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Ruddick Corporation & Subsidiaries Annual Report 2006 1
Dear Shareholders:
Fiscal 2006 was another successful year for our Company in terms of sales
and earnings growth. Our continued success can be attributed, in many ways, to our
commitment to customer service and quality. This commitment dictates how we run
our businesses, from recruiting new associates to the processes we use to evaluate
our operations and, most importantly, our customers’ satisfaction. As part of our
commitment to customer service and quality, we accelerated our growth plans for Harris
Teeter and continued the transformation of American & Efird during this past year.
We are pleased to report our fiscal 2006 results, which were:
» Net sales increased 10.2% to $3.27 billion from $2.96 billion;
» Operating profit increased 6.8% to $123.1 million from $115.3 million;
» Net income increased 5.4% to $72.3 million from $68.6 million; and
» Earnings per share on a diluted basis increased 5.6% to $1.52 from $1.44.
The cash provided by these results, along with financing available under a new
revolving credit facility we successfully negotiated in June 2006, provide the capital
necessary to continue to grow our Harris Teeter supermarket business and expand the
global operations of American & Efird.
During fiscal 2006, Harris Teeter expanded within its existing markets through
the opening of sixteen new supermarkets, including the six stores we acquired from
Winn-Dixie in fiscal 2005 and completely remodeled prior to their opening. In
addition, we continue to invest in our existing store base through our comprehensive
remodeling program. We remodeled six existing supermarkets in 2006, two of which
were expanded in size.
Next year is expected to be another significant year for Harris Teeter’s store
growth. Currently we plan to open twenty-two new stores, including two replacements,
and remodel eleven supermarkets during fiscal 2007. Six of the eleven stores to be
remodeled in 2007 will be enlarged to better serve our customers. Our effort to
Letter to Our Shareholders
Thomas W. Dickson, Chairman of the Board,
President and Chief Executive Officer