Ingles Markets, Incorporated — Third Quarter and First Nine Months of Fiscal 2026 Earnings Summary

Financial Performance

• Net sales for the third quarter ended June 27, 2026, totaled $1.37 billion, up from $1.35 billion in the same period of fiscal 2025.
• Net sales for the nine months ended June 27, 2026, reached $4.05 billion, compared to $3.97 billion for the nine months ended June 28, 2025.
• Gross profit for the third quarter was $332.4 million (24.3% of sales), matching the 24.3% margin from the prior year quarter; gross profit for the nine months was $992.3 million (24.5% of sales), up from $939.4 million (23.7% of sales) in the prior year period.
• Operating and administrative expenses for the third quarter were $298.0 million, compared to $290.1 million in the prior year; for the nine months, expenses were $884.6 million versus $860.0 million.
• Interest expense for the third quarter was $4.5 million, down from $4.9 million in the prior year; for the nine months, it was $13.6 million compared to $14.7 million.
• Net income for the third quarter was $25.9 million, down slightly from $26.2 million in the prior year; for the nine months, net income was $78.3 million, a significant increase from $57.9 million.
• Basic and diluted earnings per share (Class A) for the nine months were $4.21 and $4.12, respectively, compared to $3.11 and $3.05 in the prior year period.
• Basic and diluted earnings per share (Class B) for the nine months were $3.83, compared to $2.83 in the prior year period.
• Total debt as of June 27, 2026, was $500.5 million, down from $518.0 million as of June 28, 2025.
• Cash and cash equivalents as of June 27, 2026, were $455.1 million, up from $366.2 million as of September 27, 2025.
• Capital expenditures for the nine months ended June 27, 2026, were $76.4 million, down from $91.4 million in the prior year period.

Guidance and Future Outlook

• Capital expenditures for the full fiscal year 2026 are expected to be approximately $120 million to $130 million.
• The Company believes its financial resources, including its $150.0 million line of credit and other internal and external funds, are sufficient to meet planned capital expenditures, debt service, and working capital requirements for the foreseeable future.
• Three stores temporarily closed due to Hurricane Helene damage are expected to reopen at various times in 2026 and 2027.

Business Segments and Product Lines

• The Company operates 195 supermarkets across six southeastern states.
• In addition to supermarkets, the Company operates neighborhood shopping centers, most of which contain an Ingles supermarket.
• The Company owns a fluid dairy facility that supplies both Ingles supermarkets and unaffiliated customers.

Market and Competitive Landscape

• The Company is identified as a leading grocer in its operating area.
• The press release notes general market risks including pricing pressures, online-based procurement competition, and inflation in food, labor, and gasoline prices.

Risks and Challenges

• Three stores remain closed due to damage from Hurricane Helene, with reopening timelines extending into 2026 and 2027.
• Forward-looking statements highlight risks such as business and economic conditions, labor shortages, product shortages, inflation, pricing pressures, and changes in gasoline availability and prices.
• Other risks include the maturation of new stores, food safety concerns, technology and data security management, and financing availability.

Management Commentary and Tone

• Robert P. Ingle II, Chairman of the Board, expressed pleasure with the results and thanked associates for their focus on customer experience, value, selection, and quality.
• The tone of the release is positive regarding financial results and operational resilience, particularly noting the reduction in debt and the sufficiency of financial resources.

Other Key Points

• As of June 27, 2026, the Company had no borrowings outstanding on its $150.0 million line of credit, with only a single letter of credit for $900,000 outstanding.
• The Company reported a gain from sale or disposal of assets of $401,000 for the nine months ended June 27, 2026, compared to $3.1 million in the prior year period.
• Depreciation and amortization expense for the nine months was $90.5 million, compared to $92.2 million in the prior year period.
• Rent expense for the nine months was $5.2 million, down from $5.5 million in the prior year period.