A&P Expects Ongoing 1st Quarter EPS in 40-cent Range; Comparable Store Sales Increase 2.4%.Business Editors MONTVALE, N.J.--(BUSINESS WIRE)--June 26, 2000 The Great Atlantic & Pacific Tea Company, Inc. (A&P, NYSE NYSE See: New York Stock Exchange :GAP) said today that anticipated earnings for the first quarter of fiscal 2000 ended June 17 will be below analysts' expectations. Excluding costs associated with the Company's Great Renewal II supply chain and business process initiative, the Company expects to report an EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become improvement of approximately 4% over the first quarter of fiscal 1999. However, ongoing earnings per share in the first quarter of 2000 are expected to be approximately $.40 per share, versus ongoing earnings of $.50 per share in 1999, mainly reflecting greater interest expense in the latest year. Earnings after special charges associated with the Company's renewal initiatives are expected to be approximately $0.15 per share for the first quarter of 2000, versus a loss of $0.51 per share in the first quarter of 1999. The Company said it achieved a comparable store sales increase of 2.4% for the quarter, despite a relatively soft sales environment. This marks the eighth consecutive quarter of comparable store sales increases, and a growth rate above the supermarket industry average. Christian Haub, President and Chief Executive Officer, said "We are disappointed with our earnings for the quarter, chiefly attributable to a general slowdown For articles with similar titles, see Slow Down (disambiguation). A slowdown is an industrial action in which employees perform their duties but seek to reduce productivity or efficiency in their performance of these duties. in consumer spending Consumer demand or consumption is also known as personal consumption expenditure. It is the largest part of aggregate demand or effective demand at the macroeconomic level. , and lower than expected sales results in our recently-acquired Schwegmann's and The Barn stores. "However, our competitive profile in the marketplace remained strong. Each of our operating regions achieved comparable store sales increases, and our total increase is at the high end of the industry. Moreover, independent research data indicates that our stores outperformed competition in our markets during the quarter. "As a result, we further strengthened our leadership position in our major markets. We're also pleased that each of our major operating units operating unit A type of operating company that engages in transactions with outsiders and that is owned by another business. For example, in 1995 the stockholders of Capital Cities/ABC approved a $19 billion merger with the Walt Disney Company, whereupon - the Atlantic Region, Canada, Michigan and New Orleans New Orleans (ôr`lēənz –lənz, ôrlēnz`), city (2006 pop. 187,525), coextensive with Orleans parish, SE La., between the Mississippi River and Lake Pontchartrain, 107 mi (172 km) by water from the river mouth; founded - performed at or above last year's level at the operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. line." Mr. Haub added, "The continued improvement of market share remains at the top of our strategic agenda, supported by the implementation of Great Renewal Phase II - our development of a state of the art supply chain and business management infrastructure." Addressing the balance of the year, Mr. Haub said, "If the overall sales environment remains as it was in the first quarter, we would expect an EBITDA improvement of approximately 10%, translating to earnings in the range of $2.00 per share for the full year, excluding Great Renewal II costs." Including Great Renewal II costs, earnings are expected to be in the range of $0.50 per share, the Company said. Mr. Haub concluded, "Despite not achieving expectations, we remain encouraged by the ongoing progress of our key change initiatives. In the first quarter, they included the formation of our new Atlantic
New Atlantic were an early 1990s UK rave band from Southport, Merseyside. Region management organization, and the beginning of Great Renewal Phase II implementation. These and other key strategies reflect our commitment to A&P's transformation, and long-term success," he said. The Company confirmed that it will release full first quarter earnings on July 10, 2000. Founded in 1859, A&P was one of the nation's first supermarket chains, and is today one of North America's 10 largest. The Company operates in 15 states, the District of Columbia District of Columbia, federal district (2000 pop. 572,059, a 5.7% decrease in population since the 1990 census), 69 sq mi (179 sq km), on the east bank of the Potomac River, coextensive with the city of Washington, D.C. (the capital of the United States). and Ontario, Canada under the following trade names: A&P, Waldbaum's, Food Emporium, Super Foodmart, Super Fresh, Farmer Jack, Kohl's, Sav-A-Center, Dominion dominion, power to rule, or that which is subject to rule. Before 1949 the term was used officially to describe the self-governing countries of the Commonwealth of Nations—e.g., Canada, Australia, or India. , The Barn Markets, Food Basics
Food Basics is a no-frills Canadian supermarket chain created by A&P Canada to compete with the successful No Frills warehouse style supermarket operated by Loblaw. and Ultra Food & Drug. This release includes forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. about the future performance of the Company which are based on Management's assumptions and beliefs in light of the information currently available to it. The Company assumes no obligation to update the information contained herein. These forward-looking statements are subject to uncertainties and other factors that could cause actual results to differ materially from such statements, including but not limited to: competitive practices and pricing in the food industry generally and particularly in the Company's principal markets; the Company's relationships with its employees and the terms of future collective bargaining agreements The contractual agreement between an employer and a Labor Union that governs wages, hours, and working conditions for employees and which can be enforced against both the employer and the union for failure to comply with its terms. ; the costs of other effects of legal administrative cases and proceedings; the nature and extent of continued consolidation in the food industry; changes in the financial markets which may affect the Company's cost of capital and the ability of the Company to access capital; supply or quality control problems with the Company's vendors, and changes in economic conditions which affect the buying patterns of the Company's customers. |
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