On this page of StockholderLetter.com we present the latest annual shareholder letter from Natural Grocers by Vitamin Cottage, Inc. — ticker symbol NGVC. Reading current and past NGVC letters to shareholders can bring important insights into the investment thesis.
NATURAL GROCERS BY VITAMIN COTTAGE, INC.
2024 ANNUAL REPORT
2024 ANNUAL REPORT
DEAR FELLOW STOCKHOLDERS:
Fiscal 2024 was an outstanding year for Natural Grocers. We achieved record    nancial performance including net
sales of $1.24 billion and diluted earnings per share of $1.47. The daily average comparable store sales increase
was 7.0%, and 10.6% on a two-year basis. We are particularly pleased with the balanced nature of our sales growth
in    scal 2024, including increases in transaction counts and items per transaction, modest price in   ation and the
sales contribution from new stores. Furthermore,    scal 2024 marked our twenty-   rst consecutive year of positive
daily average comparable store sales growth. The year   s robust sales growth, combined with effective expense
management, resulted in operating leverage, which generated a year-over-year operating margin improvement of 100
basis points and a 44.1% increase in diluted earnings per share.
Our strong    scal 2024 results underscore our customers    appreciation for our commitment to the exceptional quality,
compelling value proposition and convenience provided by our innovative business model and merchandising
strategy. Additionally, we continue to bene   t from consumers    increasing prioritization of products that support
health and sustainability. Our marketing initiatives consistently reinforce Natural Grocers    distinct position in the
marketplace by emphasizing our differentiated offering and affordable pricing, which have been instrumental in
driving customer engagement and our strong sales performance.
We would like to thank every member of our Natural Grocers good4U   Crew for their commitment to operational
execution and exceptional customer service. They have been essential to our sustained success.
UPDATE ON KEY INITIATIVES
Our success in 2024 was driven by progress on key initiatives, which we believe will continue to provide meaningful
growth opportunities in the future.
We continue to leverage our {N}power   rewards program to drive customer loyalty and engagement with a focus on
re   ning the personalization, frequency and range of our offers. Additionally, we are pleased with customers    adoption
of our mobile app, originally launched in August 2023, which provides {N}power members with enhanced access to
exclusive offers, digital coupons, recipes and articles. We believe these enhancements collectively drove the
{N}power net sales penetration of 79%, up from 76% a year ago, and were a major contributor to our broad-based
sales growth.
We believe that our Natural Grocers   brand products represent premium quality at compelling prices and are a key
point of differentiation. In    scal 2024, our brand products continued to experience elevated sales growth, accounting
for 8.5% of total sales, up from 7.9% a year ago. We launched 80 new Natural Grocers brand products during the year,
including organic aged parmesan cheese, and a line of organic, gluten-free cereals.
Store unit growth and development continues to be a priority for our company. During    scal 2024 we opened four
new stores, and relocated or remodeled four stores. In    scal 2025 we expect to open four to six new stores, and
relocate or remodel two to four stores. Over the next several years we are targeting a return to opening between six
and eight new stores per year, subject to real estate opportunities and improving construction conditions.
CASH DIVIDENDS
Based on the Company   s strong    nancial results and focus on returning capital to our stockholders, in November
2024 our Board of Directors increased the quarterly cash dividend by 20% to $0.12 per common share. Since initiating
the dividend in 2019, and including the dividend paid in December 2024, the Company has cumulatively returned
$110 million in capital to our stockholders through $4.88 of cumulative cash dividends per common share.
LOOKING AHEAD
Considering    scal 2025 and beyond, we believe we have opportunity for growth from our alignment with consumer
trends, strong customer engagement through our {N}power rewards program, expansion of our line of Natural
Grocers    brand products, new store development, and driving existing store productivity.
We take great pride in our sustained and balanced growth in    scal 2024 and over the past several years. As we
look forward to    scal year 2025, we expect to build upon our momentum by executing to our founding principles,
leveraging our differentiated model and emphasizing operational excellence to drive pro   table growth. We remain
committed to maximizing value for our stockholders.
2
KEMPER ISELY, CO -PRESIDENT
ZEPHYR ISELY, CO -PRESIDENT
 • shareholder letter icon 1/24/2025 Letter Continued (Full PDF)
 • stockholder letter icon 1/19/2023 NGVC Stockholder Letter
 • stockholder letter icon 1/25/2024 NGVC Stockholder Letter
 • stockholder letter icon More "Grocery & Drug Stores" Category Stockholder Letters
 • Benford's Law Stocks icon NGVC Benford's Law Stock Score = 64


NGVC Shareholder/Stockholder Letter Transcript:

NATURAL GROCERS BY VITAMIN COTTAGE, INC.
2024 ANNUAL REPORT

2024 ANNUAL REPORT
DEAR FELLOW STOCKHOLDERS:
Fiscal 2024 was an outstanding year for Natural Grocers. We achieved record    nancial performance including net
sales of $1.24 billion and diluted earnings per share of $1.47. The daily average comparable store sales increase
was 7.0%, and 10.6% on a two-year basis. We are particularly pleased with the balanced nature of our sales growth
in    scal 2024, including increases in transaction counts and items per transaction, modest price in   ation and the
sales contribution from new stores. Furthermore,    scal 2024 marked our twenty-   rst consecutive year of positive
daily average comparable store sales growth. The year   s robust sales growth, combined with effective expense
management, resulted in operating leverage, which generated a year-over-year operating margin improvement of 100
basis points and a 44.1% increase in diluted earnings per share.
Our strong    scal 2024 results underscore our customers    appreciation for our commitment to the exceptional quality,
compelling value proposition and convenience provided by our innovative business model and merchandising
strategy. Additionally, we continue to bene   t from consumers    increasing prioritization of products that support
health and sustainability. Our marketing initiatives consistently reinforce Natural Grocers    distinct position in the
marketplace by emphasizing our differentiated offering and affordable pricing, which have been instrumental in
driving customer engagement and our strong sales performance.
We would like to thank every member of our Natural Grocers good4U   Crew for their commitment to operational
execution and exceptional customer service. They have been essential to our sustained success.
UPDATE ON KEY INITIATIVES
Our success in 2024 was driven by progress on key initiatives, which we believe will continue to provide meaningful
growth opportunities in the future.
We continue to leverage our {N}power   rewards program to drive customer loyalty and engagement with a focus on
re   ning the personalization, frequency and range of our offers. Additionally, we are pleased with customers    adoption
of our mobile app, originally launched in August 2023, which provides {N}power members with enhanced access to
exclusive offers, digital coupons, recipes and articles. We believe these enhancements collectively drove the
{N}power net sales penetration of 79%, up from 76% a year ago, and were a major contributor to our broad-based
sales growth.
We believe that our Natural Grocers   brand products represent premium quality at compelling prices and are a key
point of differentiation. In    scal 2024, our brand products continued to experience elevated sales growth, accounting
for 8.5% of total sales, up from 7.9% a year ago. We launched 80 new Natural Grocers brand products during the year,
including organic aged parmesan cheese, and a line of organic, gluten-free cereals.
Store unit growth and development continues to be a priority for our company. During    scal 2024 we opened four
new stores, and relocated or remodeled four stores. In    scal 2025 we expect to open four to six new stores, and
relocate or remodel two to four stores. Over the next several years we are targeting a return to opening between six
and eight new stores per year, subject to real estate opportunities and improving construction conditions.
CASH DIVIDENDS
Based on the Company   s strong    nancial results and focus on returning capital to our stockholders, in November
2024 our Board of Directors increased the quarterly cash dividend by 20% to $0.12 per common share. Since initiating
the dividend in 2019, and including the dividend paid in December 2024, the Company has cumulatively returned
$110 million in capital to our stockholders through $4.88 of cumulative cash dividends per common share.
LOOKING AHEAD
Considering    scal 2025 and beyond, we believe we have opportunity for growth from our alignment with consumer
trends, strong customer engagement through our {N}power rewards program, expansion of our line of Natural
Grocers    brand products, new store development, and driving existing store productivity.
We take great pride in our sustained and balanced growth in    scal 2024 and over the past several years. As we
look forward to    scal year 2025, we expect to build upon our momentum by executing to our founding principles,
leveraging our differentiated model and emphasizing operational excellence to drive pro   table growth. We remain
committed to maximizing value for our stockholders.
2
KEMPER ISELY, CO -PRESIDENT
ZEPHYR ISELY, CO -PRESIDENT



shareholder letter icon 1/24/2025 Letter Continued (Full PDF)
 

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