Ruddick Corporation (NYSE:RDK) today reported that consolidated sales for fiscal 2008 increased by 9.7% to $3.99 billion from $3.64 billion in fiscal 2007. Consolidated sales for the fiscal fourth quarter ended September 28, 2008 increased by 8.8% to $1.03 billion from $0.94 billion in the fourth quarter of fiscal 2007. The increase in consolidated sales for the year was attributable to sales increases of 11.1% at Harris Teeter, the Company’s supermarket subsidiary, that were partially offset by sales declines of 3.6% at American & Efird (“A&E”), the Company’s sewing thread and technical textiles subsidiary. The increase in consolidated sales during the quarter was driven by sales increases of 10.2% at Harris Teeter that were partially offset by sales declines of 5.8% at A&E.

The Company reported consolidated net income of $96.8 million, or $2.00 per diluted share for fiscal 2008, an increase of 19.9% from the $80.7 million, or $1.68 per diluted share reported for fiscal 2007. Consolidated net income for the fiscal fourth quarter ended September 28, 2008, was $24.8 million, or $0.51 per diluted share, an increase of 17.2% from the $21.2 million, or $0.44 per diluted share, in the fourth quarter of fiscal 2007. The increase in net income over the prior fiscal year and quarterly period was driven by improved operating profit at the Company’s subsidiaries and a lower effective income tax rate realized in fiscal 2008. Income tax expense for fiscal 2008 included refund claims related to prior years of approximately $2.4 million associated with A&E’s foreign operations.

Harris Teeter sales for fiscal 2008 increased by 11.1% to $3.66 billion from $3.30 billion in fiscal 2007. Sales for the fourth quarter of fiscal 2008 were $948.8 million, an increase of 10.2% from the $861.1 million in the fourth quarter of fiscal 2007. The increase in sales was attributable to incremental new stores and comparable store sales increases of 2.86% for the year and 2.16% for the fourth quarter. During fiscal 2008, Harris Teeter opened 15 new stores, closed 3 older stores (2 of which were replaced by new stores) and completed the major remodeling of 7 stores (4 of which were expanded in size). The Company operated 176 stores at September 28, 2008.

Operating profit at Harris Teeter for fiscal 2008 was $177.8 million (4.85% of sales), an increase of 15.4% from $154.1 million (4.67% of sales) in fiscal 2007 (an improvement of 18 basis points). For the fourth quarter of fiscal 2008, operating profit was $42.6 million (4.49% of sales), an increase of 5.2% from $40.5 million (4.71% of sales) in the prior year period (a reduction of 22 basis points).

Operating profit was impacted by new store pre-opening costs of $15.4 million (0.42% of sales) and $17.9 million (0.54% of sales) in fiscal 2008 and 2007, respectively. Pre-opening costs for the fiscal fourth quarter of 2008 and 2007 were $3.8 million (0.40% of sales) and $4.4 million (0.51% of sales), respectively. New store pre-opening costs fluctuate between reporting periods depending on the new store opening schedule and market location.

Harris Teeter’s operating profit improved primarily as a result of increased sales. The sales increases, along with a continued emphasis on operational efficiencies and overhead cost containment during this time of expansion, have provided leverage to offset the incremental costs associated with Harris Teeter’s new store program (pre-opening costs and incremental start-up costs), increased LIFO expense, fuel and cost of petroleum-based supplies, associate benefit costs, credit and debit card fees, and store occupancy costs.

Thomas W. Dickson, Chairman of the Board, President and Chief Executive Officer of Ruddick Corporation stated, “We are pleased with our results for both the quarter and fiscal year, especially during these times of economic uncertainty. As consumer confidence has fallen in recent weeks and customers continue to change their shopping habits, the coming months will continue to present challenges in regards to the trend of our same store sales. We continue to refine our merchandising strategies to respond to the changing environment and remain focused on our new store expansion and remodeling programs.”

A&E sales for fiscal 2008 decreased by 3.6% to $327.6 million from $339.8 million in fiscal 2007. Foreign sales accounted for approximately 55% and 54% of A&E sales in fiscal 2008 and fiscal 2007, respectively. Sales for the fourth quarter of fiscal 2008 were $77.7 million, a decrease of 5.8% from the $82.5 million in the fourth quarter of fiscal 2007.

Operating profit at A&E for fiscal 2008 was $2.3 million, an increase of 63.6% from $1.4 million in fiscal 2007. For the fourth quarter ended September 28, 2008, A&E realized operating profit of $0.5 million as compared to a $0.3 million operating loss in the fourth quarter of fiscal 2007. Management continues to rationalize A&E’s operations in the Americas and focus on providing best-in-class service to its customers, while expanding its product lines throughout A&E’s supply chain.

Dickson said, “The current economic environment throughout the globe has created an even more challenging retail environment for A&E’s customers. We remain committed to our strategic plans that will transform A&E’s business to a more Asian-centric global supplier of sewing thread, embroidery thread and technical textiles. As part of these plans, on April 7, 2008 we completed the previously announced joint venture with Vardhman Textiles Limited (“Vardhman”), to manufacture, distribute and sell sewing thread for industrial and consumer markets within India and for export markets. Subsequent to year end and in accordance with the original joint venture agreement, A&E increased its ownership interest in Vardhman to 49%. A&E has already realized the benefits of this joint venture and we are very excited about the opportunity to grow the business together in this important region of Asia. We will continue to evaluate A&E's structure to best position A&E to take advantage of opportunities available through its enhanced international operations.”

Capital expenditures for the consolidated Ruddick Corporation for fiscal 2008 totaled $199.5 million and depreciation and amortization totaled $114.4 million. Total capital expenditures for the year ended September 28, 2008, were comprised of $192.2 million for Harris Teeter and $7.3 million for A&E. During fiscal 2008, Harris Teeter made an additional net investment of $19.0 million ($22.7 million additional investments less $3.7 million received from property investment sales and partnership returns) in connection with the development of certain of its new stores. Additionally, A&E invested $24.1 million in connection with its joint venture with Vardhman.

Harris Teeter’s improvement in operating performance over the last several years and financial position provide the flexibility to continue with its store development program for new and replacement stores along with the remodeling and expansion of existing stores. During fiscal 2009, Harris Teeter plans to open 17 new stores (2 of which will be replacements for existing stores) and complete 4 major remodels (1 of which will be expanded in size). The new store development program for fiscal 2009 is expected to result in a 9.8% increase in retail square footage as compared to an 8.5% increase in fiscal 2008. The Company routinely evaluates its existing store operations in regards to its overall business strategy and from time to time will close or divest underperforming stores.

Harris Teeter’s new store program for fiscal 2009 calls for the continued expansion of its existing markets, including the Washington, D.C. metro market area which incorporates northern Virginia, the District of Columbia, southern Maryland and coastal Delaware. Real estate development by its nature is both unpredictable and subject to external factors including weather, construction schedules and costs. Any change in the amount and timing of new store development would impact the expected capital expenditures, sales and operating results.

Fiscal 2009 consolidated capital expenditures are planned to total approximately $247 million, consisting of $241 million for Harris Teeter and $6 million for A&E. Such capital investment is expected to be financed by internally generated funds, liquid assets and borrowings under the Company’s revolving line of credit which provide substantially more liquidity than what we expect to be required. In addition to the fiscal 2009 planned capital expenditures, A&E invested an additional $8.7 million in the first quarter of fiscal 2009 in connection with its increased investment in Vardhman.

The Company’s management remains cautious in its expectations for fiscal 2009 due to the current economic environment and its impact on our customers. The Company will continue to refine its merchandising strategies to respond to the changing shopping demands as a result of the challenging economic environment. The retail grocery market remains intensely competitive and the textile and apparel environment faces additional challenges during this recessionary period. Further operating improvement will be dependent on the Company’s ability to continue to increase Harris Teeter’s market share, rationalize A&E’s operations, offset increased operating costs with additional operating efficiencies, and to effectively execute the Company’s strategic expansion plans.

This news release may contain forward-looking statements that involve uncertainties. A discussion of various important factors that could cause results to differ materially from those expressed in such forward-looking statements is shown in reports filed by the Company with the Securities and Exchange Commission and include: generally adverse economic and industry conditions; changes in the competitive environment; economic or political changes in countries where the Company operates; changes in federal, state or local regulations affecting the Company; the passage of future tax legislation, or any negative regulatory or judicial position which prevails; management's ability to predict the adequacy of the Company's liquidity to meet future requirements; volatility of financial and credit markets which would affect access to capital for the Company; changes in the Company's expansion plans and their effect on store openings, closings and other investments; the ability to predict the required contributions to the Company's pension and other retirement plans; the Company’s requirement to impair recorded goodwill; the cost and availability of energy and raw materials; the continued solvency of third parties on leases the Company guarantees; the Company’s ability to recruit, train and retain effective employees; changes in labor and employer benefits costs, such as increased health care and other insurance costs; the Company’s ability to successfully integrate the operations of acquired businesses; the extent and speed of successful execution of strategic initiatives; and, unexpected outcomes of any legal proceedings arising in the normal course of business. Other factors not identified above could cause actual results to differ materially from those included, contemplated or implied by the forward-looking statements made in this news release.

Ruddick Corporation is a holding company with two primary operating subsidiaries: Harris Teeter, Inc., a leading regional supermarket chain with operations in eight states along the eastern seaboard and the District of Columbia, and American & Efird, Inc., one of the world’s largest global manufacturers and distributors of industrial sewing thread, embroidery thread and technical textiles.

Selected information regarding Ruddick Corporation and its subsidiaries follows. For more information on Ruddick Corporation, visit our web site at: www.ruddickcorp.com.

Ruddick Corporation
John B. Woodlief, Vice President – Finance
and Chief Financial Officer, 704-372-5404