Ingles Markets Reports 13% Decline in Net Sales and Income Due to Hurricane Helene

Ingles Markets, Incorporated reported a significant decline in financial performance for the first quarter of fiscal 2025, ending December 28, 2024. The company recorded net sales of $1.29 billion, a decrease of 13.0% from $1.48 billion in the same period last year. Net income also fell sharply to $16.6 million, down from $43.4 million, reflecting the impact of Hurricane Helene, which disrupted operations and led to an estimated revenue loss of $55 to $65 million due to store closures and electronic payment issues.

The company's gross profit for the quarter was $301.1 million, a decline of 13.7% compared to $348.8 million in the prior year, with gross profit as a percentage of sales slightly decreasing to 23.4% from 23.6%. Operating and administrative expenses decreased by 3.1% to $280.7 million, attributed to the temporary closure of four stores and a reduction in workforce due to the storm's aftermath. However, these savings were partially offset by $5.4 million in cleanup and repair costs related to the hurricane.

Ingles Markets operates 198 supermarkets across several states, including North Carolina, Georgia, and South Carolina. As of December 28, 2024, three stores remained closed due to damage from Hurricane Helene, which is expected to impact future sales. The company has focused on enhancing its product offerings, including organic products and prepared foods, while also investing in technology upgrades and store remodels. Capital expenditures for the quarter totaled $37.8 million, with plans for continued investment in store improvements and technology.

The company’s balance sheet showed total assets of $2.49 billion, a slight decrease from $2.53 billion at the end of the previous fiscal year. Total liabilities also decreased to $931.7 million from $982.1 million, primarily due to a reduction in current liabilities. Ingles Markets maintained a strong liquidity position, with cash and cash equivalents totaling $269.5 million at the end of the quarter. The company continues to expect to pay regular quarterly dividends, having declared $0.165 per share for Class A and $0.150 for Class B stock.

Looking ahead, Ingles Markets anticipates ongoing challenges due to the effects of Hurricane Helene and broader market conditions. The company plans to focus on reopening the affected stores and restoring normal operations while managing costs and capital expenditures. Despite the recent downturn, Ingles remains committed to its growth strategy and improving its operational efficiency to navigate the current economic landscape.