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Strong Q4 sales keep 99 Cents a hot commodity

BY Gail Hoffer

CITY OF COMMERCE, Calif. — Even with an extra week in this year’s reporting period, 99 Cents Only Stores reported a total sales increase for it fiscal fourth quarter. The company reported total sales of $378.5 million for the 14-week fourth quarter of fiscal 2011 ended April 2, 2011, compared with $339.3 million for the 13-week fourth quarter in the prior fiscal year.

The company reported a same-store sales increase of 0.5% for the quarter. Excluding Texas operations, comps were up 0.7%.

Eric Schiffer, CEO, commented, "Our fourth quarter same-store sales growth was 0.5%, on a comparable 13-week basis, which was in line with our expectations. We are encouraged that our same-store sales improved compared to the third quarter of fiscal 2011."

99 Cents Only said it opened five stores during the fourth quarter. This includes three in California, one in Arizona and the re-opening of one company-owned store in Texas. The gross and saleable retail square footage at the end of the fourth quarter were 6.05 million and 4.76 million, respectively. This represents an increase of 3.3% for each of gross and saleable square footage and an increase of 3.6% in the store count over last year, based on 285 stores, the company reported.

For fiscal 2011, the company reported that total sales were $1.4 billion, compared with $1.35 billion for the prior-year period. Same-store sales for fiscal 2011 increased 0.7% compared with the same period in the prior fiscal year. For the company’s non-Texas operations, same-store sales increased 0.8% in fiscal 2011.

Last month, 99 Cents Only received a buyout offer from Leonard Green & Partners. If the company continues to produce strong sales, 99 Cents could remain attractive to potential buyers.

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Ralphs, Food 4 Less raise more than $100K for Japan earthquake relief

BY Allison Cerra

LOS ANGELES — Two Kroger banners have raised funds to benefit Japan earthquake and tsunami victims.

Ralphs and Food 4 Less said they raised more than $100,000 for the American Red Cross’ International Response Fund for its Japan relief efforts. The retailers hosted a fundraising campaign that ran from March 21 through April 9.

"The magnitude of our fundraising effort really speaks to the commitment and generosity of our customers and associates," said Mike Donnelly, president of Ralphs. "It is our hope that our donations will help the Red Cross provide much-needed assistance to the victims and families of the Japanese earthquake and tsunami."

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Despite divestment, expect innovation for brands GSK holds on to

BY Michael Johnsen

WHAT IT MEANS AND WHY IT’S IMPORTANT — Duh, winning! Because there are no losers in this. GlaxoSmithKline will be able to funnel its extensive marketing dollars into a stable of poised-to-explode brands, niche marketers can take those brands being sold and breathe fresh marketing life into them and retailers now benefit most of all because a greater portfolio of brands are being marketed with gusto.

(THE NEWS: GSK announces divestment of OTC brands. For the full story, click here.)

For GSK, it means a chance to focus. For example, with growing attention paid to wellness and healthcare plans that put more onus on patients to change such bad behaviors as smoking, the Nicorette brand is poised for more growth. On the oral care side, Sensodyne is re-emerging as a brand powerhouse for aging boomers whose gum lines are receding and teeth sensitivity is an issue.

And if the rule is that older remedies make way for — and lose market share to — newly switched-from-Rx medicines, then Tums is the exception that proves that rule. Because Tums continues to grow, innovate and extol its value to the consumer, despite the introduction of H2 blockers almost a decade ago and, more recently, proton-pump inhibitors.

Expect innovation to keep coming out of the brands that GSK keeps.

And there are niche manufacturers that are going to get bigger and better out of this, too. Just look at what Meda has accomplished in the past quarter: They’ve grown into a company that now owns iron between Bifera, Feosol and the legacy brand Geritol (and its iron tonic), and can claim a stake within cough-cold with Contac and within energy with Vivarin. For the GSK brands now up for sale, a niche marketer will give these other brands a better chance to thrive and grow as they become priorities for the small and mid-size company or companies that will buy them.

And for the retailer, this means nothing gets lost in the shuffle. More choice equals larger market baskets. And with the focus you can expect from both GSK on its remaining brands and niche marketers on their newly acquired ones, retailers can expect plenty of traffic-driving activity that’ll put Mom in front of that shelf to choose in the first place.

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