Shareholders received some good news late Monday, when Winn Dixie (WINN) released better than expected third quarter results and ramped up guidance. Its shares soared more than 12% in after hours trading after smashing earnings estimates of 12 cents, by delivering a "awe inspiring" 159% beat of 30 cents. The company also ratcheted up its fiscal 2009 EBITDA outlook range substantially – lifting the bottom of its prior range to $145 million (a 32% increase) and its top end to $152 million (a 22% increase).

Operational improvement evident: WINN’s gross profit margin improved 90 basis points from 28% to 28.9% due to beneficial product mix changes, lower transportation outlays and reduced LIFO costs. Identical store sales increased .2%, aided by a 4.5% transaction count gain coupled with a 5.3% basket size increase. On the negative side, the company’s operating and administrative expense category went the wrong way, increasing 50 basis points from 26.6% to 27.1% on higher payroll and utility costs. WINN’s income tax rate didn’t help matters either, spiking 250 basis points from 40.9% to 43.4%

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