Safeway Beats Profit Forecasts, Shares Fall

by Christopher Freeburn | October 11, 2012 10:27 am

Safeway Beats Profit Forecasts, Shares Fall

Safeway (NYSE:SWY[1]) announced on Thursday that it earned $157 million during the third quarter, up 21% from $130.2 million in the same period last year. Adjusted EPS was 45 cents, which topped the 43 cents that Wall Street was looking for, the Associated Press noted.

Quarterly earnings were¬†boosted by a $49 million after-tax gain from the sales of its Genuardi’s-branded stores. Excluding that gain, Safeway earned $108 million during the quarter.

The supermarket operator recorded revenue of $10.05 billion, down slightly from $10.06 billion in 2011.

Investors weren’t pleased with the results. Shares of Safeway dropped more than 4% in Thursday morning trading.

Sames-store sales increased by 0.1% in the quarter. Safeway has introduced a new customer loyalty program called “just for U.” It’s designed to stem shopper defections to discount retailers like Wal-Mart (NYSE:WMT[2]) and Target (NYSE:TGT[3]).

Endnotes:
  1. SWY: http://studio-5.financialcontent.com/investplace/quote?Symbol=SWY
  2. WMT: http://studio-5.financialcontent.com/investplace/quote?Symbol=WMT
  3. TGT: http://studio-5.financialcontent.com/investplace/quote?Symbol=TGT

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