Printer Friendly

SAFEWAY CHAIRMAN ADDRESSES SHAREHOLDERS AT ANNUAL MEETING

 SAFEWAY CHAIRMAN ADDRESSES SHAREHOLDERS AT ANNUAL MEETING
 SCOTTSDALE, Ariz., April 29 /PRNewswire/ -- Safeway Inc. (NYSE: SWY) Chairman and CEO Peter Magowan told shareholders at the company's annual meeting that while 1991 results were achieved in difficult times for the industry, "We believe tough times make a good company better.
 "As the recession deepened in our marketing areas, we pursued specific strategies to improve our balance sheet and combat a difficult sales environment through marketing and capital spending programs," said Magowan. Financial Restructuring
 According to Magowan, Safeway completed a highly successful 17.5 million share common stock offering in April 1991, which raised $340 million in net proceeds. "This second offering resulted in a positive net worth position for Safeway and more than doubled our stock float," he said.
 "We have also made significant progress during the past year with regard to our capital structure as evidenced by the redemption of $565 million of 14.5 percent junior subordinated debentures, and the refinancing of $1 billion of other high coupon subordinated debt. These actions extended our debt maturity schedule and will reduce interest expense by more than $60 million. Marketing Strategy
 "To get more life into our sales, we have undertaken a number of new marketing programs in selected divisions:
 -- In Northern California we launched an electronic payment system that allows shoppers to pay for their purchases with their bank debit or credit cards.
 -- In our Eastern Division earlier this year we introduced a frequent shopper program called 'Savings Club.' It is designed to reward Savings Club members with instant discounts at the checkstand on selected items and with coupons mailed to their homes based on monthly volume purchases.
 -- Seattle Division has introduced a coupon book program that has proven to be effective in Portland over the last several years.
 -- Finally, we decided in 1991 to coordinate our advertising in all U.S. divisions under one ad agency. We awarded the account to McCann-Erickson. This decision was made to give us more effective consistent advertising and to improve our image nationwide. Our new ad campaign is built around the theme, 'Nobody Does It Better'". Capital Spending
 In 1990, we initiated a $3.2 billion capital expenditure program covering the 1990-94 period. During 1991, we spent $635 million, opened 33 new stores, remodeled 77 and proceeded with construction of a 1.8 million-square-foot distribution center in Tracy, Calif., which is scheduled to open May 1. We expect to invest more than $600 million per year over the next 5 years. During 1992, we expect to open more than 30 stores and remodel more stores than last year. First Quarter 1992
 Magowan also discussed recently announced results for the first quarter of 1992.
 "As expected, the industry continued to experience a continuation of low food price inflation, heightened competition in certain markets and a low level of consumer confidence in the economy. Sales of $3.4 billion were equal to those in the prior year's first quarter. Our income before the extraordinary loss associated with the redemption of our high cost debt was $22.9 million versus $26.7 million in the first quarter of 1991.
 This is the second annual shareholder meeting since Safeway went public in 1990. This year's meeting was held in Scottsdale, Ariz., and was hosted by Safeway's Phoenix Division.
 -0- 4/29/92
 /CONTACT: Brian Dowling of Safeway Inc., 510-891-3267/
 (SWY) CO: Safeway Inc. ST: California IN: REA SU:


MM-RM -- SF005 -- 4452 04/29/92 14:00 EDT
COPYRIGHT 1992 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1992 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Apr 29, 1992
Words:580
Previous Article:LONG-TERM CARE BILL S. 2141 RECEIVES MIXED REVIEWS FROM INSURANCE AGENTS
Next Article:MCGRAW-HILL, INC. DECLARES QUARTERLY DIVIDEND


Related Articles
PHARR ELECTED TO SAFEWAY BOARD OF DIRECTORS
Takeover battle blamed for slower Safeway sales.
Takeover talks put damper on Safeway sales.
Safeway still in the doldrums over sales.
Morrisons optimistic after takeover.

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters