The Pantry Inc. announced financial results for its fiscal third quarter ended June 26, 2014.
Third Quarter Summary:
Net income was $14.0 million or $0.61 per diluted share. This compares to net income of $5.9 million or $0.26 per diluted share in last year’s third quarter. Excluding the impact of impairment charges, net income for the third quarter of fiscal 2014 was $14.7 million, or $0.64 per diluted share, compared to net income of $6.4 million, or $0.28 per diluted share, in the prior year.
Adjusted EBITDA was $71.2 million, up from $65.3 million a year ago (see reconciliation below).
Comparable store merchandise revenue increased 2.3%.
Merchandise gross margin improved to 33.9% from 33.8%.
Fuel gross profit increased to $54.9 million from $53.8 million a year ago as retail fuel margin per gallon increased to $0.129 from $0.123 in the prior year quarter. Comparable store fuel gallons sold declined 2.3%.
Store operating and general and administrative expenses were $148.0 million compared to $149.4 million a year ago. Favorable adjustments to our self-insurance reserves for workers compensation and general liability were $4.3 million this year, $1.7 million less than the adjustment in the third quarter of fiscal 2013.
The effective tax rate for the third quarter of fiscal 2014 was 34.8% compared to 54.9% in the third quarter of fiscal 2013.
Store portfolio activity during the third quarter of fiscal 2014 included rebuilding one store (replacing an older store with a new, large-format store), adding four new QSRs and closing seven stores.
“Our solid third quarter results reflect continuing progress as we grew merchandise and fuel gross profit while controlling expenses,” said President and CEO Dennis Hatchell. “Improved merchandising effectiveness drove a 2.3% increase in comparable store merchandise sales, with sales per customer up 3.9%. Overall fuel performance was also encouraging as our balanced approach led to further sequential quarterly improvement in comparable store fuel gallons sold. Our team is focused on achieving strong fourth quarter results and positioning the company for further growth in fiscal 2015.”