Safeway profits up in Q1, opening more Lifestyle stores

PLEASANTON, Calif. — Safeway's first quarter net income rose to $81.6 million, from $25.1 million in the year-earlier period. Sales edged up 2.4% to $10 billion, from $9.8 billion last year. Same-store sales were flat.

"Strong cost controls helped us meet earnings expectations despite a shift in the New Year's holiday, weather patterns and high gasoline prices which dampened sales," said Steve Burd, Chairman and CEO. "In addition, operating profit in the quarter would have been essentially the same as last year without the holiday shift. In the last eight weeks, identical-store sales have been running at 1%, and we continue to believe sales will grow as our new marketing initiatives take hold."

In 2012, Safeway said it expects to invest approximately $900 million in capital expenditures, open 10 new Lifestyle stores and complete 10 Lifestyle remodels.

The company is maintaining its 2012 guidance and expects earnings per diluted share to range from $1.90 to $2.10 per diluted share.