With only a one-star rating and very little attention, Winn-Dixie
Same-store sales were in positive territory, up 1.6% compared to the same period a year ago. A closer look at this metric shows reason for both optimism and concern.
What the company calls "average basket," or average value per transaction, was up at a rather healthy 3.6% compared to the same time last year. Winn-Dixie's management attributes this to more "effective merchandising and promotional programs," as well as better execution on the operational side.
While the price of what customers are paying per transaction looks good, there were actually fewer transactions; transactions were down 2% compared to the same period a year ago. The company is hopeful that its store remodeling efforts will start to address at least a part of this negative trend.
So far, seven Winn-Dixie stores have been remodeled, with plans to finish 13 more units by the end of this fiscal year in June. In subsequent fiscal years the company plans to remodel roughly 75 stores annually.
Beyond improving sales, it is encouraging to see nice gains in profitability. Gross margins for the quarter were 27.9%, up from 25.7% this time last year. CEO Peter Lynch indicated that the margin improvement was due to lower promotional spending, as well as reduced warehouse and transportation costs.
Thanks to the sweeping changes facing the industry (spurred by the likes of super discounters like Wal-Mart
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