While the pace of growth has slowed for most grocery retailers over the past 12 months, Weis Markets continues to make the necessary investments to maintain its recent string of positive comparable store sales and profitability.
At the company’s annual meeting, held on May 2 at the regional chain’s headquarters in Sunbury, PA, chairman, president and CEO Jonathan Weis told shareholders that he remains optimistic about the future of Weis Markets, adding that the construction of six new (from the ground up) stores is slated to begin this year.
Those new stores are located in New Market, MD; Waldorf, MD; Clarksburg, MD; Middletown, DE; and two others yet to be disclosed that are also south of the Mason-Dixon line.
Some of those new store projects were slated to begin last year, but Weis noted that supply chain delays and shortages (still a factor in the building trades) delayed the process. However, Jonathan Weis confirmed that the 2024 capital expenditure budget will be a record.
“We can’t wait to get started since we’ve secured some exciting store sites in areas of substantial population growth,” the 57-year-old chief executive said.
Additionally, the closely held publicly-traded retailer plans 11 major remodels, 15 smaller store improvement projects along with five fuel centers and a significant expansion of the company’s Linglestown Road store in Harrisburg, PA.
“We will also continue to make sizable technology investments, much of it for store projects where we will continue to invest in more than a thousand smaller store projects including meal centers, high deck mid-temp cases, dual-use lanes and more which will help us drive profitable sales and offer an improved customer experience,” Weis noted.
The third-generation leader also told shareholders of the company’s continuing effort to reduce its environmental impact throughout its seven-state 194 store network.
“Since 2008, we’ve cut our overall emissions by 55 percent and we’ve made a long-term commitment to reducing waste across our stores, distribution center and support operations,” Weis stated. “In recent years, we’ve found more ways to reduce, reuse and recycle what we otherwise would have thrown away. In 2023, 53 percent of the waste we generated was diverted from landfills – nearly 41 tons of waste from our stores was recycled or reused.”
Also addressing shareholders was Kurt Schertle, chief operating. The industry veteran, who joined the retailer in 2009, noted that the past year has seen a shift in consumer buying habits, making for a more challenging operating environment for all food retailers.
“Our priority has been on maximizing consumer value. Inflation has had a significant impact on our customers who more than ever are focused on price. Through our ‘LLP’ (Low Low Prices) program, we have been able to connect with our customers in a meaningful way,” Schertle asserted. “We will continue to remain price competitive.
Schertle also noted that Weis will continue its strong commitment to its associates as well as its charitable efforts and community giving.
About a week after the shareholders meeting, the company released its Q1 sales and earnings.
Net sales totaled $1.18 billion for the 13-week first quarter ended March 30, 2024, compared to $1.14 billion for the 13-week first quarter ended April 1, 2023, up 2.9 percent. First quarter comparable store sales excluding fuel increased 3.3 percent on an individual year-over-year basis and increased 6.9 percent on a two-year stacked basis. Weis estimated that its net sales increased $14.0 million because of the Easter holiday occurring in the first quarter in 2024 compared to the second quarter in 2023.
The company’s first quarter net income totaled $23.17 million compared to $25.81 million in 2023, down 10.3 percent. First quarter earnings per share totaled $0.86 compared to $0.96 per share in 2023.
“Our first quarter 2024 results, which benefited from the Easter holiday shift, are in line with our expectations thanks to the continuing efforts of associates at every level of our company,” said Weis. “We continue to navigate marketplace trends of product cost and third-party services inflation, declining government benefits, and the increasing mix of our pharmacy retail business which has a lower margin than our grocery business. In addition, we increased investments in our associates, technologies, and facilities that improve efficiencies and enhance customer experience.”
