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EX-31.2 - EX-31.2 - STATER BROS HOLDINGS INC | v55073exv31w2.htm |
EX-31.1 - EX-31.1 - STATER BROS HOLDINGS INC | v55073exv31w1.htm |
EX-32.1 - EX-32.1 - STATER BROS HOLDINGS INC | v55073exv32w1.htm |
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended December 27, 2009
OR
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition from to
Commission file number 001-13222
STATER BROS. HOLDINGS INC.
(Exact name of registrant as specified in its charter)
Delaware | 33-0350671 | |
(State or other jurisdiction of incorporation or | (I.R.S. Employer Identification No.) | |
organization) | ||
301 S. Tippecanoe Avenue | ||
San Bernardino, California | 92408 | |
(Address of principal executive offices) | (Zip Code) |
Registrants telephone number, including area code (909) 733-5000
Not Applicable
(Former name, former address and former fiscal year, if changed since last report.)
(Former name, former address and former fiscal year, if changed since last report.)
Indicate by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days. Yes þ No o.
Indicate by check mark whether the registrant has submitted
electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of
Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Yes o No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated
filer, or a non-accelerated filer. See definition of accelerated filer and large accelerated
filer in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer o | Accelerated filer o | Non-accelerated filer þ (Do not check if a smaller reporting company) |
Smaller reporting company o |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2
of the Exchange Act). Yes o No þ.
As of February 9, 2010, there were issued and outstanding
34,552 shares of the registrants Class A Common Stock.
34,552 shares of the registrants Class A Common Stock.
STATER BROS. HOLDINGS INC.
December 27, 2009
December 27, 2009
INDEX
2
Table of Contents
PART I FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
STATER BROS. HOLDINGS INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)
CONSOLIDATED BALANCE SHEETS
(In thousands)
ASSETS
Sept. 27, | Dec. 27, | |||||||
2009 | 2009 | |||||||
(Unaudited) | ||||||||
Current assets |
||||||||
Cash and cash equivalents |
$ | 196,914 | $ | 242,247 | ||||
Restricted cash |
3,121 | 3,121 | ||||||
Receivables, net of allowance of $759 and $767 |
36,671 | 41,616 | ||||||
Income tax receivables |
4,049 | | ||||||
Inventories |
212,856 | 237,761 | ||||||
Prepaid expenses |
9,330 | 11,452 | ||||||
Deferred income taxes |
20,479 | 25,579 | ||||||
Assets held for sale |
83,617 | | ||||||
Note receivable, current portion |
300 | 300 | ||||||
Total current assets |
567,337 | 562,076 | ||||||
Property and equipment |
||||||||
Land |
97,430 | 97,430 | ||||||
Buildings and improvements |
544,440 | 550,002 | ||||||
Store fixtures and equipment |
428,431 | 432,349 | ||||||
Property subject to capital leases |
9,983 | 9,983 | ||||||
1,080,284 | 1,089,764 | |||||||
Less accumulated depreciation and amortization |
408,791 | 422,156 | ||||||
671,493 | 667,608 | |||||||
Deferred income taxes, long-term |
36,014 | 37,119 | ||||||
Deferred debt issuance cost, net |
11,276 | 10,473 | ||||||
Note receivable, less current portion |
493 | 493 | ||||||
Long-term receivable |
18,867 | 18,867 | ||||||
Goodwill |
2,894 | 2,894 | ||||||
Other assets |
6,361 | 5,975 | ||||||
75,905 | 75,821 | |||||||
Total assets |
$ | 1,314,735 | $ | 1,305,505 | ||||
See accompanying notes to unaudited consolidated financial statements.
3
Table of Contents
STATER BROS. HOLDINGS INC.
CONSOLIDATED BALANCE SHEETS (contd.)
(In thousands, except share amounts)
CONSOLIDATED BALANCE SHEETS (contd.)
(In thousands, except share amounts)
LIABILITIES AND STOCKHOLDERS EQUITY
Sept. 27, | Dec. 27, | |||||||
2009 | 2009 | |||||||
(Unaudited) | ||||||||
Current liabilities |
||||||||
Accounts payable |
$ | 153,083 | $ | 157,000 | ||||
Accrued payroll and related expenses |
53,313 | 52,580 | ||||||
Other accrued liabilities |
79,618 | 62,562 | ||||||
Income taxes payable |
| 6,450 | ||||||
Liabilities held for sale |
5,634 | | ||||||
Current portion of capital lease obligations |
1,336 | 1,389 | ||||||
Total current liabilities |
292,984 | 279,981 | ||||||
Long-term debt |
810,000 | 810,000 | ||||||
Capital lease obligations, less current portion |
3,768 | 3,400 | ||||||
Long-term portion of self-insurance and other reserves |
36,227 | 38,108 | ||||||
Long-term deferred benefits |
77,396 | 78,375 | ||||||
Other long-term liabilities |
30,605 | 30,175 | ||||||
Total liabilities |
1,250,980 | 1,240,039 | ||||||
Commitments and contingencies |
||||||||
Stockholders equity |
||||||||
Common Stock, $.01 par value: |
||||||||
Authorized shares - 100,000 |
||||||||
Issued and outstanding shares - 0 |
| | ||||||
Class A Common Stock, $.01 par value: |
||||||||
Authorized shares - 100,000 |
||||||||
Issued and outstanding shares - 35,152 |
| | ||||||
Additional paid-in capital |
8,939 | 8,939 | ||||||
Accumulated other comprehensive loss |
(16,720 | ) | (16,720 | ) | ||||
Retained earnings |
71,536 | 73,247 | ||||||
Total stockholders equity |
63,755 | 65,466 | ||||||
Total liabilities and stockholders equity |
$ | 1,314,735 | $ | 1,305,505 | ||||
See accompanying notes to unaudited consolidated financial statements.
4
Table of Contents
STATER BROS. HOLDINGS INC.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In thousands, except per share and share amounts)
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In thousands, except per share and share amounts)
13 Weeks Ended | ||||||||
Dec. 28, | Dec. 27, | |||||||
2008 | 2009 | |||||||
Sales |
$ | 959,253 | $ | 923,864 | ||||
Cost of goods sold |
712,391 | 685,714 | ||||||
Gross profit |
246,862 | 238,150 | ||||||
Operating expenses |
||||||||
Selling, general and
administrative expenses |
211,004 | 205,288 | ||||||
Gain on sale of dairy assets |
| (7,950 | ) | |||||
Depreciation and amortization |
13,360 | 12,666 | ||||||
Total operating expenses |
224,364 | 210,004 | ||||||
Operating profit |
22,498 | 28,146 | ||||||
Interest income |
205 | 59 | ||||||
Interest expense |
(17,100 | ) | (17,189 | ) | ||||
Other income (expenses), net |
149 | (11 | ) | |||||
Income before income taxes |
5,752 | 11,005 | ||||||
Income taxes |
2,211 | 4,294 | ||||||
Net income |
$ | 3,541 | $ | 6,711 | ||||
Earnings per average common share outstanding |
$ | 100.73 | $ | 190.91 | ||||
Average common shares outstanding |
35,152 | 35,152 | ||||||
Shares outstanding at end of period |
35,152 | 35,152 | ||||||
See accompanying notes to unaudited consolidated financial statements.
5
Table of Contents
STATER BROS. HOLDINGS INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
13 Weeks Ended | ||||||||
Dec. 28, | Dec. 27, | |||||||
2008 | 2009 | |||||||
Operating activities: |
||||||||
Net income |
$ | 3,541 | $ | 6,711 | ||||
Adjustments
to reconcile net income to net cash used in operating activities: |
||||||||
Depreciation and amortization |
17,660 | 15,528 | ||||||
Amortization of debt issuance costs |
803 | 803 | ||||||
(Increase)
decrease in deferred income taxes |
1,347 | (6,205 | ) | |||||
Gain on sale of dairy assets |
| (7,950 | ) | |||||
(Gain) loss on disposals of assets |
(104 | ) | 13 | |||||
Changes in operating assets and liabilities: |
||||||||
Decrease in restricted cash |
2,500 | | ||||||
Increase in receivables |
(17,468 | ) | (4,945 | ) | ||||
(Increase) decrease in income tax
receivables |
(986 | ) | 4,049 | |||||
Increase in inventories |
(7,437 | ) | (24,905 | ) | ||||
Increase in prepaid expenses |
(7,091 | ) | (2,122 | ) | ||||
Decrease in assets held for sale |
14,211 | 215 | ||||||
(Increase) decrease in other assets |
(1,258) | 796 | ||||||
Increase in accounts payable |
4,696 | 3,917 | ||||||
Increase in income taxes payable |
| 6,450 | ||||||
Increase in liabilities held of sale |
488 | 1,014 | ||||||
Decrease in other accrued liabilities |
(24,872 | ) | (17,789 | ) | ||||
Increase in long-term reserves |
6,314 | 2,430 | ||||||
Net cash used in operating activities |
(7,656 | ) | (21,990 | ) | ||||
Financing activities: |
||||||||
Principal payments on capital lease obligations |
(272 | ) | (315 | ) | ||||
Dividend paid |
| (5,000 | ) | |||||
Net cash used in financing activities |
(272 | ) | (5,315 | ) | ||||
Investing activities: |
||||||||
Decrease in store construction reimbursement |
5,950 | | ||||||
Proceeds from sale of dairy assets, net of fees |
| 84,294 | ||||||
Purchase of property and equipment |
(20,653 | ) | (11,666 | ) | ||||
Proceeds from sale of property and equipment |
189 | 10 | ||||||
Net cash provided by (used in) investing activities |
(14,514 | ) | 72,638 | |||||
Net increase (decrease) in cash and cash equivalents |
(22,442 | ) | 45,333 | |||||
Cash and cash equivalents at beginning of period |
144,942 | 196,914 | ||||||
Cash and cash equivalents at end of period |
$ | 122,500 | $ | 242,247 | ||||
Interest paid |
$ | 32,633 | $ | 32,588 | ||||
Income taxes paid |
$ | 1,850 | $ | |
See accompanying notes to unaudited consolidated financial statements.
6
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STATER BROS. HOLDINGS INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
DECEMBER 27, 2009
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
DECEMBER 27, 2009
Note 1 Basis of Presentation
The accompanying unaudited consolidated financial statements have been prepared in accordance
with U.S. generally accepted accounting principles for interim financial information and with the
instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all
of the information and footnotes required by U.S. generally accepted accounting principles for
complete financial statements. In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been included. Operating
results for the thirteen weeks ended December 27, 2009 are not necessarily indicative of the
results that may be experienced for the year ending September 26, 2010.
The consolidated balance sheet at September 27, 2009 has been derived from the audited
consolidated financial statements at that date, but does not include all of the information and
footnotes required by U.S. generally accepted accounting principles for complete financial
statements.
For further information, refer to the consolidated financial statements and footnotes thereto
included in the Companys report on Form 10-K for the year ended September 27, 2009.
Note 2 Principles of Consolidation
The unaudited consolidated financial statements include the accounts of the Company and its
wholly-owned subsidiaries, Stater Bros. Markets (Markets) and Stater Bros. Development, Inc.
(Development), and Markets wholly-owned subsidiaries, Super Rx, Inc. (Super Rx) and SBM
Dairies, Inc. (Dairies). All significant inter-company transactions have been eliminated in
consolidation.
Note 3 Reclassifications
Certain amounts in assets held for sale and deferred income taxes within the September
27, 2009 consolidated balance sheet and certain captions for operating activities within the
December 28, 2009 statement of cash flows have been reclassified to conform to the current
periods financial statement presentation. Substantially all of the assets and certain liabilities of
Dairies had been classified as Held for Sale prior to their disposal on October 11, 2009 as
described in Note 8 - Asset Sale in these notes to the unaudited consolidated financial
statements.
Note 4 Subsequent Events
The Company has evaluated subsequent events through February 9, 2010, the issuance date of its
financial statements. Other than redemption of stock as discussed in Note 12 Dividend and
Stock Redemption, the Company did not have any material subsequent events that need to be
disclosed.
Note 5 Use of Estimates
The preparation of financial statements in conformity with U.S. generally accepted accounting
principles requires management to make estimates and assumptions that affect the amounts reported
in the financial statements and accompanying notes. Actual results could differ from those
estimates.
7
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STATER BROS. HOLDINGS INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
DECEMBER 27, 2009
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
DECEMBER 27, 2009
Note 6 Income Taxes
The Company establishes deferred tax liabilities for anticipated tax timing differences where
payment of tax is anticipated. Such amounts represent a reasonable provision for taxes ultimately
expected to be paid, and the amounts may be adjusted over time as additional information becomes
known.
The Company does not have any material tax positions that do not meet a more-likely-than-not
recognition threshold. As such, the Company has not recorded any liabilities for uncertain tax
positions. During the thirteen weeks ended December 27, 2009, there were no material changes to
the amount of uncertain tax positions.
The Company recognizes interest and penalties related to income tax deficiencies or
assessments by taxing authorities for any underpayment of income taxes separately from income tax
expenses as either interest expense or other operating expenses.
For federal tax purposes, the Company is subject to review of its fiscal 2006 through fiscal
2008 tax returns. For state tax purposes, the Company is subject to review of its fiscal 2006
through fiscal 2008 state tax returns. The Company is currently under audit for its fiscal 2006
and fiscal 2007 state tax returns by the State of California Franchise Tax Board (FTB). To date,
the FTB has only made information document requests related to those years.
Note 7 Retirement Plans
The Company has a noncontributory defined benefit pension plan covering substantially all
non-union employees. The plan provides for benefits based on an employees compensation during the
eligibility period while employed with the Company. The Companys funding policy for this plan is
to contribute annually at a rate that is intended to provide sufficient assets to meet future
benefit payment requirements. Market value of plan assets is calculated using fair market values
as provided by a third-party trustee. The plans investments include cash, which earns interest,
and governmental securities and corporate bonds and securities, all of which have quoted market
values.
The following table provides the components of net periodic pension expense:
Dec. 28, | Dec. 27, | |||||||
2008 | 2009 | |||||||
(in thousands) | ||||||||
Expected return on assets |
(800 | ) | $ | (877 | ) | |||
Service cost |
574 | 841 | ||||||
Interest cost |
964 | 1,029 | ||||||
Amortization of prior service cost |
(1 | ) | (1 | ) | ||||
Amortization of recognized losses |
49 | 359 | ||||||
Net pension expense |
$ | 786 | $ | 1,351 | ||||
Actuarial assumptions used to determine net pension expense were:
Discount rate |
7.50 | % | 5.50 | % | ||||
Rate of increase in compensation levels |
3.00 | % | 3.00 | % | ||||
Expected long-term rate of return on assets |
6.50 | % | 6.50 | % |
The Company made approximately $1.1 million of contributions to its noncontributory defined pension
plan in the thirteen weeks ended December 27, 2009 and the Company expects to contribute an
additional $2.1 million during the remainder of fiscal 2010.
8
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STATER BROS. HOLDINGS INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
DECEMBER 27, 2009
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
DECEMBER 27, 2009
Note 8 Asset Sale
On October 11, 2009, the Company sold substantially all of the assets of Dairies to
subsidiaries of Dean Foods (Dean Foods) for
$88.0 million in cash, subject to a working capital adjustment, and assumption of certain
liabilities including substantially all of Dairies current liabilities, which included accounts
payable. Dairies assets which were sold consisted primarily of accounts receivable, inventory and
property and equipment. The Company incurred approximately
$3.7 million in transaction and other fees related to the
transaction and recognized a gain, net of tax, of approximately $4.7 million. The pre-tax gain
from the sale of Dairies assets is included in Gain on sale of dairy assets within the unaudited
consolidated statements of income. Dairies retained responsibility for all workers compensation
claims through the date of the transaction. As of December 27, 2009, Dairies has accrued
approximately $4.3 million in workers compensation liabilities.
Also on October 11, 2009, the Company entered into a ten year Product Purchase Agreement (the
PPA) with Dean Foods to purchase substantially all of its milk products sold in its supermarkets
from Dean Foods. The purchase prices under the PPA are deemed to approximate market pricing.
As of October 11, 2009, the Company ceased all dairy manufacturing operations. Markets and
Super Rx have similar customers, regulatory requirements and delivery methods to customers and are
included together as one reportable segment. Prior to the Dairy Transaction, Dairies was a
separate reportable segment of the Company. As operating activities of Dairies have ceased and
operating results from September 28, 2009 to October 11, 2009 are not material to the overall
financial statements of the Company taken as a whole, the Company no longer has separate reportable
segments to disclose.
Note 9 Subsidiary Guarantee
The Company has $525.0 million of 8.125% Senior Notes due June 15, 2012 and $285.0 million of
7.75% Senior Notes due April 15, 2015, collectively (the Notes).
The Notes are guaranteed by the Companys subsidiaries Markets and Development, and the
Companys indirect subsidiaries Super Rx, and Dairies (each a subsidiary guarantor, and
collectively, the subsidiary guarantors). Condensed consolidating financial information with
respect to the subsidiary guarantors is not provided because the Company has no independent assets
or operations, the subsidiary guarantees are full and unconditional and joint and several and there
are no subsidiaries of the Company other than the subsidiary guarantors.
9
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STATER BROS. HOLDINGS INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
DECEMBER 27, 2009
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
DECEMBER 27, 2009
Note 10 Credit Facility
On April 16, 2007, the Company and Markets entered into a Second Amended and Restated Credit
Agreement with Bank of America, N.A. (Bank of America), as sole and exclusive administrative
agent and sole initial lender, consisting of a three-year unsecured revolving credit facility in a
principal amount of up to $100 million (the Credit Facility), which replaced Markets previous
credit facility.
Markets is the borrower under the Credit Facility. The Credit Facility is guaranteed by the
Company and all of its existing and future material subsidiaries, including Development and the
Companys indirect subsidiaries Super Rx and Dairies (subject, in the case of Dairies, to
termination upon certain specified events). Subject to certain restrictions, the entire amount of
the Credit Facility may be used for loans, letters of credit, or a combination thereof. Borrowings
under the Credit Facility are unsecured and may be used for working capital, certain capital
expenditures and other general corporate purposes. Letters of credit issued under the letter of
credit facility are expected to be used to support obligations incurred in connection with the
construction of stores and workers compensation insurance obligations. The availability of the
loans and letters of credit is subject to certain borrowing restrictions.
Loans under the Credit Facility bear interest at a rate based upon either (i) the Base Rate
(defined as the higher of (a) the federal funds rate plus 0.50% and (b) the rate of interest
publicly announced by Bank of America as its reference rate), plus 1.00%, or (ii) the Offshore
Rate (defined as the average British Bankers Association Interest Settlement Rate for deposits in
dollars, adjusted for the maximum reserve requirement for Eurocurrency funding), plus 1.75%. For
Offshore Rate Loans, the Offshore Rate will be applied in consecutive periods of the earlier of (a)
the maturity date of the loan or (b) periods, as selected by Markets, of one, two, three or six
months.
The Credit Facility requires Markets to meet certain financial tests, including minimum net
worth and the maintenance of minimum earnings levels. The Credit Facility contains covenants
which, among other things, limit the ability of Markets and its subsidiaries to (i) incur
indebtedness, grant liens and guarantee obligations, (ii) enter into mergers, consolidations,
liquidations and dissolutions, asset sales, investments, leases and transactions with affiliates,
and (iii) make restricted payments. The Credit Facility also contains covenants that apply to the
Company and its subsidiaries, and the Company is a party to the Credit Facility for purposes of
these covenants. These covenants, among other things, limit the ability of the Company and its
subsidiaries to incur indebtedness, make restricted payments, enter into transactions with
affiliates, and make amendments to the Indentures governing the 8.125% Senior Notes and the 7.75%
Senior Notes.
The Credit Facility will mature on May 31, 2010. The Company is currently in the process of
negotiating an amendment to the facility with Bank of America which would provide terms similar to
those currently in place and would extend the maturity date.
As of December 27, 2009, Markets and the Company were in compliance with all restrictive
covenants under the Credit Facility. However, there can be no assurance that Markets or the
Company will be able to achieve the expected operating results or implement the capital expenditure
strategy upon which future compliance with such covenants is based.
The Company had $49.8 million of outstanding letters of credit and it had $50.2 million
available under the Credit Facility.
The Company had no short-term borrowings outstanding as of December 27, 2009. The Company did
not incur any short-term borrowings during the thirteen weeks ended December 27, 2009.
10
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STATER BROS. HOLDINGS INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
DECEMBER 27, 2009
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
DECEMBER 27, 2009
Note 11 Litigation Matters
Various legal actions and claims are pending against the Company in the ordinary course of
business. In the opinion of management and its general legal counsel, the ultimate resolution of
such pending legal actions and claims will not have a material adverse effect on the Companys
consolidated financial position or its results of operations.
Note 12 Dividend and Stock Redemption
On November 17, 2009, the Company paid a $5.0 million dividend to La Cadena Investments (La
Cadena), the sole shareholder of the Company.
Subsequent to December 27, 2009, the Company, on December 28, 2009, redeemed and retired 600
shares of its Class A Common Stock for $8.0 million. The redemption was for shares held by the
Moseley Family Revocable Trust. La Cadena had distributed the shares to the Moseley Family
Revocable Trust concurrently with the redemption and retirement of the shares.
After the dividend payment on November 17, 2009 and the stock redemption on December 28, 2009,
the Company had the ability under the Credit Facility and the Notes Indentures to make restricted
payments, including dividends, of $11.4 million.
Note 13 Fair Value of Financial Instruments
The following methods and assumptions were used to estimate the fair value of each class of
financial instruments for which it is practicable to estimate that value:
Cash and Cash Equivalents
The carrying amount approximates fair value because of the short-term maturity of these
instruments.
Receivables
The carrying amount approximates fair value because of the short-term maturity of these
instruments.
Note Receivable
Although a market quote for the fair value of the Companys note receivable is not readily
available, the Company believes the stated value approximates fair value.
Long-Term Receivable
Although market quotes for the fair value of the Companys long-term receivable are not
readily available, the Company valued its long-term receivable based on a discounted cash flow
approach applying a discount rate that approximates long-term market rates.
11
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STATER BROS. HOLDINGS INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
DECEMBER 27, 2009
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
DECEMBER 27, 2009
Note 13 Fair Value of Financial Instruments (contd.)
Long-Term Debt and Capital Lease Obligations
The fair value of the 8.125% Senior Notes and the 7.75% Senior Notes, are based on quoted
market prices. Although market quotes for the fair value of the Companys capitalized lease
obligations are not readily available, the Company believes the stated value approximates fair
value.
The estimated fair values of the Companys financial instruments are as follows:
As of | ||||||||
December 27, 2009 | ||||||||
(In thousands) | ||||||||
Carrying | Fair | |||||||
Amount | Value | |||||||
Cash and cash equivalents |
$ | 242,247 | $ | 242,247 | ||||
Receivables |
$ | 41,616 | $ | 41,616 | ||||
Note receivable |
$ | 793 | $ | 793 | ||||
Long-term receivable |
$ | 18,867 | $ | 18,867 | ||||
Long-term debt |
$ | 810,000 | $ | 819,638 | ||||
Capital lease obligations |
$ | 4,789 | $ | 4,789 |
12
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STATER BROS. HOLDINGS INC.
MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
PART I
FINANCIAL INFORMATION (contd.)
Item 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
CRITICAL ACCOUNTING POLICIES
We have chosen accounting policies that we believe are appropriate to report accurately and
fairly our operating results and financial position, and we apply those accounting policies in a
consistent manner. Our critical accounting policies are summarized in our report on Form 10-K for
the year ended September 27, 2009.
Our discussion and analysis of financial condition and results of operations are based upon our
unaudited consolidated financial statements prepared in accordance with U.S. generally accepted
accounting principles. The preparation of the financial statements requires the use of estimates
and judgments on the part of management. We base our estimates on our historical experience
combined with managements understanding of current facts and circumstances.
SIGNIFICANT ACCOUNTING POLICIES
There are certain accounting policies that we have adopted that may differ from policies of other
companies within our industry and other companies as a whole. Such differences in the treatment of
these policies may be important to the readers of our report on Form 10-Q and our unaudited
consolidated financial statements contained herein. For further information regarding our
accounting policies, refer to the significant accounting policies included in the notes to the
unaudited consolidated financial statements contained herein and in our report on Form 10-K for the
year ended September 27, 2009.
13
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STATER BROS. HOLDINGS INC.
MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
OWNERSHIP OF THE COMPANY
La Cadena Investments (La Cadena), a California general partnership whose sole voting
partner is the Jack H. Brown Revocable Trust, holds all of our issued and outstanding capital
stock. Jack H. Brown, the Chairman of the Board, President and Chief Executive Office of the
Company, is the Managing General Partner of La Cadena with the power to vote the shares of our
capital stock held by La Cadena on all matters, including with respect to the election of our
Board of Directors, and any other matters requiring shareholder approval.
AVAILABLE INFORMATION
We file quarterly and annual reports electronically with the Security and Exchange Commission
(SEC) under forms 10-Q and 10-K and we file current reports on form 8-K and amendments to these
reports. The SEC maintains an internet site that contains reports, proxy and information
statements and other information regarding issues that file electronically with the SEC. These
electronic files can be found at the SECs website at http://www.sec.gov. The public may
read and copy any of our reports filed with the SEC at the SECs Public Reference Room at 100 F
Street, NE., Washington, DC 20549. The public may obtain information on the Public Reference Room
by calling the SEC at 1-800-SEC-0330.
EXECUTIVE OVERVIEW
We are the largest privately owned supermarket chain in Southern California. Our revenues are
generated primarily from retail sales through our supermarkets. Our success is a result of our
marketing strategy of offering everyday low prices while providing our customers with friendly and
outstanding service on each of their visits to our stores which has been a seventy-four year Stater
Bros. tradition.
On October 11, 2009, we sold substantially all of the assets of SBM Dairies, Inc (Dairies) to
subsidiaries of Dean Foods (Dean Foods), (the Dairy Transaction), for $88.0 million in cash and
assumption of certain liabilities including substantially all of Dairies current liabilities, which
included accounts payable. Dairies assets which were sold consisted primarily of accounts
receivable, inventory and property and equipment. Also on October 11, 2009, we entered into a ten
year Product Purchase Agreement (the PPA) with Dean Foods to purchase substantially all milk
products sold in our supermarkets from Dean Foods. The purchase prices under the PPA are deemed to
approximate market pricing. We incurred approximately $3.7 million in fees related to the Dairy
Transaction and recognized a gain, net of tax, of approximately $4.7 million. We retained
responsibility for all workers compensation claims of Dairies employees for events occurring
through the transaction date. As of October 11, 2009, the Company ceased all dairy manufacturing
operations.
As a
result of the Dairy Transaction and the continued
decline in the current economy, we anticipate that our sales will be lower than in fiscal 2009.
Our strategy in the near term is to retain customer counts during these tough economic times by
continuing to provide exceptional customer service and provide value to our customers on their
purchases from our supermarkets.
In the first quarter of fiscal 2010, our consolidated gross profit margin, as a percentage of
sales, was comparable to the previous year. Our marketing area of Southern California continues to
be highly competitive and in flux. With the current economic conditions, our marketing area has
seen job losses and business closures which will put further pressure on our gross margin as we
endeavor to retain our customer base. We anticipate continued competitive pressures from big box
format competitors including Walmart, Costco and Target, from our traditional grocery format
competitors Vons, Albertsons and Ralphs and from independent supermarket operators.
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STATER BROS. HOLDINGS INC.
MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Sales and Cost of Goods Sold
Fiscal Period Ended | Change | |||||||||||||||
Dec. 28, | Dec. 27, | 2010 to 2009 | ||||||||||||||
(in thousands) | 2008 | 2009 | Dollar | % | ||||||||||||
Sales |
$ | 959,253 | $ | 923,864 | $ | (35,389 | ) | (3.69 | )% | |||||||
Gross Profit |
$ | 246,862 | $ | 238,150 | $ | (8,712 | ) | (3.53 | )% | |||||||
as a % of sales |
25.73 | % | 25.78 | % |
Sales
Sales in
our supermarkets were down 1.11% for the first quarter of fiscal 2010
compared to the same period in fiscal 2009. Overall, sales were down
$35.4 million or 3.69% for the first quarter, the Dairy Transaction
accounted for $25.0 million of the sales decline in the quarter.
Like Store Sales
We calculate like store sales by comparing year-to-year sales for stores that are opened in both
years. For stores that were not opened for the entire previous year period, we only include the
current years weekly sales that correspond to the weeks the stores were opened in the previous
year period. For stores that have been closed, we only include the prior years weekly sales that
correspond to the weeks the stores were opened in the current year. Replacement store sales are
included in like store sales.
Like store sales are affected by various factors including, but not limited to, inflation,
deflation, promotional discounting, customer traffic, buying trends, pricing pressures from
competitors and competitive openings and closings.
Like store sales decreased $20.4 million or 2.19% from the first quarter of fiscal 2009. Like
store sales were impacted by our recently opened stores. We estimate that our recently opened
stores drew approximately $3.8 million of their first quarter 2010 sales from our existing stores.
During fiscal 2009, we opened three stores, one of which was opened during a portion of the first
quarter of fiscal 2009 and the other two were opened later in fiscal 2009. As such, these
corresponding sales in fiscal 2010 are not included in like store sales. These recently opened
stores had sales of $14.2 million in the first quarter of fiscal 2010 of which $11.2 million of
sales are not included in like store sales. We closed one store in the first quarter of fiscal
2009, which reduced first quarter 2010 sales by approximately $1.2 million.
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STATER BROS. HOLDINGS INC.
MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS (contd.)
Gross Profit
Gross profit margin, as a percentage of sales, in the first quarter of fiscal 2010 was comparable
to the first quarter of fiscal 2009. With the depressed economic conditions in the nation and in
our marketing area and with the significant competitive pressures, as we and our competitors
compete to retain market share and our customer base, we anticipate our gross margins to be
challenged in the foreseeable future.
Operating Expenses and Operating Profit
Fiscal Period Ended | Change | ||||||||||||||||||
Dec. 28, | Dec. 27, | 2010 to 2009 | |||||||||||||||||
(in thousands) | 2008 | 2009 | Dollar | % | |||||||||||||||
Operating Expenses: |
|||||||||||||||||||
Selling, general and
administrative expenses |
$ | 211,004 | $ | 205,288 | $ | (5,716 | ) | (2.71 | )% | ||||||||||
as a % of sales |
21.99 | % | 22.22 | % | |||||||||||||||
Gain on sale of assets |
$ | | $ | (7,950 | ) | $ | (7,950 | ) | | ||||||||||
as a % of sales |
| (0.86 | )% | ||||||||||||||||
Depreciation and amortization |
$ | 13,360 | $ | 12,666 | $ | (694 | ) | (5.19 | )% | ||||||||||
as a % of sales |
1.39 | % | 1.37 | % | |||||||||||||||
Operating profit |
$ | 22,498 | $ | 28,146 | $ | 5,648 | 25.10 | % | |||||||||||
as a % of sales |
2.35 | % | 3.05 | % |
Selling, General and Administrative Expenses
The increase, as a percentage of sales, in selling, general and administrative expenses in the
first quarter of fiscal 2010 compared to the first quarter of fiscal 2009 is due primarily to
increases, as a percentage of sales, in payroll related expenses under our union contracts. Rates
under the contracts have increased for direct labor. Also, our rent expense has increased as a
result of new store openings.
The amount of salaries, wages and administrative costs associated with the purchase of our products
included in selling, general and administrative expenses for the first quarters of fiscal 2010 and
fiscal 2009 is $314,000 and $287,000, respectively.
Gain on Sale of Dairy Assets
Gain on sale of dairy assets comprises approximately $8.0 million of pre-tax gain from the sale of
our dairy assets. The Dairy transaction is described in Note 8 Assets Sale to our unaudited
consolidated financial statements contained herein.
Depreciation and Amortization
The decrease in depreciation and amortization expense in the first quarter of fiscal 2010 compared
to the same period in fiscal 2009 is due primarily to reduced fixed asset additions in the current
year and to the Dairy Transaction. Included in cost of goods sold is $2.9 million and $4.3 million
of depreciation and amortization in the first quarters of fiscal 2010 and 2009, respectively,
related to warehousing and distribution activities in both fiscal periods and dairy production in
fiscal 2009. The decrease in depreciation and amortization included in cost of goods sold is
attributed to the Dairy Transaction.
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STATER BROS. HOLDINGS INC.
MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS (contd.)
Interest Income
Interest income was $59,000 and $205,000 for the first quarters of fiscal 2010 and 2009,
respectively. Interest income has significantly decreased due to lower market rates in the current
year compared to the previous year. We expect our interest income to continue to be lower in the
current fiscal year as market rates continue to be depressed.
Interest Expense
Interest expense was $17.2 million for the first quarter of fiscal 2010 and $17.1 million in the
first quarter of fiscal 2009. The change in interest expense between the two periods is due to no
interest being capitalized in the current fiscal year.
Income Before Income Taxes
Income before income taxes amounted to $11.0 million and $5.8 million in the first quarters of
fiscal 2010 and fiscal 2009, respectively.
Income Taxes
Income taxes amounted to $4.3 million and $2.2 million in the first quarters of fiscal 2010 and
fiscal 2009, respectively. Our effective tax rate was 39.0% and 38.4% for the first quarters of
fiscal 2010 and 2009, respectively. The lower effective rate for fiscal 2009 is due primarily to
tax credits being applied against lower taxable income in the prior year versus the current year.
Net Income
Net income for the first quarter of fiscal 2010 amounted to $6.7 million compared to $3.5 million
in the first quarter of fiscal 2009.
LIQUIDITY AND CAPITAL RESOURCES
We historically fund our daily cash flow requirements through funds provided by operations.
We have the ability to borrow under our short-term revolving credit facilities. Markets credit
agreement, as amended and restated on April 16, 2007 expires in May 2010 and consists of a
revolving loan facility for working capital and letters of credit of $100.0 million. The letter of
credit facility is maintained pursuant to our workers compensation and general liability
self-insurance requirements.
We are currently in the process of negotiating an amendment to Markets credit facility with Bank
of America which would provide terms similar to those currently in place and would extend the
maturity date.
As of December 27, 2009, we had $49.8 million of outstanding letters of credit and we had $50.2
million available under Markets credit facility.
We had no short-term borrowings outstanding as of December 27, 2009. We did not incur any
short-term borrowings in the first quarter of fiscal 2010.
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STATER BROS. HOLDINGS INC.
MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES (contd.)
The following table sets forth our contractual cash obligations
and commercial commitments as of December 27, 2009.
Contractual Cash Obligations | ||||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Less than | After | |||||||||||||||||||
Total | 1 Year | 1-3 Years | 4-5 Years | 5 Years | ||||||||||||||||
8.125% Senior Notes due June 2012 |
||||||||||||||||||||
Principal |
$ | 525,000 | $ | | $ | 525,000 | $ | | $ | | ||||||||||
Interest |
106,640 | 42,656 | 63,984 | | | |||||||||||||||
631,640 | 42,656 | 588,984 | | | ||||||||||||||||
7.75% Senior Notes due April 2015 |
||||||||||||||||||||
Principal |
285,000 | | | | 285,000 | |||||||||||||||
Interest |
121,482 | 22,088 | 44,175 | 44,175 | 11,044 | |||||||||||||||
406,482 | 22,088 | 44,175 | 44,175 | 296,044 | ||||||||||||||||
Capital lease obligations (1) |
||||||||||||||||||||
Principal |
4,789 | 1,389 | 2,487 | 913 | | |||||||||||||||
Interest |
1,539 | 706 | 723 | 110 | | |||||||||||||||
6,328 | 2,095 | 3,210 | 1,023 | | ||||||||||||||||
Operating leases (1) |
358,648 | 37,204 | 65,186 | 50,730 | 205,528 | |||||||||||||||
Total contractual cash obligations |
$ | 1,403,098 | $ | 104,043 | $ | 701,555 | $ | 95,928 | $ | 501,572 | ||||||||||
Other Commercial Commitments | ||||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Less than | After | |||||||||||||||||||
Total | 1 Year | 1-3 Years | 4-5 Years | 5 Years | ||||||||||||||||
Standby letters of credit (2) |
$ | 49,762 | $ | 49,762 | $ | | $ | | $ | | ||||||||||
Total other commercial commitments |
$ | 49,762 | $ | 49,762 | $ | | $ | | $ | | ||||||||||
(1) | We lease the majority of our retail stores. We have subleased our former headquarters building and certain former distribution facilities located in Colton, California under an initial 15 year term for an amount equal to our lease payment. For purposes of contractual cash obligations shown here, minimum lease payments on this lease are shown without sub-lease offsets. Certain of our operating leases provide for minimum annual payments that change over the primary term of the lease. For purposes of contractual cash obligations shown here, contractual step increases or decreases are shown in the period they are due. Certain leases provide for additional rents based on sales. Primary lease terms range from 3 to 55 years and substantially all leases provide for renewal options. | |
(2) | Standby letters of credit are committed as security for workers compensation obligations. Outstanding letters of credit expire between February 2010 and December 2010. |
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STATER BROS. HOLDINGS INC.
MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES (contd.)
Working capital amounted to $282.1 million at December 27, 2009 and $274.4 million at
September 27, 2009, and our current ratios were 2.01:1 and 1.94:1, respectively. Fluctuations in
working capital and current ratios are not unusual in our industry.
Net cash used in operating activities for the thirteen weeks ended December 27, 2009 was $22.0
million and was $7.7 million for the thirteen weeks ended December 28, 2008. Significant uses of
cash for operating activities in the first quarter of fiscal 2010 included interest payments on our
long-term debt and increases in inventory levels to meet holiday sales demands.
A significant source of cash in the first quarter of 2010 was the sale of assets associated with
the Dairy Transaction. Other significant uses of cash in the thirteen weeks ended December 27,
2009 included $11.7 million of capital expenditures during the period for store remodels and
equipment purchases. Historically, our new store construction costs, store remodels and equipment
expenditures are financed through operating cash flows.
As of December 27, 2009, based upon our consolidated earnings since June 27, 2004 and the initial
amount allowed of $25.0 million under the Credit Facility and the Notes Indentures and, after
taking into consideration payments previously made, including a redemption of stock of $8.0 million
subsequent to December 27, 2009, we had the ability and right to pay a restricted payment of up to
$11.4 million.
We believe that operating cash flows and current cash reserves will be sufficient to meet our
currently identified operating needs and scheduled capital expenditures. However, we may elect to
fund some capital expenditures through capital leases, operating leases or debt financing. There
can be no assurance that such debt and lease financing will be available to us in the future.
Labor Relations
Our collective bargaining agreements with the UFCW were renewed in March 2007 and extend
through March 2011. Our collective bargaining agreement with the International Brotherhood of
Teamsters was renewed in September 2005 and expires in September 2010. We believe we have good
relations with our employees.
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STATER BROS. HOLDINGS INC.
MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
CAUTIONARY STATEMENT FOR PURPOSES OF SAFE HARBOR PROVISIONS OF THE PRIVATE SECURITIES
LITIGATION REFORM ACT OF 1995.
The Private Securities Litigation Reform Act of 1995 provides a safe harbor for
forward-looking statements. Certain information contained in our filings with the Securities and
Exchange Commission (as well as information included in oral statements or other written statements
made or to be made by us) includes statements that are forward-looking, such as statements relating
to plans for future activities. Such forward-looking information involves important risks and
uncertainties that could significantly affect results in the future and, accordingly, such results
may differ from those expressed in any forward-looking statements made by or on behalf of Holdings.
These risks and uncertainties include, but are not limited to, those relating to domestic economic
conditions, seasonal and weather fluctuations, labor unrest, expansion and other activities of
competitors, changes in federal or state laws and the administration of such laws and the general
condition of the economy.
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STATER BROS. HOLDINGS INC.
DECEMBER 27, 2009
DECEMBER 27, 2009
PART I FINANCIAL INFORMATION (contd.)
Item 3. QUANTITATIVE AND QUALITATIVE
DISCLOSURE ABOUT MARKET RISK
We
are subject to interest rate risk on our fixed interest rate debt obligations. Our fixed rate debt
obligations are comprised of the 8.125% Senior Notes due June 2012, the 7.75% Senior Notes due
April 2015 and capital lease obligations. In general, the fair value of fixed rate debt will
increase as the market rate of interest decreases and will decrease as the market rate of interest
increases. We have not engaged in any interest rate swap agreements, derivative financial
instruments or other type of financial transactions to manage interest rate risk.
Item 4. CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
Our management, with the participation of our Chief Executive Officer and Chief Financial Officer,
has evaluated the effectiveness of our disclosure controls and procedures as of December 27, 2009.
Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that
our disclosure controls and procedures were effective as of December 27, 2009. There were no
material changes in our internal control over financial reporting during the first quarter of
fiscal 2010.
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STATER BROS. HOLDINGS INC.
DECEMBER 27, 2009
DECEMBER 27, 2009
PART II OTHER INFORMATION
Item 1.
LEGAL PROCEEDINGS
Various legal actions and claims are pending against us in the ordinary course of business.
In the opinion of management and its general legal counsel, the ultimate resolution of such pending
legal actions and claims will not have a material adverse effect on our consolidated financial
position or our results of operations.
For a description of legal proceedings, please refer to the footnote entitled Litigation Matters
contained in the Notes to Consolidated Financial Statements section of our Form 10-K for the fiscal
year ended September 27, 2009.
Item 1A.
RISK FACTORS
Our performance is affected by inflation and deflation. In recent years, we have experienced
both increases and decreases in transportation costs and the cost of the products we sell in our
stores. The changes in our costs are attributed to changes in fuel, plastic, grains and other
commodity costs. During times of inflation, we have recovered, to the extent permitted by
competition, the increase in expenses by increasing prices over time. However, the economic and
competitive environment in Southern California continues to challenge us to become more cost
efficient as our ability to recover increases in expenses through price increases is diminished.
Our future results of operations will depend upon our ability to adapt to the current economic
environment as well as the current competitive conditions.
The supermarket industry is a highly competitive industry, which is characterized by low profit
margins. Competitive factors typically include the price, quality and variety of products,
customer service, and store location and condition. We believe that our competitive strengths
include our service departments, everyday low prices, breadth of product selection, high product
quality, one-stop shopping convenience, attention to customer service, convenient store locations,
a long history of community involvement and established long-term customer base in Southern
California.
Given the wide assortment of products we offer, we compete with various types of retailers,
including local, regional and national supermarket retailers, convenience stores, retail drug
stores, national general merchandisers and discount retailers, membership clubs and warehouse
stores. Our traditional grocery format competitors include Vons, Albertsons and Ralphs. We
also face competitive pressures from existing and new big box format retailers including Walmart,
Costco and Target and from a number of independent supermarket operators. We expect our competitors
to continue to apply pricing and other competitive pressures as they expand the number of their
stores in our market area and as they continue to take steps to both maintain and grow their
customer counts. We believe our everyday low prices, breadth of product offering, which includes
approximately 40,000 items offered for sale in our stores, service departments and long-term
customer relationships will assist and complement our ability to compete in this increased
competitive environment. We monitor competitive activity and regularly review our marketing and
business strategies and periodically adjust them to adapt to changes in our trading area.
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STATER BROS. HOLDINGS INC.
DECEMBER 27, 2009
DECEMBER 27, 2009
Item 2.
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
None
Item 3.
DEFAULTS UPON SENIOR SECURITIES
None
Item 4.
SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
Item 5. OTHER INFORMATION
None
Item 6. EXHIBITS
(a) Exhibits
31.1 | Certification of Principal Executive Officer pursuant to Section 302 (a) of the Sarbanes-Oxley Act of 2002. | ||
31.2 | Certification of Principal Financial Officer pursuant to Section 302 (a) of the Sarbanes-Oxley Act of 2002. | ||
32.1 | Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
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STATER BROS. HOLDINGS INC.
Signatures
Pursuant to the requirements of the Securities Exchange
Act of 1934, Registrant has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
Date: February 9, 2010 | /s/ Jack H. Brown | |||
Jack H. Brown | ||||
Chairman of the Board, President, and Chief Executive Officer (Principal Executive Officer) |
||||
Date: February 9, 2010 | /s/ Phillip J. Smith | |||
Phillip J. Smith Executive Vice President |
||||
and Chief Financial Officer (Principal Financial Officer) |
||||
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