SpartanNash(US:SPTN)2025-02-26 21:10Financial Performance - Wholesale segment net sales decreased by $209.9 million, or 3.0%, to $6.71 billion in 2024, primarily due to lower case volumes in national accounts and independent retailers [140]. - Retail segment net sales increased by $30.0 million, or 1.1%, to $2.84 billion in 2024, despite a 1.7% decrease in comparable store sales due to lower consumer demand trends [141]. - The Company reported adjusted EBITDA of $258.5 million for the fiscal year, a slight increase from $257.4 million in the prior year [137]. - Gross profit increased by $26.9 million, or 1.8%, to $1.51 billion, with the gross profit margin improving from 15.3% to 15.8% [143]. - Operating earnings decreased by $52.8 million, or 49.4%, to $54.0 million, driven by changes in net sales, gross profit, and operating expenses [148]. - Adjusted earnings from continuing operations for 2024 were $69,286,000, with an adjusted EPS of $2.03, down from $76,012,000 and $2.18 in 2023, indicating a decline of 8.3% [167]. - Net earnings for 2024 were $299,000, a significant decrease from $52,237,000 in 2023, representing a decline of approximately 99.43% [173]. - Adjusted EBITDA for 2024 was $258,486,000, slightly up from $257,401,000 in 2023, indicating a growth of about 0.42% [173]. Expenses and Impairments - Selling, general and administrative expenses rose by $15.1 million, or 1.1%, to $1.38 billion, increasing as a percentage of net sales from 14.0% to 14.5% [144]. - The Company incurred $45.7 million in goodwill impairment charges within the Retail segment due to competitive pressures impacting cash flow trends [146]. - Interest expense increased by $4.9 million, or 12.4%, to $44.8 million, attributed to a higher average debt balance, with total debt rising to $753.8 million [151]. - The effective income tax rate for 2024 was 97.3%, significantly higher than 25.5% in 2023, primarily due to non-deductible goodwill impairment and state taxes [152]. - Restructuring and goodwill/asset impairment costs increased to $74,107,000 in 2024 from $9,190,000 in 2023, indicating a substantial rise of 706.5% [162]. - The company recorded non-cash goodwill impairment charges of $45.7 million related to the retail reporting unit in 2024 [185]. - Impairments of long-lived assets were $8.2 million in 2024, compared to $11.7 million in 2023 and $5.1 million in 2022 [188]. Cash Flow and Investments - Net cash provided by operating activities increased by $116.6 million in 2024 compared to 2023, totaling $205.9 million [196]. - Net cash used in investing activities rose by $130.5 million in 2024, primarily due to acquisitions in the Retail segment and increased capital expenditures, totaling $247.0 million [197]. - Capital expenditures for 2024 were $132.4 million, with 50% allocated to both Wholesale and Retail segments, compared to $120.3 million in the prior year [198]. Debt and Dividends - Long-term debt and finance lease liabilities increased by $156.3 million to $753.8 million as of December 28, 2024, driven by additional borrowings for acquisitions and capital expenditures [200]. - The Company's current ratio was 1.57:1 at December 28, 2024, down from 1.63:1 at December 30, 2023 [202]. - Net long-term debt increased to $732.2 million as of December 28, 2024, compared to $579.5 million at December 30, 2023 [204]. - The Company declared quarterly cash dividends of $0.2175 per share in 2024, up from $0.215 in 2023 [206]. Segment Performance - The company’s adjusted operating earnings for the wholesale segment in 2024 were $120,966,000, an increase of 6.4% from $113,384,000 in 2023 [162]. - The retail segment reported adjusted operating earnings of $17,875,000 in 2024, a decrease of 37.6% from $28,589,000 in 2023, indicating challenges in retail operations [162]. - Operating earnings in the wholesale segment increased to $97,423,000 in 2024 from $87,701,000 in 2023, reflecting a growth of approximately 19.6% [173]. - The retail segment reported an operating loss of $43,462,000 in 2024, compared to a profit of $19,011,000 in 2023, marking a decline of 328.8% [173]. - The company’s adjusted EBITDA for the retail segment was $71,280,000 in 2024, down from $79,510,000 in 2023, a decrease of approximately 2.5% [173]. Other Financial Metrics - The company incurred LIFO expenses of $5,167,000 in 2024, down from $16,104,000 in 2023, showing a significant reduction of 67.8% [162]. - Depreciation and amortization expenses increased to $103,412,000 in 2024 from $98,639,000 in 2023, representing a rise of about 4.8% [173]. - The company’s income tax expense decreased to $10,726,000 in 2024 from $17,888,000 in 2023, a reduction of approximately 40.0% [173]. - The company’s total other expenses, net, increased to $42,936,000 in 2024 from $36,587,000 in 2023, indicating an increase of about 17.4% [173]. - A hypothetical 0.50% increase in interest rates would increase annual interest expense by approximately $3.1 million [209]. - The estimated fair value of the Company's fixed rate long-term debt was less than book value by approximately $2.1 million as of December 28, 2024 [211].