Supervalu sticks to strategy despite Q3 losses
MINNEAPOLIS — Supervalu said it is sticking to its "8 Plays to Win" strategy, a multipronged plan designed to benefit the company and its customers, despite reporting several losses during the third quarter.
The supermarket retailer reported its net sales during the third quarter of fiscal 2012 dropped about 5% to $8.3 billion, compared with nearly $8.7 billion in the year-ago period, and also posted a net loss of $750 million, or $3.54 per diluted share, compared with a net loss of $202 million in the third quarter of fiscal 2011.
Third-quarter retail food net sales also took a hit, dropping to $6.3 billion from $6.6 billion last year. The drop was influenced by same-store sales of -2.9% and previously announced market exits. Along with store closures, market exits also impacted Supervalu's total retail footage, which decreased 1.5% to 63.6 million sq. ft.
Supervalu president and CEO Craig Herkert attributed the struggles to the "difficult economic environment and pressured consumer," but noted the company will continue to move forward with its 8 Plays to Win strategy, which includes such initiatives as simplifying operations and logistics to make it easier for Supervalu to operate as one company; improving the shopper experience through more-consistent value pricing; a focus on fresh, localized merchandising and hassle-free shopping; and committing to the growth of the Save-A-Lot banner and the number of independents utilizing Supervalu’s supply chain services.
"Even with [these issues], we continued to make progress against our plan, allowing us to invest in price to deliver everyday value and hyper local choices that meet the needs of our customers in the diverse neighborhoods we serve," Herkert said.
Supervalu's full-year earnings guidance now is a loss of $2.58 to $2.48 per diluted share on a GAAP basis. Excluding the goodwill and intangible asset impairment charges recorded in the third quarter, full-year earnings guidance is $1.20 to $1.30 per diluted share, in line with the company's previous GAAP guidance.