Growth and Cost Savings Contributed Significantly to Fourth Quarter Profitability and Cash Flow
Building on Year-End Momentum, Company Provides Robust Fiscal 2025 Outlook
GRAND RAPIDS, Mich., Feb. 12, 2025 /PRNewswire/ — Food solutions company SpartanNash (the “Company”) (Nasdaq: SPTN) today reported financial results for its 12-week fourth quarter and 52-week fiscal year ended Dec. 28, 2024.
“I am incredibly proud of the progress the team made on our strategic plan in 2024, achieving our third consecutive year of record adjusted EBITDA, bolstered by the delivery of our margin-enhancing programs a year ahead of schedule,” said SpartanNash President and CEO Tony Sarsam. “We are energized by the momentum going into 2025, especially as we integrate the recently acquired grocery and c-store businesses – Fresh Encounter and Markham – into our retail portfolio. We are also investing into organic growth, fueled by a continued focus on our transformational initiatives, which are expected to further drive results, capture additional cost savings, enhance margin, and maximize long-term shareholder value.”
Fourth Quarter Fiscal 2024 Highlights(1)
- Net sales increased 0.7% to $2.26 billion, driven by an increase in volume in the Retail segment, partially offset by lower volume in the Wholesale segment.
- Wholesale segment net sales decreased 2.1% to $1.56 billion primarily due to reduced case volumes in both the independent retailers and national accounts customer channels.
- Retail segment net sales increased 7.7% to $697.1 million, while comparable store sales were down 0.7%. Incremental sales from stores acquired in fiscal 2024 more than offset lower consumer demand trends.
- Net loss of $1.04 per diluted share, compared to net earnings of $0.30 per diluted share.
- The decrease included the write-off of $45.7 million of goodwill within the Retail segment.
- Adjusted EPS(2) of $0.42, compared to $0.35. Adjusted EBITDA(3) of $58.6 million, compared to $53.6 million.
- These increases were driven by higher gross margin rates in both segments, including benefits from the merchandising transformation, and contributions from recently acquired retail stores. The increase was partially offset by lower case volumes within the Wholesale segment, as well as higher corporate administrative expenses.
- These measures exclude, among other items, restructuring and asset impairment charges and the impact of the LIFO provision.
Fiscal 2024 Highlights(4)
- Net sales decreased 1.9% to $9.55 billion.
- Wholesale segment net sales decreased 3.0% to $6.71 billion.
- Retail segment net sales increased 1.1% to $2.84 billion, while comparable store sales decreased 1.7%.
- Net earnings of $0.01 per diluted share decreased compared to $1.50 per diluted share.
- Adjusted EPS(2) of $2.03 decreased from $2.18. Adjusted EBITDA(3) of $258.5 million increased from $257.4 million.
- Cash generated from operating activities of $205.9 million compared to $89.3 million. The 130.5% increase in cash from operating activities is due primarily to working capital improvements.
- Net long-term debt(5) to adjusted EBITDA(5) ratio of 2.8x increased from 2.4x at the end of the third quarter, due to inorganic growth investments in the fourth quarter.
- Capital expenditures and IT capital(6) of $144.4 million compared to $127.4 million.
- Returned $45.0 million to shareholders through $15.1 million in share repurchases and $29.9 million in dividends.
|
(1)
|
All comparisons are for the fourth quarter of 2024 compared with the fourth quarter of 2023, unless otherwise noted.
|
|
(2)
|
A reconciliation of net (loss) earnings to adjusted earnings from continuing operations, as well as per diluted share (“adjusted EPS”), a non-GAAP financial measure, is provided in Table 3.
|
|
(3)
|
A reconciliation of net (loss) earnings to adjusted EBITDA, a non-GAAP financial measure, is provided in Table 2.
|
|
(4)
|
All comparisons are for the fiscal year 2024 compared with the fiscal year 2023, unless otherwise noted.
|
|
(5)
|
A reconciliation of long-term debt and finance lease obligations to net long-term debt and Net Earnings to Adjusted EBITDA, non-GAAP financial measures, are provided in Table 4.
|
|
(6)
|
A reconciliation of purchases of property and equipment to capital expenditures and IT capital, a non-GAAP financial measure, is provided in Table 5.
|
Fiscal 2025 Outlook
The following table provides the Company’s guidance for fiscal 2025:
|
Fiscal 2024
|
|
|
Fiscal 2025 Outlook
|
|
|
52 Weeks
|
|
|
53 Weeks
|
|
|
(In millions, except adjusted EPS(2))
|
Actual
|
|
|
Low
|
|
|
High
|
|
|
Total net sales
|
$
|
|
9,549
|
|
|
$
|
|
9,800
|
|
|
$
|
|
10,000
|
|
|
Adjusted EBITDA(3)
|
$
|
|
258
|
|
|
$
|
|
263
|
|
|
$
|
|
278
|
|
|
Adjusted EPS(2)
|
$
|
|
2.03
|
|
|
$
|
|
1.60
|
|
|
$
|
|
1.85
|
|
|
Capital expenditures and IT capital(6)
|
$
|
|
144
|
|
|
$
|
|
150
|
|
|
$
|
|
165
|
|
Guidance incorporates both the investments and benefits from the Company’s long-term strategic initiatives, including all transformational programs and tuck-in acquisitions. The adjusted EPS guidance also reflects an approximate $0.30 impact due to an increase in non-cash expenses primarily depreciation and amortization, as well as incremental interest costs associated with recent acquisitions and capital investments. The Company estimates that the 53rd week will contribute net sales of $0.2 billion, adjusted EBITDA of $4.0 million and adjusted EPS of $0.06.
Conference Call & Supplemental Earnings Presentation
The Company will host a conference call to discuss its quarterly results with additional comments and details on Wednesday, Feb. 12, 2025, at 8:30 a.m. ET. There will also be a simultaneous, live webcast made available on SpartanNash’s website at corporate.spartannash.com/events under the “Investors” section and will remain archived on the Company’s website through Wednesday, Feb. 26, 2025.
A supplemental quarterly earnings presentation will also be available on the Company’s website at corporate.spartannash.com/investor-presentations.
About SpartanNash
SpartanNash (Nasdaq: SPTN) is a food solutions company that delivers the ingredients for a better life. Committed to fostering a People First culture, the SpartanNash family of Associates is 20,000 strong. SpartanNash operates two complementary business segments – food wholesale and grocery retail. Its global supply chain network serves wholesale customers that include independent and chain grocers, national retail brands, e-commerce platforms, and U.S. military commissaries and exchanges. The Company distributes products for every aisle in the grocery store, from fresh produce to household goods to its OwnBrands, which include the Our Family® portfolio of products. On the retail side, SpartanNash operates nearly 200 brick-and-mortar grocery stores, primarily under the banners of Family Fare, Martin’s Super Markets and D&W Fresh Market, in addition to dozens of pharmacies and fuel centers with convenience stores. Leveraging insights and solutions across its segments, SpartanNash offers a full suite of support services for independent grocers. For more information, visit spartannash.com.
Forward-Looking Statements
The matters discussed in this press release and in the Company’s website-accessible conference calls with analysts and investor presentations include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”), about the plans, strategies, objectives, goals or expectations of the Company. These forward-looking statements may be identifiable by words or phrases indicating that the Company or management “expects,” “projects,” “anticipates,” “plans,” “believes,” “intends,” or “estimates,” or that a particular occurrence or event “may,” “could,” “should,” “will” or “will likely” result, occur or be pursued or “continue” in the future, that the “outlook,” “trend,” “guidance” or “target” is toward a particular result or occurrence, that a development is an “opportunity,” “priority,” “strategy,” “focus,” that the Company is “positioned” for a particular result, or similarly stated expectations. Undue reliance should not be placed on these forward-looking statements, which speak only as of the date made. Forward-looking statements are necessarily based on estimates and assumptions that are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which, with respect to future business decisions, are subject to change. These uncertainties and contingencies may affect actual results and could cause actual results to differ materially. These risks and uncertainties include the Company’s ability to compete in an extremely competitive industry; the Company’s dependence on certain major customers; the Company’s ability to implement its growth strategy and transformation initiatives; the Company’s ability to implement its growth strategy through acquisitions and successfully integrate acquired businesses; disruptions to the Company’s information security network, including security breaches and cyber-attacks; impacts to the availability and performance of the Company’s information technology systems; changes in relationships with the Company’s vendor base; changes in product availability and product pricing from vendors; macroeconomic uncertainty, including rising inflation, potential economic recession, and increasing interest rates; difficulty attracting and retaining well-qualified Associates and effectively managing increased labor costs; failure to successfully retain or manage transitions with executive leaders and other key personnel; changes in the geopolitical conditions; impairment charges for goodwill or other long-lived assets; impacts to the Company’s business and reputation due to an increasing focus on environmental, social and governance matters; customers to whom the Company extends credit or for whom the Company guarantees loans may fail to repay the Company; disruptions associated with severe weather conditions and natural disasters, including effects from climate change; disruptions associated with disease outbreaks; the Company’s ability to manage its private brand program for U.S. military commissaries, including the termination of the program or not achieving the desired results; the Company’s level of indebtedness; interest rate fluctuations; the Company’s ability to service its debt and to comply with debt covenants; changes in government regulations; labor relations issues; changes in the military commissary system, including its supply chain, or in the level of governmental funding; product recalls and other product-related safety concerns; cost increases related to multi-employer pension plans; and other risks and uncertainties listed under “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s most recent Annual Report on Form 10-K and in subsequent filings with the Securities and Exchange Commission. Additional risks and uncertainties not currently known to the Company or that the Company currently believes are immaterial also may impair its business, operations, liquidity, financial condition and prospects. The Company undertakes no obligation to update or revise its forward-looking statements to reflect developments that occur or information obtained after the date of this press release.
INVESTOR CONTACT:
Kayleigh Campbell
Head of Investor Relations
[email protected]
MEDIA CONTACT:
Adrienne Chance
SVP and Chief Communications Officer
[email protected]
|
SPARTANNASH COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF (LOSS) EARNINGS
(Unaudited)
|
|
|
|
|
12 Weeks Ended
|
|
|
52 Weeks Ended
|
|
|
December 28,
|
|
|
December 30,
|
|
|
December 28,
|
|
|
December 30,
|
|
|
(In thousands, except per share amounts)
|
2024
|
|
|
2023
|
|
|
2024
|
|
|
2023
|
|
|
Net sales
|
$
|
|
2,261,624
|
|
|
$
|
|
2,245,183
|
|
|
$
|
|
9,549,324
|
|
|
$
|
|
9,729,219
|
|
|
Cost of sales
|
|
|
1,897,122
|
|
|
|
|
1,906,214
|
|
|
|
|
8,036,826
|
|
|
|
|
8,243,663
|
|
|
Gross profit
|
|
|
364,502
|
|
|
|
|
338,969
|
|
|
|
|
1,512,498
|
|
|
|
|
1,485,556
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative
|
|
|
335,466
|
|
|
|
|
306,451
|
|
|
|
|
1,381,317
|
|
|
|
|
1,366,238
|
|
|
Acquisition and integration, net
|
|
|
(99)
|
|
|
|
|
1,157
|
|
|
|
|
3,113
|
|
|
|
|
3,416
|
|
|
Goodwill impairment
|
|
|
45,716
|
|
|
|
|
–
|
|
|
|
|
45,716
|
|
|
|
|
–
|
|
|
Restructuring and asset impairment, net
|
|
|
11,119
|
|
|
|
|
7,819
|
|
|
|
|
28,391
|
|
|
|
|
9,190
|
|
|
Total operating expenses
|
|
|
392,202
|
|
|
|
|
315,427
|
|
|
|
|
1,458,537
|
|
|
|
|
1,378,844
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating (loss) earnings
|
|
|
(27,700)
|
|
|
|
|
23,542
|
|
|
|
|
53,961
|
|
|
|
|
106,712
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other expenses and (income)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net
|
|
|
10,884
|
|
|
|
|
9,669
|
|
|
|
|
44,827
|
|
|
|
|
39,887
|
|
|
Other, net
|
|
|
(77)
|
|
|
|
|
(790)
|
|
|
|
|
(1,891)
|
|
|
|
|
(3,300)
|
|
|
Total other expenses, net
|
|
|
10,807
|
|
|
|
|
8,879
|
|
|
|
|
42,936
|
|
|
|
|
36,587
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) earnings before income taxes
|
|
|
(38,507)
|
|
|
|
|
14,663
|
|
|
|
|
11,025
|
|
|
|
|
70,125
|
|
|
Income tax (benefit) expense
|
|
|
(3,426)
|
|
|
|
|
4,358
|
|
|
|
|
10,726
|
|
|
|
|
17,888
|
|
|
Net (loss) earnings
|
$
|
|
(35,081)
|
|
|
$
|
|
10,305
|
|
|
$
|
|
299
|
|
|
$
|
|
52,237
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) earnings per basic common share
|
$
|
|
(1.04)
|
|
|
$
|
|
0.30
|
|
|
$
|
|
0.01
|
|
|
$
|
|
1.53
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) earnings per diluted common share
|
$
|
|
(1.04)
|
|
|
$
|
|
0.30
|
|
|
$
|
|
0.01
|
|
|
$
|
|
1.50
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
33,609
|
|
|
|
|
34,039
|
|
|
|
|
33,793
|
|
|
|
|
34,211
|
|
|
Diluted
|
|
|
33,609
|
|
|
|
|
34,670
|
|
|
|
|
34,205
|
|
|
|
|
34,901
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SPARTANNASH COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
|
|
|
|
|
December 28,
|
|
|
December 30,
|
|
|
(In thousands)
|
2024
|
|
|
2023
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
$
|
|
21,570
|
|
|
$
|
|
17,964
|
|
|
Accounts and notes receivable, net
|
|
|
448,887
|
|
|
|
|
421,859
|
|
|
Inventories, net
|
|
|
546,312
|
|
|
|
|
575,226
|
|
|
Prepaid expenses and other current assets
|
|
|
75,042
|
|
|
|
|
62,440
|
|
|
Total current assets
|
|
|
1,091,811
|
|
|
|
|
1,077,489
|
|
|
|
|
|
|
|
|
|
|
|
|
Property and equipment, net
|
|
|
779,984
|
|
|
|
|
649,071
|
|
|
Goodwill
|
|
|
181,035
|
|
|
|
|
182,160
|
|
|
Intangible assets, net
|
|
|
117,821
|
|
|
|
|
101,535
|
|
|
Operating lease assets
|
|
|
327,211
|
|
|
|
|
242,146
|
|
|
Other assets, net
|
|
|
104,434
|
|
|
|
|
103,174
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
$
|
|
2,602,296
|
|
|
$
|
|
2,355,575
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Shareholders‘ Equity
|
|
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
|
|
|
|
|
Accounts payable
|
$
|
|
485,017
|
|
|
$
|
|
473,419
|
|
|
Accrued payroll and benefits
|
|
|
85,829
|
|
|
|
|
78,076
|
|
|
Other accrued expenses
|
|
|
61,993
|
|
|
|
|
57,609
|
|
|
Current portion of operating lease liabilities
|
|
|
49,562
|
|
|
|
|
41,979
|
|
|
Current portion of long-term debt and finance lease liabilities
|
|
|
12,838
|
|
|
|
|
8,813
|
|
|
Total current liabilities
|
|
|
695,239
|
|
|
|
|
659,896
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term liabilities
|
|
|
|
|
|
|
|
|
|
|
Deferred income taxes
|
|
|
91,010
|
|
|
|
|
73,904
|
|
|
Operating lease liabilities
|
|
|
305,051
|
|
|
|
|
226,118
|
|
|
Other long-term liabilities
|
|
|
26,537
|
|
|
|
|
28,808
|
|
|
Long-term debt and finance lease liabilities
|
|
|
740,969
|
|
|
|
|
588,667
|
|
|
Total long-term liabilities
|
|
|
1,163,567
|
|
|
|
|
917,497
|
|
|
|
|
|
|
|
|
|
|
|
|
Commitments and contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders‘ equity
|
|
|
|
|
|
|
|
|
|
|
Common stock, voting, no par value; 100,000 shares
authorized; 33,752 and 34,610 shares outstanding
|
|
|
454,751
|
|
|
|
|
460,299
|
|
|
Preferred stock, no par value, 10,000 shares
authorized; no shares outstanding
|
|
|
–
|
|
|
|
|
–
|
|
|
Accumulated other comprehensive income
|
|
|
1,337
|
|
|
|
|
796
|
|
|
Retained earnings
|
|
|
287,402
|
|
|
|
|
317,087
|
|
|
Total shareholders‘ equity
|
|
|
743,490
|
|
|
|
|
778,182
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and shareholders‘ equity
|
$
|
|
2,602,296
|
|
|
$
|
|
2,355,575
|
|
|
|
|
|
|
|
|
|
|
|
|
SPARTANNASH COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
|
|
|
|
|
|
|
|
52 Weeks Ended
|
|
|
(In thousands)
|
|
|
|
December 28, 2024
|
|
|
December 30, 2023
|
|
|
Cash flow activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities
|
|
|
|
$
|
|
205,877
|
|
|
$
|
|
89,327
|
|
|
Net cash used in investing activities
|
|
|
|
|
|
(247,025)
|
|
|
|
|
(116,517)
|
|
|
Net cash provided by financing activities
|
|
|
|
|
|
44,754
|
|
|
|
|
16,068
|
|
|
Net increase (decrease) in cash and cash equivalents
|
|
|
|
|
|
3,606
|
|
|
|
|
(11,122)
|
|
|
Cash and cash equivalents at beginning of the period
|
|
|
|
|
|
17,964
|
|
|
|
|
29,086
|
|
|
Cash and cash equivalents at end of the period
|
|
|
|
$
|
|
21,570
|
|
|
$
|
|
17,964
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SPARTANNASH COMPANY AND SUBSIDIARIES
SUPPLEMENTAL FINANCIAL DATA
Table 1: Sales and Operating Earnings (Loss) by Segment
(Unaudited) |
|
|
|
|
12 Weeks Ended
|
|
|
52 Weeks Ended
|
|
|
(In thousands)
|
December 28, 2024
|
|
|
December 30, 2023
|
|
|
December 28, 2024
|
|
|
December 30, 2023
|
|
|
Wholesale Segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
$
|
|
1,564,574
|
|
|
69.2
|
%
|
|
$
|
|
1,598,169
|
|
|
71.2
|
%
|
|
$
|
|
6,709,305
|
|
|
70.3
|
%
|
|
$
|
|
6,919,217
|
|
|
71.1
|
%
|
|
Operating earnings
|
|
|
18,300
|
|
|
|
|
|
|
|
21,681
|
|
|
|
|
|
|
|
97,423
|
|
|
|
|
|
|
|
87,701
|
|
|
|
|
|
Retail Segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
|
697,050
|
|
|
30.8
|
%
|
|
|
|
647,014
|
|
|
28.8
|
%
|
|
|
|
2,840,019
|
|
|
29.7
|
%
|
|
|
|
2,810,002
|
|
|
28.9
|
%
|
|
Operating (loss) earnings
|
|
|
(46,000)
|
|
|
|
|
|
|
|
1,861
|
|
|
|
|
|
|
|
(43,462)
|
|
|
|
|
|
|
|
19,011
|
|
|
|
|
|
Total:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
$
|
|
2,261,624
|
|
|
100.0
|
%
|
|
$
|
|
2,245,183
|
|
|
100.0
|
%
|
|
$
|
|
9,549,324
|
|
|
100.0
|
%
|
|
$
|
|
9,729,219
|
|
|
100.0
|
%
|
|
Operating (loss) earnings
|
|
|
(27,700)
|
|
|
|
|
|
|
|
23,542
|
|
|
|
|
|
|
|
53,961
|
|
|
|
|
|
|
|
106,712
|
|
|
|
|
Non-GAAP Financial Measures
In addition to reporting financial results in accordance with GAAP, the Company also provides information regarding adjusted earnings from continuing operations, as well as per diluted share (“adjusted EPS”), net long-term debt, capital expenditures and IT capital, and adjusted earnings before interest, taxes, depreciation and amortization (“adjusted EBITDA”). These are non-GAAP financial measures, as defined below, and are used by management to allocate resources, assess performance against its peers and evaluate overall performance. The Company believes these measures provide useful information for both management and its investors. The Company believes these non-GAAP measures are useful to investors because they provide additional understanding of the trends and special circumstances that affect its business. These measures provide useful supplemental information that helps investors to establish a basis for expected performance and the ability to evaluate actual results against that expectation. The measures, when considered in connection with GAAP results, can be used to assess the overall performance of the Company as well as assess the Company’s performance against its peers. These measures are also used as a basis for certain compensation programs sponsored by the Company. In addition, securities analysts, fund managers and other shareholders and stakeholders that communicate with the Company request its financial results in these adjusted formats.
Current year adjusted earnings from continuing operations, and adjusted EBITDA exclude, among other items, LIFO expense, organizational realignment, severance associated with cost reduction initiatives, a non-routine settlement gain with an insurance company related to a legal matter from a previously closed operation, operating and non-operating costs associated with the postretirement plan amendment and settlement and a non-operating benefit associated with a pension refund from an annuity provider. Current year organizational realignment includes consulting and severance costs associated with the Company’s change in its go-to-market strategy as part of its long-term plan, which relates to the reorganization of certain functions. Costs related to the postretirement plan amendment and settlement include operating and non-operating expenses associated with recognition of plan settlement losses and amortization of the prior service credit related to the amendment of the retiree medical plan, which are adjusted out of adjusted earnings from continuing operations. Postretirement plan amendment and settlement costs also include operating expenses related to payroll taxes which are adjusted out of all non-GAAP financial measures. The pension refund from an annuity provider is related to a terminated pension plan and is a non-operating benefit which is adjusted out of adjusted earnings from continuing operations.
Prior year adjusted earnings from continuing operations, and adjusted EBITDA exclude, among other items, LIFO expense, organizational realignment, severance associated with cost reduction initiatives and a non-routine settlement related to a legal matter resulting from a previously closed operation and operating and non-operating costs associated with the postretirement plan amendment and settlement.
Each of these items are considered “non-operational” or “non-core” in nature.
The Company is unable to provide a full reconciliation of the GAAP to non-GAAP measures used in the Fiscal 2025 Outlook section of this press release without unreasonable effort because it is not possible to predict certain adjustment items with a reasonable degree of certainty since they are not yet known or quantifiable, and do not relate to the Company’s normal operating activities. These adjustments may include, among other items, restructuring and asset impairment activity, acquisition and integration costs, severance, organizational realignment costs, and the impact of adjustments to the LIFO inventory reserve. This information is dependent upon future events, which may be outside of the Company’s control and could have a significant impact on its GAAP financial results for fiscal 2025.
|
Table 2: Reconciliation of Net (Loss) Earnings to Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization
(Adjusted EBITDA)
(A Non-GAAP Financial Measure)
(Unaudited)
|
|
|
|
|
12 Weeks Ended
|
|
|
52 Weeks Ended
|
|
|
(In thousands)
|
December 28, 2024
|
|
|
December 30, 2023
|
|
|
December 28, 2024
|
|
|
December 30, 2023
|
|
|
Net (loss) earnings
|
$
|
|
(35,081)
|
|
|
$
|
|
10,305
|
|
|
$
|
|
299
|
|
|
$
|
|
52,237
|
|
|
Income tax (benefit) expense
|
|
|
(3,426)
|
|
|
|
|
4,358
|
|
|
|
|
10,726
|
|
|
|
|
17,888
|
|
|
Other expenses, net
|
|
|
10,807
|
|
|
|
|
8,879
|
|
|
|
|
42,936
|
|
|
|
|
36,587
|
|
|
Operating (loss) earnings
|
|
|
(27,700)
|
|
|
|
|
23,542
|
|
|
|
|
53,961
|
|
|
|
|
106,712
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIFO expense (benefit)
|
|
|
121
|
|
|
|
|
(6,341)
|
|
|
|
|
5,167
|
|
|
|
|
16,104
|
|
|
Depreciation and amortization
|
|
|
25,265
|
|
|
|
|
23,394
|
|
|
|
|
103,412
|
|
|
|
|
98,639
|
|
|
Acquisition and integration, net
|
|
|
(99)
|
|
|
|
|
1,157
|
|
|
|
|
3,113
|
|
|
|
|
3,416
|
|
|
Restructuring and goodwill / asset impairment, net
|
|
|
56,835
|
|
|
|
|
7,819
|
|
|
|
|
74,107
|
|
|
|
|
9,190
|
|
|
Cloud computing amortization
|
|
|
1,979
|
|
|
|
|
1,349
|
|
|
|
|
7,585
|
|
|
|
|
5,034
|
|
|
Organizational realignment, net
|
|
|
842
|
|
|
|
|
529
|
|
|
|
|
2,757
|
|
|
|
|
5,239
|
|
|
Severance associated with cost reduction initiatives
|
|
|
117
|
|
|
|
|
7
|
|
|
|
|
537
|
|
|
|
|
318
|
|
|
Stock-based compensation
|
|
|
2,604
|
|
|
|
|
2,463
|
|
|
|
|
10,743
|
|
|
|
|
12,536
|
|
|
Stock warrant
|
|
|
168
|
|
|
|
|
280
|
|
|
|
|
868
|
|
|
|
|
1,559
|
|
|
Non-cash rent
|
|
|
(398)
|
|
|
|
|
(505)
|
|
|
|
|
(2,679)
|
|
|
|
|
(2,599)
|
|
|
(Gain) loss on disposal of assets
|
|
|
(236)
|
|
|
|
|
(45)
|
|
|
|
|
(284)
|
|
|
|
|
259
|
|
|
Legal settlement
|
|
|
(900)
|
|
|
|
|
–
|
|
|
|
|
(900)
|
|
|
|
|
900
|
|
|
Postretirement plan amendment and settlement
|
|
|
–
|
|
|
|
|
–
|
|
|
|
|
99
|
|
|
|
|
94
|
|
|
Adjusted EBITDA
|
$
|
|
58,598
|
|
|
$
|
|
53,649
|
|
|
$
|
|
258,486
|
|
|
$
|
|
257,401
|
|
|
Wholesale:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating earnings
|
$
|
|
18,300
|
|
|
$
|
|
21,681
|
|
|
$
|
|
97,423
|
|
|
$
|
|
87,701
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIFO expense (benefit)
|
|
|
517
|
|
|
|
|
(4,346)
|
|
|
|
|
4,378
|
|
|
|
|
12,388
|
|
|
Depreciation and amortization
|
|
|
13,165
|
|
|
|
|
12,370
|
|
|
|
|
54,291
|
|
|
|
|
51,535
|
|
|
Acquisition and integration, net
|
|
|
–
|
|
|
|
|
27
|
|
|
|
|
2,048
|
|
|
|
|
216
|
|
|
Restructuring and asset impairment, net
|
|
|
9,122
|
|
|
|
|
7,860
|
|
|
|
|
15,914
|
|
|
|
|
8,548
|
|
|
Cloud computing amortization
|
|
|
1,239
|
|
|
|
|
915
|
|
|
|
|
4,861
|
|
|
|
|
3,414
|
|
|
Organizational realignment, net
|
|
|
526
|
|
|
|
|
330
|
|
|
|
|
1,720
|
|
|
|
|
3,269
|
|
|
Severance associated with cost reduction initiatives
|
|
|
91
|
|
|
|
|
7
|
|
|
|
|
321
|
|
|
|
|
303
|
|
|
Stock-based compensation
|
|
|
1,831
|
|
|
|
|
1,601
|
|
|
|
|
7,403
|
|
|
|
|
8,216
|
|
|
Stock warrant
|
|
|
168
|
|
|
|
|
280
|
|
|
|
|
868
|
|
|
|
|
1,559
|
|
|
Non-cash rent
|
|
|
(14)
|
|
|
|
|
4
|
|
|
|
|
(803)
|
|
|
|
|
(134)
|
|
|
Gain on disposal of assets
|
|
|
(253)
|
|
|
|
|
(72)
|
|
|
|
|
(380)
|
|
|
|
|
(83)
|
|
|
Legal settlement
|
|
|
(900)
|
|
|
|
|
–
|
|
|
|
|
(900)
|
|
|
|
|
900
|
|
|
Postretirement plan amendment and settlement
|
|
|
–
|
|
|
|
|
–
|
|
|
|
|
62
|
|
|
|
|
59
|
|
|
Adjusted EBITDA
|
$
|
|
43,792
|
|
|
$
|
|
40,657
|
|
|
$
|
|
187,206
|
|
|
$
|
|
177,891
|
|
|
Retail:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating (loss) earnings
|
|
|
(46,000)
|
|
|
|
|
1,861
|
|
|
|
|
(43,462)
|
|
|
|
|
19,011
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIFO (benefit) expense
|
|
|
(396)
|
|
|
|
|
(1,995)
|
|
|
|
|
789
|
|
|
|
|
3,716
|
|
|
Depreciation and amortization
|
|
|
12,100
|
|
|
|
|
11,024
|
|
|
|
|
49,121
|
|
|
|
|
47,104
|
|
|
Acquisition and integration, net
|
|
|
(99)
|
|
|
|
|
1,130
|
|
|
|
|
1,065
|
|
|
|
|
3,200
|
|
|
Restructuring and goodwill / asset impairment, net
|
|
|
47,713
|
|
|
|
|
(41)
|
|
|
|
|
58,193
|
|
|
|
|
642
|
|
|
Cloud computing amortization
|
|
|
740
|
|
|
|
|
434
|
|
|
|
|
2,724
|
|
|
|
|
1,620
|
|
|
Organizational realignment, net
|
|
|
316
|
|
|
|
|
199
|
|
|
|
|
1,037
|
|
|
|
|
1,970
|
|
|
Severance associated with cost reduction initiatives
|
|
|
26
|
|
|
|
|
–
|
|
|
|
|
216
|
|
|
|
|
15
|
|
|
Stock-based compensation
|
|
|
773
|
|
|
|
|
862
|
|
|
|
|
3,340
|
|
|
|
|
4,320
|
|
|
Non-cash rent
|
|
|
(384)
|
|
|
|
|
(509)
|
|
|
|
|
(1,876)
|
|
|
|
|
(2,465)
|
|
|
Loss on disposal of assets
|
|
|
17
|
|
|
|
|
27
|
|
|
|
|
96
|
|
|
|
|
342
|
|
|
Postretirement plan amendment and settlement
|
|
|
–
|
|
|
|
|
–
|
|
|
|
|
37
|
|
|
|
|
35
|
|
|
Adjusted EBITDA
|
$
|
|
14,806
|
|
|
$
|
|
12,992
|
|
|
$
|
|
71,280
|
|
|
$
|
|
79,510
|
|
Notes: Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“adjusted EBITDA”) is a non-GAAP operating financial measure that the Company defines as net earnings plus interest, discontinued operations, depreciation and amortization, and other non-cash items including share-based payments (equity awards measured in accordance with ASC 718, Stock Compensation, which include both stock-based compensation to employees and stock warrants issued to non-employees) and the LIFO provision, as well as adjustments for items that do not reflect the ongoing operating activities of the Company.
Adjusted EBITDA and adjusted EBITDA by segment are not measures of performance under GAAP and should not be considered as a substitute for net earnings, cash flows from operating activities and other income or cash flow statement data. The Company’s definitions of adjusted EBITDA and adjusted EBITDA by segment may not be identical to similarly titled measures reported by other companies.
|
Table 3: Reconciliation of Net (Loss) Earnings to
Adjusted Earnings from Continuing Operations, as well as per diluted share (“adjusted EPS”)
(A Non-GAAP Financial Measure)
(Unaudited)
|
|
|
|
|
|
|
12 Weeks Ended
|
|
|
|
December 28, 2024
|
|
|
|
December 30, 2023
|
|
|
|
|
|
|
per diluted
|
|
|
|
|
|
|
per diluted
|
|
|
|
(In thousands, except per share amounts)
|
Earnings
|
|
|
share
|
|
|
|
Earnings
|
|
|
share
|
|
|
|
Net (loss) earnings
|
$
|
|
(35,081)
|
|
|
$
|
|
(1.04)
|
|
|
|
$
|
|
10,305
|
|
|
$
|
|
0.30
|
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIFO expense (benefit)
|
|
|
121
|
|
|
|
|
|
|
|
|
|
|
(6,341)
|
|
|
|
|
|
|
|
|
Acquisition and integration, net
|
|
|
(99)
|
|
|
|
|
|
|
|
|
|
|
1,157
|
|
|
|
|
|
|
|
|
Restructuring and goodwill / asset impairment, net
|
|
|
56,958
|
|
|
|
|
|
|
|
|
|
|
7,819
|
|
|
|
|
|
|
|
|
Organizational realignment, net
|
|
|
842
|
|
|
|
|
|
|
|
|
|
|
529
|
|
|
|
|
|
|
|
|
Severance associated with cost reduction initiatives
|
|
|
117
|
|
|
|
|
|
|
|
|
|
|
7
|
|
|
|
|
|
|
|
|
Legal settlement
|
|
|
(900)
|
|
|
|
|
|
|
|
|
|
|
–
|
|
|
|
|
|
|
|
|
Postretirement plan amendment and settlement
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
(763)
|
|
|
|
|
|
|
|
|
Total adjustments
|
|
|
57,039
|
|
|
|
|
|
|
|
|
|
|
2,408
|
|
|
|
|
|
|
|
|
Income tax effect on adjustments (a)
|
|
|
(7,522)
|
|
|
|
|
|
|
|
|
|
|
(693)
|
|
|
|
|
|
|
|
|
Total adjustments, net of taxes
|
|
|
49,517
|
|
|
|
|
1.46
|
|
*
|
|
|
|
1,715
|
|
|
|
|
0.05
|
|
|
|
Adjusted earnings from continuing operations
|
$
|
|
14,436
|
|
|
$
|
|
0.42
|
|
|
|
$
|
|
12,020
|
|
|
$
|
|
0.35
|
|
|
|
* Includes rounding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
52 Weeks Ended
|
|
|
|
December 28, 2024
|
|
|
|
December 30, 2023
|
|
|
|
|
|
|
per diluted
|
|
|
|
|
|
|
per diluted
|
|
|
|
(In thousands, except per share amounts)
|
Earnings
|
|
|
share
|
|
|
|
Earnings
|
|
|
share
|
|
|
|
Net earnings
|
$
|
|
299
|
|
|
$
|
|
0.01
|
|
|
|
$
|
|
52,237
|
|
|
$
|
|
1.50
|
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIFO expense
|
|
|
5,167
|
|
|
|
|
|
|
|
|
|
|
16,104
|
|
|
|
|
|
|
|
|
Acquisition and integration, net
|
|
|
3,113
|
|
|
|
|
|
|
|
|
|
|
3,416
|
|
|
|
|
|
|
|
|
Restructuring and goodwill / asset impairment, net
|
|
|
74,230
|
|
|
|
|
|
|
|
|
|
|
9,190
|
|
|
|
|
|
|
|
|
Organizational realignment, net
|
|
|
2,757
|
|
|
|
|
|
|
|
|
|
|
5,239
|
|
|
|
|
|
|
|
|
Severance associated with cost reduction initiatives
|
|
|
537
|
|
|
|
|
|
|
|
|
|
|
318
|
|
|
|
|
|
|
|
|
Pension refund from annuity provider
|
|
|
(239)
|
|
|
|
|
|
|
|
|
|
|
–
|
|
|
|
|
|
|
|
|
Legal settlement
|
|
|
(900)
|
|
|
|
|
|
|
|
|
|
|
900
|
|
|
|
|
|
|
|
|
Postretirement plan amendment and settlement
|
|
|
(1,458)
|
|
|
|
|
|
|
|
|
|
|
(3,174)
|
|
|
|
|
|
|
|
|
Total adjustments
|
|
|
83,207
|
|
|
|
|
|
|
|
|
|
|
31,993
|
|
|
|
|
|
|
|
|
Income tax effect on adjustments (a)
|
|
|
(14,220)
|
|
|
|
|
|
|
|
|
|
|
(8,218)
|
|
|
|
|
|
|
|
|
Total adjustments, net of taxes
|
|
|
68,987
|
|
|
|
|
2.02
|
|
|
|
|
|
23,775
|
|
|
|
|
0.68
|
|
|
|
Adjusted earnings from continuing operations
|
$
|
|
69,286
|
|
|
$
|
|
2.03
|
|
|
|
$
|
|
76,012
|
|
|
$
|
|
2.18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
The income tax effect on adjustments is computed by applying the effective tax rate, before discrete tax items, to the total adjustments for the period.
|
Notes: Adjusted earnings from continuing operations, as well as per diluted share (“adjusted EPS”), is a non-GAAP operating financial measure that the Company defines as net (loss) earnings plus or minus adjustments for items that do not reflect the ongoing operating activities of the Company and costs associated with the closing of operational locations.
Adjusted earnings from continuing operations is not a measure of performance under GAAP and should not be considered as a substitute for net (loss) earnings, cash flows from operating activities and other income or cash flow statement data. The Company’s definition of adjusted earnings from continuing operations may not be identical to similarly titled measures reported by other companies.
|
Table 4: Reconciliation of Long-Term Debt and Finance Lease Obligations to Net Long-Term Debt and Net Earnings to
Adjusted EBITDA
(A Non-GAAP Financial Measure)
(Unaudited)
|
|
|
|
|
(In thousands)
|
December 28, 2024
|
|
|
October 5, 2024
|
|
|
Current portion of long-term debt and finance lease liabilities
|
$
|
|
12,838
|
|
|
$
|
|
9,747
|
|
|
Long-term debt and finance lease liabilities
|
|
|
740,969
|
|
|
|
|
626,957
|
|
|
Total debt
|
|
|
753,807
|
|
|
|
|
636,704
|
|
|
Cash and cash equivalents
|
|
|
(21,570)
|
|
|
|
|
(17,510)
|
|
|
Net long-term debt
|
$
|
|
732,237
|
|
|
$
|
|
619,194
|
|
|
Rolling 52- Weeks Ended
|
|
|
(In thousands, except for ratio)
|
December 28, 2024
|
|
|
October 5, 2024
|
|
|
Net earnings
|
$
|
|
299
|
|
|
$
|
|
45,685
|
|
|
Income tax expense
|
|
|
10,726
|
|
|
|
|
18,510
|
|
|
Other expenses, net
|
|
|
42,936
|
|
|
|
|
41,008
|
|
|
Operating earnings
|
|
|
53,961
|
|
|
|
|
105,203
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
LIFO expense (benefit)
|
|
|
5,167
|
|
|
|
|
(1,295)
|
|
|
Depreciation and amortization
|
|
|
103,412
|
|
|
|
|
101,541
|
|
|
Acquisition and integration, net
|
|
|
3,113
|
|
|
|
|
4,369
|
|
|
Restructuring and goodwill / asset impairment, net
|
|
|
74,107
|
|
|
|
|
25,091
|
|
|
Cloud computing amortization
|
|
|
7,585
|
|
|
|
|
6,955
|
|
|
Organizational realignment, net
|
|
|
2,757
|
|
|
|
|
2,444
|
|
|
Severance associated with cost reduction initiatives
|
|
|
537
|
|
|
|
|
427
|
|
|
Stock-based compensation
|
|
|
10,743
|
|
|
|
|
10,602
|
|
|
Stock warrant
|
|
|
868
|
|
|
|
|
980
|
|
|
Non-cash rent
|
|
|
(2,679)
|
|
|
|
|
(2,786)
|
|
|
Gain on disposal of assets
|
|
|
(284)
|
|
|
|
|
(93)
|
|
|
Legal settlement
|
|
|
(900)
|
|
|
|
|
–
|
|
|
Postretirement plan amendment and settlement
|
|
|
99
|
|
|
|
|
99
|
|
|
Adjusted EBITDA
|
$
|
|
258,486
|
|
|
$
|
|
253,537
|
|
|
|
|
|
|
|
|
|
|
|
|
Net long-term debt to adjusted EBITDA ratio
|
|
|
2.8
|
|
|
|
|
2.4
|
|
Notes: Net long-term debt is a non-GAAP financial measure that is defined as long-term debt and finance lease obligations plus current maturities of long-term debt and finance lease obligations less cash and cash equivalents. The Company believes both management and its investors find the information useful because it reflects the amount of long-term debt obligations that are not covered by available cash. Net long-term debt is not a substitute for GAAP financial measures and may differ from similarly titled measures of other companies.
|
Table 5: Reconciliation of Purchases of Property and Equipment to Capital Expenditures and IT Capital
(A Non-GAAP Financial Measure)
(Unaudited)
|
|
|
|
|
|
|
|
52 Weeks Ended
|
|
|
(In thousands)
|
|
|
|
December 28, 2024
|
|
|
December 30, 2023
|
|
|
Purchases of property and equipment
|
|
|
|
$
|
|
132,394
|
|
|
$
|
|
120,330
|
|
|
Plus:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cloud computing spend
|
|
|
|
|
|
12,050
|
|
|
|
|
7,040
|
|
|
Capital expenditures and IT capital
|
|
|
|
$
|
|
144,444
|
|
|
$
|
|
127,370
|
|
Notes: Capital expenditures and IT capital is a non-GAAP financial measure calculated by adding spending related to the development of cloud computing applications to capital expenditures, the most directly comparable GAAP measure. Cloud computing spend only includes costs incurred during the application development phase and does not include ongoing costs of hosting or maintenance associated with these applications, which are expensed as incurred. The Company believes it is a useful indicator of the Company’s investment in its facilities and systems as it transitions to more cloud-based IT systems. Capital expenditures and IT capital is not a substitute for GAAP financial measures and may differ from similarly titled measures of other companies.
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SOURCE SpartanNash
