Natural Grocers by Vitamin Cottage Inc (NGVC) Posts Strong Q1 Fiscal 2024 Results; Raises ...
Net Sales: Increased by 7.6% year-over-year to $301.8 million.
Daily Average Comparable Store Sales: Grew by 6.2%, including a 3.4% rise in transaction count.
Gross Profit: Rose by 12.8% to $88.8 million, with gross margin improving to 29.4%.
Operating Income: Improved significantly to $10.8 million, with operating margin at 3.6%.
Net Income: Increased to $7.8 million, with diluted earnings per share up 78.9% to $0.34.
Adjusted EBITDA: Grew by 35.5% to $18.8 million.
Dividend Announcement: A quarterly cash dividend of $0.10 per common share declared.
On February 8, 2024, Natural Grocers by Vitamin Cottage Inc (NYSE:NGVC) released its 8-K filing, announcing its first quarter fiscal 2024 results and raising its fiscal outlook for the year. The company, a leading operator of natural and organic grocery and dietary supplement stores, reported a 7.6% increase in net sales to $301.8 million, driven by a 6.2% rise in daily average comparable store sales and a 3.4% increase in transaction count.
Kemper Isely, Co-President of NGVC, attributed the strong performance to the company's differentiated product offerings and effective marketing initiatives, including the {N}power rewards program. The company's focus on natural and organic products, as well as its commitment to providing affordable prices and nutrition education, continues to resonate with health-conscious consumers.
The increase in gross profit to $88.8 million, with a gross margin of 29.4%, reflects the company's ability to leverage effective pricing and promotions. Operating income saw a substantial increase to $10.8 million, with operating margin improving to 3.6%. Net income for the quarter was $7.8 million, translating to a 78.9% increase in diluted earnings per share to $0.34.
Financial Health and Future Growth
The balance sheet of NGVC remains solid with $13.6 million in cash and cash equivalents and a moderate level of debt with $18.4 million in outstanding borrowings on its revolving credit facility. The company's cash flow from operations was robust at $16.6 million, with $11.8 million invested in net capital expenditures, primarily for new and relocated stores.
During the quarter, NGVC opened two new stores and relocated one, ending the quarter with a total of 167 stores. The company has since opened one additional store and raised its outlook for fiscal 2024, now expecting 3.0% to 5.0% growth in daily average comparable store sales and diluted earnings per share of $1.02 to $1.12.
NGVC's commitment to growth is further underscored by its announcement of a quarterly cash dividend of $0.10 per common share, demonstrating confidence in its financial stability and future prospects.
Investor Considerations
For value investors, NGVC's strong performance in key financial metrics such as net sales, gross profit, and diluted EPS is indicative of a company that is effectively managing its operations and growth strategies. The company's ability to raise its fiscal outlook suggests a positive trajectory that could be of interest to potential investors.
Investors are invited to join the company's earnings conference call to discuss these results and gain further insights into NGVC's strategies and expectations for the coming year.
For a detailed understanding of NGVC's financial performance, including reconciliations from GAAP to non-GAAP financial measures such as EBITDA and Adjusted EBITDA, investors can refer to the full earnings release and financial statements.
For more information on Natural Grocers by Vitamin Cottage Inc and its commitment to providing high-quality natural and organic products, visit www.NaturalGrocers.com.
Explore the complete 8-K earnings release (here) from Natural Grocers by Vitamin Cottage Inc for further details.
This article first appeared on GuruFocus.
