Safeway income down 36% in quarter

by FoodBusinessNews.net Staff
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PLEASANTON, CALIF. — Net income for Safeway, Inc. fell 36% during the third quarter, led lower by softer sales.

For the quarter ended Sept. 12, net income was $128.8 million, equal to 31c per share on the common stock, down from $199.7 million, or 46c per share, during the same quarter of the previous year. Revenue during the quarter was $9,458.3 million, down 7% from $10,169.3 million during the same quarter of the previous year.

"Safeway’s sales remained soft, driven largely by deflation in dairy, produce and meat, and a sluggish economy," said Steve Burd, chairman, president and chief executive officer. "However, we are encouraged that our household and transaction counts increased in the quarter and that volume trends continue to improve. In addition, our year-to-year free cash flow of $865 million is up $366 million, or 73%, over last year. In this difficult economy, we are working diligently to lower costs and meet the needs of our customers with high quality products, lower everyday prices and attractive club card specials."

For the nine months ended Sept. 12, the company had net income of $511.6 million, or $1.22 per share, down 18% from $627.4 million, or $1.44 per share, during the same period of the previous year. Revenue during the period was $28,156.8 million, down 7% from $30,288.1 million during the same period of the previous year.

The company has given an earnings guidance for 2009 of $1.70 to $1.90 per share.

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