EMERYVILLE, Calif. - Grocery Outlet Holding Corp. (NASDAQ: NASDAQ:GO), a leading extreme value retailer of quality, name-brand consumables, announced the appointment of Eric Lindberg as Interim President and CEO, effective immediately. Lindberg, who previously led the company as CEO or co-CEO from January 2006 to December 2022, replaces RJ Sheedy following his resignation.
Lindberg's return comes as the company disclosed preliminary financial results for the third quarter of 2024, with net sales expected to reach $1.1 billion, marking a 10.4% increase compared to the same period last year. Comparable store sales have seen a more modest rise of 1.2%. While the company anticipates meeting its third-quarter earnings guidance, it is revising its full-year adjusted EBITDA guidance to fall below the previously stated range of $252.0 to $260.0 million, despite expecting to exceed its full-year net sales guidance of $4.30 to $4.35 billion.
The company, with a history spanning nearly 80 years, attributes its growth to a differentiated business model that has led to significant expansion and returns. During Lindberg's previous tenure, Grocery Outlet's store count and net sales saw substantial increases, and the company transitioned from a family-owned business to a publicly traded entity in 2019.
The Board has initiated a search for a permanent CEO with the assistance of a global executive search firm. In the interim, Lindberg will focus on executing the company's strategy and working with employees, independent operators, and supplier partners to realize Grocery Outlet's potential.
The financial update provided by Grocery Outlet is based on preliminary data and subject to change upon completion of closing and review procedures. These figures have not been reconciled to GAAP due to the unpredictable impact of taxes and non-recurring items. The company will issue a comprehensive update on its full-year guidance and final third-quarter earnings on Tuesday, November 5, 2024.
This news article is based on a press release statement from Grocery Outlet Holding Corp.
In other recent news, Grocery Outlet Holding Corp. posted robust Q2 2024 results, registering a 12% increase in sales and a 2.9% rise in comparable store sales, with net sales hitting $1.13 billion. This performance is attributed to the successful integration of the recently acquired United Grocery Outlet, and the launch of a personalization app, downloaded over 700,000 times. The company also launched its private label program, GO Brands, set to introduce 100 new products by year-end, as part of its ongoing efforts to diversify product offerings.
Grocery Outlet's expansion plans continue, with 10 new stores opened in Q2, totaling 524 locations. The company aims to open up to 64 new stores this year, with net sales for fiscal 2024 predicted to be between $4.3 billion to $4.35 billion.
On the analyst front, Loop Capital has initiated coverage on Grocery Outlet shares with a Hold rating, expressing a cautious stance due to the company's current challenges, including systems integration issues and heightened competition. Goldman Sachs, on the other hand, maintained its Sell rating on Grocery Outlet shares, emphasizing the company's unique business model and growth trajectory.
These recent developments reflect Grocery Outlet's commitment to growth and its ability to adapt to market fluctuations. The company's future expectations are based on these facts and the analysis provided by the analyst firms.
InvestingPro Insights
As Grocery Outlet Holding Corp. (NASDAQ: GO) navigates through this leadership transition and financial update, InvestingPro data provides additional context to the company's current position.
Despite the recent leadership change and revised EBITDA guidance, Grocery Outlet's financial health appears stable. An InvestingPro Tip indicates that the company's liquid assets exceed short-term obligations, suggesting a solid financial foundation as it moves forward under interim leadership.
The company's revenue growth remains positive, with InvestingPro data showing a 11.71% quarterly revenue growth in Q2 2024. This aligns with the preliminary Q3 2024 results mentioned in the article, which reported a 10.4% increase in net sales.
However, investors should note that according to another InvestingPro Tip, GO's stock price has fallen significantly over the last three months, with data showing a -21.17% price return over that period. This decline may reflect market reactions to the company's recent challenges and leadership changes.
For a more comprehensive analysis, InvestingPro offers 14 additional tips for Grocery Outlet Holding Corp., providing investors with deeper insights into the company's financial health and market position during this transitional period.
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