Own Brands, Online Grocery Propel Albertsons in Q3
The Albertsons Cos. said that online grocery and store brands drove tremendous growth during its latest fiscal quarter.
For the third quarter ended Nov. 30, the grocer reported same-store sales growth of 2.7%, marking the company’s eighth consecutive quarter of same-store sales growth.
"Our identical sales momentum continued in the third quarter, as our core business continues to deliver strong growth," said Vivek Sankaran, president and CEO. "We are focused on providing our customers with an easy shopping experience, exciting merchandise and friendly customer service in our omnichannel shopping environment, and creating deep and lasting customer relationships."
Meanwhile, Own Brands sales penetration reached a new high of 25.6% at Albertsons. Online home delivery and Drive Up and Go sales grew 34%.
As more consumers switch to private label products, Own Brands remains an important source of growth and innovation at Albertsons, according to the company. Own Brands penetration has grown from 23% in fiscal 2017 to 25.6% in the third quarter. The Own Brands team launched 1,100 new items in 2018 alone.
Albertsons additionally reported that during the third quarter, the retailer has slashed its outstanding debt by more than $1.8 billion since 2017.
"Our productivity and cost reduction initiatives are also beginning to take shape, which we intend to use to fund strategic growth investments, offset cost inflation and support earnings growth," Sankaran added.
During the quarter, net income was $55 million. Adjusted EBITDA was $634 million, slightly ahead of expectations. Sales and other revenue increased 1.9% to $14.1 billion, compared with $13.8 billion during the prior-year quarter.
The grocer also said that its Just for U loyalty registrations and digital coupon redemptions were up 25% and 31%, respectively, during the period.
Boise, Idaho-based Albertsons Cos. operates stores across 35 states and the District of Columbia under 20 well-known banners, including Albertsons, Safeway, Vons, Jewel-Osco, Shaw’s, Acme, Tom Thumb, Randalls, United Supermarkets, Pavilions, Star Market, Haggen and Carrs, as well as meal-kit company Plated. The company is No. 3 on Progressive Grocer's 2019 Super 50 list of the top grocers in the United States.