posted a 77% rise in fourth-quarter earnings Thursday and backed its 2007 guidance.
The Pleasanton, Calif.-based company earned $307.9 million, or 69 cents a share, up from $173.5 million, or 39 cents a share, a year earlier. Earnings in the latest quarter were boosted by an 8-cent-a-share gain from tax-related items.
Excluding the gain, the earnings beat Thomson Financial's mean analyst estimate by a penny.
Sales increased 3.8% to $12.5 billion, slightly shy of analysts' forecast of $12.63 billion. Identical-store sales increased 3.5%.
The company said the sales were boosted by a strong performance from its "lifestyle" format, which include more items like organic foods, prepared dishes and in-store bakeries and flower shops.
"Our fourth-quarter results demonstrate that our strategy continues to work well," Steve Burd, chairman, president and CEO, said in a statement. "By delivering superior perishables, completing more Lifestyle stores, making investments in price and promotion, controlling our costs, and delivering outstanding service, we are able to bring more to the table for our customers and our shareholders. We plan to continue to build on this momentum in 2007."
For all of 2006, the company earned $870.6 million, or $1.94 a share, compared with $561.1 million, or $1.25 a share, a year earlier. Sales increased 4.6% to $40.2 billion.
During 2006, Safeway invested $1.67 billion in capital expenditures. The company opened 17 new stores under its lifestyle format, completed 276 lifestyle remodels and closed 31 stores. For 2007, the company expects about $1.7 billion in capital expenditures, including the opening about 25 new lifestyle stores and about 275 lifestyle remodels.
Safeway reaffirmed its earlier guidance of 2007 earnings of $1.90 to $2 a share, while Wall Street is looking for a profit $1.94 a share. Identical-store sales, excluding fuel, are expected to grow about 3.3%.
The growth outlook wasn't enough for investors, as Safeway shares recently were down $1.34, or 3.6%, to $35.62 amid news that rival
will be bulking up by buying fellow natural-foods chain