Boise, Idaho—Albertsons Companies announced its financial results for the fourth quarter and full fiscal year 2024, ending February 22, 2025. Albertsons predicts yearly profits will fall short of expectations due to selective discounts and investments in its loyalty program aimed at boosting sales. Inflation is impacting consumer spending, leading to a 3% drop in its shares.
“We delivered solid results in the fourth quarter and closed fiscal 2024 with positive momentum as we continued to invest in our Customers for Life strategy,” said Vivek Sankaran, CEO. “This strategy has firmly positioned the Company for its next chapter of growth and value creation for shareholders. As previously announced, I am retiring as of May 1, 2025, and am delighted that the Board of Directors has selected Susan Morris to succeed me as CEO. Under Susan's leadership, I have the utmost confidence that she and the entire team will continue to drive future growth and continue to elevate our role with our customers and our communities.”
Susan Morris, COO and incoming CEO, said, “I am thrilled to be taking the helm of our Company during this transformational time in our Customers for Life strategy. None of this would be possible without the support of our 285,000 associates who work tirelessly to make it all happen.” Morris added, “As we look forward to fiscal 2025 and beyond, we are excited about the investments we have made in our core business, including the growth opportunity inherent in our digital platforms working together to generate deeper engagement, increased digital inventory and acceleration of growth in the Albertsons Media Collective. While fiscal 2025 will be an investment year, beginning in fiscal 2026 we expect to drive growth consistent with our long-term algorithm of 2+% identical sales and Adjusted EBITDA growth higher than identical sales growth.”
Fourth Quarter Highlights:
- Identical sales increased 2.3%
- Digital sales increased 24%
- Loyalty members increased 15% to 45.6 million
- Net income of $172 million, or $0.29 per share
- Adjusted net income of $270 million, or $0.46 per share
- Adjusted EBITDA of $855 million
The company attributed the rise in identical sales primarily to strong growth in pharmacy sales. However, the gross margin rate decreased by 58 basis points compared to the prior year, which was impacted by increased shrinkage, higher digital fulfillment costs, and a greater mix of lower-margin pharmacy sales.
Full-Year Fiscal 2024 Highlights:
- Identical sales increased 2.0%
- Digital sales increased 24%
- Net income of $959 million, or $1.64 per share
- Adjusted net income of $1,382 million, or $2.34 per share
- Adjusted EBITDA of $4,005 million
Fiscal 2025 Outlook:
- Identical sales growth in the range of 1.5% to 2.5%
- Adjusted EBITDA in the range of $3.8 billion to $3.9 billion, including approximately $65 million related to the Company's 53rd week
- Adjusted net income per Class A common share in the range of $2.03 to $2.16 per share, including approximately $0.03 per share related to the Company's 53rd week
- Effective income tax rate in the range of 23.5% to 24.5%
- Capital expenditures in the range of $1.7 billion to $1.9 billion
CEO Sankaran acknowledged anticipated headwinds in fiscal 2025, including increased labor costs, reduced government assistance, and margin pressures from the growing pharmacy and digital segments. As for tariffs, Albertsons has limited exposure to imports from countries such as China, Canada and Mexico but weak spending could weigh on its sales.
For more detailed information, please refer to the full press release.
