Quick Stats

Quick Stats

    You are here

    The Pantry Exceeds Fiscal Estimates

    Company continues to put the brakes on further acquisitions.

    SANFORD, N.C. -- Despite what he called a "challenging environment," Chief Financial Officer Frank Paci of The Pantry Inc. said the company remains on solid footing, falling in line with its 2008 expectations.

    "The industry overall is rapidly growing and we are well-positioned to capture market share," Paci said during the 28th Annual Growth Stock Conference. The escalation, he said, is a result of an increase in everyday items and "a growing trend in convenience shopping."

    Paci noted The Pantry, which operates approximately 1,650 c-stores in the Southeast under the Kangaroo banner, exceeded third quarter earning estimates. Looking forward, he said the company expects merchandise and retail gasoline sales for fiscal 2008 to be within the ranges of $1.6 to $1.7 billion and 2.1 to 2.2 billion gallons, respectively.

    When Paci assumed his position in July of 2007, oil was trading at $65 a barrel, a number that has doubled in the last year. "In the last months we have had 15-cent up and downs," he said of fluctuating gas prices. "It makes it difficult to translate to retail prices."

    The merchandise gross profit margin, he noted, is expected to be approximately 37 percent, with a retail gasoline margin between 10 and 12 cents per gallon. The company also continues to expect that fiscal 2008 store operating and general and administrative expenses will be at the low end of the previously announced range of $615 to $630 million.

    Paci cited credit card fees as a pervasive industry issue. "Credit card fees have grown with gas prices," he continued. "It has been a challenge, but we'll manage through it. We have a strategy to reduce fees, but it will be difficult [to execute]," he said, adding, "Everyone is feeling the pain."

    In regards to physical expansion, Paci said the company has suspended acquisition activity, and will continue to "exit underperforming stores" when appropriate.

    • About

    Related Content

    Related Content