Natural Grocers by Vitamin Cottage (NGVC) Q1 2026 earnings summary

Executive summary

• Net sales for the first quarter of fiscal 2026 rose 1.6% year-over-year to $335.6 million, with daily average comparable store sales up 1.7% and diluted EPS up 14% to $0.49.

• Two-year comparable sales growth reached 10.6%, outpacing the broader grocery retail industry.

• Adjusted EBITDA increased 3.1% to $23.5 million, and EBITDA rose 6.2% to $22.6 million.

• Operates 168 stores in 21 states, specializing in natural and organic groceries, dietary supplements, and body care products as of December 31, 2025.

• One store was relocated during the quarter; one closure in Austin, Texas, with no further closures expected this year.

Financial highlights

• Gross profit was $98.9 million, with gross margin down 40 basis points to 29.5% due to higher inventory shrink from isolated events.

• Operating income rose 9.7% to $14.6 million; net income increased 14% to $11.3 million.

• Store expenses decreased 0.7% to $73.0 million; administrative expenses fell 5.9% to $10.8 million.

• Adjusted EBITDA margin was 7.0% for Q1 2026, up from 6.9% in Q1 2025.

• Free cash flow for the quarter was $11.6 million, with $23.2 million in cash and no outstanding borrowings.

Outlook and guidance

• Fiscal 2026 guidance affirmed: 6 to 8 new stores, 2 to 3 relocations/remodels, daily average comparable store sales growth of 1.5% to 4.0%, diluted EPS of $2.00 to $2.15, and capital expenditures of $50 to $55 million.

• Sales comps expected at the low end of the range in Q2, improving in the second half as comps ease.

• Gross margin and store expenses as a percentage of net sales anticipated to remain relatively flat year-over-year.

• Approximately $0.12 of diluted EPS to be invested in new store openings due to higher preopening and store expenses.

• Targets annual new store unit growth rate of 4–5% for the foreseeable future.