SpartanNash Co (SPTN)·Q2 2025 Earnings Summary

Executive Summary

• Q2 2025 delivered modest top-line growth (+1.8% YoY to $2.271B) with improved profitability on an adjusted basis; adjusted EPS of $0.54 beat consensus, while revenue slightly missed .
• Wholesale gross margin rate improved and recent retail acquisitions supported segment mix; reported EPS fell to $0.18 due to merger costs, higher D&A, organizational realignment, and incentive comp .
• Management withdrew FY25 guidance and did not host a quarterly call given the pending acquisition by C&S; the transaction at $26.90 per share is expected to close in late 2025 and remains the chief stock catalyst .
• Balance sheet metrics improved sequentially: net long-term debt/adjusted EBITDA declined to 2.7x vs 2.9x in Q1; YTD operating cash flow was $112.6M and $15.5M was returned via dividends .

What Went Well and What Went Wrong

What Went Well

• Adjusted profitability improved: adjusted EBITDA rose to $68.7M (+6.5% YoY), and adjusted EPS of $0.54 benefited from gross margin expansion and cost savings .
• Retail acquisitions lifted segment mix: Retail net sales +12.8% to $762.9M, supported by incremental sales from acquired stores .
• Management focus and execution: “delivered strong profitability driven by cost savings and expanded margins… energized by the opportunity to deliver even greater value” — Tony Sarsam, President & CEO .

What Went Wrong

• Reported earnings compressed: diluted EPS fell to $0.18 from $0.34 YoY, reflecting merger-related costs, higher D&A, organizational realignment, and incentive compensation .
• Wholesale volume pressure: Wholesale net sales declined 3.0% YoY to $1.508B on lower case volumes in national accounts and elimination of intercompany sales to newly acquired stores .
• Retail comps softened: comparable store sales decreased 0.5% due to lower unit volumes, offset by acquisition contribution .

Financial Results

Notes: Margins calculated from reported net sales, gross profit, and adjusted EBITDA; figures cited above for components.

Segment Breakdown

KPIs (Q2 2025 and YTD context)

Guidance Changes

Earnings Call Themes & Trends

Note: The company did not host a Q2 2025 earnings call due to the pending C&S transaction .

Management Commentary

• “I’m proud of our team’s continued focus and efforts to execute on the strategic plan, which delivered strong profitability driven by cost savings and expanded margins. Our performance remains ahead of our expectations as we work to maximize shareholder value.” — Tony Sarsam, President & CEO
• “Closing the C&S transaction remains a top priority, and we are energized by the opportunity to deliver even greater value to hometown grocery stores and shoppers across the country.” — Tony Sarsam
• Prior quarter framing: “Posting another quarter of growth and achieving record adjusted EBITDA in the first quarter… strong Wholesale margins, positive comps, increased sales from recent Retail acquisitions.” — Tony Sarsam
• Year-end framing: “Third consecutive year of record adjusted EBITDA… margin-enhancing programs delivered a year ahead of schedule… integrating recently acquired grocery and c-store businesses.” — Tony Sarsam

Q&A Highlights

• No Q2 2025 earnings call was held; therefore, no Q&A or guidance clarifications were provided .

Estimates Context

Values retrieved from S&P Global.*

Implications:

• EPS beat reflects margin expansion and cost savings even as non-cash expenses weighed on reported EPS; revenue miss aligns with Wholesale volume headwinds and elimination of intercompany sales to acquired stores .

Key Takeaways for Investors

• Adjusted profitability resilient: margin expansion and cost actions drove adjusted EPS/EBITDA improvement despite revenue softness and elevated non-cash costs .
• Mix shift benefits from acquisitions: Retail net sales growth from acquired stores offset soft comps; watch for integration progress and comp trajectory normalization .
• Wholesale volume remains the swing factor: national accounts case volumes pressured sales; military channel helped; volume recovery is a key variable for revenue beats .
• Balance sheet progressing: net LT debt/adj. EBITDA improved to 2.7x; continued cash generation supports flexibility while the transaction is pending .
• Corporate action dominates near-term narrative: the $26.90/share cash acquisition expected late 2025 creates a valuation anchor and likely caps-volatility absent regulatory/closing surprises .
• Lack of FY25 guidance and no call reduce near-term information flow; model updates should center on segment mix, margin durability, and expense normalization .
• Dividend continuity maintained ($0.22 declared Aug 28); capital returns continue alongside transaction process .

Supporting Detail and Notes

• Q2 revenue $2.271B (+1.8% YoY), net earnings $6.2M, diluted EPS $0.18; adjusted EPS $0.54; adjusted EBITDA $68.7M .
• Segment results: Wholesale net sales $1.508B (operating earnings $18.0M); Retail net sales $0.763B (operating earnings ~$0.1M) .
• YoY drivers: acquisitions (Retail), improved Wholesale gross margin rate; headwinds from national accounts case volumes and eliminated intercompany sales to acquired stores .
• Operating cash flow YTD $112.6M; capex+IT YTD $56.2M; net LT debt/adj. EBITDA 2.7x; dividends returned $15.5M in Q2 .
• No Q2 call or FY25 guidance due to pending C&S transaction; transaction expected to close late 2025 .