Arden Group Inc. (ARDNA) filed Quarterly Report for the period ended 2009-10-03.
Arden Group, Inc. is a holding company with certain real estate holdings which conducts other operations through its wholly-owned subsidiary, Arden-Mayfair, Inc. Arden Group Inc. has a market cap of $331.4 million; its shares were traded at around $104.83 with a P/E ratio of 15 and P/S ratio of 0.7. The dividend yield of Arden Group Inc. stocks is 0.9%. Arden Group Inc. had an annual average earning growth of 14.6% over the past 10 years.
Highlight of Business Operations:
Interest and dividend income was $261,000 in the third quarter of 2009 compared to $733,000 for the same period in 2008. The decrease is partially due to significantly lower interest rates as a result of the current financial crisis. In addition, the Company’s cash available for investment was significantly lower during the third quarter of 2009 compared to the same period of the prior year due to a special cash dividend paid on December 8, 2008 totaling approximately $79,027,000.
Same store sales from the Company’s 18 supermarkets (all of which are located in Southern California), including revenue from licensing arrangements, subleases, leases and finance charges, were $320,452,000 during the first nine months of 2009. This represents a decrease of 8.3% from the same period of the prior year, when sales were $349,588,000. Sales during 2009 were negatively impacted by economic conditions and increased competition in our trade area. The Company recorded $479,000 of revenue related to gift card breakage during the first nine months of 2009 of which $432,000 was related to prior periods as a result of the change in accounting for gift cards and certificates as described in Note 1. The decrease in sales during the first nine months of 2009 compared to the same period of the prior year would have been slightly greater if not for the revenue from gift card breakage. In addition, sales during the first nine months of 2009 included sales from Rosh Hashanah and Yom Kippur, whereas, a portion of Rosh Hashanah and all of Yom Kippur sales occurred in the fourth quarter of 2008.
Interest and dividend income was $526,000 in the first nine months of 2009 compared to $2,056,000 for the same period in 2008. The decrease is partially due to significantly lower interest rates as a result of the current financial crisis. In addition, the Company’s cash available for investment was significantly lower during the first nine months of 2009 compared to the same period of the prior year due to a special cash dividend paid on December 8, 2008 totaling approximately $79,027,000.
The Company’s current cash position, including investments and net cash provided by operating activities, is the primary source of funds available to meet the Company’s capital expenditure and liquidity requirements. The Company’s cash position, including investments, at the end of the third quarter of 2009 was $32,209,000. The Company’s cash position was reduced by approximately $79,027,000 on December 8, 2008 when the Company paid its special cash dividend of twenty-five dollars ($25) per share on the Company’s Class A Common Stock. During the thirty-nine weeks ended October 3, 2009, the Company generated $18,166,000 of cash from operating activities compared to $19,787,000 in the same period of 2008. The decrease in net cash provided by operating activities reflects the lower net income earned in 2009 compared to the prior year.
As of October 3, 2009, management had authorized expenditures on incomplete projects for the purchase of property, plant and equipment which totaled approximately $1,157,000. The Company has an ongoing program to remodel existing supermarkets and to add new stores. During the first nine months of 2009, capital expenditures were $2,467,000.
A change in market prices exposes the Company to market risk related to its investments. As of October 3, 2009, all investments were classified as available-for-sale securities and totaled $22,942,000. A hypothetical 10% drop in the market value of these investments would result in a $2,294,000 unrealized loss and a corresponding decrease in the fair value of these instruments. This hypothetical drop would not affect cash flow and would not have an impact on earnings until the Company sold the investments.
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