Albertsons Caps Robust 2020 With Another Quarterly Beat

Q4 results, 2021 fiscal outlook exceed analyst estimates
Albertsons exterior
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Albertsons Cos. topped a historic fiscal year with one last quarter of roaring sales gains, and is guiding to an encore that exceeds Wall Street expectations.

The Boise, Idaho-based retailer, whose 2020 fiscal year aligned nearly perfectly with the onset of the coronavirus pandemic that drove record demand for food at home and digital shopping, said identical-store sales in its fiscal fourth quarter ending Feb. 27 improved by 11.8%, driven by a 282% increase in digital sales. Total revenues in the 12-week quarter of $15.8 billion increased by 2.6% but came against a 13-week period in fiscal 2019.

Gross profit as a percent of sales totaled 28.9% in the quarter, up from 28.6% in the same period a year ago, reflecting the benefits of higher sales volume in terms of reduced shrink and cost leverage. A net loss of $144 million in the quarter was related to a previously disclosed pension investment of $449.4 million. Adjusted net income was $347.2 million, or 60 cents per share—a 78.8% increase from last year’s fourth quarter.

For the fiscal year, Albertsons’ sales totaled $69.7 billion, an 11.5% increase over a 53-week 2019. Identical-store sales for the year soared by 16.9%, and digital sales were up by 258%. Gross profit margin increased to 29.3% of sales from 28.2% in 2019.

“We are very proud of what our team accomplished in fiscal 2020, serving our customers and communities throughout the COVID-19 pandemic,” said Vivek Sankaran, president and CEO. “As a result of our strong execution, we delivered record full-year results, drove meaningful market share gains and are well positioned for continued success and strong performance in fiscal 2021.

“We have made substantial progress against our strategic priorities, and are still in the early innings of our transformation journey,” he added. “Looking ahead, we remain committed to further strengthening our relationships with our customers, offering a superior shopping experience and generating value for all stakeholders.”

Though facing mountainous comps—particularly in the ongoing first quarter of fiscal 2021—Albertsons delivered relatively upbeat financial guidance for the new year. Comps for the year will be down between 6% and 7.5%, but that would represent a gains of 9.4% to 10.9% on a two-year stack. The company is calling for adjusted EBITDA in the range of $3.5 billion to $3.6 billion and earnings per share in the range of $1.95 to $2.05. The expected EBITDA and EPS range were above Wall Street estimates.

Albertsons will share additional detail in a conference call this morning.




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