The Pantry downgrades guidance for fiscal 2007
The Pantry, Inc. (Nasdaq: PTRY), a convenience store chain operator in the southeastern United States, said this morning that it expects its fourth quarter and full fiscal year earnings to be below previous expectations due to lower than anticipated gasoline gross margins.
Based on preliminary data, the small cap said it expects its retail gasoline gross margin for the fourth fiscal quarter to be between $0.10 and $0.105 per gallon, bringing its fiscal year 2007 retail gasoline margin to approximately $0.109 per gallon, substantially below the previously expected $0.115 per gallon.
Accordingly, The Pantry expects earnings per share for the fourth quarter and the full fiscal year to also be below previous expectations.
The company also provided guidance for fiscal 2008. Given current near-record oil prices and volatile gas margins, The Pantry is broadening its target range for retail gasoline margins in fiscal 2008 to between $0.11 and $0.13 per gallon. Excluding potential acquisitions, the company said it expects merchandise sales to grow about 10% to approximately $1.7 billion and retail gasoline gallons to grow about 11% to approximately 2.3 billion gallons.
Shares of The Pantry (PTRY) slid $1.68, or 5.86%, to $27.00 just ahead of the opening.
