Dive Brief:

• Publix expects capital spending to total $2 billion in 2022, according to the company’s recent 10-K filing — a 55% increase over the nearly $1.3 billion it spent last year. 
• Publix reported $48 billion in fiscal year 2021 sales, up 7% from its total the previous year. Comparable store sales for the year, which ended on Dec. 25, 2021, increased 5.4%, mainly due to increased product costs.
• The Lakeland, Florida-based company’s stock price increased from $66.40 per share to $68.80 per share, effective March 1. Publix’s stock is not publicly traded and is only available to employees and executives. 

Dive Insight:

Publix is stepping up its capital expenditures budget as its growth moderates and it continues its push into new states while also defending its stronghold markets in the Southeast.

The company said in its 10-K filing that it expects to spend $2 billion this year to build new supermarkets, remodel existing stores, build or maintain warehouses, invest in information technology and buy or develop shopping centers where its stores operate.

That spending figure could end up being less than projected. Publix projected capital expenditures to total $1.6 billion in 2021 but ended up spending more than $300 million less than that, according to its recent filing.

In 2021, Publix opened 45 new supermarkets and remodeled 134 locations while closing 16 stores. All told, Publix operates 1,293 stores and nine primary distribution warehouses across its seven-state operating footprint. It's in the process of building a tenth distribution center in Greensboro, North Carolina. 

Last fall, Publix announced it will open stores in Kentucky in 2023. That comes on the heels of its push up the East Coast, including expansion over the past few years into Virginia, where it currently operates 19 stores. 

Publix's spending increase comes as the sales of the pandemic have moderated and inflation has taken hold in the industry. Although Publix’s net sales growth moderated significantly from the double-digit increase it recorded in 2020, its net earnings for 2021 increased to $4.4 billion. 

In addition to its net sales growth, Publix reported $4.4 billion in net earnings for 2021, up from the $4 billion profit it logged in 2020. Gross margin for 2021 was 27.7%, compared to 27.9% in 2020. After excluding the last-in, first-out (LIFO) reserve effect, the decrease was primarily due to increased shrink and distribution costs, the company said. 

In Publix’s fiscal fourth quarter, which comprised the three months that ended on Dec. 25, 2021, the company reported $12.6 billion in net sales, up 12.4% over the same period a year ago. Comparable sales during the period increased 10.5%.