Identical sales, which the company defines as stores that operated in both the current and prior fiscal year compared by sales on a daily basis and includes direct to consumer digital sales and excludes fuel sales, was the backbone of the company’s earnings report. Year-over-year, identical sales grew 1.5% and on a 2-year stacked basis (comparing to pre-covid 2019 rather than post covid 2020) identical sales grew 15.3%.
Albertson CEO Vivek Sankaran attributed the surge in same-store sales to increased productivity and stronger talent. After this strong quarter, the company raised its outlook to anticipate identical sales to decline between 2.5% and 3.5%, rather than its previously expected decline of between 5% and 6%.
In addition to strong identical sales, the company reported continued growth in its digital sales. Identical sales were helped in part by a 5% increase in digital sales, which on a two-year stacked basis came in at 248% growth.
The company's gross profit margin fell to 28.6% from 29% in the prior quarter. Excluding fuel costs, gross margin was flat. The company said higher costs for products and advertising as well as supply chain issues were partially offset by increases in productivity, a favorable product mix and higher pharmacy margins related to administering Covid-19 vaccines.
Due to the strong quarter, Alberston raised its dividend 20%, bringing the quarterly dividend to $0.12 from $0.10.