Arden Group Inc. (ARDNA) filed Quarterly Report for the period ended 2010-04-03.
Arden Group Inc. has a market cap of $295.4 million; its shares were traded at around $93.48 with a P/E ratio of 13.6 and P/S ratio of 0.7. The dividend yield of Arden Group Inc. stocks is 1.1%. Arden Group Inc. had an annual average earning growth of 9.3% over the past 10 years.ARDNA is in the portfolios of Chuck Royce of Royce& Associates, Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:Same store sales from the Companys eighteen supermarkets (all of which are located in Southern California), including revenue from licensing arrangements, subleases, leases and finance charges, were $104,777,000 during the first quarter of 2010 compared to $108,847,000 in the first quarter of 2009. The 3.7% decrease in sales reflects the negative impact of current economic conditions and competition in our trade area. Sales in the first quarter of 2010 included sales from Easter and Passover which did not occur until the second quarter of 2009. Consequently, the decrease in sales in the first quarter of 2010 compared to the same period of the prior year would have been greater if these holiday sales had occurred in the same quarter of both fiscal 2010 and 2009. The impact of these holiday sales was somewhat offset by the recognition of revenue related to gift card breakage of $432,000 during the first quarter of 2009 which related to prior periods. See Note 1 under Notes to Condensed Consolidated Financial Statements for further information regarding gift cards and certificates.
SG&A expense as a percent of sales was 30.3% in the first quarter of 2010 compared to 30.4% in the same period of 2009. The decrease in SG&A expense as a percent of sales is due to a decrease in SARs compensation expense during the first quarter of 2010 compared to the same period of the prior year. During the first quarter of 2010, the Company reversed $602,000 of SARs compensation expense recognized in prior periods due to the exchange of SARs discussed above partially offset by an increase in the fair value of SARs outstanding as of the end of the quarter and additional vesting. During the first quarter of 2009, the Company reversed $192,000 of SARs compensation expense recognized in prior periods. SG&A expense also decreased as a percent of sales due to a reduction in labor hours. The decrease in SG&A expense as a percent of sales was significantly offset by increases in UFCW health & welfare costs as discussed above, as well as an increase in advertising expenditures in an effort to draw more customers into our stores.
The Companys current cash position, including investments and net cash provided by operating activities, is the primary source of funds available to meet the Companys capital expenditure and liquidity requirements. The Companys cash position, including investments, at the end of the first quarter of 2010 was $47,986,000. During the thirteen weeks ended April 3, 2010, the Company generated $10,958,000 of cash from operating activities compared to $11,549,000 in the same period of 2009. The decrease in net cash provided by operating activities reflects the lower net income earned during the first quarter of 2010 compared to the same period of the prior year.
As of April 3, 2010, management had authorized expenditures on incomplete projects for the purchase of property, plant and equipment which totaled approximately $1,763,000. The Company has an ongoing program to remodel existing supermarkets and to add new stores. During the first quarter of 2010, capital expenditures were $277,000.
On April 20, 2010, the Company paid a regular quarterly cash dividend of $0.25 per share of Class A totaling approximately $790,000 to stockholders of record on March 31, 2010.
A change in market prices exposes the Company to market risk related to its investments. As of April 3, 2010, all investments were classified as available-for-sale securities and totaled $33,350,000. A hypothetical 10% drop in the market value of these investments would result in a $3,335,000 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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