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AMERICAN STORES CO. ANNOUNCES FISCAL YEAR SALES AND EARNINGS

 AMERICAN STORES CO. ANNOUNCES FISCAL YEAR SALES AND EARNINGS
 SALT LAKE CITY, March 9 /PRNewswire -- American Stores Co. (NYSE: ASC) today announced that for its 1991 fiscal year ended Feb. 1, 1992, net earnings before non-recurring items were $192.4 million or $2.78 per common share, compared to $176.7 million or $2.56 per common share in 1990. Non-recurring items in 1991 include gains on the sale of assets, primarily Alpha Beta; early adoption of SFAS No. 106 "Employers' Accounting for Postretirement Benefits Other Than Pensions;" and a year-end accrual for litigation principally associated with its salmonella lawsuits. Reported net earnings for 1991 increased 9.3 percent to $199.4 million, or $2.88 per common share, compared to net earnings of $182.4 million, or $2.64 per common share, in 1990.
 Sales from comparable operations in 1991 increased 2.3 percent to $20.1 billion. Comparable operations exclude the results of the Alpha Beta Co. and 59 drug stores which were sold in 1991 and the Buttrey Food & Drug chain which was sold in 1990.
 Total like-store sales, or sales from stores that have been open at least one year, increased slightly in 1991, with like-store sales from the company's drug stores increasing 7.7 percent and like-store sales from its grocery and combination stores decreasing 1.6 percent. Like store customer count increased 0.3 percent.
 Total sales for the 52-week period ended Feb. 1, 1992 were $20.8 billion, down 6.0 percent from $22.2 billion for the 52-week period ended Feb. 2, 1991.
 After LIFO, 1991 operating profits from comparable operations, excluding non-recurring adjustments, were $620.5 million, compared to $648.7 million in 1990.
 Operating profits from comparable 1991 drug store operations, before the LIFO charge to earnings and non-recurring items increased 2.4 percent to $179.2 million, compared to $175.1 million in 1990. The company's 1991 grocery and combination stores' pre-LIFO operating profits from comparable operations, before the non-recurring items, decreased 8.8 percent to $506.6 million, compared to $555.4 million in 1990.
 The company said that comparable operating profits for the 1991 year were negatively impacted by the continuing softness in sales growth related to the current economic environment and the losses reported by the Jewel/Osco combination food and drug stores located in Texas, Oklahoma, Arkansas and Florida. On Feb. 17, 1992, the company announced that it had entered into a definitive agreement to sell 74 of those stores, as well as a general merchandise warehouse in Oklahoma to Albertson's Inc. during the first quarter of fiscal 1992. The 30-day waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 expired on Feb. 28, 1992.
 Net earnings for 1991 include a pre-tax LIFO charge to earnings of $34.9 million or $0.30 per share, vs. $50.0 million, or $0.44 per common share in 1990.
 In 1991, the company also recorded a $19.6 million pre-tax charge, or $0.17 per common share, in connection with the 1985 salmonella incident, primarily for legal fees and expenses associated with these claims, and pre-tax gains of $103.6 million or $0.90 per share on the disposition of assets, primarily from the sale of the Alpha Beta Co. subsidiary. Additionally, the company adopted SFAS No. 106, which reduced earnings per common share by $0.59.
 Net earnings for 1990 include pre-tax earnings of $9.4 million or $0.08 per common share from non-recurring items, primarily gains on the sale of assets, including Buttrey Food & Drug.
 The company recorded a fourth quarter charge in connection with the company's salmonella-related litigation, primarily associated with increased legal fees and other expenses. The company, in 1989, increased the reserve for salmonella-related claims in anticipation that the reserve would be adequate to meet future liabilities. Because of the protracted nature of these claims and the significant fees and expenses involved, it is anticipated that the costs
will be more than originally estimated. The company believes that the present reserve for claims and legal fees will cover all future costs.
 Further the company elected to adopt the immediate recognition provision of SFAS No. 106, effective the first quarter of 1991. The adoption of this statement, accounted for as a cumulative effect of an accounting change, had no material effect in the fourth quarter of fiscal 1991. By electing the immediate recognition provision, the company eliminated the negative impact on future earnings of the alternative 20-year amortization method.
 Interest expense in 1991 declined to $264.2 million from $356.9 million in 1990. Interest expense was lower in 1991 than in 1990 because of lower interest rates and reductions in the company's outstanding debt.
 Average common shares outstanding for the year were 69,182,000 in 1991 and 69,022,000 in the prior year. All per share amounts and average shares outstanding have been adjusted to reflect the company's July 16, 1991 2-for-1 stock split.
 J.L. Scott, president and chief executive officer of American Stores, said that during 1992, the company remains committed to maximizing returns by focusing on its most profitable operations, reducing operating expenses, improving the efficiency of its operations and maintaining its customer base by remaining competitive in retail pricing.
 "During 1991, we continued our efforts to increase our competitive capabilities as a company," he said. "We continued our program, begun in 1989, of selling under-performing assets and concentrating in our most profitable markets. This effort has resulted in a smaller, more profitable store base, one on which our capital can be most effectively concentrated. The proceeds from our asset sales have also allowed us to reduce our debt.
 "We further strengthened our capital structure through the successful offering in September 1991 of $175 million worth of 7-1/4 percent Convertible Subordinated Notes due 2001. The proceeds from this offering were used to reduce bank debt, thus freeing up our cash flow for future capital expenditures. We also filed a shelf registration statement for up to $500 million of debt securities which may be offered in the future to fix our debt at favorable rates. In addition to allowing us to increase capital expenditures, these refinancings also reduce our exposure to floating rate debt," Scott stated.
 "While we recognize that the continued weakness in the economy will challenge us during the coming year, we believe that the actions we have taken and those which we will continue to take to strengthen the company and improve its competitive position will benefit American Stores and its shareholders in the years to come," he said.
 American Stores Co.'s principal grocery and combination store operating subsidiaries include Acme Markets Inc., Jewel Food Stores Inc., Star Market, Jewel Osco Southwest, Jewel Osco Florida and Lucky Stores Inc. American Stores Co.'s drug subsidiary, American Drug Stores Inc., operates under the Osco Drug and Sav-on names. At Feb. 1, 1992, the company's grocery and combination store subsidiaries operated 1,013 stores. The company's drug store subsidiary, American Drug Stores, operated the drug side of 225 of the combination stores and 475 stand-alone drug stores.
 AMERICAN STORES CO.
 Financial Highlights
 (Amounts in thousands except per share data)
 Like store 13 Weeks 13 Weeks Percent
 Sales Ended Ended
 Increase Feb. 1, Feb. 2, Change
 1992 1991
 Sales:
 Grocery &
 combination
 stores (2.27 pct) $4,154,227 $4,174,746 (0.49 pct)
 Drug stores 4.69 pct 1,058,584 1,010,369 4.77 pct
 Other --- 3,795 3,133 21.16 pct
 Comparable (0.91 pct) 5,216,606 5,188,248 0.55 pct
 Disposed of divisions --- 519,980
 Total sales $5,216,606 $5,708,228 (8.61 pct)
 Operating Profits:
 Grocery &
 combination
 stores $137,075 $164,234 (16.54 pct)
 Drug stores 62,904 67,264 (6.48 pct)
 LIFO 19,104 12,480 53.08 pct
 Purchase acct.
 amort. (17,853) (18,272) 2.29 pct
 All other (13,543) 10,455 (229.54 pct)
 Comparable 187,687 236,161 (20.53 pct)
 Disposed of divisions 51 12,408
 Total operating
 profits 187,738 248,569 (24.47 pct)
 Interest expense (61,697) (87,169)
 Gains on asset
 sales, other (8,709) 807
 Earnings before
 taxes 117,332 162,207
 Income taxes (58,444) (76,173)
 Effective tax rate 49.81 pct 46.96 pct
 Net earnings $58,888 $86,034
 Earnings per
 common share (a) $0.85 $1.24
 Dividends per
 common share (a) $0.175 $0.14
 (a) Reflects the 2-for-1 stock split on July 16, 1991.
 AMERICAN STORES CO.
 Financial Highlights
 (Amounts in thousands, except per share data)
 Like 52 Weeks 52 Weeks
 Store Sales Ended Ended Pct.
 Increase Feb. 1, 1992 Feb. 2, 1991 Change
 Sales:
 Grocery &
 combination
 stores (1.57 pct.) $16,344,121 $16,181,645 1.00 pct.
 Drug stores 7.72 pct. 3,729,887 3,451,390 8.07 pct.
 Other --- 12,879 11,929 7.96 pct.
 Comparable 0.05 pct. 20,086,887 19,644,964 2.25 pct.
 Disposed of divisions 736,069 2,510,566
 Total sales $20,822,956 $22,155,530 (6.01 pct.)
 Operating
 Profits:
 Grocery & combination
 stores $506,585 $555,402 (8.79 pct.)
 Drug stores 179,227 175,077 2.37 pct.
 LIFO (34,896) (50,020) 30.24 pct.
 Purchase acct. amort. (71,789) (74,394) 3.50 pct.
 All other 17,294 42,593 (59.40 pct.)
 Comparable 596,421 648,658 (8.05 pct.)
 Disposed of divisions 13,678 52,091
 Total operating profits 610,099 700,749 (12.94 pct.)
 Interest expense (264,162) (356,901)
 Gains on asset sales, other 104,705 12,584
 Earnings before taxes 450,642 356,432
 Income taxes (210,474) (174,045)
 Effective tax rate 46.71 pct. 48.83 pct.
 Earnings before cumulative
 effects of accounting
 change 240,168 182,387
 Cumulative effects of
 accounting change --
 net of tax (b) (40,734) ---
 Net earnings $199,434 $182,387
 Earnings per common share (a):
 Before cumulative effects
 of accounting change $3.47 $2.64
 Cumulative effects of
 accounting change (b) (0.59) ---
 Earnings per common share $2.88 $2.64
 Average common shares
 outstanding (a) 69,182 69,022
 Dividends per common share (a) $0.63 $0.56
 (a) Reflects the 2-for-1 stock split on July 16, 1991.
 (b) The company elected early adoption of SFAS No. 106, Employers' Accounting for Postretirement Benefits Other Than Pensions, effective in the first quarter of 1991.
 -0- 3/9/92
 /CONTACT: Cal Drecksel, VP-investor relations, American Stores Co., 801-539-0112/
 (ASC) CO: American Stores Co. ST: Utah IN: REA SU: ERN


KJ-EH -- LA005 -- 6164 03/09/92 06:03 EST
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