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Delhaize, Supervalu Name Senior Execs

BY CSA STAFF

Brussels, Belgium, Delhaize Group has appointed Georges Jacobs chairman of the board. Jacobs, chairman of Belgian pharmaceutical concern UCB Group, succeeds the retiring Gui de Vaucleroy.

In other grocery executive news, Minneapolis-based Supervalu named Roger Davidson corporate senior VP and COO of retail food companies, a newly created position. Davidson joins Supervalu from H.E. Butt Grocery Co., where he served as senior VP of grocery procurement, merchandising and store brands.

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Kmart’s Holiday Comps Decline 4.6%

BY CSA STAFF

Troy, Mich., Kmart said its same-store sales declined 4.6% for November and December and declined 2.6% for December alone. The news was seen as good news by new CEO Aylwin Lewis. “We are pleased with the significant improvement in the rate of our same-store sales decline,” he said. “We are implementing numerous initiatives to grow sales and increase profits in 2005.”

The chain, which expects to merge with Sears early this year, said operating income should increase 10% in November and December to $250 million.

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Walgreen Has Record First Quarter

BY CSA STAFF

Deerfield, Ill., Walgreen Co. posted a record first quarter for both sales and earnings. The drug chain reported net income of $332.7 million for the quarter ended Nov. 30, an increase of 30.5% over the same quarter last year. Comp-store sales increased 9.4% as total sales for the quarter rose 13.4% to $9.9 billion. “Earnings this quarter were powered by solid prescription and general merchandise sales, as well as our second straight quarter of significantly higher gross profit margins,” said chairman and CEO Dave Bernauer.

Prescription sales, which accounted for 65% of sales in the quarter, climbed 14.4%. Prescription sales in comparable stores rose 11.3% in the quarter. Third-party plans now account for 93% of all prescription sales.

Costs associated with converting to digital-photo labs and payroll to improve customer service contributed to selling, occupancy and administration expenses increasing 62 basis points to 22.35 as a percent to sales. Also impacting the SO&A ratio were lower-priced generic drugs that slowed the company’s sales line.

Walgreen opened 111 new stores in the first quarter and plans to open about 450 new stores during fiscal 2005, for a net increase after closings and relocations of about 365 stores. At Nov. 30, Walgreens operated 4,680 drugstores in 44 states and Puerto Rico, vs. 4,291 a year ago, for a net increase of 389. Walgreens is on track to operate 7,000 stores in 2010.

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