Having bought time from its lenders, organic and natural grocery chain Planet Organic has posted increased sales but a deeper net loss in its fiscal 2009.
The Edmonton company, which operates Planet Organic Market, Sangster’s, Healthy’s and Mrs. Green’s Natural Market stores in Canada and the U.S., on Wednesday reported a net loss of $3.31 million on $127.67 million in sales for 2009, up from a $228,000 loss on $113.97 million in sales in 2008.
“We are glad to report that same store sales growth in our two largest divisions was positive this past year, despite the tough economic conditions both in Canada and the U.S.,” co-CEO Darren Krissie said in a release, referring to the Planet Organic and Mrs. Green’s stores, which together account for about 88 per cent of total revenue.
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Planet Organic Market, which has 10 stores in Canada, posted total overall sales growth of 11.3 per cent at $61 million, while Mrs. Green’s, which has 11 U.S. stores, reported sales up 18 per cent at C$51.7 million.
Pre-tax losses, meanwhile, were primarily driven by a foreign exchange loss of $2.3 million on conversion of U.S.-denominated debt and accrued interest on the senior convertible notes payable, the company said.
“Additionally, with the depreciation of the Canadian dollar against the U.S. dollar for much of the year, the company incurred additional interest expense on long-term debt.”
“Despite the losses, Planet continues to be confident in its position and ability to capitalize when the economy recovers,” Krissie said.
Also, he said, “with forbearance agreements now in place, Planet continues to work closely with its lenders towards achieving resolution of the covenant breaches to assure Planet’s position as a leading organic and natural products retailer.”
The company announced earlier this month that it had reached a forbearance agreement with TD Bank and New York-based financier Ares Capital Corp., in which the two lenders would hold off for 60 days on “enforcing their rights and remedies with respect to credit defaults.”
