PLEASANTON, Calif. (AP) — In a story Oct. 11 about Safeway's third-quarter earnings, The Associated Press reported erroneously that Safeway's net income surpassed analyst expectations. Safeway's adjusted net income totaled 30 cents per share. But its adjusted income from continuing operations totaled 10 cents per share, and that was the comparable figure with analyst estimates. By that measure Safeway missed expectations.
A corrected version of the story is below:
Safeway 3Q net income drops
Safeway 3rd-quarter profit falls as company says it will exit the Chicago market
PLEASANTON, Calif. (AP) — Safeway said Thursday its third-quarter net income fell 58 percent, hurt by a software impairment charge, higher theft and lower property gains.
Still, shares rose 6 percent in aftermarket trading.
The grocery chain, which operates 1,406 stores in the U.S., also says it's exiting the Chicago market by early 2014 to focus on more profitable business. It operates 72 Dominick's stores in Chicago that have been losing money. The move comes after Safeway said in June it would sell its Canadian stores.
Safeway and other traditional supermarket chains have been working to focus operations and keep costs low to fight off competition from big-box discounters such as Target and Wal-Mart Stores, as well as drug stores and dollar stores that have been expanding their grocery sections.
"These actions will allow us to focus on improving and strengthening our core grocery business," said CEO Robert Edwards. In a call with investors, he added that the company's "strong store base, brand positioning and sales momentum, built from recent retail and loyalty initiatives," will help the company become more profitable.
Edwards said Safeway has received interest in the Dominick's stores from "a number of different parties" and is looking to sell all or as many of the stores as they can as quickly as possible.
Safeway's net income fell to $85.8 million, or 27 cents per share. That compares with $157 million, or 66 cents per share, in the prior-year quarter. Excluding a software impairment charge, net income was 30 cents per share. Adjusted income from continuing operations was 10 cents per share. Analysts expected net income of 16 cents per share, according to FactSet.