The Pantry reported first-quarter earnings early Thursday that beat Wall Street estimates.
Excluding the impact of impairment charges, the Cary convenience store chain reported a net loss of $4.6 million, or 20 cents per share, compared with a net loss of $1.7 million, or 8 cents per share in the first quarter of 2013.
That was a narrower loss than the $5.94 million, or 26 cents per share, loss that was the consensus among analysts who cover the company, according to Bloomberg.
The Pantry continues to work to offset declines in fuel sales at its stores with increased merchandise sales. The company’s fuel gross profit was $48.7 million in the first quarter, down from $49.2 million during the same period a year ago. Comparable store fuel gallons were also down 4 percent.
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But comparable store merchandise revenue increased 3.5 percent in the quarter, and The Pantry’s sales per customer were up 4.1 percent.
“These encouraging results were supported by continued progress upgrading our store base,” said CEO Dennis Hatchell in a statement. The company opened one new store and completed remodeling 28 others during the quarter.
On a conference call with analysts, Hatchell said excluding cigarettes, the company’s comparable store sales were up 5.4 percent.
“Our merchandise and promotional activities are resonating with our customers and showing up across most of our product categories,” he said.
The Pantry has 1,541 stores throughout the Southeast, primarily under the Kangaroo Express brand.
The company’s latest earnings report comes as a group of dissident shareholders are seeking to get three independent candidates elected to The Pantry’s Board of Directors.
JCP Investment Management and Lone Star Value Management, which own about 1.9 percent of The Pantry’s outstanding shares, argue that the Cary convenient store chain is undervalued and needs better corporate governance.
Pantry officials have said the candidates should not be nominated to serve on the company’s board, saying the current executive team is executing the company’s strategy.
The Pantry shares closed Thursday at $15.87, down 46 cents. The stock is up 29 percent over the past year.