FINANCE

Harris Teeter Q1 income up 67%; nine new stores on tap

BY Staff Writer

Matthews, N.C. — Harris Teeter Supermarkets Inc. reported that its fiscal first-quarter net income rose nearly 67%. The company earned $22.8 million for the quarter that ended Jan. 1, up from $13.7 million in the same quarter last year. The prior year’s results included an $18 million cost to settle some pension liabilities and employee benefits in connection with the sale of its industrial thread manufacturing company.

Harris Teeter’s total revenue increased to $1.16 billion from $1.12 billion. Same-store sales rose 2.5%.

Harris Teeter said it plans to open nine new stores during the remainder of its 2013 fiscal year, complete eight major remodels and reopen one store in Washington, D.C. that was damaged by flooding. It operated 211 stores as of Jan. 1.

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REAL ESTATE

Starbucks makes Vietnam debut; sees potential there for ‘hundreds’ of cafes

BY Marianne Wilson

New York — Starbucks Coffee Co. on Friday opened its first location in Vietnam, following an expanded long-term relationship with Hong Kong Maxim’s Group.

The two-level flagship store has been designed to reflect Starbucks’ signature coffee heritage, while embracing Vietnam’s distinctive local traditions and coffee culture. It is located the bustling neighborhood of Ho Chi Minh City’s District 1.

“The market presents tremendous opportunity for Starbucks over the long term,” said John Culver, president, Starbucks China and Asia Pacific. “Ho Chi Minh City is our first stop and we aim to open our stores in key metropolitan cities across Vietnam, including Hanoi, in the future.”

The chain told Bloomberg that it plans to add hundreds of stores in the Asian nation in the long term.

The design of Starbucks’ Vietnam flagship reflects the vibrance of cosmopolitan Ho Chi Minh City and still retains the city’s pride for its distinct local heritage. The store features numerous décor items that have been sourced locally, repurposed and given a new life in the first Starbucks store, including the distinctive Starbucks community table, whose teakwood surface was recycled from a local villa, and an old ‘ba gac’ (bicycle), which was traditionally used to transport goods around the city in the past, now stands as a central piece of artwork on the ground floor of the store. The store also showcases wall mural designs created by local artists.

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News

Harris Teeter Q1 sales up, grows market share

BY CSA STAFF

MATTHEWS, N.C. — Southeastern and Mid-Atlantic supermarket chain,Harris Teeter, reported that sales for the first quarter of fiscal 2013 increased by 3.7% to $1.16 billion from $1.12 billion in the first quarter of fiscal 2012. The increase in sales was driven by an increase in comparable-store sales of 2.53% and sales from new stores, partially offset by store closings.

During the first quarter of fiscal 2013, the company opened three new stores, two of which were the stores acquired from Lowe’s Food Stores that were re-opened under a new format and banner – “201central”. Since the end of the first quarter of fiscal 2012, the company has opened twelve new stores, opened one store that replaced a store closed in the first quarter of fiscal 2012, closed two stores and sold six stores to Lowes Foods, for a net addition of five stores. The closed stores included one that will be replaced with a new store scheduled to open in the third quarter of fiscal 2013 and one that was temporarily closed due to damage caused by flooding. The company is in the process of repairing damages to the temporarily closed store and expects to re-open it once repairs are completed. The company operated 211 stores as of Jan. 1.

Harris Teeter posted net earnings for the first quarter of fiscal 2013 were $22.8 million, or 46 cents per diluted share, compared with net earnings of $13.7 million, or 28 cents per diluted share, for the first quarter of fiscal 2012. Net earnings for the first quarter of fiscal 2012 were comprised of earnings from continuing operations of $25.8 million, or 53 cents per diluted share, and losses from discontinued operations of $12.1 million, or 25 cents per diluted share.

Thomas Dickson, chairman of the board and CEO stated, “We continue to focus on driving unit sales and growing our market share. During the first quarter of fiscal 2013, our pricing and promotional strategies were effective in this regard, as evidenced by an increase in the number of active households and number of customer visits we experienced over the prior year. However, aggressive pricing by competitors, low inflation during the period and the generally sluggish retail environment experienced during the holiday season combined to put downward pressure on our gross profit. We believe it is important to continue to drive sales and grow our market share and remain committed to our customers to deliver outstanding values and excellent customer service.”

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