Safeway profit drops in Q2

Pleasanton, Calif. Safeway reported Thursday that net income for the second quarter was $141.3 million, compared with $238.6 million a year earlier.

Second quarter 2009 included a $57.8 million tax benefit from the resolution of a tax matter.

Total sales for the quarter were $9.5 billion, essentially flat compared with $9.5 billion a year ago. A higher Canadian exchange rate and higher fuel sales were largely offset by a 2.5% decline in same-store sales, excluding fuel.

Safeway invested $192.1 million in capital expenditures in the second quarter, opening five new stores, completing 17 Lifestyle remodels and closing five stores. For the year, Safeway said it plans to invest about $1 billion in capital expenditures, open approximately 15 new Lifestyle stores and complete approximately 60 Lifestyle remodels.