Ingles Markets Inc

Ingles Markets, Incorporated, a North Carolina corporation (collectively with its subsidiaries, "Ingles," or the "Company," "we," "us" or "our"), is a leading supermarket chain in the southeast United States and operates a total of 194 supermarkets in North Carolina (72), Georgia (64), South Carolina (35), Tennessee (21), Virginia (1) and Alabama (1), excluding three stores that remain temporarily closed due to damage sustained during Hurricane Helene.

On September 27, 2024, Hurricane Helene severely impacted western North Carolina, including the area where the Company’s headquarters are located, resulting in catastrophic flooding and destruction, power and communication outages, water outages, major road closures, and loss of life. For the year ended September 28, 2024, the Company recognized impairment losses of $30.4 million related to inventory and $4.5 million related to property and equipment, in each case that was damaged or destroyed by Hurricane Helene. These recorded losses do not include future repairs and rebuilds, nor did they account for revenue lost due to store closures or electronic payment disruptions.

The Company’s properties, including its distribution center, were impacted; however, the distribution center returned to full operation within two weeks following the storm. Four stores sustained damage that required that they be temporarily closed, of which, as of the date of this Annual Report on Form 10-K, three remain closed and are currently expected to reopen at various times during 2026 or in 2027. In addition, for the year ended September 27, 2025, the Company incurred approximately $9.0 million in cleanup and repair costs and received aggregate insurance proceeds of $6.2 million.

On July 4, 2025, the One Big Beautiful Bill Act ("OBBB") was signed into law. The OBBB reinstated several key income tax provisions that were initially part of the U.S. Tax Cuts and Jobs Act of 2017, but which have been phased out in recent years or were set to expire in 2025, and made other changes to income tax provisions, many of which are not effective until 2026. The OBBB, among other things, repealed the mandatory capitalization of domestic research and development expenditures under Internal Revenue Code Section 174, extended the ability to take 100% bonus depreciation, reinstituted the EBITDA based Section 163(j) calculation, revised international tax regimes, and accelerated the phase out of clean energy credits. The Company has evaluated the impact of the OBBB and does not believe it will have a material impact on its consolidated financial statements. The Company will continue to monitor future guidance and developments related to the OBBB and will update its income tax disclosures as appropriate.