Reaffirms Fiscal 2024 Profitability Guidance Transformational Programs Continue to Drive Results GRAND RAPIDS, Mich., May 30, 2024 /PRNewswire/ -- Food solutions company SpartanNash (the "Company") (NASDAQ:SPTN) today reported financial results for its 16-week first quarter ended April 20, 2024. "SpartanNash continues to prove that we can deliver despite the challenging market dynamics, and we remain on target to reach the $125 to $150 million of gross benefits set out in our strategic plan by the end of 2024 – a year earlier than initially communicated. Thanks to the operational excellence and dedication of our Associates, along with our investments in supply chain and merchandising transformations, we continued to expand our adjusted EBITDA margin in the first quarter," said SpartanNash CEO Tony Sarsam. First Quarter Fiscal 2024 Highlights(1) Net sales decreased 3.5% to $2.81 billion, driven by lower volumes in both the Wholesale and Retail segments. Wholesale segment net sales decreased 3.4% to $2.01 billion due to reduced revenue in the national accounts customer channel. Retail segment net sales decreased 3.6% to $792.2 million, with comparable store sales down 2.5%. The net sales decrease included a reduction in food assistance program benefits and lower fuel sales. Net earnings of $0.37 per diluted share, compared to $0.32 per diluted share. The increase was primarily due to a higher gross profit rate, which included lower LIFO expense of $9.2 million and benefits from the merchandising transformation, as well as decreased incentive compensation. This favorability was partially offset by lower unit volumes, changes in customer mix within the Wholesale segment, as well as higher interest, tax, and asset impairment expenses. Adjusted EPS(2) of $0.53, compared to $0.64. Adjusted EBITDA(3) of $74.9 million, compared to $76.8 million. These measures exclude, among other items, restructuring and asset impairment charges and the impact of the LIFO provision. Cash generated from operating activities of $36.5 million increased from the cash flows used in operations of $2.7 million. Net long-term debt(4) to adjusted EBITDA(3) ratio of 2.4x increased sequentially compared to 2.3x at the end of the fourth quarter. Capital expenditures and IT capital(5) of $44.1 million increased compared to $39.8 million. Returned $10.7 million to shareholders through $2.6 million in share repurchases and $8.1 million in dividends. Transformational programs on track to deliver $50 million to $60 million of annual run rate savings from supply chain transformation, merchandising transformation, and go-to-market strategy. (1) All comparisons are for the first quarter of 2024 compared with the first quarter of 2023, unless otherwise noted. (2) A reconciliation of net earnings to adjusted earnings from continuing operations, as well as per diluted share ("adjusted EPS"), a non-GAAP financial measure, is provided in Table 3. (3) A reconciliation of net earnings to adjusted EBITDA, a non-GAAP financial measure, is provided in Table 2. (4) A reconciliation of long-term debt and finance lease obligations to net long-term debt, a non-GAAP financial measure, is provided in Table 4. (5) A reconciliation of purchases of property and equipment to capital expenditures and IT capital, a non-GAAP financial measure, is provided in Table 5. Fiscal 2024 Outlook The Company has reaffirmed its previous profitability guidance provided on February 15, 2024, with respect to adjusted EBITDA, adjusted EPS, and capital expenditures and IT capital, and is updating its total net sales guidance to reflect current trends and market conditions. The following table provides the Company's updated guidance for fiscal 2024: Fiscal 2023 Previous Fiscal 2024 Outlook Updated Fiscal 2024 Outlook (In millions, except adjusted EPS(2)) Actual Low High Low High Total net sales $ 9,729 $ 9,700 $ 9,900 $ 9,500 $ 9,700 Adjusted EBITDA(3) $ 257 $ 255 $ 270 $ 255 $ 270 Adjusted EPS(2) $ 2.18 $ 1.85 $ 2.10 $ 1.85 $ 2.10 Capital expenditures and IT capital(5) $ 127 $ 135 $ 145 $ 135 $ 145 Guidance incorporates the Company's long-term strategic initiatives, including all transformational programs and tuck-in acquisitions. Conference Call & Supplemental Earnings Presentation The Company will host a conference call to discuss its quarterly results with additional comments and details on Thursday, May 30, 2024, at 8:30 a.m. ET. There will also be a simultaneous, live webcast made available at SpartanNash's website at www.spartannash.com/webcasts under the "Investor Relations" section and will remain archived on the Company's website through Thursday, June 13, 2024. A supplemental quarterly earnings presentation will also be available on the Company's website at www.spartannash.com/investor-presentations. About SpartanNash SpartanNash (NASDAQ:SPTN) is a food solutions company that delivers the ingredients for a better life. Committed to fostering a People First culture, the SpartanNash family of Associates is 17,000 strong. SpartanNash operates two complementary business segments – food wholesale and grocery retail. Its global supply chain network serves wholesale customers that include independent and chain grocers, national retail brands, e-commerce platforms, and U.S. military commissaries and exchanges. The Company distributes products for every aisle in the grocery store, from fresh produce to household goods to its OwnBrands, which include the Our Family® portfolio of products. On the retail side, SpartanNash operates 147 brick-and-mortar grocery stores, primarily under the banners of Family Fare, Martin's Super Markets and D&W Fresh Market, in addition to dozens of pharmacies and fuel centers. Leveraging insights and solutions across its segments, SpartanNash offers a full suite of support services for independent grocers. For more information, visit spartannash.com.  Forward-Looking Statements The matters discussed in this press release and in the Company's website-accessible conference calls with analysts and investor presentations include "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended ("Exchange Act"), about the plans, strategies, objectives, goals or expectations of the Company. These forward-looking statements may be identifiable by words or phrases indicating that the Company or management "expects," "projects," "anticipates," "plans," "believes," "intends," or "estimates," or that a particular occurrence or event "may," "could," "should," "will" or "will likely" result, occur or be pursued or "continue" in the future, that the "outlook," "trend," "guidance" or "target" is toward a particular result or occurrence, that a development is an "opportunity," "priority," "strategy," "focus," that the Company is "positioned" for a particular result, or similarly stated expectations. Undue reliance should not be placed on these forward-looking statements, which speak only as of the date made. Forward-looking statements are necessarily based on estimates and assumptions that are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which, with respect to future business decisions, are subject to change. These uncertainties and contingencies may affect actual results and could cause actual results to differ materially. These risks and uncertainties include the Company's ability to compete in an extremely competitive industry; the Company's dependence on certain major customers; the Company's ability to implement its growth strategy and transformation initiatives; the Company's ability to implement its growth strategy through acquisitions and successfully integrate acquired businesses; disruptions to the Company's information security network, including security breaches and cyber-attacks; impacts to the availability and performance of the Company's information technology systems; changes in relationships with the Company's vendor base; changes in product availability and product pricing from vendors; macroeconomic uncertainty, including rising inflation, potential economic recession, and increasing interest rates; difficulty attracting and retaining well-qualified Associates and effectively managing increased labor costs; failure to successfully retain or manage transitions with executive leaders and other key personnel; impacts to the Company's business and reputation due to an increasing focus on environmental, social and governance matters; customers to whom the Company extends credit or for whom the Company guarantees loans may fail to repay the Company; changes in the geopolitical conditions; disruptions associated with severe weather conditions and natural disasters, including effects from climate change; disruptions associated with disease outbreaks; the Company's ability to manage its private brand program for U.S. military commissaries, including the termination of the program or not achieving the desired results; impairment charges for goodwill or other long-lived assets; the Company's level of indebtedness; interest rate fluctuations; the Company's ability to service its debt and to comply with debt covenants; changes in government regulations; labor relations issues; changes in the military commissary system, including its supply chain, or in the level of governmental funding; product recalls and other product-related safety concerns; cost increases related to multi-employer pension plans; and other risks and uncertainties listed under "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Company's most recent Annual Report on Form 10-K and in subsequent filings with the Securities and Exchange Commission. Additional risks and uncertainties not currently known to the Company or that the Company currently believes are immaterial also may impair its business, operations, liquidity, financial condition and prospects. The Company undertakes no obligation to update or revise its forward-looking statements to reflect developments that occur or information obtained after the date of this press release. INVESTOR CONTACT:Rose & MEDIA CONTACT: Adrienne Chance SVP,   SPARTANNASH COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited) 16 Weeks Ended April 20, April 22, (In thousands, except per share amounts) 2024 2023 Net sales $ 2,806,263 $ 2,907,394 Cost of sales 2,365,919 2,460,728 Gross profit 440,344 446,666 Operating expenses Selling, general and administrative 403,633 418,196 Acquisition and integration, net 327 74 Restructuring and asset impairment, net 5,768 4,083 Total operating expenses 409,728 422,353 Operating earnings 30,616 24,313 Other expenses and (income) Interest expense, net 13,487 11,589 Other, net (1,048) (1,039) Total other expenses, net 12,439 10,550 Earnings before income taxes 18,177 13,763 Income tax expense 5,206 2,426 Net earnings $ 12,971 $ 11,337 Net earnings per basic common share $ 0.38 $ 0.33 Net earnings per diluted common share $ 0.37 $ 0.32 Weighted average shares outstanding: Basic 34,139 34,547 Diluted 34,593 35,457   SPARTANNASH COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) April 20, December 30, (In thousands) 2024 2023 Assets Current assets Cash and cash equivalents $ 18,968 $ 17,964 Accounts and notes receivable, net 422,161 421,859 Inventories, net 555,368 575,226 Prepaid expenses and other current assets 69,608 62,440 Total current assets 1,066,105 1,077,489 Property and equipment, net 647,536 649,071 Goodwill 182,160 182,160 Intangible assets, net 100,132 101,535 Operating lease assets 245,385 242,146 Other assets, net 100,483 103,174 Total assets $ 2,341,801 $ 2,355,575 Liabilities and Shareholders' Equity Current liabilities Accounts payable $ 447,458 $ 473,419 Accrued payroll and benefits