MINNEAPOLIS -- Supervalu here said last week earnings for the year and fourth quarter will fall below the company's earlier guidance because of continuing operating-margin pressure in its distribution segment.
> Supervalu released preliminary financial results for the year and fourth quarter ended Feb. 22, saying it expects diluted earnings per share for the fourth quarter ended Feb. 22 to range from 46 cents to 49 cents and full-year diluted earnings per share to range from $1.89 to $1.92.
That contrasts with the company's previous guidance for earnings per share of 55 cents to 60 cents for the quarter and $1.98 to $2.03 for the year.
The company said it will release its final fourth-quarter and year-end results on April 10.
Same-store sales in the retail segments during the quarter were flat, Noddle said, although the results reflected an improvement over the drop of 2.3% in the third quarter, he added. When adjusted for cannibalization of Supervalu's planned in-market store expansion, same-store sales for the quarter were positive, Noddle pointed out.
"During the quarter, the near-term savings from our distribution efficiency initiatives were not sufficient to offset other cost pressures," he explained. "However, our retail operations performed well, and during the fourth quarter we generated positive same-store sales growth when adjusted for the impact of in-market expansion."
He also said Save-A-Lot, the company's extreme-value format, generated positive same-store sales growth in the quarter. Save-A-Lot's 1,150 stores included 35 newly developed combination stores that link Save-A-Lot with Deals - Nothing Over $1, Noddle noted.
"We expect retail segment results will be slightly higher in the fourth quarter than in the prior year, even after adjusting for the impact of goodwill," he stated.
Looking ahead to the close of the current fiscal year -- a 53-week year -- Noddle said preliminary earnings per share are anticipated to be in the range of $2 to $2.15, reflecting a slowly recovering economy, while same-store sales for the year are expected to be flat, also reflecting cautious consumer behavior and the continued impact of in-market expansion.
Capital expenditures for fiscal 2004 are projected at $450 to $475 million, including $75 million of capitalized leases, compared with cap-ex of approximately $450 million, including capitalized leases of approximately $50 million, in the fiscal year just ended, Noddle said.
