Pantry earnings exceed expectations

Bolstered by the recent sharp decline in oil prices and cost-cutting measures it has taken, The Pantry Inc. said this morning that its fourth-quarter and fiscal year earnings exceeded expectations and the company's 2007 performance.

The results were so good that President Pete Sodini said the company can now consider making new acquisitions, something that had been tabled earlier this year as the economy soured.

"Our strong fourth quarter results, together with our capital spending reductions during the year, enabled us to deliver free cash flow of approximately $55 million for fiscal 2008. The retail environment clearly remains challenging, but with our ample liquidity and improved profitability, we believe we are well-positioned to again consider strategic ‘tuck-in’ acquisitions in our regional markets that we believe will be accretive for our shareholders,” Sodini said in a statement today.

For the quarter ended Sept. 25, the Pantry reported sales of $2.5 billion, up 24.5 percent from the fourth quarter of 2007. Income was $22.9 million, or $1.03 per share, up from $5.6 million and 25 cents per share in the fourth quarter of 2007.

For the fiscal year, the Pantry's revenue was $9 billion, up 30.2 percent from 2007. Net income also rose to $31.8 million or $1.43 per share. In 2007, the Pantry reported earnings of $26.7 million and $1.17 per share.

The Pantry owns and operates more than 1,600 gas stations throughout the Southeast, including the Kangaroo brand chain.