NEW YORK — Safeway issued guidance here Tuesday that includes projected earnings of $1.90 to $2.10 per share and identical-store sales increases, excluding fuel, of between 1% and 2% for the 2012 fiscal year, with the "Just for U" digital marketing program as the primary driver of top-line results.
Speaking during the company's annual 's investor conference, Steve Burd, chairman, president and chief executive officer of the Pleasanton, Calif.-based chain, said Safeway isn't being more aggressive in its guidance "because if we gave you significantly higher numbers, most analysts wouldn't believe it. But with Just for U, we've developed something cool, which is the reason many young people are using it, and until this new platform is fully marketed, we will be cautious in our predictions."
To explain the reason for his confidence in Just for U, Burd said the number of customers using it at Vons in Southern California, where it was introduced only about 30 days ago, is more than those using the earlier version of the program in Northern California, where it's been in place for more than a year, "and that's without a hard marketing program," he pointed out. "So we believe this is a game changer, but we have to prove that to analysts and investors."
Burd said he believes Safeway is well positioned for future growth, based on its initiatives in 2011, "[during which] we built out an internal technology platform for Just for U; continued to achieve significant cost reductions; maintained price parity; saw our consumer brands team create another $100 million brand with Open Nature while Blackhawk delivered another year of double-digit growth; and we returned $1.7 billion in cash to shareholders. And with 87% of our store base remodeled into lifestyle stores, we believe we have the freshest asset base in the supermarket industry. When you combine all this with our differentiated offering, we believe we are very well positioned for future growth."