CARTERET, NJ-Pathmark’s profits are down for its second quarter of 2006, despite a modest same store sales increase. The supermarket lost $8.8 million this quarter, $0.17 per diluted share, due to a variety of cost escalations.

Last year’s 2Q net loss was $5.1 million. The decline this year was largely due to an EBITDA drop. It was $26.9 million this quarter, compared to $31.7 million last year. Same store sales are up 0.5% to $1,002.9 million, versus $1,000.7 million from a year ago.

The $4.8-million decline is due to lower gross profits of $1 million (largely a pharmaceutical hit from Medicare Part D), higher utility costs of $2.3 million, self-insured workers’ compensation and general liability costs of $2.2 million, medical and pension of $1.9 million, and supplies of $0.6 million. A credit of $3.2 million for new accounting of breakage income from gift cards softened the blow.

Pathmark is in the middle of a revamping effort over the past year, covering the gamut from produce upgrades to rebranding to cost-cutting and the removal of in-store clutter.

“We’re a little behind our objectives from an earnings perspective,” says John Standley, Pathmark CEO, “but we’re gaining traction with our initiatives.”

“Our pharmaceuticals margin was affected by the transfer of Medicaid scrips to Medicare Part D, as well as a reduction in generic reimbursement rates for certain plans,” says Frank Vitrano, CFO.

“We expect to see improvements in gross margin due to sales mix and lower shrink as the fiscal year progresses,” says Standley. “On the cost side, we expect our various initiatives will help mitigate expected expense increases during the remainder of the fiscal year.”

Pathmark currently operates 141 supermarkets, primarily in the New York/New Jersey and Philadelphia metropolitan areas.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?


© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Dig Deeper


GlobeSt Net Lease Spring 2024Event

This conference brings together the industry's most influential & knowledgeable real estate executives from the net lease sector.

Get More Information


Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join now!

  • Free unlimited access to's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including and

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2024 ALM Global, LLC. All Rights Reserved.