FINANCE

Safeway net income plunges in Q3

BY Dan Berthiaume

Pleasanton, Calif. – Safeway Inc. saw its net income plunge 58% from $157 million to $65.8 million during the third quarter of fiscal 2013, amid a software impairment charge, higher theft and lower property gains. Results, however, beat expectations however.

Sales grew 1.1% from $8.52 billion to $8.62 billion, driven by a 1.9% improvement in same-store sales.

Following a decision to sell its Canadian business in June of this year, Safeway is now exiting the Chicago market with the sale of its 72 Dominck’s stores in the area by early next year (link to lead story). This will result in a cash tax benefit of $400 million to $450 million which will be available in the short-term to partly offset the cash tax expense on the sale of the net assets of Canada Safeway Limited. Safeway said it expects to use the cash tax benefit and any other cash proceeds from the disposal of Dominick’s properties to buy back stock and to invest in growth opportunities.

"The decision to sell Canada Safeway and to exit the Chicago market is consistent with Safeway’s priority of maximizing shareholder value," said Robert Edwards, Safeway president and CEO. "These actions will allow us to focus on improving and strengthening our core grocery business. We are continuing to review all of our businesses to optimize our allocation of resources, improve sales and grow operating profits."

Safeway also cited a problem with fresh produce shrink, which it said has been corrected, as well as a software impairment charge, as negatively affecting quarterly results.

Safeway expects to record same-store sales growth of 1.6% to 1.9% for fiscal year 2013.

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OPERATIONS

Halston launches e-commerce site, plans new stores

BY Dan Berthiaume

New York – Halston is launching its digital flagship store in more than 80 countries today, including the U.S., and Canada. The vertical e-commerce site will feature Halston Heritage apparel and accessories. The brand is also expanding its physical presence, with plans to expand to more than 20 locations by yearend.

The launch of the online store is a partnership between Halston and Branded Online, an innovative e-commerce provider who developed the proprietary platform, and will manage all back-office functions including fulfillment, distribution and client services. The day-to-day business including merchandising, marketing, brand creative and brand communication will be run by Halston. The site will serve as a complement to the retailer’s ongoing digital strategy, which is designed to strengthen direct communication and interaction with Halston clients and fans through the digital space and social media platforms.

This e-commerce launch follows the rollout of the first Halston Heritage retail stores earlier this year. There are currently seven stores worldwide and the company plans to have more than 20 by the end of the year.

“The launch of Halston’s first e-commerce store is an important milestone for one of America’s most iconic fashion brands,” said Ben Malka, chairman and CEO of Halston “The site will serve as our global flagship and will give us the opportunity to present the brand the way we envision it, while reaching new audiences in new markets across the world.”

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News

TABS Group forms dedicated Wal-Mart analytics team to enhance insights at chain

BY Marianne Wilson

Shelton, Conn. — TABS Group, a technology-enabled analytics firm, has announced the formation of a senior-level team dedicated to supporting internal and customer-related initiatives with Walmart.

TABS Group will tap into its new talent base to obtain a comprehensive understanding as to how the largest U.S. retail chain operates on a chain and local level. The insights gained will benefit Walmart and consumer products manufacturers and further contributes to the firm’s mission to simplify and improve the way analytics is conducted within the industry.

The new TABS Group analysts have a high level of expertise on Wal-Mart and retain outstanding credibility with the retailer. They previously held positions at IRI Worldwide, a leading provider of syndicated retail sales data.

As the newly appointed VP of client services at TABS Group, Kayla Fromm-Mendoza will focus exclusively on Walmart’s internal analytical needs. John Powell, also appointed to VP of client service, will serve as a liaison between manufacturers and Wal-Mart initiatives.

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