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The Eden Prairie-based supermarket giant said today its earnings fell 42 percent from a year ago, it cut its dividend in half, and it slightly pared its guidance for fiscal 2010.
The company earned $74 million in the second quarter, on $9.5 billion in sales. A year ago, sales stood at $10.2 billion for the quarter, reflecting the multiple factors pressuring the food retailer, including recession, store closings, food deflation, and the sixth consecutive quarter of declining same-store sales.
Craig Herkert, Supervalu's chief executive, said the company will be plowing new investment into its extreme discount line, known as Save-A-Lot, which has 1,179 outlets around the country, but none in the Twin Cities.
"We expect to double the size of that (Save-A-Lot) business within the next five years," Herkert told analysts this morning. He added, "This is not an abandonment of traditional grocery, this is an investment in Save-A-Lot."
Supervalu owns Cub Foods in the Twin Cities, as well as a network of prominent regional grocers around the country, including Jewel-Osco in Chicago, Albertsons in Southern California and Acme in Philadelphia.
In late morning trading, Supervalu stock was unchanged at $16.94 a share.
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