INGLES MARKETS INC Segments Disclosure
The reportable segments were determined based on information reviewed by the Company’s CODM for operational decision-making purposes, and the segment information is prepared on the same basis that the CODM reviews such financial information. The Company operates one primary business segment, retail grocery sales (representing the aggregation of individual retail stores) and includes four categories of product sales: grocery, non-foods, perishables and fuel. The “All Other” segment includes the results of non-reportable segments, fluid dairy and shopping center rentals, which do not meet both quantitative and qualitative criteria as defined under ASC 280, Segment Reporting. In fiscal year 2025, expense allocation methodology changed to include direct and indirect costs associated with the shopping center rentals that were previously included in the retail segment. Fiscal years 2024 and 2023 were recast to be comparable. The CODM utilizes operating income to assess the Company’s operating performance and to make decisions about allocating resources to each segment. The CODM does not review assets in evaluating results. Therefore, such information is not provided. The Company’s President and Chief Executive Officer is the CODM. The accounting policies are the same as those described in the summary of significant accounting policies.
The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM. For fiscal year ended September 28, 2024, income from operations for the primary business segment, retail grocery sales, included the charges for impairment losses from Hurricane Helene of $34.9 million.
A reconciliation of net income (amounts in thousands):
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| 2025 |
| 2024 |
| 2023 | |||
Retail grocery revenue |
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Grocery (1) |
| $ | 1,934,445 |
| $ | 1,983,198 |
| $ | 2,062,416 |
Non-foods (2) |
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| 1,167,586 |
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| 1,273,324 |
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| 1,326,907 |
Perishables (3) |
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| 1,404,687 |
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| 1,441,039 |
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| 1,482,089 |
Fuel |
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| 620,924 |
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| 724,230 |
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| 792,524 |
Total retail grocery revenue |
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| 5,127,642 |
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| 5,421,791 |
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| 5,663,936 |
All other revenue |
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| 206,391 |
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| 217,818 |
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| 228,846 |
Total revenues from unaffiliated customers |
| $ | 5,334,033 |
| $ | 5,639,609 |
| $ | 5,892,782 |
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Total retail grocery revenue |
| $ | 5,127,642 |
| $ | 5,421,791 |
| $ | 5,663,936 |
Less retail grocery expenses: |
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Merchandise costs (4) |
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| 3,913,286 |
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| 4,151,150 |
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| 4,325,262 |
Salary and wages |
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| 578,132 |
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| 590,921 |
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| 577,319 |
Insurance costs |
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| 56,515 |
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| 54,875 |
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| 39,311 |
Repair and maintenance |
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| 91,761 |
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| 81,136 |
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| 78,416 |
Bank charges |
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| 60,019 |
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| 62,164 |
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| 61,712 |
Depreciation and amortization |
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| 94,242 |
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| 93,384 |
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| 90,391 |
Utilities |
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| 61,466 |
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| 63,819 |
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| 61,344 |
Other retail grocery expenses (5) |
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| 171,685 |
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| 158,400 |
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| 158,961 |
Impairment loss (6) |
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| — |
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| 34,957 |
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| — |
Retail grocery operating income |
| $ | 100,536 |
| $ | 130,986 |
| $ | 271,220 |
Other operating income (7) |
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| 17,044 |
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| 16,159 |
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| 21,084 |
Other income |
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| 12,068 |
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| 14,217 |
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| 8,269 |
Interest |
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| 19,710 |
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| 21,860 |
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| 22,068 |
Taxes |
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| 26,345 |
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| 33,960 |
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| 67,693 |
Net income |
| $ | 83,593 |
| $ | 105,541 |
| $ | 210,812 |
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(1)The “Grocery” category includes grocery, dairy, and frozen foods.
(2)The “Non-foods” category includes alcoholic beverages, tobacco, pharmacy, and health/beauty/cosmetic products.
(3)The “Perishable” category includes meat, produce, deli and bakery.
(4)Merchandise costs include product costs, net of discounts and allowances, warehousing, distribution and freight.
(5)Other retail grocery expenses includes supplies, taxes and licenses, advertising, professional fees and other expenses.
(6)Impairment loss includes inventory impairment of $30.4 million and asset impairment of $4.5 million, in each case recognized as a result of damage sustained during Hurricane Helene.
(7)Other operating income includes operating income from shopping center rentals, fluid dairy and the gain or loss on the disposal of fixed assets.
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.