y., (32,900 square feet) and completed major remodels of stores in Mayville, N.Y., and Johnstown. At present we have eight new or replacement stores under construction, as well as 10 major remodels."
 Hirsch continued, "We are also nearing the completion of a new 230,000-square-foot perishable distribution center in Syracuse, N.Y. The completion of this facility, which is scheduled for July, will enable Penn Traffic to consolidate the distribution of perishable products in central upstate New York into one highly efficient distribution center. Further, this facility will enable our P&C division to internalize ice cream distribution and expand the variety of perishable and grocery products offered to customers."
 Hirsch added, "To date, we have completed the upgrading and remodeling of six of the recently acquired Peter J. Schmitt stores. Five additional remodels of the former Schmitt stores are in progress, which we expect to be completed by June 30. We expect to complete the remodeling of the remaining former Schmitt stores by the end of the fiscal year. Finally, the 82,000-square-foot enlargement of our Jamestown, N.Y., distribution center will be opened in July. This enlarged facility will be used to service the newly acquired stores."
 The Penn Traffic Company is one of the leading food retailers in the United States, operating 217 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 138 licensed franchises and 121 independent operators and a discount general merchandise business with 17 stores. Grand Union, in which Penn Traffic holds a 17.8 percent equity interest, operates supermarkets and food stores in the eastern United States.
 THE PENN TRAFFIC COMPANY
 Consolidated Statement of Operations
 In thousands of dollars
 Unaudited
 13 Weeks Ended May 1, 1993 May 2, 1992
 Consolidated Consolidated (D)
 Sales and revenues:
 Net sales and service fees (A) $750,356 $673,591
 Other revenues 11,684 10,966
 Total revenues 762,040 684,557
 Cost and operating expenses:
 Cost of sales (including buying
 and occupancy costs) 593,757 540,379
 Selling and administrative
 expenses 136,724 116,572
 Operating income 31,559 27,606
 Interest expense 30,759 29,183
 Income (loss) before income taxes and
 extraordinary item 800 (1,577)
 Provision for income taxes 381 366
 Income (loss) before extraordinary item 419 (1,943)
 Extraordinary charge (net of tax
 benefit) (B) (17,602) (6,224)
 Net (Loss) (17,183) (8,167)
 Preferred dividends (159) (248)
 Net (loss) applicable to common stock (17,342) (8,415)
 Primary income (loss) per common share:
 Income (loss) before extraordinary
 item (after preferred dividends) $0.03 $(0.27)
 Extraordinary charge $(2.03) $(0.75)
 Net loss applicable to common stock $(2.00) $(1.02)
 Average number of common shares
 outstanding 8,691,177 8,258,113
 Supplemental data:
 EBITDA (C) $51,990 $45,523
 Depreciation and amortization 19,871 17,517
 LIFO provision 560 400
 (A) "Same store sales" for the company's supermarkets increased .7 percent during the first quarter. Total supermarket square footage at May 1, 1993, was 7,939,090 square feet.
 (B) The extraordinary charges resulted from the early retirement of debt.
 (C) EBITDA or operating cash flow is earnings before interest, depreciation, amortization, LIFO provision, extraordinary charge and taxes.
 (D) Restated to reflect impact of the adoption of Financial Accounting Standard No. 109, "Accounting for Income Taxes."
 -0- 5/27/93
 /CONTACT: Gary D. Hirsch, chairman of the board, 914-921-3000, or Claude J. Incaudo, president & CEO, 315-457-9460, both of Penn Traffic/
 (PNF)


CO: The Penn Traffic Company ST: Pennsylvania, New York, Ohio, West Virginia IN: REA SU: ERN

DM-CD -- PG003 -- 2886 05/27/93 11:07 EDT
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Date:May 27, 1993
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