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Natural Foods Merchandiser

Natural Grocers by Vitamin Cottage reports strong quarter

Natural Grocers by Vitamin Cottage reports strong quarter
The Natural Grocers chain reported impressive third-quarter sales at it approaches the opening of its 100th store.

Natural Grocers by Vitamin Cottage (NYSE: NGVC) was able to report strong growth as it gears up to celebrate its 60th anniversary next month, as well as the launch of its 100th store. Reporting an 18.4 percent sales increase in the third quarter, co-president Kemper Isely said during the company’s earnings call July 30, “We remain focused on new store growth and plan to open five new stores in the fourth quarter of fiscal 2015.”

Net income increased 29.2 percent in the third quarter, which ended on June 30, 2015, compared to the same period in fiscal 2014. Diluted earnings per share were $0.19. EBITDA increased 19.4 percent to $12.6 million.

The jump in net sales, which total $462.3 million for the fiscal year to date, is largely because of a $16.9 million increase in new-store sales and a $7.7 million boost in comparable store sales. Mature stores also saw increases in both daily average transaction counts and average transaction size.

Looking ahead, Natural Grocers plans to roll out its new {N}Power customer appreciation program in the coming months; Isely said early testing of the program in Oregon and Washington showed higher average ticket sales among {N}Power customers than among regular customers.

Isely added the company has some private label products under development in both dairy and grocery; they'll be rolled out in the next two quarters. Asked about the impact of Natural Grocers' pasture-based dairy policy, Isely said the dairy department has recovered from an initial slump when the policy was first implemented. The department is now “performing above our company sales growth-wise. For the last 12 months, it's almost up 26 percent, compared to a growth of 19 percent, almost 20 percent, of the company. It's gained some market share in the last 12 months.”

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