Safeway reports dismal Q4 results

PLEASANTON, Calif. Safeway reported a net loss of $1.61 billion during fourth quarter 2009, compared with the year-ago period.

The retailer also said that total sales declined 8.1% to $12.7 billion in the fourth quarter 2009, compared with $13.8 billion in the fourth quarter 2008. Safeway said the decline was the result of an additional week in 2008 and a 4.1% decline in same-store sales, excluding fuel, for the quarter.

Meanwhile, gross profit declined 14 basis points to 28.64% of sales in the fourth quarter 2009, compared to 28.78% of sales in the same period last year.

“Excluding the non-cash goodwill impairment charge, our results were in line with our expectations,” said Steve Burd, chairman, president and CEO. “Despite very challenging economic conditions, Safeway generated free cash flow of $1.5 billion in 2009. This exceeded our expectations and is the highest annual free cash flow ever achieved by Safeway.”

Safeway currently operates 2,000 stores.