CARY, N.C. -- The Pantry convenience store chain continued its site disposition program in the last three months of 2011, closing 25 underperforming stores and selling 22 of them to new dealer customers.
"This resulted in $2.1 million in proceeds, and we expect $900,000 in improvement in EBITDA as a result," CFO Mark Bierley said on a first-quarter earnings call yesterday.
"We're continuing to market approximately 35 properties with modifications in the offering to make them more attractive to perspective buyers," he added. "We hope to close on additional transactions in the second and third quarters, and expect to generate proceeds in excess of $2 million based on the locations we currently have a firm interest in [from buyers]."
The store sales are part of The Pantry's goal of raising its "investment hurdle" on stores to ensure the chain is working with the best stores and best locations.
An early version of the program led the chain to put 114 stores up for sale through NRC Realty, Chicago. With that sale complete, Pantry executives continue to consider whether another collection of stores should be put on the auction block.
"We're also currently marketing 86 surplus properties with an estimated fair value of $25 million," Bierley said. "To date, we've sold 10 sites for $3.5 million, including three transactions in the first quarter totaling $1.4 million."
Based in Cary, N.C., The Pantry Inc. is the leading independently operated convenience-store chain in the southeastern United States and one of the largest independently operated convenience store chains in the country. As of February 3, 2012, the company operated 1,618 stores in 13 states under select banners, including Kangaroo Express, its primary operating banner.
(See Related Content below for previousCSP Daily News coverage.)
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