Albertsons Companies(US:ACI)2026-01-07 12:30Financial Performance - Net sales and other revenue increased by 1.9% to $19,123.7 million for the third quarter of fiscal 2025, driven by a 2.4% increase in identical sales and a 21% increase in digital sales[6]. - Net income was $293.3 million, or $0.55 per share, compared to $400.6 million, or $0.69 per share, in the same quarter last year[12]. - Adjusted net income was $390.3 million, or $0.72 per share, compared to $420.3 million, or $0.71 per share, in the prior year[13]. - Operating income for the 40 weeks ended November 29, 2025, was $1,234.3 million, a decrease from $1,270.1 million in the previous year, reflecting a decline of 2.8%[31]. - Net income for the 40 weeks ended November 29, 2025, was $698.2 million, down from $786.8 million in the same period last year, a decrease of 11.2%[31]. - Adjusted net income for the 40 weeks ended November 29, 2025, was $957.6 million, down from $1,112.9 million in 2024, reflecting a decline of approximately 13.9%[39]. - Adjusted EBITDA for the 12 weeks ended November 29, 2025, was $1,038.7 million, compared to $1,065.1 million in 2024, indicating a decrease of about 2.3%[37]. Cost and Expenses - Gross margin rate decreased to 27.4% from 27.9% in the same quarter last year, primarily due to increased delivery and handling costs associated with digital sales growth[7]. - Selling and administrative expenses decreased to 24.9% of net sales, down from 25.1% in the prior year, reflecting improved sales leveraging and lower merger-related costs[8]. - Gross margin for the 40 weeks ended November 29, 2025, was $17,093.7 million, slightly down from $17,106.6 million in the prior year, indicating a margin of 27.2% compared to 27.8%[31]. - Depreciation and amortization expenses for the 40 weeks ended November 29, 2025, totaled $1,439.6 million, up from $1,396.9 million in 2024[43]. - The company incurred merger-related costs of $23.1 million for the 12 weeks ended November 29, 2025, significantly lower than $61.1 million in 2024[37]. Capital and Investments - Capital expenditures for the first 40 weeks of fiscal 2025 were $1,412.8 million, including the completion of 74 remodels and the opening of five new stores[14]. - The company announced a share repurchase program increase from $2.0 billion to $2.75 billion, including a $750 million accelerated share repurchase agreement[15]. Outlook and Projections - The updated fiscal 2025 outlook includes adjusted EBITDA in the range of $3.825 billion to $3.875 billion and an effective income tax rate of 23% to 24%[21]. - Identical sales growth is projected to be between 2.2% and 2.5% for fiscal 2025[21]. - The company estimates a 16 to 18 basis point impact on pharmacy sales due to the Inflation Reduction Act's Medicare Drug Price Negotiation Program starting January 1, 2026[17]. Assets and Liabilities - Total current assets increased to $7,096.8 million as of November 29, 2025, from $6,559.0 million as of February 22, 2025, reflecting a growth of 8.2%[33]. - Total liabilities increased to $24,591.5 million as of November 29, 2025, compared to $23,369.7 million as of February 22, 2025, an increase of 5.2%[33]. - Total debt, including finance leases, increased to $9,012.7 million as of November 29, 2025, from $7,838.4 million in 2024[45]. - The total net debt ratio rose to 2.29 for the 12 months ended November 29, 2025, compared to 1.88 in the previous year[45]. Shareholder Information - Basic net income per Class A common share for the 40 weeks ended November 29, 2025, was $1.25, compared to $1.36 in the prior year, a decline of 8.1%[31]. - Adjusted net income per Class A common share for the 40 weeks ended November 29, 2025, was $1.69, down from $1.88 in 2024[39]. - The weighted average diluted Class A common shares outstanding for the 12 weeks ended November 29, 2025, was 534.7 million, compared to 584.1 million in 2024[39]. Store Operations - The number of stores at the end of the quarter was 2,243, down from 2,273 in the previous year, indicating a reduction of 1.3%[31]. - Net cash provided by operating activities of $1,649.6 million for the 40 weeks ended November 29, 2025, compared to $1,922.1 million in the prior year, a decrease of 14.1%[35]. - Cash and cash equivalents at the end of the period were $200.9 million, a decrease from $206.5 million at the end of the same period last year[35].