Marsh Supermarkets, Inc. Third Quarter Results of Operations Reports EBITDA up 14%

INDIANAPOLIS, Indiana, UNITED STATES


INDIANAPOLIS, Feb. 20, 2001 (PRIMEZONE) -- Marsh Supermarkets, Inc. (Nasdaq:MARSA) (Nasdaq:MARSB) reports results of operations for the 12 weeks ended January 6, 2001.

Sales and other revenues for the third quarter were $429,817,000 -- up 2.4% from the prior year's $419,582,000. For the quarter, net income was $3,835,000 compared to $3,256,000 last year. Earnings per diluted share were $0.42 versus $0.35 last year -- a 20% increase. During the quarter, the Company revised the estimated useful lives used to depreciate building, leaseholds and land improvements and wrote-off its minority interest in an investment. The result increased net income by $303,000.

Operating income was $12,092,000 compared to $9,973,000 last year -- a 21.2% improvement. This is the eighteenth consecutive quarter of operating income improvement.

For the quarter, EBITDA was $18,893,000 compared to $16,583,000 last year -- a 13.9% improvement.

"We are extremely pleased with this quarter's results," said Don E. Marsh, Chairman and CEO of Marsh Supermarkets, Inc. "Not only is this our eighteenth consecutive quarter of operating income improvement, we are particularly delighted with our 14% increase in EBITDA, an important measurement for our bond investors." EBITDA is earnings before interest, taxes, depreciation and amortization.

The Company continues to invest in new stores and, as a result, interest expense was $5,529,000 versus $5,075,000 last year.

To date, the Company has spent $11.9 million of the $12.0 million authorized under the previously announced stock repurchase plan. The Board of Directors has authorized the repurchase of up to an additional $3.0 million of common stock. The ability of the Company to complete the repurchase, in whole or in part, is subject to known and unknown risks and uncertainties.

During the quarter, Marsh opened two new upscale supermarkets. Village Pantry opened an acquired store, a replacement store, a new store and a fuel kiosk on a supermarket parking lot.

Subsequent to quarter end, Village Pantry acquired three convenience stores and McNamara Florist opened a new retail location.

Marsh is a leading regional chain operating 72 Marsh(r), 27 LoBill Foods(r), 35 pharmacies, 187 Village Pantry(r) convenience stores and two Savin*$(r) limited selection, every-day low-price stores. The Company also operates Convenience Store Distributing Company, a wholesale distributor serving 1,005 non-affiliated stores in seven states; Crystal Food Service(tm), a specialist in catering, business cafeteria management, vending, office coffee and concessions; Primo Banquet catering and Conference Centers; and McNamara Florist, and Enflora(r) -- Flowers for Business.

Cautionary Note Regarding Forward-Looking Statements. This report includes certain forward-looking statements (statements other than those made solely with respect to historical fact). Actual results could differ materially and adversely from those contemplated by the forward-looking statements due to known and unknown risks and uncertainties. The forward-looking statements and the Company's future results, liquidity and capital resources are subject to the following risks and uncertainties: softness in the general retail food industry, the entry of new competitive stores and e-retailers in the Company's market, adverse developments regarding customer retention, the ability to predict the impact of the revision in the estimated useful lives of building and land improvements, the impact of any acquisitions or dispositions, the stability of distribution incentives from suppliers, the level of discounting by competitors, the timely and on budget completion of store construction, expansion, conversion and remodeling, the ability to complete authorized share repurchases, the successful integration of acquisitions, uncertainties relating to tobacco and environmental regulations, and the level of margins achievable in the Company's operating divisions and their ability to minimize operating expenses. The Company undertakes no obligation to update or revise any forward-looking statements to reflect subsequent events or circumstances.


                             MARSH SUPERMARKETS, INC.
                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                      (In thousands, except per share amounts)
                                   (Unaudited)

                          12 Weeks Ended          40 Weeks Ended
                        Jan. 6,     Jan. 1,      Jan. 6,     Jan. 1,
                         2001        2000         2001         2000
                         ----        ----         ----         ----
 Sales and other
  revenues            $  429,817   $  419,582  $1,467,071  $1,348,451
 Cost of merchandise
  sold, including
  warehousing and
  transportation         316,980      316,453   1,100,637   1,018,190
                         -------      -------   ---------   ---------
 Gross profit            112,837      103,129     366,434     330,261
 Selling, general
  and administrative      95,548       87,209     312,301     280,751
 Depreciation              5,197        5,947      19,801      19,620
                         -------      -------   ---------   ---------
 Operating income         12,092        9,973      34,332      29,890
 Interest and debt
  cost amortization        5,529        5,075      19,158      16,506
                         
 Other non-operating
  (income) expense           811           13       1,000    (    113)
                         -------      -------   ---------   ---------
 Income before
  income taxes             5,752        4,885      14,174      13,497
 Income taxes              1,917        1,629       4,723       4,344
                         -------      -------   ---------   ---------
 Net income           $    3,835   $    3,256   $   9,451   $   9,153
                         =======      =======   =========   =========

 Earnings per
  common share        $      .47   $      .39   $    1.15   $    1.10
                         =======      =======   =========   =========

 Earnings per
  common share -
  assuming dilution   $      .42   $      .35   $    1.05   $    1.00
                         =======   ==========   ==========   ========
 Dividends per
  share               $      .11   $      .11   $     .33   $     .33
                         =======   ==========   ==========   ========

                            MARSH SUPERMARKETS, INC.
                    CONDENSED CONSOLIDATED BALANCE SHEETS
                               (In thousands)
                                 (Unaudited)
 
                                    January 6,        January 1,
                                       2001              2000
                                       ----              ----
 Assets
 Current assets:
  Cash and equivalents               $ 34,927          $ 30,912
  Accounts receivable                  43,012            38,567
  Inventories, less LIFO
   reserve: January 6, 2001
   - $8,593;
   January 1, 2000 - $11,979          133,288           120,272
  Prepaid expenses                      5,809             6,124
  Recoverable income taxes                --              1,190
                                     --------          --------
   Total current assets               217,036           197,065
 Property and equipment,
   less allowances for
   depreciation                       307,156           298,871
 Other assets                          53,362            54,501
                                     --------          --------
                                     $577,554          $550,437
                                     ========          ========
 
 Liabilities and Shareholders' Equity
  Current liabilities:
  Notes payable to bank              $    600          $   --
  Accounts payable                     89,502            77,296
  Accrued liabilities                  60,330            53,132
  Current maturities of 
  long-term liabilities                 2,786             3,228
                                     --------          --------
   Total current liabilities          153,218           133,656
 
 Long-term liabilities:
   Long-term debt                     244,565           244,407
   Capital lease obligations           13,885            14,367
                                     --------          --------
  Total long-term liabilities         258,450           258,774
 
 Deferred items:
   Income taxes                        12,883            12,103
   Other                               16,269            14,447
                                     --------          --------
        Total deferred items           29,152            26,550
 
 Shareholders' Equity:
  Common stock, Classes A and B        25,593            25,449
  Retained earnings                   124,065           115,183
  Cost of common stock
   in treasury                      (  10,964)       (    6,941)
  Deferred cost -
    restricted stock                (   1,036)       (    1,769)
  Notes receivable - 
  stock options                     (     924)       (      465)
                                     --------          --------
    Total shareholders' equity        136,734           131,457
                                     --------          --------
                                     $577,554          $550,437
                                     ========          ========


        

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