Supervalu Swings To Q4 Profit - Update

(RTTNews) - Grocery retailer Supervalu Inc. (SVU), Wednesday reported a swing to profit in the fourth quarter, due mainly on revenue growth and lower expenses. Last year's results were hurt by a large loss from discontinued operations. Earnings for the quarter came in ahead of analysts' estimates, as did revenues.

Eden Prairie, Minnesota-based Supervalu reported a fourth-quarter profit of $26 million or $0.10 per share, compared to a loss of $1.41 billion or $6.65 per share last year.

The retailer divested five retail grocery banners last year, including Albertsons, Acme, Jewel-Osco, Shaw's and Star Market, to Cerberus Capital Management-led investor group for $3.3 billion. The company also reduced its national workforce by 1,100 positions, following the divestiture.

Last year, the company reported loss from discontinued operations of $1.24 billion.

Adjusted earnings from continuing operations for the fourth quarter was $48 million or $0.18 per share, compared to a loss of $25 million or $0.11 per share last year. Twelve analysts polled by Thomson Reuters expected earnings of $0.15 per share for the quarter. Analysts' estimates typically exclude special items.

Supervalu's sales for the fourth quarter grew 1.4 percent to $3.95 billion from $3.90 billion last year. Ten analysts had a consensus revenue estimate of $3.88 billion for the quarter.

Retail food segment sales were flat at $1.09 billion, while Save-A-Lot unit's rose 3.1 percent to $999 million. Independent business sales inched down 0.6 percent to $1.82 billion.

Supervalu said identical store sales in the Save-A-Lot network were a positive 2.1 percent, while it was a positive 0.2 percent in the Retail Food segment.

Gross margin for the fourth quarter improved to 14.9 percent from 14.3 percent last year. Selling and administrative expenses dropped to $471 million from last year's $760 million.

SVU is currently trading at $6.95, up $0.19 or 2.81%, on the NYSE.