US grocery operator Stater Bros. saw net income drop during its first quarter on the back of refinancing costs.

The company said yesterday (9 February) that for its first quarter, ended 26 December, it recorded US$1.2m in net profit – against $6.7m in the the same quarter of 2010.

However, Stater Bros. said it recorded a $4.7m gain from its dairy asset sale in the first quarter of 2010, as well as after-tax charges of $3m of one-off costs through refinancing in the current quarter.

Excluding the refinancing costs, net profit in this year’s first quarter would have reached $4.3m.

Meanwhile, consolidated sales fell 2.7% during the quarter to $899m against the same period last year. Like-for-like sales fell 2.3%

Commenting on the results, Stater Bros. chairman, president and CEO Jack Brown said: “We are excited to have been able to reduce our overall debt load and to refinance a significant portion of our debt at lower rates, which will reduce our interest expense.  We will be able to use the savings from our debt reduction to continue to provide our ‘Valued Customers’ with the value and quality they have come to expect from their Stater Bros. Market.”

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By GlobalData