Tops Holding Corp., the parent company of US retailer Tops Supermarkets, has seen its third-quarter losses widen on the back of its acquisition of local rival Penn Traffic.

For the quarter ended 9 October, Tops Holding’s net losses reached US$7.6m against $0.9m in the comparable period of 2009.

Net sales reached US$519.9m, up 39.3%, or $146.6m, against the same period of the previous year. Sales from the acquired Penn Traffic stores contributed $133.3m of the increase.

However, total operating expenses increased 42.8% on the same quarter of 2009. The increase was due to incremental costs associated with operating the acquired Penn Traffic stores, including labour to complete the rebannering process, re-opening events, integration expenses and higher advertising costs.

Tops Holding said “inside” sales were up 40.5% to $483.5m for the quarter, with a 1% increase in same-store inside sales.

Tops Holding said that of the 55 Penn Traffic outlets the company is operating, 48 have been converted to the Tops banner. The seven remaining outlets are subject to a judgement from the Federal Trade Commission, which may mean the retailer has to sell the stores.

Tops Holding bought the then bankrupt Penn Traffic in January for US$85m, plus the “forgiveness” of $100m in debt.