Kroger to Buy Scott's; Supervalu Surges

MINNEAPOLIS -- Supervalu here said yesterday it has agreed to sell its Scott‘s Food & Pharmacy banner in the Fort Wayne, Ind., market to Kroger Co., Cincinnati, for an undisclosed sum. Kroger said it would retain the Scott‘s banner and incorporate the chain into its 145-unit Central Division, based in Indianapolis. In a conference call discussing its results for the fiscal year that ended Feb. 24, Supervalu said Scott‘s had “too much square footage” in a market of 300,000 people. Supervalu also reported sharply increased sales and earnings, reflecting the acquisition last year of most of the Albertsons chain and what it described as a surge in momentum toward the end of the year. Overall, retail sales for the fourth quarter totaled $8.2 billion, vs. $2.5 billion a year ago. Identical-store sales, as if the acquired stores were in operations for a full year, were up 1.4%, including 1.8% from the acquired Albertsons locations. Legacy stores posted flat IDs for the fourth quarter. In total, Supervalu reported net income for the fourth quarter of $119 million, vs. $6 million in the year-ago period, whicxh included several one-time charges. Sales were up 55%, to $10.3 billion, compared with year-ago results. For the full year, net income more than doubled, to $452 million, vs. $206 million a year ago. Sales rose 47%, to $37.4 billion. -- Mark Hamstra