On November 16, 2023, Natural Grocers by Vitamin Cottage Inc (NGVC, Financial) released its 8-K filing, announcing its financial results for the fourth quarter and full fiscal year ended September 30, 2023. The company reported a 20th consecutive year of positive comparable store sales growth and record earnings, alongside a special cash dividend declaration of $1.00 per common share.
Fiscal 2023 Fourth Quarter and Full Year Highlights
NGVC's fourth quarter saw a robust increase in net sales by 7.6% to $295.1 million, driven by a 6.9% rise in daily average comparable store sales and a 3.6% increase in daily average transaction count. For the full fiscal year, net sales climbed 4.7% to $1,140.6 million, with daily average comparable store sales up by 3.6%. The company attributes these gains to its differentiated business model, effective pricing, promotions, and marketing initiatives that have resonated with consumers.
Gross profit for the fourth quarter increased 11.3% to $84.3 million, with gross margin improving by 100 basis points to 28.6%. For the fiscal year, gross profit rose 7.2% to $326.9 million, with a gross margin increase to 28.7%. Operating income for the fourth quarter was $7.7 million, and $31.7 million for the fiscal year, maintaining an operating margin of 2.8% for both periods.
Net income for the fourth quarter reached $5.9 million, or $0.26 diluted earnings per share, compared to $2.2 million, or $0.09 diluted earnings per share, for the same period last year. The fiscal year net income stood at $23.2 million, or $1.02 diluted earnings per share, up from $21.4 million, or $0.94 diluted earnings per share, in the previous year.
Financial Position and Dividend Announcement
As of September 30, 2023, NGVC had a solid financial position with $18.3 million in cash and cash equivalents, no outstanding borrowings on its $50.0 million revolving credit facility, and $7.7 million outstanding on its term loan facility. The company generated $64.6 million in cash from operations and invested $38.0 million in net capital expenditures during fiscal 2023.
Reflecting the company's strong operating trends and financial position, NGVC's Board of Directors declared a special cash dividend of $1.00 per common share, in addition to a quarterly cash dividend of $0.10 per common share, to be paid on December 13, 2023, to stockholders of record as of November 27, 2023.
Store Expansion and Fiscal 2024 Outlook
NGVC continued its growth trajectory by opening one new store and relocating/remodeling two stores in the fourth quarter, ending with 165 stores. Since September 30, 2023, two additional stores have been opened, and leases for two more have been signed for future openings.
For fiscal 2024, NGVC anticipates opening 4-6 new stores and undertaking 4-6 relocations/remodels, with daily average comparable store sales growth projected at 2.0% to 4.0%. Diluted earnings per share are expected to be between $1.00 and $1.10, with capital expenditures estimated at $30 to $39 million.
NGVC's continued focus on its founding principles and operational excellence has led to another year of positive financial results and strategic growth. The company's commitment to quality products at affordable prices and its robust marketing initiatives continue to drive customer engagement and shareholder value.
Explore the complete 8-K earnings release (here) from Natural Grocers by Vitamin Cottage Inc for further details.
