Publix continues COVID-19 pandemic sales surge
LAKELAND — Publix Super Markets Inc. saw a pandemic-induced 22% increase in sales revenue for its second quarter that ended June 27.
The Lakeland-based regional supermarket chain, like its competitors, greatly benefited from the fact they were declared an essential business during the COVID-19 shutdown that extended into the second quarter and were allowed to remain open.
Publix reported quarterly sales revenue of $11.4 billion, a 21.8% increase from $9.3 billion in 2019. It estimated sales for the three months through June 27 increased approximately $1.5 billion or 16.1% due to the impact of the coronavirus pandemic.
Same-store sales for the quarter increased 20%. The key retail industry statistic measures sales at stores open at least one year, which factors out sales growth from recently opened supermarkets.
The company saw a second quarter profit of $1.4 billion, or $1.94 per share, more than double the $661.1 million profit, 92 cents per share, a year ago.
“Sales are up for everybody,” said David Livingston, a grocery industry analyst based in Hawaii. “These levels will probably stay as long as the pandemic is around.”
While every supermarket has benefited, Publix has performed above the industry average, roughly 15% increases in quarterly sales revenue, he said.
The second quarter profit also benefited from gains in Publix-held stocks, bonds and other investments. It gained $76 million on investments for the quarter compared to a $27.2 million in the second quarter 2019.
Excluding those investments in the second quarters this year and 2019, Publix would have posted a profit of $978.3 million ($1.39 per share) in the recently completed quarter, a 53.6% gain compared to $637 million (89 cents) in 2019.
The results represented good news to Publix stockholders, who saw an 8.5% increase to $54.35 per share on Saturday, up from $50.10 per share previously.
Publix stock is not publicly traded and is held by current and former employees, including members of the board of directors. Independent financial analysts determine the Publix stock prices based on a comparison of financial performance in a “peer group” of other supermarket chains: Ahold Delhaize, Kroger and Weis Markets.
The financial results for the first half of 2020 also benefited from the pandemic-induced economic surge.
Publix’s first-half sales reached $22.6 billion, a 19% increase from $19 billion in the first half of 2019. Same store sales increased 17%.
The company estimated sales for the six months rose approximately $2.5 billion, or 13%, because of the coronavirus pandemic.
The company reported a $2 billion profit ($2.89 per share) in this year’s first half, jumping 24% from $1.6 billion ($2.29 per share) in the same period last year.
After factoring out its investments, the first-half profit soared to $1.9 billion ($2.74 per share), a 40.3% increase from the adjusted profit of $1.4 billion ($1.92 per share) in 2019. Publix gained $76 million on investments during this year’s first half compared to a $34 million loss last year.
“Our associates’ efforts to serve our customers and communities have been remarkable,” Publix CEO Todd Jones said in the statement reporting the financial results. “I want to thank our associates for the comfort they bring to our customers and their fellow associates during this difficult time. It is heartwarming to see how much they care.”
Livingston predicted the pandemic sales increases will have legs even beyond the passing of COVID-19. The disease has caused a longer-lasting change in consumer lifestyles.
“If the coronavirus goes away tomorrow, people are going to say, ‘You know what, working at home is pretty good.’ And the companies will say working from home is OK,” Livingston said.
There could be a long-term increase in home schooling and consumers may be reluctant to return to restaurants, he added. All of which will result in more food consumption at home, boosting grocery sales.
Publix’s future also looks promising because of the company’s expansion along the East Coast to Virginia and North and South Carolina, Livingston said.
“Moving up the eastern seaboard is going to return big benefits,” he said. “The competition there is very mediocre.”
The statement also noted Publix has helped tenants in its company-owned shopping centers by offering two months of rent relief to those businesses impacted by the COVID-19 pandemic.
Kevin Bouffard can be reached at firstname.lastname@example.org or at 863-802-7591.
This story originally published to theledger.com, and was shared to other Florida newspapers in the USA TODAY Network - Florida.