Ingles Markets, Inc. Faces Challenges Growth in Fourth Quarter and Fiscal Year 2024 Results
Ingles Markets, Incorporated (NASDAQ: IMKTA) has announced its financial results for the fourth quarter and fiscal year ending September 28, 2024. The company faced significant challenges during the fiscal year, including the impact of Hurricane Helene, which severely affected operations and communities in western North Carolina. Despite these difficulties, Ingles Markets demonstrated resilience and community solidarity.
Impact of Hurricane Helene
On September 27, 2024, Hurricane Helene struck western North Carolina, causing catastrophic flooding and widespread disruptions, including power, communication, and water outages, as well as major road closures. The hurricane’s impact was felt directly at Ingles Markets’ headquarters and surrounding regions. Robert P. Ingle II, Chairman of the Board, praised the collective efforts of associates and community members, stating, “After Hurricane Helene impacted our communities, I am proud of how not only our associates came together, but our entire region. We are truly thankful for all the volunteers and the outpouring of support for our region.”
The company recognized significant impairment losses due to the hurricane. For the quarter and year ended September 28, 2024, Ingles Markets reported an impairment loss of $30.4 million related to inventory damaged or destroyed by the hurricane. Additionally, a property and equipment impairment loss of $4.5 million was recorded.
Fourth Quarter Financial Results
For the fourth quarter of fiscal 2024, net sales totaled $1.40 billion, compared to $1.58 billion in the fourth quarter of fiscal 2023. It is important to note that the fourth quarter of fiscal 2024 included 13 weeks, while the fourth quarter of fiscal 2023 had 14 weeks. Gross profit for the quarter reached $299.4 million, representing 21.4% of sales, down from $369.7 million, or 23.3% of sales, in the same period the previous year.
Operating and administrative expenses for the quarter totaled $301.0 million, slightly higher than the $299.4 million reported for the fourth quarter of fiscal 2023. Interest expense also declined, totaling $5.2 million compared to $5.9 million in the same quarter last year. Total debt at the end of fiscal 2024 stood at $532.6 million, a reduction from $550.2 million at the end of fiscal 2023.
The company reported a net loss of $1.5 million for the fourth quarter of fiscal 2024, compared to a net income of $52.6 million in the same quarter of fiscal 2023. Basic and diluted losses per share for Class A Common Stock were $0.08, compared to earnings per share of $2.83 and $2.77, respectively, in the prior year’s quarter. For Class B Common Stock, basic and diluted losses per share were each $0.07, compared to earnings per share of $2.57 in the fourth quarter of fiscal 2023.
Fiscal Year 2024 Results
Net sales for the fiscal year ended September 28, 2024, totaled $5.64 billion, a decrease from $5.89 billion in fiscal 2023. The fiscal year 2024 consisted of 52 weeks, compared to 53 weeks in fiscal 2023. Gross profit for the year was $1.3 billion, or 23.1% of sales, compared to $1.4 billion, or 23.8% of sales, in the previous fiscal year.
Operating and administrative expenses for fiscal 2024 increased to $1.2 billion, up from $1.1 billion in fiscal 2023. Interest expense for the year was $21.9 million, slightly lower than the $22.1 million reported for fiscal 2023.
Net income for fiscal 2024 totaled $105.5 million, a significant decrease from $210.8 million in fiscal 2023. Basic and diluted earnings per share for Class A Common Stock were $5.68 and $5.56, respectively, compared to $11.35 and $11.10 in the previous fiscal year. For Class B Common Stock, basic and diluted earnings per share were each $5.16, down from $10.32 in fiscal 2023.
Capital Expenditures and Financial Resources
Capital expenditures for fiscal 2024 totaled $210.9 million, an increase from $173.6 million in fiscal 2023. Despite the challenges faced during the year, Ingles Markets maintained strong financial resources. The company has the full amount available under its $150.0 million line of credit and believes its financial resources, including the line of credit and other internal and anticipated external sources of funds, are sufficient to meet planned capital expenditures, debt service, and working capital requirements for the foreseeable future.
Looking Ahead
While fiscal Ingles Markets 2024 presented unique challenges, Ingles Markets has shown resilience and a commitment to both its operations and the communities it serves. The impact of Hurricane Helene underscores the importance of disaster preparedness and community support in overcoming adversity. Moving forward, the company remains focused on maintaining financial stability and supporting its associates, customers, and communities.
Ingles Markets continues to adapt to changing market conditions and challenges, ensuring that it remains a trusted provider of goods and services in its regions. The company’s financial results reflect both the difficulties faced and the efforts made to mitigate those challenges, providing a foundation for future growth and stability.
