Harris Teeter announces store growth plans
MATTHEWS, N.C. — Harris Teeter plans to expand its presence in existing markets, the company said in its third-quarter earnings release.
Harris Teeter said its capital expenditure plans entail the continued expansion of its existing markets, including the Washington, D.C., metro market area, which incorporates northern Virginia, the District of Columbia, southern Maryland and coastal Delaware. Back in June, the retailer and entered a purchase and sale agreement with regional chain Lowes Foods, through which Harris Teeter acquired ten Lowes Foods store locations in the central Carolinas region and Lowes Foods acquired six Harris Teeter store locations in western North Carolina. Next quarter, Harris Teeter said it plans to open a total of seven stores (6-of-the-10 stores acquired from Lowes Foods and one additional store) and complete major remodels on nine stores, five of which will be expanded in size.
Harris Teeter noted that it continues to accelerate its new store growth as the new store development program for fiscal 2012 is expected to result in a 4.5% increase in retail square footage, as compared with a 3.2% increase in fiscal 2011. Looking ahead, the retailer said it plans to open 12 new stores (two of which are replacements), open the three stores acquired from Lowes Foods that are being converted to the new innovative format and complete major remodels on nine stores (three of which will be expanded in size) during fiscal 2013. The new store openings currently are scheduled for three in the first quarter, two in the second quarter, two in the third quarter and eight in the fourth quarter.
Third-quarter sales for Harris Teeter rose 4.6% to $1.15 billion for the period ended July 1, thanks to an increase in comparable-store sales and sales from new stores, partially offset by store closings. Comps for the North Carolina-based retailer rose 3.7% for the quarter.
The Lowes Foods transaction, the company said, impacted its net earnings, which dropped from $32.1 million to $15.8 million for the third quarter of fiscal 2012. The net impact of the Lowes Foods transaction costs and insurance gains reduced earnings from continuing operations after tax in the third quarter of fiscal 2012 by $10.4 million, or 21 cents per diluted share.
At the end of the third quarter, Harris Teeter operated 201 stores.