Record sales help boost JP Foodservice's net income More acquisitions sought, CEO says

Food wholesalers

October 24, 1997|By Bill Atkinson | Bill Atkinson,SUN STAFF

JP Foodservice Inc.'s net income more than tripled to $6.9 million in its first fiscal quarter on record sales and operating earnings, the company said yesterday.

The Columbia-based food distributor said net income jumped 19 percent to 31 cents per share before nonrecurring charges in the quarter ended Sept. 27, compared with 26 cents for the same period a year earlier.

Income from operations rose nearly 28 percent to $16 million, up from $12.5 million. And net sales rose 13 percent to $468 million in the quarter, compared with $414.4 million in the same period a year earlier.

JP Foodservice's recent acquisitions of Arrow Paper and Mazo-Lerch accounted for net sales growth of 9 percent, the company said.

The company's stock fell 37.5 cents a share yesterday to close at $32.625.

Jim Miller, JP's chairman and chief executive, said that despite sluggish conditions in the industry, "we are encouraged by current trends in our street sales growth, which is now running 8 percent over last year."

Miller said company officials will continue "efforts to seek out new strategic acquisitions and are currently evaluating a number of prospects."

The company, which distributes food and other products to restaurants and institutional food service establishments, recently agreed to acquire Wilkes-Barre, Pa.-based Rykoff-Sexton Inc. in a stock swap valued at about $1.4 billion.

The move will more than quadruple its size and make it one of the biggest restaurant supply companies in the nation.

JP Foodservice this month signed a contract to become a key supplier for Compass Group USA Inc., a Charlotte, N.C.-based catering firm.

The three-year agreement has an estimated value of $240 million.

JP will provide food supplies to approximately 900 Compass Group locations.

Pub Date: 10/24/97

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