Fairway Group Holdings Corp (NASDAQ:FWM) Gets Downgraded
A slew of bad news has buffeted the stock of Fairway Group Holdings Corp (NASDAQ:FWM) ever since it announced disappointing 3Q results on 6th February. Following the worse than expected dip in operational profits, the stock also suffered 3 parallel downgrades from analyst houses on the same day on 7th February, as a result of the bleak outlook. The $344 million market capped grocery retailer also announced that the departure of its CEO Herb Ruetsch citing personal and family reasons.
Mr Ruetsch would be replaced by another long serving of Fairway Group Holdings Corp (NASDAQ:FWM) veteran Bill Sanford who has been anointed as the interim CEO. He is currently serving as the president of the company and has been in the role since 2012.
Huge Dip In Income
Fairway Group Holdings Corp (NASDAQ:FWM), which positions itself as a “iconic, growing specialty food retail powerhouse, serving some 20 million customer annually in the tri-state area” reported a net loss of 74 cents per share for the 3Q, which was way over the 3 cents per share loss that analyst were expecting the firm to report. While the income slid, the profitability inched upwards, for the quarter, in comparison to the huge $4.2 loss that it had reported in 3Q12. Revenue for the penultimate quarter of its fiscal 2013 was also up 23 percent to reach $205 million.
Disappointing Holiday Season Sales
Fairway Group Holdings Corp (NASDAQ:FWM), Executive Chairman of the Board Charles W. Santoro who faced the press post the earnings call has been quoted to have said that, “While our business faced a number of headwinds during the quarter including a tougher comparison over last year, the compressed holiday shopping season and a generally softer retail backdrop, we remain excited about our long-term growth prospects. Same-store sales decreased 1.7%. The fall in sales was due to a compressed holiday shopping period and the beneficial impact of Sandy in the year earlier due to a pre- and post-storm stock-up.”