US supermarket company Pathmark Stores has reported a second-quarter net loss, hit by increased promotional spending amid fierce competition.
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The retailer posted a net loss of US$1.6m, or 5 cents per share, for the second quarter to 31 July, compared to net earnings of $6.2m, or 21 cents per share, for the year-ago period.
Sales were $1.01bn, an increase of 1.6% from $995.6m in the prior year’s second quarter. Same-store sales increased 1.3% in the second quarter.
“We had mixed results for our second quarter in what continues to be a difficult economic environment in the markets we serve and in the face of increasingly aggressive promotional programmes by our competitors,” said chief executive Eileen Scott.
“While same-store sales rose 1.3% as a result of increased promotional spending, our earnings were negatively affected by the incremental costs associated with these promotions, as well as continued gross profit pressures from inflation in certain categories. We also experienced higher medical expenses, a trend that is affecting our entire industry. We saw a weakening in consumer demand and in our operating performance in the second half of the quarter, a trend that has continued into our current quarter,” she added.
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By GlobalDataLooking forward, the company said it remains highly focused on driving sales through effective marketing programmes, controlling costs and modernising stores through its renovation programme.
Pathmark Stores operates 142 supermarkets primarily in the New York – New Jersey and Philadelphia metropolitan areas.
