SVU -- Here is the WSJ take on things. Pretty out of touch, if you ask me, but I guess that's what makes a market.
Supervalu Swings to Loss
By KRISTIN JONES Supervalu Inc. SVU +3.57% swung to a fiscal fourth-quarter loss as the supermarket operator contended with weak same-store sales, store closings and the sale of fuel centers.
Supervalu, whose brands include Albertson's, Save-A-Lot and Shaw's, has struggled to cut costs in an effort to remain competitive with low-priced rivals like Kroger Co. KR -1.45% and Safeway Inc. SWY -0.41% The company planned to cut 800 office jobs in February in a bid to offset growing food costs.
Looking ahead to the current year, the supermarket operator sees per-share earnings of $1.27 to $1.42 on revenue of $35 billion to $35.5 billion. Analysts polled by Thomson Reuters most recently expected earnings of $1.19 a share on revenue of $35.3 billion.
Shares were up 10% in premarket trading to $5.85 as adjusted earnings for the latest period also topped expectations. The stock hit a 30-year low last week and is down 34% so far this year.
Ahead of the report, investment bank J.P. Morgan warned that the supermarket operator's stock has been "unusually weak because of bankruptcy concerns," adding that investors believe, rightly or wrongly, that "Supervalu is on an unavoidable course toward insolvency." The company didn't address those concerns Tuesday.
For the quarter ended Feb. 25, Supervalu reported a loss of $424 million, or $2 a share, from a year-earlier profit of $95 million, or 44 cents a share. Excluding goodwill and work-force reduction charges and other items, earnings were 38 cents a share. Revenue decreased 5% to $8.23 billion. Wall Street saw earnings of 35 cents on $8.31 billion in revenue.
Same-store sales were negative 1.9%.
Gross margin narrowed to 22.8% from 23.3% on added advertising expense, among other things.
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