SAFEWAY SETS $950 MILLION IN 1998 OUTLAYS; RESULTS RISE

PLEASANTON, Calif. -- Safeway here said it plans to spend more than $950 million in 1998, opening 40 to 45 new stores, remodeling more than 200 stores and completing the construction of its Maryland distribution facility.

sales of $5.49 billion the year prior.

Diluted earnings per share rose by 35% to 85 cents from 63 cents in 1996.

Fourth-quarter same-store sales, not including replacement stores, were up 2.4%. The company did not release a year-to-year same-store sales comparison.

After an extraordinary charge due to early retirement of debt, Safeway's net income for the year was up 21% to $557.4 million, or $2.24 per share, on sales of $22.5 billion, compared with year-earlier net income of $460.6 million, or $1.94 per share, on sales of $17.3 billion.

Safeway's 1997 income statement includes Vons Cos.' operating results since the beginning of the second quarter; the 1996 statement factors in Safeway's 35% equity interest in Vons.

In 1997 Safeway and Vons had $829 million in capital expenditures, opening 37 units, remodeling 181 and beginning construction of the Maryland distribution center.

Safeway also announced a two-for-one split of its common stock.

4th-QUARTER RESULTS

Qtr Ended 1/3/98 12/28/96

Sales $7.79 billion $5.49 billion

Change 42%

Same-store 2.4%

Net Income $214.9 million $151.6 million

Change 41.8%

Inc/Share 85 cents 63 cents

53 Weeks 1998 1996

Sales $22.5 billion $17.3 billion

Change 30.2%

Same-store N/A

Net Income $557.4 million $460.6 million

Change 21%

Inc/Share $2.24 $1.94

Fiscal 1998 had an extra week.

Excluding replacement units.