Safeway

Safeway Inc.'s profit and sales slumped during its third quarter, eroded by severance charges and the supermarket giant's ongoing price cuts to entice customers who have been battered by a dreary economy. Pleasanton, Calif.-based Safeway earned $122.8 million on sales of $9.4 billion in its third quarter that ended Sept. 12. Compared with the same quarter a year earlier, profit fell 4.7% and sales slipped 0.6%. Profit of 33 cents a share beat Wall Street's predictions by 2 cents a share.

A former Safeway Inc. employee was sentenced Tuesday to spend seven months in home detention in connection with the federal investigation of defunct California tomato processor SK Foods. Michael Chavez, 52, of Fremont had pleaded guilty to two counts of wire fraud and accepting $5,000 in bribes from an official of SK Foods, which was based in Monterey. Chavez was a corporate purchasing manager for the Pleasanton, Calif., grocery chain from 2000 to 2007, and responsible for negotiating deals for processed tomato products, court documents said.

The Food and Drug Administration on Thursday announced a potentially massive recall of salad dressing, chip dip, soup mixes and other foods made with a commonly used food additive that may be contaminated with salmonella. Among the products being taken off store shelves is a potato salad from an Oregon supplier, according to the Oregonian newspaper, that makes products distributed under the Safeway and Wal-Mart brands. Safeway Inc. said Thursday that it was removing its Red Potato Salad with Dill products from its Vons and Pavilions stores, as well as its self-named markets.

Who could object to rewarding people who quit smoking, lose weight or start to exercise? The American Cancer Society and the American Heart Assn., for starters. Some companies are charging lower insurance premiums to workers who meet benchmarks for healthy living. The Senate's healthcare overhaul legislation would expand the trend. But instead of cheering the proposal, some patient advocacy and health groups are worried that it could mean higher rates for less-fit Americans, possibly pricing them out of their employers' insurance plans.

How will we know when the recession is ending? Watch the coffee index, says Steven Burd, chief executive of Safeway Inc., the Pleasanton, Calif., supermarket company that owns Vons here in Southern California. Speaking to investors about Safeway's third-quarter profit, Burd said shoppers were starting to trade up to more expensive items after a long period in which they had gravitated to less costly goods. "When we went into the recession, we saw a change in the mix of lattes versus coffee, and now we've seen -- it's early but we're seeing -- a trend back to lattes," Burd said.

Budget-conscious shoppers and falling fuel and commodity prices took a toll on Safeway Inc. during its second quarter, and the grocery store operator, which doesn't expect the picture to improve soon, lowered its full-year earnings forecast. Pleasanton, Calif.-based Safeway earned $238.6 million, or 57 cents a share, for the second quarter, up from $234.3 million, or 53 cents, in the year-earlier period. The slight profit improvement was largely because of a $57.8-million benefit from the resolution of a tax matter.

Grocery store operator Safeway Inc. said weak consumer spending, the stronger dollar, lower fuel prices and the late Easter holiday caused its first-quarter profit to fall 25%. The Pleasanton, Calif., company also lowered its full-year outlook because of the weak environment but raised its dividend. Safeway's net income declined to $144.2 million, or 34 cents a share, from $193.4 million, or 44 cents, a year earlier. The results missed the company's estimate and the 40 cents a share that analysts polled by Thomson Reuters had predicted.

Higher sales at its gas stations and upscale stores helped boost grocer Safeway Inc.'s profit nearly 3% in its third fiscal quarter. The nation's second-biggest grocery chain said Tuesday that its profit rose to $199.7 million, or 46 cents a share, for the three months ended Sept. 6, from $194.6 million, or 44 cents, a year earlier. The results sent Safeway shares up nearly 5% on Tuesday to close at $22.85, gaining $1.08 for the day.

Higher gasoline sales and a boost from its more upscale stores helped grocer Safeway Inc. post higher second-quarter earnings Thursday, but a downbeat outlook caused by reduced consumer spending sent its shares tumbling more than 10%. The nation's second-largest grocer, which owns Vons, said that cutting costs and revising its retail strategy helped it to report the higher earnings, which beat Wall Street expectations. Chief Executive Steve Burd said Safeway had a very strong quarter but acknowledged that the economy and its effect on shoppers' spending habits made for soft same-store sales.