EXHIBIT 99.1
Ingles Markets, Incorporated Reports First Quarter Sales and Earnings Increases
ASHEVILLE, N.C.--(BUSINESS WIRE)--Feb. 9, 2006--Ingles Markets,
Incorporated (NASDAQ: IMKTA) today announced increased sales and earnings for
the first quarter of fiscal year 2006, ended December 24, 2005.
Net income grew 53.4% to $7.8 million for the December 2005 quarter
compared with $5.1 million for the December 2004 quarter. Basic and diluted
earnings per share for the Company's publicly traded Class A common stock were
$0.33 and $0.32, respectively, for the December 2005 quarter compared to $0.22
and $0.21, respectively, for the December 2004 quarter.
Net sales and comparable store sales increased 11.5% and 9.8%,
respectively, for the December 2005 quarter over the same quarter last year.
During the December 2005 quarter, the Company completed the replacement of one
store and purchased three future store sites. Ingles operated 197 stores at
December 24, 2005, and at December 25, 2004.
Gross profit increased 8.2% for the December 2005 quarter over the December
2004 quarter, while gross profit as a percentage of sales decreased 80 basis
points to 24.6% in the current year quarter from 25.4% in the prior year
quarter. Larger sales growth in lower margin departments and holiday-related
pricing incentives contributed to the gross profit percentage decrease.
Operating and administrative expense dollars increased 6.3%, however as a
percentage of sales, operating and administrative expenses decreased to 20.9%
for the December 2005 quarter compared with 21.9% of sales for the December 2004
quarter due to the higher sales volume.
Interest expense decreased $0.7 million for the three months ended December
24, 2005, compared to the three months ended December 25, 2004, due to a $30.9
million reduction in total debt from $595.2 million at December 25, 2004, to
$564.3 million at December 24, 2005.
Capital expenditures for the December 2005 quarter totaled $30.2 million.
Ingles capital expenditure plans for all of fiscal year 2006 total approximately
$75 million. For the balance of the fiscal year, Ingles plans to open four new
or replacement stores, add three fuel stations at existing store locations and
purchase sites for future expansion.
Commenting on the results, Robert P. Ingle, chief executive officer,
stated, "We are off to a very good start with the results for the first quarter
of our fiscal year. Two weeks included in this quarter experienced record sales
for our Company. We also experienced excellent comparable store sales growth.
Whether it's additional organic products, expanded pharmacy and gasoline
operations, or unique specialty departments, we're focused on delivering what
our customers want."
The comments in this press release contain certain forward-looking
statements. Ingles undertakes no obligation to publicly release any revisions to
any forward-looking statements contained herein to reflect events or
circumstances occurring after the date hereof or to reflect the occurrence of
unanticipated events, except as required by law. Ingles' actual results may
differ materially from those projected in forward-looking statements made by, or
on behalf of, Ingles. Factors that may affect results include changes in
business and economic conditions generally in Ingles' operating area, pricing
pressures, increased competitive efforts by others in Ingles' marketing areas
and the availability of financing for capital improvements. A more detailed
discussion of these factors may be found in reports filed by the Company with
the Securities and Exchange Commission including its 2005 Form 10-K and Form
10-Q for the quarter ended December 24, 2005.
Ingles Markets, Incorporated is a leading supermarket chain with operations
in six southeastern states. Headquartered in Asheville, North Carolina, the
Company operates 197 supermarkets. In conjunction with its supermarket
operations, the Company also operates 74 neighborhood shopping centers, all but
17 of which contain an Ingles supermarket. The Company's Class A Common Stock is
traded on The NASDAQ Stock Market's National Market under the symbol IMKTA. For
more information about the Company, visit Ingles' website at
www.ingles-markets.com.
INGLES MARKETS, INCORPORATED
(Amounts in thousands except per share data)
Unaudited Financial Highlights
Condensed Consolidated Statements of Income (Unaudited)
Quarter Ended
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Dec. 24, Dec. 25,
2005 2004
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Net sales $623,394 $559,275
Gross profit 153,551 141,952
Operating and administrative expenses 130,478 122,708
Rental income, net 1,284 1,470
Income from operations 24,357 20,714
Other income, net 740 447
Interest expense 12,327 13,047
Income taxes 5,000 3,050
Net income $7,770 $5,064
Basic earnings per common share - Class A $0.33 $0.22
Diluted earnings per common share - Class A $0.32 $0.21
Basic earnings per common share - Class B $0.30 $0.20
Diluted earnings per common share - Class B $0.30 $0.20
Additional selected information:
Depreciation and amortization expense $14,755 $14,460
Rent expense $6,129 $7,706
Condensed Consolidated Balance Sheets (Unaudited)
Dec. 24, Sept. 24,
2005 2005
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ASSETS
Cash and cash equivalents $27,879 $50,626
Receivables-net 44,322 39,079
Inventories 214,521 204,113
Other current assets 11,665 10,639
Property and equipment-net 756,172 744,163
Other assets 17,279 17,385
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TOTAL ASSETS $1,071,838 $1,066,005
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current maturities of long-term debt $14,951 $16,413
Accounts payable, accrued expenses and
current portion of other long-term
liabilities 193,593 184,462
Deferred income taxes 29,076 31,246
Long-term debt 549,366 553,015
Other long-term liabilities 3,971 4,020
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Total Liabilities 790,957 789,156
Stockholders' equity 280,881 276,849
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TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $1,071,838 $1,066,005
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CONTACT: Ingles Markets, Incorporated, Asheville
Ron Freeman, 828-669-2941 (Ext. 223)