Ingles posts 3.1% decline in comp-store grocery sales

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Ingles Markets said its comparable-store sales were down 3.1% in the third quarter, excluding fuel, compared with the year-ago period.

Total sales including fuel were up 1.6%, however, to $1.37 billion, which also included sales from a new store that opened shortly before the quarter ended on June 27. The retail price of gasoline was up more than $1 per gallon over year-ago levels at times during the company's fiscal third quarter.

The report mostly covered Ingles' first quarter of operations since it lost a proxy battle with an activist investor who has called for the company to explore splitting its grocery and real estate holdings into separate companies. Ingles did not address those investor concerns in its third-quarter earnings report.

In its quarterly filing with the Securities and Exchange Commission, Ingles reported fuel sales of about $213.6 million in the third quarter, up about 32% compared with $161.8 million in the third quarter of last year. Those gains outpaced sales declines in grocery categories, which fell about 2%, to $468.3 million, and nonfoods (including pharmacy), which fell about 9%, to $268.5 million. Sales of perishables inched up about 0.6%, to $359.7 million.

Net income for the third quarter was down about 1.1%, to $25.9 million, compared with year-ago results, as operating and administrative expenses increased to $298 million, or 21.8% of sales, vs. $290.1 million, or 21.5% of sales, in the year-ago third quarter. Ingles attributed nearly half the cost increase to higher salaries and wages.

"Salaries and wages increased due to overall increased cost to attract and retain associates in the company's market area, which has experienced significant wage inflation over the last several years," the company said in the SEC filing.

Ingles also cited increased bank charges due to higher credit card usage, "which entails more card swipes and related fees," the company said.

Asheville, N.C.-based Ingles Markets operates 195 supermarkets in six Southeastern states. At the end of the third quarter, three of the four stores that the company closed in 2024 due to damage sustained in Hurricane Helene remained closed but are expected to reopen at various times in 2026 and 2027, the company said.