PLEASANTON, Calif. — Safeway here said Thursday income from continuing operations for the second quarter rose 22.1% to $58.1 million, while sales and other revenue dropped 1.6% to $8.7 billion and identical-store sales, excluding fuel, rose 1.2%.
Safeway said in June it had entered into an agreement to sell its Canadian operations to Sobeys. The company said income on continuing operations — less the Canadian business — included increased legal reserves of $17 million, an expense of $5.7 million triggered by its initial public offering of Blackhawk and a gain on the sale of investments of $8.5 million.
The company said the decline in sales for the 12-week quarter was due primarily to lower fuel sales and the disposition in 2012 of its Genuardi's stores.
For the half-year period, income on continuing operations rose 45.2% to $113 million, while sales and other revenue fell 0.8% to $17.2 billion and ID sales, excluding fuel, were up 1.5%.
According to Robert Edwards, president and chief executive officer, "The substantial cash proceeds we expect to receive from the sale of our Canadian operations, combined with the completion of the Blackhawk IPO, will allow us to broadly enhance stakeholder value. At the same time our continuing U.S. operations demonstrated strong year-over-year earnings growth in the quarter, and we continue to gain share in our U.S. markets with a 20-basis-point improvement in the supermarket channel and a 2-basis-point improvement in the all-outlet channel."
On an overall basis, net income for the company fell 93.2% to $8.4 million for the quarter, while sales declined 1.6% to $8.7 billion. For the half net income was down 34.9% to $127.3 million, and sales fell 0.8% to $17.2 billion.
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