Lifestyle stores boost Safeway’s sales
PLEASANTON, Calif. Safeway Inc. today reported net income of $218.2 million (49 cents per diluted share) for the second quarter ended June 16. Net income in the second quarter of 2006 was $246.2 million (55 cents per diluted share).
Total sales and other revenue increased 4.9% to $9.8 billion in the second quarter of 2007 compared to $9.4 billion in the second quarter of 2006. Identical-store sales increased 4.5% for the second quarter of 2007. Excluding the effect of fuel sales, identical-store sales increased 3.7%. Contributions from Lifestyle stores as well as strong perishable and non-perishable performance drove this increase.
“Our positive sales and income trends continued in the second quarter, bolstered by strong performance from both new and seasoned Lifestyle stores,” said Steve Burd, chairman, president, and ceo. “We are on track to deliver earnings toward the top end of the range we previously provided for the year.”.
Net income for the first 24 weeks of 2007 was $392.6 million (88 cents per diluted share) compared to $389.1 million (86 cents per diluted share) in the first 24 weeks of 2006.
Safeway narrowed the earnings guidance range for 2007 to $1.95 to $2.00 per diluted share from the previously provided range of $1.90 to $2.00. Safeway confirmed 2007 annual guidance for both non-fuel, identical-store sales growth of 3.6% to 3.8% and free cash flow of $400 million to $600 million.
Bright future forecasted for HD-DVD
LAS VEGAS Studio executives and analysts expect a bright future for high-definition DVD despite a slow start in 2006 caused in part by a format war.
At the Home Media Expo opening business session in Las Vegas Tuesday, Warner Home Video worldwide senior vp Steve Nickerson said consumers are already preparing for the transition from standard to high-definition DVD. “It’s estimated that 36% of all U.S. households will have a high definition TV by year’s end,” said Nickerson.
A report from Adams Media Research said the Blu-Ray and HD-DVD high-definition formats launched last spring accounted for just 0.5% of total DVD sales in 2006 but that percentage is on the rise. Kagan Research estimates high-definition DVD will account for 14% of sales by 2009 and 53.7% ($14.98 billion) by 2012.
GSI opens largest fulfillment center
RICHWOOD, Ky. GSI Commerce Inc. announced that it recently opened a new, highly automated fulfillment center in Richwood, Ky. At 540,000 square feet, the state-of-the-art center is GSI’s largest facility to date. At full capacity, Richwood will ship more than 110,000 orders per day during peak season while creating more than 500 full-time and 500 seasonal jobs.
“Our advanced Richwood facility was designed to support the immediate and future needs of GSI’s growing, diverse partner base,” said Bob Wuesthoff, GSI’s evp of global operations. “Fulfillment is a key component to GSI’s end-to-end solution, and Richwood complements our existing infrastructure while simultaneously providing additional scalability to our operations. The employees at our Shepherdsville and Louisville, Ky., facilities are critical to the success of our global operations and we’re delighted to welcome the community of Richwood and our newest employees to GSI.”