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    The Pantry Comes Up Short

    First-quarter earnings fall sharply.


    SANFORD, N.C. -- The Pantry Inc., which operates more than 1,300 convenience stores in the Southeast, said its fiscal first-quarter net income fell by 75 percent as profits were hurt by pressure on gasoline margins.

    In the quarter ended Dec. 27 the company reported net income of $475,000 compared with $1.9 million a year ago.

    "Our first quarter results reflect the continuing pressure on gasoline margins and the nationwide recession, which was particularly hard felt in key economic sectors of the Southeast," said Peter J. Sodini, president and CEO of The Pantry. "Despite a declining wholesale gasoline cost environment, these market conditions coupled with competitive pricing pressures resulted in an average gasoline margin two cents lower than the first quarter 2001."

    As a consequence, Sodini added, gasoline gross profits declined $3.5 million, despite a 6 percent increase in gasoline gallons sold and comparable store gallon growth of just under 1 percent. "As markets change, we continue to refine our gasoline pricing philosophy and are particularly pleased with the rebound in gallon volume and recent trends in comparable store gallon sales," he said."

    Total revenues for the quarter were $577.4 million, compared with $634.2 million a year earlier. Sales of merchandise at stores open at least a year rose 1.4 percent.

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