Ingles Markets, Incorporated Reports Results for Second Quarter and First Six Months of Fiscal 2023

Ingles Markets, Incorporated (NASDAQ: IMKTA) today reported increased sales for the three and six months ended March 25, 2023.

Robert P. Ingle II, Chairman of the Board, stated, “We are pleased with our results and appreciate the hard work and dedication of our customer-driven associates, who helped us provide affordable, high-quality products in an inflationary environment.”

Second Quarter 2023 Results

Net sales totaled $1.381 billion for the quarter ended March 25, 2023, an increase of 0.25% compared with $1.377 billion for the quarter ended March 26, 2022.

Gross profit for the second quarter of fiscal 2023 totaled $325.9 million, or 23.6% of sales. Gross profit for the second quarter of fiscal 2022 was $348.6 million, or 25.3% of sales.

Operating and administrative expenses for the second quarter of fiscal 2023 totaled $268.9 million, as compared with $254.7 million for the second quarter of fiscal 2022.

Interest expense totaled $5.3 million for the second quarter of fiscal 2023, as compared with $5.4 million for the second quarter of fiscal 2022.

Net income totaled $40.5 million for the second quarter of fiscal 2023, as compared with $68.6 million for the second quarter of fiscal 2022. Basic and diluted earnings per share for Class A Common Stock were $2.18 and $2.13, respectively, for the quarter ended March 25, 2023, as compared with $3.70 and $3.61, respectively, for the quarter ended March 26, 2022.

First Half Fiscal 2023 Results

First half fiscal 2023 net sales totaled $2.87 billion, an increase of 3.8% compared with $2.77 billion in the first half of fiscal 2022.

Gross profit for the six months ended March 25, 2023, totaled $697.1 million, as compared with $699.1 million for the first six months of last fiscal year. Gross profit, as a percentage of sales, was 24.3% for the first half of fiscal 2023, compared with 25.3% for the first half of fiscal 2022.

Operating and administrative expenses totaled $545.1 million for the six months ended March 25, 2023, as compared to $514.8 million for the six months ended March 26, 2022.

Interest expense decreased to $10.7 million for the six-month period ended March 25, 2023, as compared with $10.8 million for the six-month period ended March 26, 2022. Total debt as of March 25, 2023 was $556.7 million compared with $578.5 million as of March 26, 2022.

Net income totaled $109.9 million for the six-month period ended March 25, 2023, as compared with $134.8 million for the six-month period ended March 26, 2022. Basic and diluted earnings per share for Class A Common Stock were $5.92 and $5.79, respectively, for the six months ended March 25, 2023, as compared to $7.26 and $7.10, respectively, for the six months ended March 26, 2022.

Capital expenditures for the first half of fiscal 2023 totaled $91.4 million compared with $34.1 million for the first half of fiscal 2022.

The Company currently has no outstanding borrowings under its $150.0 million line of credit. The Company believes its financial resources, including its line of credit and other internal and external sources of funds, will be sufficient to meet planned capital expenditures, debt service and working capital requirements for the foreseeable future.

About Ingles Markets, Incorporated

Ingles Markets, Incorporated is a leading grocer with operations in six southeastern states. Headquartered in Asheville, North Carolina, the Company operates 198 supermarkets. In conjunction with its supermarket operations, the Company operates neighborhood shopping centers, most of which contain an Ingles supermarket. The Company also owns a fluid dairy facility that supplies Ingles supermarkets and unaffiliated customers. To learn more about Ingles Markets visit ingles-markets.com.

Cautionary Note Regarding Forward-Looking Statements

This press release includes certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may address, among other things, our expected financial and operational results and the related assumptions underlying our expected results. These forward-looking statements are distinguished by use of words such as “anticipate,” “aim,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “will,” “would” and the negative of these terms, and similar references to future periods. These statements are based on management’s current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from these expectations due to, among other things: business and economic conditions generally in the Company’s operating area, including inflation or deflation; shortages of labor, distribution capacity, and some product shortages as the economy recovers from the COVID-19 pandemic; inflation in food, labor and gasoline prices; the Company’s ability to successfully implement our expansion and operating strategies; pricing pressures and other competitive factors, including online-based procurement of products the Company sells; sudden or significant changes in the availability of gasoline and retail gasoline prices; the maturation of new and expanded stores; general concerns about food safety; the Company’s ability to manage technology and data security; the availability and terms of financing; and increases in costs, including food, utilities, labor and other goods and services significant to the Company’s operations. Detailed information about these factors and additional important factors can be found in the documents that the Company files with the Securities and Exchange Commission, such as Form 10-K, Form 10-Q and Form 8-K. Forward-looking statements speak only as of the date the statements were made. The Company does not undertake an obligation to update forward-looking information, except to the extent required by applicable law.

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