Segment Reporting

12 Months Ended

Dec. 28, 2024

Segment Reporting

Segment Reporting

Note 8Segment Reporting

The Company manages the business activities on a consolidated basis and has one operating segment: retail. The Company derives all its revenue from sales within Pennsylvania and surrounding states. The Company’s retail segment derives revenues from customers through the retail sale of a range of products including grocery, pharmaceutical and fuel from company owned supermarkets. See Note 7 for the disaggregation of revenue by product category. The accounting policies of the Company’s single segment are the same as those described in the Company’s Significant Accounting Policies.

The Company’s chief operating decision maker is the Chief Operating Officer. The chief operating decision maker assesses performance for the segment and decides how to allocate resources based on operating income and net income that is also reported on the accompanying Consolidated Statements of Income. The measure of segment assets used to assess performance and allocate resources is reported on the Consolidated Balance Sheets as total assets. The chief operating decision maker uses operating income and net income to evaluate income generated from segment assets in deciding whether to reinvest profits into the segment, such as for acquisitions. Operating income and net income are used to monitor budget versus actual results. The chief operating decision maker also uses operating income and net income in competitive analysis by benchmarking to the Company’s competitors. The competitive analysis along with the monitoring of budgeted versus actual results are used in assessing performance of the segment.

Note 8Segment Reporting (continued)

The following table presents the retail segment’s revenue, significant segment expenses, and segment operating and net income for the years ended December 28, 2024, December 30, 2023, and December 31, 2022:

(amounts in thousands)	2024		2023		2022
Net sales	$	4,773,880	$	4,696,950	$	4,695,943
Other revenue (1)		17,850		17,623		18,043
Total revenue		4,791,730		4,714,573		4,713,986
Less:
Cost of sales - stores		3,508,283		3,491,616		3,471,725
Labor - stores		425,333		410,681		408,149
Depreciation and amortization - stores (2)		90,890		88,508		85,389
Occupancy - stores		85,872		84,345		81,756
All other expense - stores (3)		312,690		276,197		270,536
Administration, manufacturing, and property management expense		125,785		118,412		145,790
Distribution and transportation		111,161		107,626		93,589
Income from operations		131,715		137,186		157,052
Other income (expense) (4)		(3,409)		(3,652)		3,807
Investment income (loss) and interest expense		21,970		13,162		(82)
Provision for income taxes		40,334		42,868		35,581
Net income	$	109,941	$	103,828	$	125,196

(1) Other revenue represents commission income as described in Note 1.

(2) Segment depreciation and amortization expense, for stores and non-stores, for the years ended December 28, 2024, December 30, 2023 and December 31, 2022 was $114 million, $108 million and $104 million respectively. Segment additions of long-lived assets for the years ended December 28, 2024, December 30, 2023 and December 31, 2022 was $169 million, $104 million and $122 million respectively.

(3) All other expense consists of all other store controllable and fixed expenses, such as financial services fees, utilities, and outside services.

(4) Other income (expenses) consists of gains (losses) on SERP investments.