A slump in fourth-quarter earnings has hit full-year profits at Philadelphia-based retailer Weis Markets.

The company saw net profit tumble almost 39% to US$8.6m during the 13 weeks to 29 December. The fall meant annual earnings decreased by 9% to $50.9m.

Weis Markets said it had persisted with some "aggressive" promotions during the fourth quarter despite a spike in wholesale food prices.

"According to the latest US Bureau of Labor Statistics' report, food-at-home price inflation increased 4.2% in 2007 while wholesale food inflation increased at a higher rate of 6.5%," Weis Markets said. "This difference contributed significantly to the decline in the company's gross profit rate."

Comparable store sales rose 4.9% during the fourth quarter and were up 3.5% across the whole of 2007.

Net sales rose 4.4% to just under $603m.