San Juan, Puerto Rico-based Pueblo Xtra International has announced results for the first quarter (16 weeks) ended 23 February 2002.
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Pueblo Xtra is the parent corporation of Pueblo International, one of the largest supermarket operators in Puerto Rico and the US Virgin Islands. Through its subsidiaries, it operates 47 supermarkets and 41 video rental stores in the areas.
It reported total sales for the Q1 of US$187.3m, versus US$187.7m for the 16 comparable weeks ended February 24, 2001, a decrease of 0.2%; however same store sales increased by 0.2%.
Same store sales during the Q1 were US$185.6m, versus US$185.2m in the comparable period. Same store sales in the Retail Food Division increased 0.3% from the 16 comparable weeks ended 24 February 2001. The principal factors contributing to the increase in same stores sales in the Retail Food Division, despite continued growth in competition, are the company’s PuebloCard, a customer loyalty card program launched in March 2001, and its repositioning efforts, also begun in March 2001. Video Rental Division same store sales decreased 0.4% from the 16 comparable weeks in 2001.
During the 16 weeks ended 24 February 2001 the company closed two of its supermarkets and relocated one of its video rental stores in Puerto Rico. It also closed two of its video rental stores in Puerto Rico in June of 2001 and closed an additional supermarket on 16 February 2002.
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By GlobalDataPuebla Xtra recorded a net loss for the Q1 2002 of US$4.6m, a US$0.2m improvement from the net loss of US$4.8m for the 16 comparable weeks ended 24 February 2001.
EBITDA was US$11.3m for the Q1 2002, versus US$9.4m for the comparable 16 weeks ended 24 February 2001, an increase of US$1.9m.
As of 23 February 2002, the company’s cash and cash equivalents were approximately US$5.8m. At that date it had cash borrowings of US$30m and letters of credit outstanding of US$3.9m under its US$65m revolving credit facility. The company has agreed with the banks providing the credit facility that total borrowings under the facility will be limited to US$43m through 18 May 2002 and to US$40m from 19 May 2002 through the termination date of the facility which is 1 February 2003.
The appraisal process in Florida concerning the company’s business interruption claim resulting from Hurricane Georges, which occurred on 21 September 1998, is continuing.
Commencing 5 March 2002, appraisers for both Pueblo Xtra and the insurance carriers are making orientation presentations to the court appointed umpire hearing the matter. During the company’s fiscal FY ended 27 January 2001, the carriers invoked the appraisal provisions of the policy which, essentially, require an arbitration process to value the claim. Pueblo Xtra and the carriers have been unable to agree which court has jurisdiction over appointing the umpire.
Consequently, the appointment of the umpire is being litigated in two jurisdictions. On 30 October 2001, the Federal Court for the Southern District of Florida appointed an umpire as a result of litigation initiated by the Company. The insurance carriers have asked that the appraisal process in Florida be stayed while they appeal the appointment of the umpire to the US Court of Appeals for the Eleventh District. The request for a stay of the appraisal process in Florida has been denied and no decision has been rendered by the US Court of Appeals. The litigation initiated in Puerto Rico by the carriers for the appointment of an umpire has been stayed pending the outcome of the appeal in the Florida litigation to the US Court of Appeals.
Pueblo Xtra has received reimbursements totaling US$6.9mn in connection with the US$69.4m proof of loss submitted on 1 December 2000. The US$6.9m was received prior to the Q1 2002 and will not be included in income until such time as the claim is settled and the related gain is realized. The company is unable to predict when the appraisal process will conclude or what total amount eventually may be recovered.
On 2 November 2001 Pueblo Xtra changed its fiscal year-end from the Saturday closest to 31 January to the Saturday closest to 31 October. Consequently, the Q1 of the current fiscal year is the 16 weeks ended 23 February 2002. The comparable period is the 16 weeks ended 24 February 2001, which was presented for comparison purposes and has never been reported separately in press releases or filings with the Securities and Exchange Commission (SEC).
