Albertsons Companies, Inc. Reports Fourth Quarter and Full Year Results

Albertsons Companies, Inc. today reported results for the fourth quarter of fiscal 2021 and full year fiscal 2021, which ended Feb. 26, 2022 and provided a fiscal 2022 outlook.

Fourth Quarter of Fiscal 2021 Highlights

• Identical sales increased 7.5 percent; on a two-year stacked basis identical sales growth was 19.3 percent
• Digital sales increased 5 percent; on a two-year stacked basis digital sales growth was 287 percent
• Net income of $455 million$0.79 per share
• Adjusted net income of $437 million$0.75 per share
• Adjusted EBITDA of $1,074 million

Fiscal 2021 Highlights

• Identical sales decreased 0.1 percent; on a two-year stacked basis identical sales growth was 16.8 percent
• Digital sales increased 5 percent; on a two-year stacked basis digital sales growth was 263 percent
• Net income of $1,620 million$2.70 per share
• Adjusted net income of $1,781 million$3.07 per share
• Adjusted EBITDA of $4,398 million

“We are pleased with our fourth quarter and full-year 2021 results and the continuing momentum we are seeing as we enter 2022,” said Vivek Sankaran, CEO. “Our strategy is working, and we are executing well against industry-wide pressures. We want to recognize and thank all of our retail, distribution and manufacturing teams for their commitment to and care of our customers and their communities.”

Fourth Quarter of Fiscal 2021 Results

Net sales and other revenue was $17.4 billion during the 12 weeks ended Feb. 26, 2022 (“fourth quarter of fiscal 2021”) compared to $15.8 billion during the 12 weeks ended Feb. 27, 2021 (“fourth quarter of fiscal 2020”). The increase was driven by the Company’s 7.5 percent increase in identical sales and higher fuel sales, with retail price inflation contributing to the identical sales increase.

Gross margin rate decreased to 28.7 percent during the fourth quarter of fiscal 2021 compared to 28.9 percent during the fourth quarter of fiscal 2020. Excluding the impact of fuel, gross margin rate was flat compared to the fourth quarter of fiscal 2020 primarily due to productivity initiatives, improved pharmacy margins related to administering Covid-19 vaccines and favorable product mix, offset by lower gross margin rates across certain product categories due to the rate impact of increased product costs, higher supply chain costs and an increase in LIFO expense, all driven by the current inflationary environment.

Selling and administrative expenses decreased to 24.9 percent of Net sales and other revenue during the fourth quarter of fiscal 2021 compared to 30.0 percent of Net sales and other revenue during the fourth quarter of fiscal 2020. Excluding the impacts of fuel and the Combined Plan (as defined herein) withdrawal, Selling and administrative expenses as a percentage of Net sales and other revenue decreased 30 basis points. The decrease in Selling and administrative expenses was primarily attributable to lower Covid-19 related expenses and the execution of productivity initiatives, which were offset by higher employee costs, depreciation and other expenses related to the Company’s investments in its digital and omnichannel capabilities and other strategic priorities. The increase in employee costs was the result of additional labor to support the increase in fresh sales, market-driven wage rate increases, incremental front-line associate appreciation pay and higher equity-based compensation expense.

Interest expense, net was $108.0 million during the fourth quarter of fiscal 2021 compared to $113.1 million during the fourth quarter of fiscal 2020.

Other income, net was $47.5 million during the fourth quarter of fiscal 2021 compared to Other income, net of $107.2 million during the fourth quarter of fiscal 2020. The decrease in other income is primarily attributable to lower unrealized gains on non-operating investments in the fourth quarter of fiscal 2021 compared to the fourth quarter of fiscal 2020.

Income tax expense was $148.7 million, representing a 24.6 percent effective tax rate, during the fourth quarter of fiscal 2021. Income tax benefit of $64.1 million, representing a 30.8 percent effective tax rate, was the result of the loss before income taxes which was driven by the $607.2 million Combined Plan withdrawal charge during the fourth quarter of fiscal 2020.

Net income was $455.1 million or $0.79 per share during the fourth quarter of fiscal 2021, which included the $78.7 million or $0.14 per share gain, net of tax, related to the Combined Plan withdrawal. Net loss was ($144.2 million) or ($0.37) per share during the fourth quarter of fiscal 2020, which included the $449.4 million or $0.97 per share charge, net of tax, related to the Combined Plan withdrawal.

Adjusted net income was $436.8 million, or $0.75 per share, during the fourth quarter of fiscal 2021 compared to $347.2 million, or $0.60 per share, during the fourth quarter of fiscal 2020.

Adjusted EBITDA was $1,073.7 million during the fourth quarter of fiscal 2021 compared to $916.9 million during the fourth quarter of fiscal 2020.

Supplemental Two-Year Results

The following table provides a comparison of the fourth quarter of fiscal 2021 and 52 weeks ended Feb. 26, 2022 (“fiscal 2021”) to the 13 weeks ended Feb. 29, 2020 (“fourth quarter of fiscal 2019”) and 53 weeks ended Feb. 29, 2020 (“fiscal 2019”) for certain financial measures, including a compounded annual growth rate (“CAGR”), to demonstrate the two-year growth in the Company’s business. The Company believes these supplemental comparisons provide meaningful and useful information to investors about the trends in its business relative to pre-Covid-19 pandemic periods.

For more information, visit the company’s official press release.