Grocery Outlet Holding Corp (NASDAQ:GO) Q2 2020 Earnings Conference Call - Final Transcript

Aug 10, 2020 • 04:30 pm ET

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Grocery Outlet Holding Corp (NASDAQ:GO) Q2 2020 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Greetings, and welcome to Grocery Outlet's fiscal second quarter 2020 earnings results conference call. [Operator Instructions] It is now my pleasure to introduce your host, Joseph Pelland, Vice President of Investor Relations. Thank you. You may begin.

Executive
Joseph Pelland

Thank you. Good afternoon, everyone, and thank you for joining us on today's call to discuss Grocery Outlet's second quarter financial results.

Participants on this call will make forward-looking statements which are subject to various risks and uncertainties that could cause our actual results to differ materially from these statements. Any such items, including our outlook for fiscal 2020 and future performance, should be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. A description of these factors can be found in this afternoon's press release, as well as in our latest prospectus and periodic reports we file with the SEC, all of which may be found on our website at investors.groceryoutlet.com or on sec.gov. We undertake no obligation to revise or update any forward-looking statements or information.

During our call, we may reference certain non-GAAP financial information, including adjusted items. Reconciliations of GAAP to non-GAAP measures, as well as the description, limitations and rationale for using each measure may be found in the supplemental financial tables included in this afternoon's press release, in our SEC filings and the investors tab of our website. We reference non-GAAP measures in some of our financial discussions as we believe they more accurately represent the true operational performance and underlying results of our business.

Presenting on today's call will be Grocery Outlet's Chief Executive Officer, Eric Lindberg; President, RJ Sheedy; and Chief Financial Officer, Charles Bracher. Following our prepared remarks, we will open the call for questions.

With that, I'll turn it over to Eric.

Executive
Eric Lindberg

Thanks Joe. Good afternoon, everyone. I hope you and your families remain safe and well. Approximately one year ago today, we conducted our first earnings call as a public company. We are very pleased to have delivered strong and consistent financial performance since our IPO. We're equally proud of our ability to navigate the unprecedented challenges and opportunities presented by COVID-19 in recent months.

I'm also extremely proud of our hard work, dedication, community support that has been demonstrated across our organization. This includes our IOs and their store associates, who've worked tirelessly on the front lines to serve our customers and our communities; our distribution center teams, who went above and beyond to help us keep product flowing; our purchasing teams, who leveraged our strong relationships to source both opportunistic and everyday products, enabling us to deliver great values to our customers. I'm so, so grateful for all of their commitment.

Looking at our second quarter results, our performance reflects the strong execution across our organization. Revenue growth of 24.5% was driven by a 16.7% increase in comparable store sales and sales from 32 new store openings since June of last year. Adjusted EBITDA grew 34.7%, reflecting gross margin expansion, slightly offset by modest SG&A