Exhibit 99.1
Company Provides Fiscal 2008 Diluted Earnings Per Share Guidance on a
GAAP Basis of $2.58 to $2.77 Compared to Fiscal 2007 Guidance on a
GAAP Basis of $2.34 to $2.41
Fiscal 2008 Diluted Earnings Per Share Guidance Prior to Stock Option
Expensing and One-Time Transaction Costs is $2.90 to $3.05
SUPERVALU's Transformational Acquisition on Track
and Showing Excellent Progress
MINNEAPOLIS--(BUSINESS WIRE)--Feb. 21, 2007--SUPERVALU (NYSE:SVU)
announced today its fiscal 2008 diluted earnings per share guidance,
on a GAAP basis, of $2.58 to $2.77. Fiscal 2008 diluted earnings per
share guidance, on a GAAP basis, includes $0.16 to $0.20 per diluted
share of one-time transaction costs and approximately $0.12 per
diluted share of expense from the adoption of FAS 123R related to
stock option expensing. The company also affirmed its fiscal 2007
diluted earnings per share guidance, on a GAAP basis, of $2.34 to
$2.41.
Jeff Noddle, SUPERVALU chairman and chief executive officer
commented, "We are on track with our transformational acquisition and
have made progress on our key milestones in fiscal 2007 and expect to
continue this success into fiscal 2008. From a financial standpoint,
we expect to deliver double-digit earnings accretion in both fiscal
2007 and fiscal 2008 as we capture the potential of the new SUPERVALU.
I am very pleased with the progress we have made to date and attribute
this success to our talented management team and associates across the
country. Together, their thoughtful planning, disciplined execution
and day-to-day focus on serving our customers are central to our
achievements. Another important benchmark is our improving identical
store sales. Our identical store sales on a combined basis in the
fourth quarter of fiscal 2007 which ends February 24 are expected to
increase approximately one percent, representing continued sequential
improvement from the 0.6 percent increase in the third quarter of
fiscal 2007 as we successfully execute across our entire retail
network."
Company Announces Guidance for Fiscal 2008
SUPERVALU announced guidance for fiscal 2008 which begins February
25, 2007 and ends on February 23, 2008. Earnings ranges shown below
provide detail on certain items to improve comparability.
Fiscal 2007 Fiscal 2008
Guidance Guidance
- ----------------------------------------------------------------------
Net Sales $37 Billion $44 Billion
Diluted earnings per share guidance $2.62 to $2.67(a) $2.90 to $3.05
prior to adjustments
Adoption of FAS 123R stock option
expensing $0.08 $0.12
One-time transaction costs $0.20 to $0.18 $0.20 to $0.16
- ----------------------------------------------------------------------
Diluted earnings per share guidance $2.34 to $2.41 $2.58 to $2.77
on a GAAP basis
Weighted average diluted shares 194 to 198 214 to 217
outstanding (millions)
(a) Fiscal 2007 diluted earnings per share includes the $0.06 impact
from HITS not settling early.
The company still expects pre-tax synergies of $150 to $175
million to be at the full run rate by the end of the third full year
following the acquisition. The company still expects to incur total
one-time transaction costs of approximately $145 million pre-tax by
the end of the third full year following the acquisition. Incorporated
into the guidance for fiscal 2007 and 2008 is the preliminary
assessment of purchase accounting, based on initial estimates of fair
values. These estimates of fair values will be refined as final
valuation information is received or developed. The company expects to
release fourth quarter and full year fiscal 2007 earnings on April 19
and to provide additional outlook comments regarding fiscal 2008 at
that time.
Noddle added, "Fiscal 2008 will see the implementation of many
projects that continue to leverage our new business model. Net sales
in fiscal 2008 will approximate $44 billion representing the first
full year of acquired operations, with retail representing
approximately 80 percent of net sales. We also expect to see an
increase in identical store sales of one to two percent, representing
the combined retail operations as if the acquired retail operations
were in the store base for more than one year. We will also invest
approximately $1.2 billion in our business, primarily supporting the
remodel and expansion of our retail fleet as well as the installation
of automated technology in the eastern region of our supply chain
network. As we deploy our new store and remodel program, called
Premium Fresh and Healthy, and undertake major remodels of
approximately 100 to 110 stores and open 25 to 30 new standard size
grocery stores in fiscal 2008, we are raising the store standards
across our retail network. I am confident that fiscal 2008 will
continue to demonstrate the benefits of the value enhancing
acquisition which transformed SUPERVALU into a retail powerhouse."
About SUPERVALU
SUPERVALU INC. is one of the largest companies in the United
States grocery channel with annual sales approaching $40 billion.
SUPERVALU holds leading market share positions across the U.S. with
its approximately 2,500 retail grocery locations. Through SUPERVALU's
nationwide supply chain network, the company provides distribution and
related logistics support services to more than 5,000 grocery
endpoints across the country. SUPERVALU currently has approximately
200,000 associates. For more information about SUPERVALU visit
www.supervalu.com.
CAUTIONARY STATEMENTS RELEVANT TO FORWARD-LOOKING INFORMATION FOR
THE PURPOSE OF "SAFE HARBOR" PROVISIONS OF THE PRIVATE SECURITIES
LITIGATION REFORM ACT OF 1995
Except for the historical and factual information contained
herein, the matters set forth in this news release, including
statements as to the progress and expected benefits of the combination
of the operations of Albertson's, Inc. that were acquired in June 2006
with those of SUPERVALU, such as efficiencies, cost savings, market
profile and financial strength, and the competitive ability and
position of the combined company, and other statements identified by
words such as "estimates," "expects," "projects," "plans," and similar
expressions are forward-looking statements within the meaning of the
"safe harbor" provisions of the Private Securities Litigation Reform
Act of 1995. These forward-looking statements are subject to risks and
uncertainties that may cause actual results to differ materially,
including the possibility that the anticipated benefits from the
acquisition cannot be fully realized or may take longer to realize
than expected, the possibility that costs, including costs related to
purchase accounting estimates of fair value, or difficulties related
to the combination of Albertsons operations into SUPERVALU will be
greater than expected, and the impact of competition, economic and
industry conditions, security and food and drug safety issues, severe
weather and natural disasters, labor relations and employee benefit
costs, expansion, liquidity, legal and administrative proceedings,
regulatory and accounting matters, changes in operating conditions,
and other risk factors relating to our business or industry as
detailed from time to time in SUPERVALU's reports filed with the SEC.
You should not place undue reliance on these forward-looking
statements, which speak only as of the date of this news release.
Unless legally required, SUPERVALU undertakes no obligation to update
publicly any forward-looking statements, whether as a result of new
information, future events or otherwise.
CONTACT: SUPERVALU
Investors & Financial Media:
Yolanda Scharton, 952-828-4540
Yolanda.Scharton@supervalu.com
or
Media:
Haley Meyer, 952-828-4786
Haley.Meyer@supervalu.com