Albertson's bottom line strong

Chain Drug Review, June 17, 1991

Albertson's bottom line strong

BOISE, Idaho - Though sales growth tapered off to 7.5%, Albertson's Inc. still managed to achieve a 14.6% bottom-line gain for the first quarter of fiscal 1991.

The big operator of food/drug combination stores and supermarkets netted $58.7 million during the 13 weeks ended May 2, up from $51.2 million a year earlier. Sales for the period rose to $2.16 billion from $2.01 billion, with same-store results rising 3.4%.

Bottom-line growth was stoked by a 0.2-percentage-point increase in gross margins to 23.2% from 23% a year ago. "This increase was due primarily to continued efficiencies realized from the company's distribution centers, as retail gross margins remained relatively constant," Albertson's explains in its quarterly report.

Combining the margin improvement with a decrease in operating and administrative expenses to 18.7% of sales from 18.8%, Albertson's realized a 12.6% increase in operating income for the quarter. The chain reduced net interest expenses to 0.27% of sales from 0.33%.