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Supervalu earnings grow 30 percent
Food-price inflation is making consumers more cautious, and the grocer has been expanding its line of store brands. They're now 16 percent of retail sales.
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Minnesota business by the numbers
See Minnesota's top earning companies, CEOs and non-profits
4th quarter FY2008, 2/23
2008 2007 % chg. Revenue $10,386.0 $10,300.0 +0.8 Income 156.0 120.0 +30.0 Earn/share 0.73 0.57 +28.1 12 months Revenue $44,048.0 $37,406.0 +17.8 Income 593.0 452.0 +31.2 Earn/share 2.76 2.32 +19.0 Figures in millions except for earnings per share.More from Business
Eric Wieffering, assistant managing editor/business • 612-673-4237 • ewieffering@startribune.com
Supervalu Inc. said fourth-quarter profit jumped 30 percent, despite bargain-hunting shoppers who are being squeezed by food inflation.
Supervalu saw some profit growth from its stores and food-distribution businesses. Paying down debt and cutting administrative expenses helped, too. Supervalu became one of the nation's largest grocers with its 2006 acquisition of most Albertsons Inc. grocery stores.
Supervalu shares jumped more than 5 percent Thursday.
Chairman and CEO Jeff Noddle said food inflation has been running in the high 3 percent range. Customers are coming to Supervalu stores less often, but spending more each time, he said.
"We are seeing evidence of customers managing their budget and focusing on value" by waiting for sales and promotions, clipping coupons, and buying economy sizes and store brands, he said. Supervalu recently has been expanding its own store brands rapidly; they're now 16 percent of retail sales.
Supervalu chains include Cub Foods, Save-A-Lot, Jewel-Osco and Shop 'n Save. Sales at stores open at least a year were flat.
Still, Supervalu Inc. profit for the quarter that ended Feb. 23 rose to $156 million, or 73 cents per share. The company said it earned 77 cents per share excluding acquisition costs.Revenue climbed less than 1 percent to $10.39 billion.
Analysts polled by Thomson First Call expected 71 cents per share on revenue of $10.17 billion.
Eden Prairie-based Supervalu has been paying down debt since the Albertsons deal. Including leases, Supervalu debt now stands at $8.8 billion, down from $9.5 billion a year ago.
In fiscal 2009, Supervalu forecast earnings of $3.10 to $3.25 per share excluding costs. Analysts had been anticipating $3.07 per share.
Supervalu shares rose $1.60, or 5.5 percent, to close at $30.65 Thursday.
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