SPTN - Earnings call transcript Q2 2019

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day. And welcome to the SpartanNash Company Second Quarter 2019 Earnings Call and Webcast. All participants will be in listen-only mode. [Operator Instructions] Please note this event is being recorded.

I would now like to turn the conference over to Ms. Director. Managing Turner, Katie ma'am. ahead, go Please

Katie Turner

Thanks. Good quarter SpartanNash second to And XXXX earnings welcome fiscal the conference Company's morning. call.

Mark Chief On the Chairman Officer, and and Eidson, Officer. are company Vice and Chief Executive Financial call today and from Interim the Shamber, President Executive Dennis President

should to now, yesterday release, issued the which everyone By approximately X:XX earnings was at PM have access Eastern Time.

the is will copy SpartanNash's XX website This on call visit be approximately the replay at a please being website release, of and days. For a recorded for company's available www.spartannash.com/investors.

may Before that expectations, I discussed results statements. during will remind uncertainties. that begin, forward-looking differ These these we'd like in results significant and forward-looking estimates comments today's materially to everyone involve from contain plans, management made and may by the discuss statements. projections forward-looking statements risks call Actual

external others, among and companies; strategic Internal general operations; differences may and competitive uncertainties and pressures that plans inherent and such distribution food, in conditions. implementing retail integrating the cause include, factors and market amongst economic

Additional associated with can with company's recent and filings information the report company's the SEC. on SpartanNash's and release, annual earnings in uncertainties factors found in statements Form be other forward-looking XX-K the the risk about most

on statements. investors uncertainties, not of risks statements. update forward-looking these obligation Because and or SpartanNash intention to place any undue or should any reliance forward-looking disclaims revise any

was is reconciliation today. the financial most A comparable by measures earnings to the G included investors provide financial other performance. information these measures measures earlier the which metrics company's period as presentation and includes certain company's and in required GAAP release non-GAAP This with useful non-GAAP Regulation issued comparable about information to of financial

my turn Dennis. now to over the it's call to pleasure And

Dennis Eidson

for as And Interim nice President CEO. Good thank today. again with speaking and joining Katie. It's Thanks, the many of you everyone. us morning, be to you

profitability in transition growth, up also your performance quarter strategies the some financial to detail we'll provide second want our take will questions. and Mark our while to update topline sustain the leadership run. provide opportunity our then our then address for an improving the additional and the call I to of on long open

of his his board the I'd thank growth at business. has team, SpartanNash joining company. to throughout Davis instrumental for contributions successful Dave was wish the in Dave in Since First, and driving over the the our tenure in Staples personally presided the initiatives XXXX, business on behalf entire future. numerous And we across and best like SpartanNash

I XXXX. know, of with prior to long dating I that, President, to As XXXX. Marketing Chief Operating and and having Officer And a many served history back CEO Merchandising SpartanNash, as have of as in you retired EVP

stepped see since to last the organization. I've the our certainly at associates SpartanNash, of back across few In the been passion Dave's role days, dedication and refreshing into

improve value our our of with that segments order to strength the momentum. help long-term positioning the profitable for growth together effort in team to working confident to improvements, while of of our wins drive shareholders. us SpartanNash secure We're associates I in and and meaningful forward achieve to platform to look across this our gain all

As operations. fresh-cut part distribution Fresh shift exit decided and effort, Kitchen focus to Indianapolis-based and produce to of Caito's we've the and expertise the the operations

enable them this it believe aligns operational transition levels and Caito's and better We expertise improve with will efficiency. to service

transition Fresh is as and our Kitchen for as and to will associates seamless executed we're Production customers, transition committed our as plan the the continue possible make suppliers.

in you complete fiscal the quarters. transition to the will of and future development expect the on XXXX by this We end update

our respect strategic business With our to quarter. has progress the in made team many during current objectives, areas

line into on translating remain we sales our achieved not bottom improved we've focused Although goals, performance. trends growth our profitability on

billion, of growth sales for $X consecutive XXth the to net company. representing Consolidated increased the quarter X.X%

pleased objectives to with strategic other working our on strengthen team, progress capital and are our making debt particularly continued our lower the ability levels. and also We during improve quarter

business. acquired Retail newly In was from contributions sales segment, by the driven growth the Martin's

consumer we sales resulting these positive trend experienced Additionally, a have Family in Fare the in in banner for response a favorable locations. to relaunch the the West Michigan, of

Food the net segment, sales In increased Distribution from intercompany impact the sales of the of before X% Martin's. elimination

wet more the we of month more these recent deceleration of a pleased to levels. experienced during growth in rate the have weather approximated cool However, growth from recent and that of due as rate unseasonably the quarters, trends favorable the most sales and improved largely became We're to very July weather.

the In the in environment Military even continued current net segment, sales to commissary increased as contract broader quarter. the nominally

continue We private of revenues DeCA's brands. and this benefit of year from we as remainder slightly XXXX business ahead be growth in to to Military expect for the new

As we in One and business. companywide help Project our initiative, growth discussed we Team, previously drive our move expect will forward, profitability

annual last Our team continue $XX we achieve run end by savings in and on initiative to to XXXX. of has starting made this months in greater than progress the six rate fiscal since the track million remain

time, include policies the this and are and procurement initiatives, initiatives the routine supply At inventory in improving more systems tasks. several which for efficiency chain automation of process implemented administrative the we've management, implementing significant organization across and of and

XXXX The are and resources start-up to the earnings during cost implementing opportunities due phase. expected these to effect the be of material required not saving in to time

the will depth most strengthening recently, Distribution chain. retail the And segment is landscape benefit Lentz welcomed team, Food in Food and and management the of experience the manufacturing entire of chain, supply strategic company's as chain. and supply Walt Distribution. Another supply the President objective we systems His

we other some already been the excited places. Walt with and company's of way see that We're take to to running the hit food that improve ground the organization leaders in has aligning

to quarter million progress team paid strategic Martin's debt $X on Since million the in million the used net has made net debt, our resulting the fund over to the balance despite $XX the also I'm reduce with an working down reduction pleased investment. objective of and we've capital year, especially the debt acquisition. last in $XX second in

last the back to facility, half up term forward. credit reduction expense, paid low which year, our of in only overall As interest week, going revolving of contribute our of loan, will this rate not but our also to we a result significant

Our of team from quarter last over by mid-single growing while sales working capital reduced fiscal year, $XX million has the also digits. second

to toward and balance I their team improvements to fiscal to look forward the year the that for the date reduction efforts work of in capital the commend we're million as able we target. our $XX make

over the turn now the review. call I'll financial for Mark to

Mark Shamber

morning good joining to on the and conference webcast Thanks, us Dennis. And today. call everyone

of of mentioned, or quarter million for sales billion. quarter Dennis fiscal Net XXXX increase second X.X% $X.X of to an $XXX XXXX billion, second sales as the $X increased over

second Adjusted EPS fiscal compared fiscal came of at XXXX at in diluted per second quarter. diluted for quarter per the share XXXX in EPS $X.XX share $X.XX to adjusted

reported the loss second quarter of fiscal diluted basis, $X.XX to of GAAP in per quarter a share compared per the earnings of XXXX. On in the company share $X.XX

Food our sales in decreased million X.X% Net to segments. $X.X Shifting of business or fiscal million second $XXX.X XXXX. Distribution to by the quarter in

of to by primarily acquisition, to from elimination sales due the sales the to subsequent X%, increased Martin's Excluding intercompany growth existing sales customers.

quarter QX basis increase XXX point the compared XX basis basis quarter, points an of accelerated Inflation Food the Distribution an improvement of and XX second from to in points during XXXX. fiscal to

due totaled compared repositioning the Fresh offset XXXX, operations, the of in expenses, expenses year with chain second higher incentive Caito Food by to operations, $XX.X adjustments impairment in to the and recall from Kitchen the the lower quarter losses and Fresh than supply Production prior favorable partially quarter of the in associated million operating to asset second Reported earnings $XXX,XXX primarily Distribution charges for fiscal compensation.

$XX.X income operating second $XX.X income of totaled Adjusted the year's million versus quarter the in million. prior adjusted operating quarter

Second release. X the are quarter in current allocation Team operating adjusted costs adjusted current quarter. exclude quarter the earnings as in year of yesterday's with one-time Project associated million charges, in as Fiscal the XXXX in detailed press earnings expenses, $X.X asset excludes $XX in operating million which impairment One well table second of

Military in DeCA's the $XXX.X million the new Incremental from existing second lower of reflect million and comparable $XXX.X commissary quarter business of an with increase, or million. sales to customer partially year volume private locations. was increase $X.X by net drove brand program compared of revenues which at an prior sales offset X.X% sales

compared loss due well $X.X higher marginal due quarter to second and of reported partially the of sale an to in rates, cycling earnings Distribution Military as shift million the quarter gains in fiscal of to lower quarter. primarily the costs second as of chain operating a related facility business, prior-year in in mix XXXX, of closed the of the the supply the million $X.X to a

loss compared operating to On of was second fiscal of an $X.X XXXX in the basis, XXXX million Military's operating quarter $X.X second for adjusted earnings quarter. million

was million quarter due in increased XX.X% to sales acquisition. million net Martin's The to sales the year. increase Retail quarter our compared second last $XXX.X the for Finally, to the $XXX

closures Easter X%, partially sales Excluding store the in holiday of for X.X% and July August X.X% to estimate two of comparable conditions $XX.X totaling due million in this sequentially quarter. weather decrease which periods associated to and and the improved acquisition, a decreased sales this the sales comparable in lower store with we shift first trends the timeframe. unfavorable sales have at The due

million quarter operating to of GAAP the for prior-year $X second reported earnings $X.X compared in Retail million XXXX quarter. second of the

acquired contribution pharmacy stores adjusted compared by the $X.X primarily increase First million to managers. paid The lower and incentive impact second Retail earnings quarter. closing in quarter higher underperforming stores, [second operating in the offset $X.X quarter] mostly million fees (sic) was benefit XXXX were to driven by of favorable the Martin's comp, of

in million year. higher Interest last the compared second XXXX expense fiscal of rates $X.X $X.X interest due same to increased to to period the million quarter

to more the from down operations. debt Interest cash fund associated borrowings offset Martin's were paid with through by the acquisition than

are of pension due the our expense to We as primarily recognized termination previously distributing plan announced. settlement down quarter, in assets costs million corporate as and second $X we pension winding

quarter of We third expect plan. to the the expense $XX million the to asset additional of non-cash related distributions in approximately $XX million final

million, of in operating we cash XXXX, period of consolidated generated first $XXX.X fiscal So, consistent million. of half the the with $XXX.X prior year-to-date flows

million quarter of decreased generated of able $XXX.X operations Martin's to debt at the were by to cash the million and with long-term other investments of as second XXXX closed end compared facilities. the $XX.X net total Our we million of to acquisition $XXX.X certain offset by disposition the and

reiterated XXXX. sales net outlook of XXXX full-year originally February perspective, which on was provided XX, sales we an have growth, our guidance From mid-single-digit

expect $X.X the disposition earnings as items other losses $X.X detailed for expenses company's exit the associated and million yesterday's of operations million of million, table taxes, we Kitchen year in its to projected with release, to and our planned As charges share company's which earnings million to earnings adjusted per frozen $XX million $X full-year includes charges of excluding totaling communicated basis $XX of an terminate $X.XX plan the on in and after-tax million of Fresh the remainder $X.X pension $X.XX to of after to release. X

adjusted We supplemental program $XXX $XXX include for expect to EBITDA a eligible associates. incentive This the associated range outlook transition and million. not costs CEO does costs million non-recurring will from with from transition

we a of expect From be that reported perspective, $X.XX diluted continuing earnings range GAAP per to $X.XX the operations from share. in will

$XX our to in and lower of from and expect jurisdictions. million. updating range $XX to range our million Interest expense from shift due a to profitability from expenditure a amortization range rates effective to $XX $XX and million range adjusted $XX to XX% capital tax $XX to million are XX% to million into We tax to we depreciation and guidance now to approximately million reported

to turn point, And like this over call the back at Dennis. I'd to

Dennis Eidson

our remains that to return Thanks, profitability Mark. In still done be recognize closing, work expect. to levels to we much we organization that the

remains company in an team see forward the contributing on excited how this even new moving to area. And to team are extremely build I'm of organization. members Our the stronger focused the

we what accomplish potential. team this as SpartanNash will to forward look personally full reaches at its I

turn With open to you, the that, questions. I for will call and Keith, over any up

Operator

you. Thank And Mandeville question [Operator Chris first Jefferies. comes with Instructions]. from Yes. the

Blake Anderson

Chris. This know options my morning. some for Kitchen you, for you've experts. walk with taking Good outside just Hi. assessment discussing there business? of from questions. your Can all, on first Thanks been I is the of learnings us through Blake Fresh the

you you business? what out came So, found sell the that just problems about on detail the to more and main experiencing, a decision little how you're

Mark Shamber

appreciate I the Blake, Yeah. question.

we I have completed point, by we this focus of a the year. exit findings our think, end made be and decision, this will too that underway we I process don't that want that point as have the fiscal and the think much decision at business about at the to on to

was we lower were a sales it eventually, we expectations length at were the decision. the they the in the at SKUs have – runs think, growth have good than I of I think anticipated. end they've come, the – day, sales There of team, [indiscernible] be more runs far sales the the than from thought customers would initially opportunities. rate strategically projections. the some and a And there I while come and And smaller think some or we originally where of

the we're And the just think, made could reduce weren't so, as additional them period where the sales a onboard, and was team lead to the we've costs happened three a see that we four And was shorter by it virtue on to associated improvements, at labor pace needed. in we the the that talked expected. growth, just And about – shrink significant that that associated probably we've runs manage we to where that customers, measurable the that, came – our longer time. than it I a get could volume, looking last of while we added we and wait the level sales perhaps trajectory able sales time, added that initially so we've efforts see felt, to for of with we scenario or quarters with hasn't

felt was and time in so, forward. we at this move the point right to And exit decision

Blake Anderson

the to Okay, going margins, that's helpful. a numbers we are the you maybe or lift how EBITDA forward? think of then, can level it to share had about on was much so And any there headwind willing

Mark Shamber

don't I It think get going into was integrated of sort an to operation. level of No. detail. we're that

on there it Cut into talked prior we're $XX this about don't of actually of will to want does up out to it's all It business. retaining going $XX what – doing so, time, only it we the to about the that if the break had of the $XX of exit will we're we what we little the back Fresh that to business as exiting, in some what we're be and sort were it, we've think of what to fact a million projections to get do. challenging. calls And portion of go and administrative in trying the of think would that and operations with results. I some I at – you running And the million aspects million see business, until

current forma as I'm as expect process of we So, all go we've expenses not back it and half not rate, part a to be sort have back or the of be try had may as run the given of been shutdown. history going guidance as to at losses into to But expect the we this well the would may of what dead for continued pro some the would because that it the incur of part on. that we to

Blake Anderson

to rest sales on And banners? all? Understood. what quickly real one, at the give you Okay. Retail, could then same-store Martin's last you us were versus of just your that willing out Are break

Mark Shamber

doing is Martin's what they about comp. talk We'll when into fall No. the

out. any During banner particular here, we've I years know don't my broken ever two

the what what were I it some we because do think should to as announced are. banner. they you the an not to how when there'd performing. But historically. range think of transaction going going sharing carve estimate they're an forward that and sales give typically you That we're as we're So, we doing out we sort expectation I don't be We individual do to gave

Blake Anderson

makes Yeah, sense.

so thanks much. Okay,

Operator

Karen from comes And the question Short Thank next you. with Barclays.

Karen Short

much. very thanks Hi,

Kitchen So, the has also industry picture been I very a tough. just bigger question. been realize has but a Obviously, that disappointment,

most are guess, if to operating about with industry self-inflicted retailers general in at you you to industry to decision line malaise? top being look think just Because with I how it being look growth as So, seeing the general, profit think as I Dave, declines. respect opposed the I do the

trying parse of kind out it just industry? of relates So, how to much is the to

Mark Shamber

then let portion me maybe understand try portion Karen, and a and I make Dennis there's answer. just sure a will So, the answer there's to I'll question

or you our feel, as on of associated – So, the with we the what a if you're asked, is asking I is performance, all self-inflicted Retail portion asking just primarily how if segments? you're side understand and whole, are what you the versus for focusing much industry recent

Karen Short

Retail. Kitchen like, necessarily No. again, what's but Spartan happening I industry. it in the say, Distribution, but –not ask I has is or obviously, for And of industry? would is been a really a an at all it Spartan Military, problem, context It's tough a issue

Dennis Eidson

Karen, I think right? yes, other. one the or answer of is is kind It not the

a one space. think difficult I recognize we is environment the the that macro certainly in

by environment. heartened we're fact on reflect that, to that positive that despite we we've As consistently generate been sales pretty the able

guess, release, pleased consecutive amount I bottom sales in as I that not cascade top And, an the line think to to put as of with ability it's we're appropriate the line. the we quarter. XXth our get to

that to Some is sure. of industry pressures, be

are in things we some in think, get we we that are a believe nature forward. those and to shortfall, our of Other causing that be going improved executional will position

business complex place. that kind a think is in and to question, we to a the answer it's no it's solution I need So, but of broad-based simple there have

Karen Short

in helpful. Okay. provide the update along then, are an versus that That's you're Retail? if you of customer And you I seen worth on also, the or noting, attrition color Thanks. have called maybe guess, on quarter, rate Distribution? traffic recent wins lines, just even seeing us the can in some basket on haven't And then, give then, obviously losses press those anything in And out release? any you

Mark Shamber

Yeah.

I on question have So, I we that but typically size, first next. basket I know and don't talked ticket don't versus can handy let that the second do and me then know we've answer that

some that whether customers they've say close showing they've we there that that or given – would of things to that, and look, nature. some whether store, chosen win we merged any we're on are the there maybe I quarter, customers are declines at

for I we quarter, to say, that would said individually would the low- number had would of volumes for anyone Having or wins had with new then call customers, typical those don't given I out. that, mid-teens the I aggregate, probably would about say, But of this know customers. quarter. the I the in we attempt associated to be any in

was to attrition the again, nothing, that relates there it is the I of of that ordinary. business, As the think out

unusually early spring his with we as think it – and covered the we on unseasonably as or the cooler I well, mentioned release, the in I to Dennis was more typical we softer into in numbers, we've we talked have and timeframe, a press summer summer in date returned sort comments, saw and returned. into saw to weather but the of August and as sales the seen July that

while than probably two-thirds quarter a the more anything since that seen perspective component so, to has the of competition what because two-thirds softness, might we've of a of levels. some period just had weather I have the returned attribute or And more typical to weather from

covers the the So, side. Distribution on I that think

to me. as have then, tell And size, it can the – of sure you relates I'm it that in I not right front basket don't I

know I I on or you that. I if, to answer know follow-up we can don't it's with have I don't Dennis, if can So, something have…

Dennis Eidson

Yeah.

have I a the and actual is think the Karen. rates. really as mix, the Easter the of you X%. saw, by actually positive transaction numbers per which, identifying negative That X%, was were said, the that I shift without X.X% sales count of transaction think negative Mark, We I a impacted negative

Karen Short

you. Thank Okay, great.

Operator

Thank you.

Research. comes Wolfe Scott with question from next Our Mushkin

Scott Mushkin

to again. Hey, all wish know I you taking guys in time my Dennis, to And worked the guys. Thanks the long together for Dave too. nice I talk best you past. And, a questions.

is morning. about little do kind food. direction what they we that – noteworthy had industry is want I And on I bit So, retail report I to Walmart what think this to slight in of actually the guess, a was what reported, deflation talk side, the of I wanted

wholesale your so, but points, on only some And suggesting own think basis if you business, guys the XXX not got pinch also right, I on Retail I commented that inflation here about really on your customers. of level,

seems how So, even and the though customers wondering you do this in retail stuck to maybe actually going pricing neutral be best costs up? I how we that should help falling, environment, at attack in was when margin, if, are your

Mark Shamber

when our I don't Retail for from out standpoint, the quarter I but Well, an – on XX in basis think saw maybe script, and side. that I side, on we started points the the called it about know we inflation

Walmart So, I that know what saying. is that would contradict

And so, about or a actually from there an quarter, a But points. we blend at perspective. is inflation a sequential we were saw acceleration standpoint. maybe mix Last XX basis

XX over saw up the Still quadrupled. but basis went X% we almost quarter, points, an actually we for acceleration. So, sub

Scott Mushkin

be gotten taking holding me the this pricing down, line? because a nervous, And it though, little Walmart right, might or has

Mark Shamber

in ago, Scott, we period saw years if markets. we we year what and – think, for two go back was doing to our I about a a almost it Walmart of almost talked time

as I so I are about commentary or year we lot a and ago later so, a that about about And think of two the Walmart concern. think years where think and today made that caused

that against we've attempting as seen and Aldi veal expanding, back think already Lidl push pricing. through we've into or to entered think [ph] the from battle they Walmart, incursions whether I further gone I that US were

And the so, what X XX referred might months. levels to be last over to returned as rational to more they've

basic lower we that two be ago. But years we're of levels on than were still, some at where commodities, the would

your referencing, they're that yourself they at seeing price our markets. what I because above still I being as is But those checks, other they're and we're checks sit shared into see seeing pushed now don't we are what country perhaps information think are within it look some price from as I your here prices that and today. peers by what the of know gets geographies well in

Scott Mushkin

right, appreciate the very guys. All I Thanks you taking questions. much.

Mark Shamber

Scott. Thanks, Okay.

Operator

Wolf Andrew Capital with Thank you. Markets. question Loop next from The comes

Andrew Wolf

morning. I Thanks. Walmart, on push question Scott's guess, I to on continuing price. to into follow-up want Good

of They their in which the the that, maintain an what's think created later. sounds maintained Historically, inflationary at boosted continuing of they're has inflationary the know a to the do turn going least then been has prices the on as I that players, historically Sort that's maybe of rest they're larger to saying an been but them I Walmart like pricing case. is to isn't do, frankly, which historically image and -- not – sharper kind going but what industry, up maybe case. isn't know I'm price and I environment.

maybe broader all, you at going your studies for of that's have agree as you on the sense chains would compete look what's expect you other price yourself, and inflation? First do market, with second, that pattern of in customers large And one of you that's agree that there? that kind a might done historical out a sort that do in a return to

Mark Shamber

Yeah.

the I we might because lost I what think part, think on prices in And we've – historical Andy, I below was, about prices of talking think and – up XX that, to their banana to and certainly last you levels, the XX and or milk as way costs migrated but first I before were. over drifted were yes, have middle question we back $X.XX the below those approaching egg certainly have the back they've where but months. seen gallons perhaps not to

do three so, markets, think what would those weren't commented seen through. And I or to I going what and or – we that's watermark. I to that's sustainable what likely think investments I up the half occur. some what can't made, first but we we return of it not same And can't I and they're during they comment think saw of of had sort back certainly experienced – those we've to XXXX, the markets, I – all in in And And and need not. battled that the But sort that's timeframe. the that if at XXXX time our quarters the of some higher first experienced speculate of we've speculate that we were think that you half against of our

yes, that and So, country. We've other up. I It's those some gotten likely that pushed back drifted inflation once to drift they're may other in then that of allow parts gains seen in they that quite they've has geographies pricing think, doing the in.

this on as digest retail. chance XX side know But quarters, that between called had so, that right? the Scott and quarter. inflation the distribution and wholesale to out a basis I few was their reflected what we're but almost say both points And a and wholesale could referenced again, spread seen the fully they're what there's But, we've haven't I release. same, at what we've seeing Walmart last the in not referenced

Andrew Wolf

helpful. productivity think this for Okay. one two largest goal Military throw guess Kind Thanks. of And in on it I so, – side some the It's execution more way? you what on I sales productivity kind framing year, get issue, am good. might and at issues. wholesale to, ex And look when Do execution. I going you It's agree I the as I sales wholesale for retail? as the profit quite which sort challenges there, the on kind Karen clearly, be think than to your a could could right would plans, in side which there is alluded so next I look at guess a Dennis. we view of if are to Retail, Martin's, elaborate of I you it's sales in of But, the are the of growth, I more segments decent. – execution and

Dennis Eidson

challenges are the the that plenty And also of disruption we causing some on Yeah. was We continue heartened are the to clearly, the segment. going Distribution on the we We've believe grow our articulated in some macro things going growth there in believe, is profitability. of that. are It on we're yes, forward. ability there line. bit by touching company engine that can to and, where improve side, the Little Karen top

working Kicking executing the is unproductive you just P&L at level. be higher that some is Walt – will Supply that the we chain of brand that. focus metrics they've where to the capital a around start inventory but, those hidden area improve improvement come. – on think benefits, when new, we Inventory another some is of of through a down management will primary clearly, focus out, kind cascade opportunities have

And believe do. we so, there that's to

the and Martin's customer In in strategy. we've we did talked I that strategy that it discussed company into acquisition adjacent a into And fit the side, about. was portfolio. plays On Retail our think, market, the fit the it when last has we very nicely for right year, segment the servicing It, decades. that how about – were

western With be made there. opportunistic regard was engaged fits the the acquisitions, the business strategy. That would we wouldn't in But that of Martin's to transaction. Retail and we have this sense US, in part

recently of our Retail some things landscape consumer the pretty home seem with significantly. Rapids is sales be and to improving And market our I regard Grand think stores more that in trends tough resonating the done here we've with some to in

And as on Lori our cases of in black. job you, bringing retail chain and relatively And I the functions we initiatives and Walt as an – are lot the the exactly think will but But side, She's engaged supply fronts. focused she's both some about and on to company. is is Walt thought those comp And the help fresh team the get on to in Lori got store the organization. is they combination red Raya would. And of from merchandising a new to ideas. marketing of sales tell of I the spoke that. some organization I working can

Andrew Wolf

sense Okay. those And for you to reference of I kind of Project begin if I some cost be savings me like flow to the to time think it be I reinvestment, line? between but well, it assuming could could versus example, -- heard allocated that. might business initiative, could cost One lot something driving growth reductions which One link of have growth, project, like Do through in kind in the a the using it this for to at price as the like, how bottom you or just that sounds a include for at Project least, flowing a in and things,

Mark Shamber

are we've share as can can we're Andy, that in make in exactly as I improvements – group how as – managing flow as look, the the and place. on a associates you as level through which know detail, through all I – of how got well whole of exactly One could way divisions expected the Yeah. that I and those take you folks is to the tell flow timeframe don't not initiatives to tell Project the much we working that say that to project, what business I going

break in we into position present that next and business. we're where think reinvest of invest a look some in and it's of or plan that to to and our bit in a folks we're we going kind give order I set that those early as As year out. to the you opportunities to necessarily don't know take XXXX guidance, I still

place be we'd for we may in already otherwise about there that reasons have aspects were components they honestly may share something tried that price probably do be some you if talk tried couldn't there – market. And in reinvesting, when until the or would we to competitive

Andrew Wolf

Okay. Thank you.

Mark Shamber

You're welcome.

Operator

Thank you. [Operator Cerankosky Instructions] question Chuck And the comes next from Northcoast with Research.

Charles Cerankosky

Good morning, everyone.

Mark Shamber

Chuck. morning, Good

Dennis Eidson

Good morning.

Charles Cerankosky

sort little And from of issues. you automation? in labor the you Distribution, productivity what I including internal offsets bit the know are supply absenteeism that Food a had talk some the programs, Could about, to and situation?

Mark Shamber

Look, as you it the to the I numbers. supply, unemployment see relates think

we're employment. offer. into perhaps good been I past, still it's able I while virtue folks of challenging by that, a And benefits in it's attract and approaching As that full think starting than a to wage we're a the little recent company the the country, think, more we

years. bit talked our we've seen standards associates a bit the little learning up getting from what curve think we've recent that, delayed standpoint, about of more our has been say, to, than in I a

not much quickly point we're – be days at XX XX this They with the that as this historically. days to in level. in so, in be, not we've productivity at get as same there the it's do past. a or or as have seen might point, what it may associated to used But And to eventually compared that hey, getting we lag

a want question the solutions versus the some through. address absenteeism that DCs. variety absenteeism, that And some scenario, face a generational work I that full still experience don't that's had to a a our to future. to And in To we we think through in something it but that's unexplained to the thing employment I and try on of of challenge something attribute we're to working it's we've

to too on part the the think speculate of standpoint perspective. an it's second I of automation from question, the anything From early

efficient being our on we're in think more focused I operations.

our help number got organization within automation-driven. help rates say, he's I improvements think through supply they're Walt's the I would a and get of driving the initiatives not chain. to that And

Charles Cerankosky

distribution and better the to distribution the the at are Military involved? those are looking separate assets I And utilize segments, two Thanks. realize the traditional grocery, how platforms now segments, integrated

Mark Shamber

they're parts initiatives Dar, the that's years, longer, share, network. CIO at get that is distribution of that a on our for the but beginning year, is place, most on the platforms. platform of joined couple are has in that next the part, new us our they're whole The they Arif over a we've initiative And different coming got platforms, who the – of to across an entire one he maybe there little

Charles Cerankosky

Best of rest All year. of you right. luck very for Thank much. the the

Mark Shamber

Thanks, Chuck.

Operator

next is question from line Thank you. follow-up with And a Chris Mandeville's the Jefferies.

Blake Anderson

On I I done. you now was how many Hey, just have follow-up. business, could your one Retail had wondering share you if remodels

number. the us pipeline now? year, could give have end expect? a And update there have the you Fast XX many have provide at Just left? Thank then, on many are as the think you of I we locations, Do last if you. that And can us Lane you that in number stores how about then, how

Mark Shamber

Yeah.

Fast think the I So, the out Fast additional Lane on have Lane, enrolled on we store.

that is you still same be quoted, the XX the number, number. would same that the So, still

the – you the we fiscal say year, of fiscal On say, I call whether had that, or medium I current year did it for talking then that depends major or XX on we the would what stores current the touch-ups. of would are referencing? had are remodels periods number a you want you remodel, to time and for

get the a from remodel into And of major it's number would factor so, but the perspective, XX. about all in if mid high-teens to them, you

Blake Anderson

perfect. Okay,

Mark Shamber

or And question did did the them? all of miss answer a middle I in I

Blake Anderson

was was it. That it. Thank That you. No.

Operator

the exhausted we for return I'd to any And you. questions, as all like have comments. Thank the Eidson floor closing Dennis to

Dennis Eidson

third I look Thanks. And, results. their to when and questions quarter with speaking fiscal on thank call. participation of our XXXX all for want forward report to certainly, again we you everybody today's

Operator

Thank you Thank today's presentation. for concluded. you. attending The has conference now

disconnect You now your may lines.

SpartanNash (SPTN) 15 Aug 192019 Q2 Earnings call transcript