Albertsons Companies, Inc. (NYSE: ACI) released its third-quarter fiscal 2023 results, showing a 2.9% increase in identical sales, with digital sales growing by 21%. The company reported net income of $361 million, or $0.62 per share, and adjusted net income of $462 million, or $0.79 per share. Adjusted EBITDA was $1,107 million.
Vivek Sankaran, CEO of Albertsons Companies, commented on the results, saying, "We delivered another solid quarter amidst a challenging economic backdrop. We want to thank all our teams for their commitment to serving our customers and communities. As we look ahead, our ambition is to create customers for life, in part through our focus on operational excellence in our stores, driving growth in our digital and pharmacy operations, and deepening our relationships with our customers."
Sankaran also addressed the company's future outlook, stating, "While we are benefiting from our productivity initiatives, we expect to continue to see the impacts of investments in associate wages and benefits, cycling significant prior year food inflation, customers receiving less government assistance, the resumption of student loan payments and other types of payment deferrals, inflationary cost increases and the outsized growth of our pharmacy and digital businesses as we continue to lean into increased customer engagement in our customers for life strategy."
During the third quarter of fiscal 2023, net sales and other revenue were $18.6 billion, compared to $18.2 billion during the same period in fiscal 2022. The company attributed the increase to the 2.9% rise in identical sales, driven by strong growth in pharmacy sales. Digital sales also contributed to the growth with a 21% increase.
The gross margin rate decreased to 28.0% during the third quarter of fiscal 2023, primarily due to the growth in pharmacy operations, which carries an overall lower gross margin rate, and increases in shrink. Selling and administrative expenses decreased to 24.8% of net sales and other revenue during the same period.
Looking ahead to the fourth quarter of fiscal 2023, the company expects continued outsized growth and margin impact in its pharmacy and digital operations.
Albertsons Companies, Inc. is a leading food and drug retailer in the United States, operating 2,271 retail food and drug stores across 34 states and the District of Columbia. As of December 2, 2023, the company had 1,726 pharmacies, 401 associated fuel centers, 22 dedicated distribution centers, and 19 manufacturing facilities.
The company's full 8-K submission is available here.
| 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|---|
| Revenue (MM) | $59,925 | $60,534 | $62,455 | $69,690 | $16,728 | $77,650 |
| Revenue Growth | n/a | 1.02% | 3.17% | 11.58% | -76.0% | 364.18% |
| Operating Margins | 0% | 1% | 2% | 2% | 4% | 2% |
| Net Margins | 0% | 0% | 1% | 1% | 3% | 2% |
| Net Income (MM) | $46 | $131 | $466 | $850 | $424 | $1,936 |
| Net Interest Expense (MM) | -$194 | -$213 | -$155 | -$116 | -$111 | $51 |
| Depreciation & Amort. (MM) | $1,330 | $1,258 | $1,245 | $1,298 | $1,681 | $1,807 |
| Earnings Per Share | $0.08 | $0.23 | $0.99 | $1.48 | $0.79 | $3.33 |
| Free Cash Flow (MM) | -$502 | $325 | $429 | $2,259 | $1,907 | $700 |
| Capital Expenditures (MM) | $1,520 | $1,363 | $1,475 | $1,643 | $1,606 | $2,154 |
| Current Ratio | 1.1 | 1.0 | 1.13 | 1.12 | 0.8 | 0.81 |
| Total Debt (MM) | $10,734 | $8,765 | $8,549 | $8,128 | $7,920 | $8,886 |
| Net Debt / EBITDA | 8.06 | 4.09 | 2.5 | 1.88 | 1.54 | 2.3 |
