SUPERVALU and Safeway Shares Fall Sharply After SUPERVALU Releases Weak Quarterly Results

After the recession in 2008 more and more consumers have turned to discount stores like Wal-Mart for their groceries. SUPERVALU’s CEO Craig Herkert on a recent call with analysts said that dollar-store chains have begun to take away more customers.

“Given the economic situation the American consumer is in, a lot of grocery competitors are focused on making sure they have the right value proposition for customers,” Herkert said on the call. “We needed to accelerate our ability to play in that game.”

For the quarter ended June 16, 2012, SUPERVALU reported net sales of $10.6 billion and net earnings of $41 million, or $0.19 per diluted share. In the first quarter of fiscal 2012, net sales were $11.1 billion and the company reported net earnings of $74 million, or $0.35 per diluted share. Shares of the company fell nearly 50 percent Thursday. SUPERVALU on Wednesday said they are currently considering selling all or part of their company.

Safeway is a Fortune 100 company and one of the largest food and drug retailers in North America based on sales. The company operates 1,675 stores in the United States and western Canada and had annual sales of $43.6 billion in 2011. The company will host a conference call with investors on Thursday, July 19, 2012 at 11:00 a.m. ET (8:00 a.m. PT) to discuss its second quarter 2012 financial results.