Albertson's, Inc., Convenes Annual Stockholders' Meeting, Announces Focused Plans to Revitalize Position As Leader in Retail Grocery and Drug Store Industries.

Business Editors

BOISE, Idaho--(BUSINESS WIRE)--June 14, 2001

New Initiatives Guided by Five Strategic Imperatives

Guided by five new strategic imperatives, Albertson's, Inc., (NYSE:ABS) is on track to "unleash the untapped potential" of the Company, Larry Johnston, chairman and chief executive officer, told shareholders here today at the annual meeting.

"We are focusing on increasing sales, reducing costs and improving return on capital investments," Johnston said. "Our goal is to improve shareowner value, as we reinvigorate our growth strategies and strengthen Albertson's position with consumers as one of the world's leaders in the grocery and drugstore industries."

Johnston, the former president and CEO of GE Appliances who was appointed to the Albertson's top position on April 23, 2001, detailed the strategic imperatives that have been instituted at the Company:

-- Aggressive cost and process control

-- Maximization of return on invested capital

-- Customer-focused approach to growth

-- Company-wide focus on technology

-- Energized employees

"We need to make a number of significant changes in order to leverage our strengths and reach our full potential," Johnston said. "We are committed to making the tough decisions and taking the decisive actions necessary to move this Company forward in the right direction."

Johnston did not announce a timetable for the implementation of key initiatives tied to the strategic imperatives, but told shareholders:

"We exceeded expectations for the first quarter. Our sales momentum is continuing, and we generated strong cash flow from operations. Now we are in the midst of accelerating our cost reduction and process improvement efforts while we also take the appropriate actions on underperforming assets. We are making significant strides in the right direction, and we are committed to improving shareholder value."

Peter Lynch, president and chief operating officer, reviewed the Company's progress to date on a refocused approach to the business. "We are busy implementing the plans that will make this Company the best in the combined grocery and drugstore business," Lynch said. "A strong new focus on our customers will be the major thrust that guides all our efforts . . . and we are confident that we have the people who will help us to realize our plans and achieve our goals."

At the Annual Meeting 22 Albertson's associates from across the nation were honored as role models for the Company's new "Service First....Second to None" program. "These associates are among the best of the best in providing great service to our customers," said Lynch. "Each of them received a customer service award during 2000. They were among more than 4,500 associates who received such recognition last year."

In the business portion of the Annual Meeting, shareholders elected five directors to new terms with the Company. Elected to three-year terms were Cecil D. Andrus, chairman of the Andrus Center for Public Policy and former governor of Idaho; Pamela G. Bailey, chief executive officer and president of the Advanced Medical Technology Association; J.B. Scott, chairman of the board of Alscott, Inc., and the J.A. and Kathryn Albertson Foundation; and Will M. Story, retired executive vice president and chief financial officer of American President Companies, Inc. Henry I. Bryant, retired managing director of J.P. Morgan and Company, was elected to a two-year term.

The shareholders also ratified the appointment of Deloitte & Touche LLP as the Company's independent auditors and approved the amended and restated 1995 Stock-Based Incentive Plan, increasing the number of authorized shares under the plan by 20 million shares. With regard to the four stockholder proposals set forth in the Company's proxy statement and considered at the meeting, the shareholders approved the proposal to declassify the Company's Board of Directors; defeated the proposal on identifying and labeling genetically engineered food; defeated the proposal regarding shareholder approval of executive severance over $3 million; and defeated the proposal on the adoption of the Principles of the Coalition for Environmentally Responsible Economics.

Albertson's, Inc., is one of the nation's largest food and drug retailing companies, with annual revenues of approximately $37 billion. Based in Boise, Idaho, the Company currently operates 2,539 retail stores in 36 states across the United States.

The Company does not undertake to update forward-looking statements in this news release to reflect actual results, changes in assumptions or changes in other factors affecting such forward-looking information. Assumptions and other information that could cause actual results to differ from those set forth in the forward-looking information can be found in the Company's filings with the Securities and Exchange Commission, including the Company's Form 10-Q.