Natural Grocers (NGVC) Prelim. Q2 Results Fall Short of Consensus

Natural Grocers by Vitamin Cottage, Inc. (NYSE: NGVC) today reported preliminary unaudited results for its second fiscal quarter and six months ended March 31, 2016.

Preliminary Unaudited Financial Results

For the second quarter of fiscal 2016, Natural Grocers by Vitamin Cottage, Inc. (together with its subsidiaries, the "Company") expects net sales in the range of $176.5 million to $178.0 million, an increase of approximately 11.9% to 12.8% from net sales of $157.7 million in the same period in fiscal 2015. Daily average comparable store sales are expected to increase by approximately 1.0% in the second quarter of fiscal 2016.

(Street sees Q2 EPS of $0.26 on revenue of $184.42 million)

Net sales for the six months ended March 31, 2016 are anticipated to be in the range of $344.5 million to $346.0 million, an increase of approximately 13.5% to 14.0% from net sales of $303.6 million in the first half of fiscal 2015. Daily average comparable store sales are expected to increase by approximately 2.3% in the six months ended March 31, 2016.

For the second quarter of fiscal 2016, the Company anticipates net income to be in the range of $3.4 million to $3.6 million, a decrease of approximately 33.4% to 37.1% from net income of $5.4 million in the same period in fiscal 2015. The Company expects diluted earnings per share in the range of $0.15 to $0.16 for the second quarter of fiscal 2016, compared to diluted earnings per share of $0.24 for the same period in fiscal 2015.

Net income for the six months ended March 31, 2016 is anticipated to be in the range of $7.2 million to $7.4 million, a decrease of approximately 17.5% to 19.7% from net income of $9.0 million in the first half of fiscal 2015. The Company expects diluted earnings per share in the range of $0.32 to $0.33 for the six months ended March 31, 2016, compared to diluted earnings per share of $0.40 for the first half of fiscal 2015.

As of March 31, 2016, the Company expects cash and cash equivalents to equal $5.6 million, with $20.4 million available for borrowing under its $30.0 million credit facility.

EBITDA for the second quarter of fiscal 2016 is expected to be in the range of $12.4 million to $12.7 million, a decrease of approximately 12.6% to 14.7% from EBITDA of $14.5 million in the same period in fiscal 2015. For the six months ended March 31, 2016, the Company expects EBITDA to be in the range of $25.1 million to $25.4 million, a decrease of approximately 2.1% to 3.3% from EBITDA of $26.0 million for the first half of fiscal 2015.

"We expect our second quarter sales results will reflect the evolving and competitive natural and organic food retailing environment," said Kemper Isely, the Company's Co-President. "To a lesser extent, we anticipate second quarter sales will be impacted by economic pressures in several of the markets we serve due to continuing low oil and gas prices and internally generated competition as a result of our opening of new stores in existing markets. Further, adverse weather in Colorado affected the key Easter holiday selling period. In addition, we were unable to quickly adjust expense levels to the moderated sales trends, resulting in pressure on store-level margins."

The Company expects to release its full results for its second fiscal quarter and six months ended March 31, 2016 after the market closes on May 5, 2016.

The Company does not plan to release preliminary financial information on an ongoing basis. The financial information presented above is preliminary and based upon information available as of the date of this release. As of the date of this release, the Company has not completed the financial reporting process and review for its second fiscal quarter and six months ended March 31, 2016. During the course of that process, the Company may identify items that would require it to make adjustments, some of which may be material, to the preliminary financial information presented above.

Revised Fiscal 2016 Outlook

Based on the Company's performance to date in fiscal 2016 and the current outlook for the remainder of this fiscal year, the Company is revising its previous financial outlook for fiscal 2016, which was provided on November 19, 2015 and updated on January 28, 2016. For fiscal 2016, the Company now expects:

Revised Fiscal

2016 Outlook

Number of new stores

23

Number of relocations

4

Number of remodels

2

Daily average comparable store sales growth

0% to 1.5%

EBITDA as a percent of sales

6.7% to 7.0%

Net income as a percent of sales

1.6% to 1.8%

Diluted earnings per share

$0.50 to $0.56

Conference Call

The Company will host a conference call today at 2:45 p.m. Mountain Time (4:45 p.m. Eastern Time) to discuss the above-described preliminary unaudited financial results and the Company's updated fiscal 2016 outlook. The dial-in number is 1-888-347-6606 (US); 1-855-669-9657 (Canada); or 1-412-902-4289 (International). The conference ID is "Natural Grocers by Vitamin Cottage." Please dial in at least five minutes before the start of the conference call.

You May Also Be Interested In

• Gilead Sciences (GILD) Misses Q1 EPS by 288c
• Intel (INTC) tops Q1 EPS by 3c; misses on guidance
• Utah Medical Products (UTMD) Reports Q1 EPS of $1.10