US grocery retailer Albertsons has reported a sharp drop in quarterly earnings, hit by costs related to the labour dispute in Southern California.
The company posted net earnings of US$36m, or 10 cents per share, for the first quarter to 29 April, compared to $172m, or 47 cents per share, in the same period of the previous year.
Albertsons said first-quarter net earnings were reduced by 27 cents per share by the Southern California labour dispute, including the impact to operations, a contribution to the health and welfare trust and a contract ratification bonus.
The company reported total sales of $8.7bn for the quarter versus last year’s first quarter sales of $8.9bn. Albertsons estimated that the labour dispute negatively impacted total sales by approximately $386m in the first quarter. Total company comparable store sales for the quarter (including the impact of the labour dispute) declined 3.7% and identical store sales declined 4.1%. Excluding the Southern California stores involved in the labour dispute, total company comparable store sales for the quarter increased 0.3% and identical store sales decreased 0.1%.
Albertsons, which recently completed its acquisition of US supermarket chain Shaw’s from UK-based J Sainsbury, reiterated its earnings per share estimates for fiscal 2004 of between $1.40 and $1.50 per diluted share, including Shaw’s.