SpartanNash (SPTN) Misses Q2 EPS by 7c, Revenues Beat; Offers FY18 EPS Outlook Below Consensus

SpartanNash (NASDAQ: SPTN) reported Q2 EPS of $0.50, $0.07 worse than the analyst estimate of $0.57. Revenue for the quarter came in at $1.9 billion versus the consensus estimate of $1.87 billion.

• Net Sales Increase Driven by Continued Strong Growth in Our Distribution Businesses of 4.2%
• Second Quarter EPS from Continuing Operations of $0.50 per Diluted Share, Including $0.06 in Estimated Losses Associated with Voluntary Product Recall

Mr. Staples continued, “We expect to see continued strong distribution sales growth during the back half of fiscal 2018 and into 2019. As I stated previously, we remain excited about our long-term strategic objectives as we continue to build our distribution businesses, move forward with the rebranding of our Family Fare banner and grow our fresh product offering. However, we will continue to face some challenges as we move into the second half of the year. Within our military segment, all parties are very pleased with the performance of the private brand products released to-date, and we continue to expect growth for the remainder of this year and significant growth in fiscal 2019. However, the release of new products under the program for the back half of the year is now expected to be much slower than our original plan for fiscal 2018. We also anticipate lower sales and profit growth than originally expected from our food processing operations. Despite strong interest in our offerings, the new business development timeline is taking longer than anticipated and production efficiency improvements are running behind plan partially due to disruption caused by the voluntary product recall. Lastly, within the food distribution segment, the roll out of one of our significant customer programs is taking longer than our initial expectations. While this program has now launched, and we believe it will provide substantial volume going forward, the volume and profit contributions to the business for the second half of 2018 will be below our initial forecast. We expect all of these efforts to benefit our fiscal 2019 results.”

GUIDANCE:

SpartanNash sees FY2018 EPS of $1.96-$2.21, versus the consensus of $2.25.

For earnings history and earnings-related data on SpartanNash (SPTN) click here.

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