PLEASANTON, Calif. — Safeway here said yesterday it believes savings from ongoing cost reductions that it invests in lower prices will enable it to grow earnings, despite perceptions to the contrary.
"We see a lot of opportunities to lower costs and then use what we save to finance price investments," Steve Burd, chairman, president and chief executive officer, said, "and if we get good sales results, as we anticipate, we can grow earnings in 2009 and beyond." Talking with analysts in a third-quarter conference call, Burd said that speeding transaction time at the checkstands by even one second can save millions of dollars.
For the 12-week quarter, which ended Sept. 6, Safeway net income rose 2.6% to $199.7 million, and sales and other revenues increased 3.9% to $10.2 million. Identical-store sales, excluding fuel, were up 0.5%. For the 36-week period, net income grew 6.9% to $627.4 million, while revenues climbed 4.7% to $30.3 billion. Burd said Safeway had same-store gains above 1.5% during the first five weeks of the fourth quarter.
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