- Albertsons on Tuesday posted results for the third quarter of 2022 that exceeded analysts’ expectations, with net sales and other revenue up 9% year-over-year, to $18.2 billion.
- Identical sales rose 7.9% during the quarter compared with the same period in 2021.
- Albertsons recorded another strong quarter as the retailer seeks regulatory clearance for its controversial plan to merge with Kroger.
While Albertsons turned in a solid performance during Q3, which ended Dec. 3, 2022, the company noted that its strong identical sales were driven primarily by inflation — which also propelled Albertsons’ same-store sales during the second quarter.
The annual rate of grocery inflation has been slowing in recent weeks after hitting a multi-decade high last summer and is expected by analysts to decline further in 2023, suggesting that Albertsons, like other grocers, will likely need to look to other sources to help drive revenue ahead down the road.
Albertsons’ posted third-quarter adjusted net income of $505 million, or 87 cents per share, which beat what analysts had predicted. The figures were up from Q3 of 2021, when the supermarket operator posted adjusted net income of $457 million, or 79 cents per share.
The company also said e-commerce sales grew 33%, and loyalty program membership rose 16% to 33 million.
“Our investments in digital transformation, differentiation in Own Brands and Fresh offerings, and the modernization of our operational capabilities contributed to these results,” CEO Vivek Sankaran said in a statement. “As we look ahead to the balance of the year and into fiscal 2023, we believe that all of these initiatives position us well to continue to drive top-line growth and deepen our customer and community engagement both online and in-store.”
Albertsons did not host an earnings call or provide guidance for its anticipated future results because of its efforts to merge with Kroger.
In addition to posting its quarterly results Tuesday, Albertsons announced that it will pay a common stock dividend of 12 cents per share for the fourth quarter of 2022 to stockholders on Feb. 10.
Albertsons is also looking to distribute a special $4 billion dividend to investors, but the company has been stymied in that effort by several state attorneys general who have argued that the payment, which would come out to $6.85 per share, would significantly weaken Albertsons ahead of its planned combination with Kroger. Albertsons has disputed that assertion, saying the dividend would not hurt its financial strength.
In December, a judge in the state of Washington denied a request by the state’s attorney general, Bob Ferguson, for a preliminary injunction to stop the special dividend, but kept in place a temporary restraining order blocking distribution of the money to shareholders. The Washington Supreme Court is scheduled on Jan. 17 to consider an application from Ferguson for review of the denial of the injunction, Albertsons said last week.