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Grocery chain Safeway’s profit up 77 percent

Grocery store chain Safeway Inc. said Thursday its fourth-quarter profit climbed 77 percent on higher revenue and a tax gain.
/ Source: The Associated Press

Grocery store chain Safeway Inc. said Thursday its fourth-quarter profit climbed 77 percent on higher revenue and a tax gain.

Quarterly earnings grew to $307.9 million, or 69 cents per share, in the three months ended Dec. 30 from $173.5 million, or 39 cents per share, in the prior-year period.

The results included a gain of 8 cents per share from favorable tax items. Excluding the gain, the company earned 61 cents per share.

Analysts polled by Thomson Financial were expecting earnings of 60 cents per share.

Revenue rose 4 percent to $12.5 billion from $12.05 billion in the fourth quarter of 2005.

The company said revenues from its Lifestyle stores, which offer more upscale items like prepared meats and imported cheeses contributed to the boost, as did strong performance from both perishable and nonperishable merchandise.

Safeway said its same-store sales — or sales at stores open at least a year, a key performance indicator — grew 3.7 percent for the quarter.

For the full year, net income climbed 55 percent to $870.6 million, or $1.94 per share, from $561.1 million, or $1.25 per share, in 2005. Revenue rose 5 percent to $40.19 billion from $38.42 billion in the prior year.