Earnings call transcript Q1 2023

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Operator

Welcome to the SpartanNash First Quarter 2023 Earnings Conference Call. At this time all participants will be in a listen-only mode. Later we will conduct a question-and-answer session. I would now like to turn the call over to Kayleigh Campbell, Head of Investor Relations.

Kayleigh Campbell

Good morning and welcome to the SpartanNash Company’s First Quarter 2023 Earnings Conference Call.

from Sarsam; are and and Officer, Monaco. today Executive and Chief call Jason Tony Officer, Executive the the President company Chief Financial On Vice President which have A.M. XX:XX the By at access everyone this morning should earnings now release, was issued approximately to Time. Eastern

presentation, of call earnings is be and replay visit For being company's a well available the at will company's earnings recorded the copy SpartanNash's website. on as website release, as supplemental please This the www.spartannash.com/investors. a

like subject to to include that would you risks Before that forward-looking in will we company actual differ begin, uncertainties discussion remind a expressed those statements. the today's the results and from cause could These to forward-looking of materially number statements. statements are certain

as We'll company's recent these the materially We will refer forward-looking a to see company's differ SpartanNash's that morning, as SEC actual most well earnings could filings. from of statements. this release factors discussion to cause results the from

now can growth which earnings be underlying included comparable found measures is financial over the SpartanNash’s reconciliation pleasure it it of to non-GAAP all statements forward-looking current remember my the with statements. Please these measures, financial investors in call and on a reflect will no and The revise on believes release at SpartanNash perspective number has our of trends business the only the company certain expectations full company to to measures also these forward-looking most to or And Tony. www.spartannash.com/investors. a measures. non-GAAP references to undertakes GAAP useful provide make turn that obligation website update of made The today the

Tony Sarsam

internship at These This class our This to SpartanNash pipeline SpartanNash. and the grow summer to our Kayleigh diverse receive solving stay brings going to excited cohort be help growing and and interns It mentorship you good summer. Thank largest to them our interns and like leaders our business. everyone. fresh creative and continue I'd to of is we're of to hopefully yet a young program. great assignments will start welcoming by new perspectives morning problem is meaningful family.

are Alright, results let's pivot about why our the excited and future. to we

proud First, had execute to year say an to organization. targets. plans our is are prudently synergies capital initiatives a We strategic excellence long-term our and had We the the full and on out reiterating guidance are start our XXXX strategic working. operational our allocation. our strong in year we are in of right we we place inflection to retail Two, plan, a and that and managing are transformational three, one, point wholesale long-term our funnel and segments. rolling advancing team between robust This

challenging wage Our that are team team supply we and targets. an and also chain With from benefits we transformation EBITDA This initiatives We driving This XX% long-term of believe last of compared us fiscal merchandising expect gross about of confident gives XXXX at confidence XXXX. year, this our we our value. managing increase. the this expect macrodynamics. Notably, do cycled will and than to outstanding actions more the initiatives us, in growth job continues our significant contribute both transformation transformational our to XX% in to two will least to realize are retail through benefits total from our grow expansion. margin behind headwind also by hitting adjusted successfully quarter, ability year to that continue end these by full

in given runway is need there insights our win plenty our us drive We capabilities, to are this have and strategic we momentum to of plan which core and And have people, operational ahead. behind environment. excellence, focus solutions

last anticipated on executing the supply drive multi-pronged our quarterly to adjusted we year would first well to quarter our which the transformations are strategy and for This lapped growth The chain QX of results. first expected want growth past transformational $XX.X accomplished quarter. delivering of performance internal as of significant as our focus results date. be our our most success quarter results the million. these from we This strong our turn adjusted team to despite I outperformed headwinds, expectations best profitable reflects initiatives These merchandising come. solid by Okay, from the EBITDA impactful and significant to to highlights EBITDA during years

create transformation inflation and they're to may shoppers. born Throughout these offerings we retail remember want enhanced customers, food hard our stretch costs. you to from enhanced unprecedented to have We Okay, trying on value customers taking a that for and worked rising for mitigate offerings merchandising value creating and focus was step their when these more wholesale back, our our especially dollars.

As a families we company when that believe win. food we all solutions wholeheartedly win,

with We collaborated have are CBG grateful essentials. to to and to groceries brands the us maintain that affordable [ph] consumers access ensure

launch attract our our total are merchandising last this the program wholesale a providing shoppers. will continuously products from the merchandising price. and capabilities. at year. led Because the with from filling transformation right of gaining many macro momentum. wholesale the transformation are business. shelves headwinds, through Along price the The is offsetting monitor quarter, as place benefits past transformation realizing of environment these we and strong and additional for we're started foundation merchandising to the quarter enhanced also possible we customers the customers past timed transformation customer the strategically We the to our focus of on this SpartanNash years at We of the right inflation and processes, to the our involves able anticipate right some shoppers headwinds, the growth program brought of have place by retail through with forward impact new flowing Significant processes related as help in gains and benefits

have Day. made since progress our Additionally, we Investor significant

category next the our planning, We enhanced compelling the are merchandising of assortment the one, two, includes of and phase generation now entering and of This the transformation. program. offering launch next

merchandising to to progress deck. refer supplemental with $XX please from to transformation are the million benefits details our Slide consistent making, $XX that we're expects the in company fiscal XX plan. million more the the In long-term the gross XXXX, realize For about

our which Turning chain to transformation, network. our involves supply optimizing

we find prior We to point rate I operating and we Their continue QX SpartanNash Storage opportunities ahead. our top during with improved in fill growth to we team. were Compared our a the and XXXX. our of want basis give a wholesale by excellence first hearty recently reported recognized XXXX in to following; chain rate truly Party to operations year, Two, Providers drove award, our the of X% there and Logistics in XX% the commitment savings the delivered They to and plenty and our our one, throughput in expenses a the inspiring. three, is segment. synergies are XX to the improvement increased in quarter, steadfast Third the customers to compared operational accomplishment industry. supply XX% congratulations distinguished Cold team

is savings I total To overview this financial transformation. year is the million for In benefits This reiterate, million want initiatives. the their expect merchandising of realized remarkable to we the end Okay, our transformational realize benefits in expected a This progress gross the $XX to benefits. fiscal another $XX team this year. from chain entire $XX initiatives we we of includes from provide the to gross million transformation, of XXXX the the savings and of the supply XX% expectations transformation SpartanNash expect than supply from of chain proud from and gross more both by and that. growth

segment's share marketing from segment, to scaled are our providing retail consumers time our during insights increased convenience. solutions within and we Alright, In that we $XX innovation Retail's we quarter billion are plenty leveraging opportunities market addressable grow of further. the opportunities offer our within value operations. market, share environment the an starved, turning have unlock more when are to to retail and

harmonizing shopper one, the value based homegrown tailoring personalized omnichannel improve are And promotions. shopper sites through emphasis Two, unique with vendor our and deliver local offerings. e-commerce own to on We Three, relationships experience shopper's enhancing to four, experiences digital product preferences. products. brand's banner brands creating experience loyalty on an broadening by

am are also indulgence offerings. provide our of amplifying programs. example We want excited these why convenience so I to I and an about

sales incredible year-to-date. over our our lot building be now say, Suffice turn on prepared Monaco accomplishment. CFO, and details to of I this our terrific we things about a freshly to XX% are to an produce almost more up is to value-added proud Jason financials. will This have Our momentum. share

Jason Monaco

our Thanks plan, strategic call. some is in great of nice our a doing us of the strong the Tony, year, especially and on joining the and welcome to uncertainties after through navigating marketplace. start We execution about to team job today's everyone a feel

on plan, on our value strategic framework organic opportunities. we strategy long-term year full incorporates And margin environment. results provides release, the that the of potential Pivoting our heavily and are balanced which to stated of As and strong expansion capital which for our Two, elements our today's approach our earnings both stack our the deliver related to continue we current creation to in shareholder strength of to three, our means M&A transformational future, one, long-term allocation. incremental XXXX macro the guidance, value initiatives expectations validating plan. the reiterating

$XXX XXX levels lower reduced segments, in Now be million quarter growth forward The positive into in favorably elevated pharmacy driven were which compared margins. billion. $X.XX increased the the in of trends. wholesale sales was of to quarter impacted year results. net first wholesale sales to inflation first first compared or prior and by to $X.XX net let's than million for benefits to year's and the of XX.X% can both for compared the rate to quarter. Gross jump prior retail more sales quarter the detailed by segment quarter, gross XXXXs the the decline retail X% sales profit sales XX.X% in was or billion by Net This profit attributed

to year LIFO expense the compared increased slightly quarter. Additionally, prior

realized a the The partially volume increased offset of was result margin customer the military rate and merchandising within decline gross initiative rates channel. and by benefits transformation as profit

of reported to percentage by our store quarter, wages. Two, the chain administrative next charges. as as a supply points impairment expense the an of The were expenses initiative prior merchandising asset a realized in chain supply sales, And transformation from as to a offset retail and rates three, in due investments reduction from efficiencies related year phase transformation our decreased lower costs in partially increase operating result expenses the higher compensation. includes which XX initiative. well costs, our restructuring basis As incentive of one, primarily in corporate decreases

the was as military This pricing on impact our due compared year's well to primarily billion, quarter. sales first prior in increase to as wholesale increase in of the segments, Turning first $X.X to increased inflationary increase an the and $XXX million net X.X% to quarter when volume. an

X.X%. by case which were sales Our volumes down, net reduced

share customers core maintained and will help volume secular offset feel we new confident organic However, the that pressures. business and

our The totaled $XX.X segments wholesale administrative gross EBITDA lower quarter EBITDA were versus million. rate quarter by costs. first incentive quarter. to million in quarter due slight $XX.X adjusted partially in in was were and Wholesale the The driven the supply of offset XXXXs compared a $XX.X earnings supply million corporate increases expenses by rate reduced chain operating decrease transformation year's increases to and These profit of adjusted first first a chain million reported lower $XX.X compensation. prior

in at an $XXX in of the increase quarter the million compared $XXX came sales XXXX, first of million quarter X.X%. to Retail for

increased and store first decrease lower The due restructuring even the profit earnings unit $X loss in closures. by wage investments sales volumes. reported primarily This million year to current to in quarter. XXXXs due an increase impairment the asset strong related inflation at X.X% to in prior and Retail the was two lower in earnings first a first rates Our quarter by to store compensation costs. increase reported continued reported health operating offset from a the Retail to EBITDA partially quarter, in insurance million and momentum in pricing, compared to comparable the incentive $XX.X operating related rate. The million was due adjusted partially was $XX.X in gross remains offset of modestly year break store quarter. charges

interest quarter a increased prior On prior $X.X both net or of due our expense earnings $XX.X were was of $X.XX quarter. year's a $X by The borrowing the adjusted higher reported reported to basis earnings first million increase in in which reflected quarter. drag Net rates, compared $XX.X primarily million. increase million a consolidated the million versus EPS on and expense to year interest the steep

XXXX. to adjusted quarter best macro our QX compared despite The year lapped adjusted quarterly results team expectations $XX.X a QX $XX.X internal the first from EBITDA million delivering of EBITDA and accomplished in We challenging in last million of outperformed in environment. by this

cycled first during million wage retail of during including headwinds we and headwinds. the forward investments million As million $XX in buy quarter, $XX $X call, discussed our QX

to mentioned, As our Tony have the help buys. diligently effective forward manage in place of teams we processes monitor impacts and

balance from X debt the ratio to of EBITDA to quarter the net to adjusted current our times. increased Moving sheet, long-term over X.X

us Our organic and giving liquidity plans, strong, including strategic flexibility our to remains both investments. and inorganic long-term support

we XX in to activities compared operating generating primarily in quarter cash X.X used changes due from year The of year quarter. to operating compared the capital. quarter, in For the cash of million was activities prior flows million in prior decrease to the cash working

a capital to also We disciplined to take approach continue allocation.

dividends. through in one, quarter, $XX.X repurchases During two, million in $X.X and the we to million XX.X share million returned shareholders

flexibility through in million quarter. revolver organic of plan, our facility, terms past our $XXX addition aligns new of of inorganic with long-term the million the availability billion quarter and we as of excess lenders. investments. increased during provides on strategic The and future, $X.XX end borrowing supporting both than the our $XXX more credit growth including capacity of our first our of the had to additional Based by towards recent capacity the Looking we the

X%. full As be we to wholesale of billion. X% continue year. comparable year expect to strong release today to with sales to our continue expect to $X.X in X% billion X% sales range grow the sales to our mentioned, expected the we earnings for guidance. to retail, between reiterated we grow we the results XXXX $XX.X net expect In In and Overall,

EBITDA We to will range $XXX adjusted in continue our expect million be to of million. that the $XXX

which be $X.XX million range guidance, to our $X.XX we We $XX incorporated expense share. year, the to expect interest be to to in to EPS full into $XX is and for expect million continue the per of adjusted

on launched our comments, Tony's initiatives. made echo transformational we've progress and To significant

benefits down break from Let's the initiatives that are both expected in sight.

to deck throughout on commitments the November, please $XXX ease gross realize the refer transformational Slide plan X to Consistent supplemental million of our For in net Day Investor the are to with benefits million our past at reference, of website. benefits that's long-term initiatives posted of made with $XXX the period, expected this $XX realize the to million which and million, merchandising of of macro gross one, in includes expect benefits chain impacts savings transformation offsetting million transformation of to -- million of to gross $XX the $XX fiscal the benefits total these from significant gross headwinds two, supply XXXX, million $XX we $XX from million. to $XX

first we run with $XX tracking, the run we by rate a So the than continued how in from gross are in rate we our perspective gross chain transformation. $XX momentum And of our more exited from supply transformation savings. merchandising million securing quarter benefits million

like and benefits merchandising As transformation I'd turn to to a over gross from to now reminder, call expected the Tony. additional flowing the the wholesale the excludes that our customers benefits shoppers. are back And retail

Tony Sarsam

in transformations strategic long-term securing well executing and we are Thank are benefits as of wholesale success own chain plan, our you, bottom generating line. for our savings and our our which The significant and customers shoppers, merchandising To retail supply as summarize, results. our Jason. gross is evident

to continuing remains Kayleigh road with drive and will meeting. to out serve feel shareholder team free focused customers, investors. to Our on reach strong and out be grow more meeting a the value. on to Please Jason coordinate results, soon long-term I

side it your at the next to and Additionally, that, back we look questions. over to call the sell Food operator like seeing Solutions analyst forward up our With I'd month. for Expo turn open SpartanNash the to

Operator

Research. comes from [Operator Cerankosky question from And Instructions]. Northcoast Chuck our first

Your line open. is

Charles Cerankosky

and down you volumes Jason you're week while market of about the last and are right and one retailers food volume Tony at grocery your talking looking your talk about volumes. in but category would competitive discretionary hard hit of some some position got were Kayleigh. example be the up Costco categories? they showing up now, reporting sort morning good Can overall, When Hey,

Tony Sarsam

Well, that you our we had in the and but speak studied I the alright, direct kind other to kind number of grocery shift we our good channel is, -- think case morning, share -- Kroger, Chuck. a actually Costco's the expectation when of what the about an to that of pretty beat carefully, woods -- We our in of share our includes key retailers. Meyer, first Walmart, of Gross neck expectation. gross quarter we in that would versus folks and other include can't

that directly. I So, we we compete think feel that performance good we channel most, overall about in most again, the with our

Charles Cerankosky

Okay. biggest biggest can't at And the going talk interest I on down the outflow face. was to item you that, around fight you the is earnings Any about operating it pretty one anything of of to headwinds -- know for strategies big Jason? expense there, to this pretax, what cash one you what you get was what's and Jason, bit a at the a but showed Fed brought quite the

Jason Monaco

Hey good question. thanks morning, the and Chuck for

On rates in primarily as exposure. from what increase interest debt But of interest million expense quarter, saw expense the the to us of we we obviously hedge But in look benefited in the related does control We the the the quarter and as gave a you you can't floating a like. out our Fed noted, that what we side, of course, increase. rate couple know, quarter pennies. significant $XXX during fixed

and don't So we balance EPS increase. rate of that the some drag had we this of to are to rates quarter, reasonable a sure wanted roughly use and muted $X.XX we with going also the the hedge that that on most high floating because We believe make fixed in the of was forever. that of stay

way. the along storm that weathering is doing we're what so And

XXXX. for we're last start rates as to lapping higher from year through when the you year, the going outlook to we that, move the addition In about think

a the expect Our of for rest and outlook increases be lapping will kind flattish began the higher that year profile rate that of the mid-XXXX. reflects we we rate

In and working to that a we've our got capital and capital, we management, addition course, to approach etc. disciplined debt do ensure that maintain keep the that, and we of ensure cash right to management that load best flow diligent our to managed balanced. of

Charles Cerankosky

about be debt that end? Jason, any will will level be year told where at prognostication Spartan’s

Jason Monaco

of But guide the math XXX leverage X of our and typically, don't to running closer be the of that we number. X. do range, to keep of year. we where debt will X.X point in guide the can the by to We to Yeah, we think it's to EBITDA, typically to been XXX kind end kind against

Charles Cerankosky

you. thank Alright,

Operator

from And our comes question next from Rob Dickerson Jefferies.

Your line open. is

Rob Dickerson

Great, so guess just just I much. in attractive obviously question, on helped the first thanks and SG&A the lines, quarter.

Yeah, through of progression kind drivers the should the the think the then we that through is offsets. or we're that quarter, potential the the in is were kind I that actually SG&A kind argument's just and rest as question? that’s of you there could there benefits sets year, how there I outweighed SG&A, of the be get you about through clear kind flat some rest we would say, small the As the the of cadence of like year-over-year. benefits think Thanks, think year, sake be first But, of were and as year thinking of the heard basically increase it for but

Tony Sarsam

million the dropped energized in for joining. that and outlook yet. bottom with line expect million of peak committed the that our have run we a in thanks by the results. have driver that that year exited saw big we Rob, that, at. reached benefits transformation. talking improvement $XX XXXX, I'll quarter's supply of And OPEX of year's the to not We're another the you roughly we really run kind rate chain in of maybe Hey $XX this rate on to that's to this We're year, start the million stacks top $XX this And about

the So that year. continue of to up we ramp to the expect through remainder

to So bottom confident year to the going and supply line strong growth back continue the EBITDA we're that the progress throughout despite to of we're the that challenging we're chain going transformation. headwinds, we to on expect deliver

Rob Dickerson

some to volume not we're back And in And going still enough. everyone clearly, seeing general, positive cycle. I decline. a is industry the the clearly kind repricing kind of mean, through we're question. some then just fair I Okay, seeing traffic, CPG guess volumes of

ship brand You've incrementally kind initiatives, how improve the of about of some own of you mix. potentially your of store kind talked kind to plan kind of or

into I course, everything's the like the side, so trade the in curious kind you of little would par it's or -- like not within consumers say more of collectively buying much, some you just have kind of in just So locations stores a bit sensed of your kind am maybe that less? kind incrementally retail of you for essentially down where shift

Tony Sarsam

is This let couple give there. Tony, to great. a let me you think Yeah, things me about of

So overall, it's notions. a couple of

kind inflation. to folks about save seeking was money our in think quarter up last we're indulgence. is sales that so for the of unit down of year, strength suppliers seeing inflation lower those with ways that bit. at Our a mix roughly, price of the brand there opportunities folks the so combination In little with, or great up volume in the analog out national XX%, we're seeing for little less our family traffic of to out by a as and the a over increase. and basket seeing we're you've interesting the for And on either overall ways is price, same convenience actually -- versus inflation and the noted, noted We're find their products as the and XX% price and as from brands a you looking quarter the basket, we is seeing seeking that than rehab per saw particularly an still roughly The amount mix, pricing.

out people to families. still are see some were food, also quarter. choices. for significant so example, for examples, work the the get We back those frozen for or sales think of kind the ways couple you quarter. seeking of They're give for decent saw of some looking their to those inflation some of I'll And where a pretty meals, And that we frozen

are ways the sales in earlier and to fruit comments, people noted we're just us I seeing for those look up the cut also those per and things looking on of like items. of looking same on some store way indulgence mentioned, combination while trade for As that time a that. [indiscernible] time see are higher for to convenience, money and off, fresh we price save pound folks we the vegetables. Those That at save

that's we're So in basket now. of what the right kind seeing

Rob Dickerson

you that. Okay, year. from at just year, that quarter least the that last that of through the that I is clearly was benefit the much. it. should the have flow. first the inventory helpful. half up question the quarter that's the kind a very in seeing helping kind event, CAPEX cash there's then free Appreciate assumption capital so year? in this the free for of such in reverse the we we're back In And some just working half, Thanks on guess, step here, past That's bit in Is drag such of rest drag of a back get flow the cash fine considering, as that

Jason Monaco

flow Rob. capital we to improvement continued work through positions. towards the the we year. expect cash of see continue Yeah, improved working Thanks, remainder and expect to to And,

partner products with right key the we're is vendor space, that the with the merchandising -- in transformation balance work to and our as players the we our as in we food we're from become continue and that warehouses. get our that community, that goods as and think CPG ensuring the engagement transitioning us I through for we transitioning available, work

you continue a of the move and period So of through going transition But there's I the if year. we be to improve remainder bring expect as cash will. out old inventory to flow to inventory

Rob Dickerson

so super. Alright, much. Thanks

Operator

from BMO Our next Benjamin Markets. question comes Wood from Capital

open. is line Your

Benjamin Wood

for morning. Thanks Kelly. asking hi, taking our question, behalf and me of Hey, good on

or that start track think expectation to your talked with QX share wondering I tracking decide expectations, plan the from wanted to quarter versus the take improve, where follow quarter rates we to Just or in CPG to players pre-COVID? in is tracked compared compared how last your about and would we how promotions and suppliers might some fill would stocks are that did more and vendors just the

Tony Sarsam

great question. it's Yeah,

about fill some We indeed as we improve had this against I actually improved they earlier, fairly set aggressive XX% during market quarter to so did rates the saw markedly, that in year fill north we of So fill than wanted substantially cadence targets it that quarter. mentioned We would pretty or the last expect We rate ago, the targeted. actually that a six and itself. rate versus XX% first was more weeks increased XX%. pretty and increased

seen that. believe get overall terms in little on and of as what recounted performance the those softer fact just that last see from seeking numbers the by will a predictable that as increasing you moment they're So are good And, since measure, better things we pre-COVID. rate deals a ideas and that seeing just highest vendor ago we've our around call they fill volume, from the community. we're And

Benjamin Wood

in of thank guess a guys tracking? seeing has way, a elasticities areas, how if come you. you I'm quarter? up I a change sense sorry, any then if where then cases And previous inflation trying down get inflation are in consumer five question, in segments asking behavior, I following I just on inflation, just in pickup categories was And your are to couple may. skews impact missed a those any Great, that there's of during What penetrations just a or different or the a or on the own on volume brand kind it.

Jason Monaco

that inflation stand to out at. inflationary down a When generally quarter. similar for saw that are categories, to to -- Thanks retail. outbound is or look of landed down you inflation it flat the take flat couple From think to a Produce around you we're standpoint, our is about business. digits, in little an in at the Jason. there question. the this we Ben, where north And want when was X% high single Hi in food our

And dairy balance of to done But we and continued building we're produce fixed basket. a model Tony items work label to more. that where will. consumers. continue blow creating declined. consumers to more we business about would up like see saw continue includes for continued to in expected strongly to a as or that brand, business Our But earlier, than didn't or continues things wallet, dairy private our inflation which units our strapped overall at retail consumers are our grow own great our that are drive in and trips trips space store. significantly. you job that solutions a our go into through pickup Interestingly, XX% to really rates more we the win pricing portfolio, rise build if as we've pretty business consumers have And you in And talked really

create alluded which to folks -- have prepared in to of and improvements a fresh where we continue deli them perhaps in in lieu remarks, We business dining XX% can and done something where in cut our in for Tony meals, the and fruits and prior or exchange in our solutions at saw come restaurant. that in

finding the we to So or going marketplace we're looking market in spite at in operate on a in. win way what's of that the and

that of we in economy does control So sure that but we economy can some despite how and those we headwinds. win can't control we what can the make we behave

Benjamin Wood

you. thank Great,

Operator

of our And C.L. Wolf Instructions]. Andrew next from [Operator question King. comes

Your open. is line

Andrew Wolf

Good Thanks. everybody. morning,

I using forward? to but gains, is XX that they're our of and didn't the a with gross comparison highest, $XX that and highest rate, on earlier, terms the start million comparisons highest the going it, I but is the is line in profit weeks, holding Just comparison the know the headwind it hear

Jason Monaco

that's Yeah, Yeah, of morning. Andrew, the good is highest, This year. highest the Jason. rate

it to moderate of QX in QX. We expect and kind

the periods the numberish, quarter of the lap as about think from half community. it fully should that vendor then You peak we being in price and increases easing roughly fourth

Andrew Wolf

this labor like the Great, cost of seeing where structure, into thanks, it have that you sounds year? and are the you Jason. was now -- quarter you're for does in the wage rest market that structure? cost On your wage for the do expect you inflation what own what the what And -- last you put inflation

Tony Sarsam

year of overlap of So during we QX, increases this peak wage the the that was overlap in last Tony. quarter. was is the the -- sort inflation, that took big also The

in a We process for have offering continuous staying increases the marketplace. and then offering competitive and

in biggest So in there by quarters, QX the but future good will inflation the was wage one be measure.

the are a we flow. better of terms seeing applicant marketplace, In

effects of influenced economic combination effects the think that. I the

wages two have what well. and the impacting, a we terms we're seeing We make that's we've of also over both to rate also and versus standpoint, offer benefits. offerings a work and very we increased stick our saw And done as here believe in lot made a of to stronger, three years this cultural last an from compelling

that, labor right So we're not market waving entry -- all everybody's yet terms so it's just competitive it key in in though, flag these roles a direction, that level especially tight victory tough, because is very very moving getting the still business. of the still still is in

that dial there we organization work. our to so efforts the offers place and are most continuing our up make And first sure people to compelling

ongoing we're good battle. seeing recently wins actually that's market. an the some labor So But here on

Andrew Wolf

operating year. expenses, -- mean, else retail you in the actually throughput And are inflation benefit actually your just being help that? called that's year, flow given special on Yeah, the wholesale this up, thanks. increase there just you either there there you over in out the lower of of -- you year last is hours I through on year-over-year there down last another rest not are maybe manage comp. slowing you. accruals somewhere I there or expenses, the with from year? Thank think is it, or is sort explaining the you anything is Or dramatically in may What quarter labor incentive filling reconcile accrual still lower can us the a are that And also is in

Tony Sarsam

per Jason number X% costs influences great throughput start add big quarter. up cost little increase supply that color. on a big, may we have measure. supply mean X% influence light especially that and and on a our was those overcoming I'll overall our fewer business by cases produced on those terrific. the in and It's of And deliver the fixed haven't performance, chain case has maybe the first I Big terrific work the chain vendor has the to almost to driver, biggest on in finished team up. been year, Yeah, And side. throughput rate, are done cost I'll overall and moving performance throughput. good Last we you remember, really their was

We've stores, we that. for it in service of make labor ways kind bounce added other sure feel manage good to increased actually all shoppers. our of all great different parts and we great store And we in our in store the offering strategically even our secure with we've found that. actually a about that we've productivity had the to to of So as parts have --

supply on So team retail both feeling really chain and performance, about the overall. labor strong our

Jason Monaco

overall, on building in that played results, cost improved through our healthcare dead as And, of line period of job are delivering relatively great remained role rear a on excellence, achieving things I'd mirror. really on improved working, Tony's cost promise a cost along is year-over-year our we operational the our position couple operational and has coming is bottom a workforce so improving But view declined with programs and the in delivering way, other here our highlight it the done in as volatile of place the teams productivity, comments, Yeah, that's has the well. excellence P&L. our the are COVID in that driving really have healthy A have results position. transformations

Andrew Wolf

thank Appreciate for color. Great, you it. the

Operator

question next our And from BTIG. comes Peter Saleh from

line is Your open.

Peter Saleh

quarter. this And morning all in inflation thanks. the the thanks for color on Great, the

was and it You digit single X% high guys mentioned range. up the around

peak inflation. the the is on could of I this the time color you give little balance Just around inflation and going the if a year saw expectations on forward, us when maybe curious last trends. year believe in more some of we bit kind of for XQ

should to moderation year-over-year that we of and seeing starting moderate, if are basis, curious Just on still a expect you that occur? some inflation to already

Jason Monaco

Pete question. Yeah, morning, good for and thanks the

our remainder a in from reflects down inflation step QX year. through of and outlook plan the the Our

year going the what is how on expect and perfect inflation no the crystal to interacts. ball to rates. economy is close the of Fed inflationary to there's kind Obviously, pre-COVID We going end to do respond how and

assumed and that For that year the planning our in down purposes, step the outlook. of through remainder included we've

Peter Saleh

Great.

terms in or a bit growth in nice just maybe seeing talk you're of then of label. on more I that think private as the seeing percentage little and you're penetration, private mentioned, in mix? there label some of about rate terms growth elaborate the Jason, Can stand a And what you Okay. you does where

Jason Monaco

private of have XX%. in little the in here. the final penetration a to think We're grow. label our of I front I low Yeah, north me don't number in XXs, continues

the comps the that growth the delivered overall, was quarter. we XX% For was around about growth higher so it for than X%

Peter Saleh

Great, thank you very much.

Operator

comes from question Next Krisztina Bank. Deutsche Katai from

Your line is open.

Jessica Taylor

us you for Taylor top on this Thanks questions. Jessica if line Krisztina. with is taking wanted I give details through the your cadence of kind on for Good morning, start to could our performance, the any quarter?

Tony Sarsam

on tracked feel whole volume members and about unit it And continues and energized thanks on services much line From business in wholesale, had our relatively haven't the top where a a we the about the provide patrons from growth for show the we're we're side. stable. military to goods independent year-over-year we at a some ups military. good able relatively fact, we standpoint first our business, which stable. and to at of the to Good morning, be retail and various talked to all, retail standpoint our the today, -- downs trending year, goods but of and basis. in In closely weeks to question. XX was lot business, through customers Overall, to relatively throughout our Naturally, retail a our the holidays

Jessica Taylor

continuing retail and competitors, that. categories start you your you're for a to certain that little you about that about with on seeing especially on we the thinking some for promotional talk on how year? deflation of And the see remainder then bit the can just -- side, environment you're the Thank just as

Jason Monaco

a as unit Great vendor questions. we've vendor I vendors Yeah, pursue continue promotional year just in growth drive and really similar the of we'll a community to to a as as to and transformation or And I way. that performance we've as innovation customers as to through the we see from create standpoint, rates remind opportunities promotions unit well up it for well expect promotional and continued be continue be modestly. prior to to collaborate brands, we've to we'll this kind volume performance, of And to period got the whether that other methods. drive value consumers From the -- run naturally, together challenged would of group along enter I continues standpoint, to maybe think want our with merchandising with that to continue and our for challenged drive and their them vendors remind partnered partner number or partners. a volume, industry those underway with that

Jessica Taylor

best luck. of you, Thank

Operator

And Research. comes question our next Northcoast Chuck from from Cerankosky

Your line is open.

Charles Cerankosky

wholesale, retail? little up trends any were sales follow bit, military, private To label on if different see between what a and did you that

Tony Sarsam

this is Tony. Not lot a Chuck,

more retail again business our developed are our wholesale and obviously military. We than in over then

in of items we're for areas is looking we produce more growth always actually speaking the big pursuing interesting as you'll a terms meat national in so to and focus broadly grow because go overall, an of new as ways a and are fresh We between one and and goods in business see the steady, more finest better the opportunity the military it's we're introducing And us develop fresh there items lot rates that military. brand. brands. Jason into place significantly the But wasn't we difference and baked mentioned, than as our three from

Charles Cerankosky

Great, you. thank

Operator

closing the no for I'll turn Sarsam over questions to Tony And there other back remarks. are call this at time.

Tony Sarsam

lot all want today's to questions. of a you great pleasant thank day you great A and of Well, just all family ahead. good. your very for participation from our We to yours Very summer wish on call. a

Operator

and pleasant you a meeting joining now for have concluded. Thank has The day.

SpartanNash (SPTN) 1 Jun 232023 Q1 Earnings call transcript