Albertsons Companies(ACI) - 2026 Q3 - Quarterly Report

Financial Performance - Net sales for the 12 weeks ended November 29, 2025, were $19,123.7 million, an increase of 1.9% compared to $18,774.5 million for the same period in 2024[9] - Operating income for the 12 weeks ended November 29, 2025, was $489.7 million, a decrease of 5.5% from $518.5 million in the same period of 2024[9] - Net income for the 40 weeks ended November 29, 2025, was $698.2 million, down 11.2% from $786.8 million in 2024[11] - Retail segment sales for the 12 weeks ended November 29, 2025, were $18,926.9 million, an increase from $18,595.0 million for the same period in 2024, representing a growth of 1.8%[84] - Net income for the quarter ending September 7, 2024, was reported at $400.6 million, reflecting a strong performance[15] - The company reported a net income of $293.3 million for the 12 weeks ended November 29, 2025, compared to $400.6 million for the same period in 2024, a decline of 26.7%[88] Assets and Liabilities - Total current assets increased to $7,096.8 million as of November 29, 2025, compared to $6,559.0 million as of February 22, 2025, reflecting a growth of 8.2%[8] - Total liabilities rose to $24,591.5 million as of November 29, 2025, up from $23,369.5 million as of February 22, 2025, representing an increase of 5.2%[8] - Long-term debt and finance lease obligations increased to $8,417.0 million as of November 29, 2025, from $7,762.5 million as of February 22, 2025, an increase of 8.4%[8] - As of November 29, 2025, total stockholders' equity is $2,501.8 million, with a net income of $293.3 million for the period[13] Cash Flow and Investments - The company reported a 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 2024, a decrease of 14.1%[11] - Cash and cash equivalents decreased to $195.1 million as of November 29, 2025, from $293.6 million as of February 22, 2025, a decline of 33.6%[8] - The company issued long-term debt amounting to $2,585.0 million during the 40 weeks ended November 29, 2025, compared to $50.0 million in the previous year, indicating a significant increase in financing activities[11] Shareholder Activities - The company declared cash dividends of $0.15 per common share, totaling $77.1 million in the latest quarter[13] - The Company repurchased a total of 64.1 million shares of common stock for $1,211.6 million during the 40 weeks ended November 29, 2025, including $600.0 million under an accelerated share repurchase agreement[23] - The total number of Class A Common Stock shares increased to 600,523,680, up from 594,445,268 shares as of February 24, 2024[15] Tax and Expenses - The effective tax rate for the 12 weeks ended November 29, 2025, was 22.3%, up from 3.5% for the same period in 2024, primarily due to state income taxes and the absence of discrete state income tax benefits recognized in the prior year[24] - Employee costs for the 40 weeks ended November 29, 2025, totaled $9,166.4 million, an increase from $8,956.2 million in the prior year, reflecting a rise of 2.3%[84] - Merchandise costs, including advertising, distribution, and freight, for the 40 weeks ended November 29, 2025, were $44,500.9 million, compared to $43,379.7 million in 2024, an increase of 2.6%[84] Legal and Regulatory Issues - The Company is facing allegations of overcharging federal government healthcare programs, with claims exceeding $100 million before trebling and excluding penalties[63] - The U.S. Supreme Court issued an opinion adverse to the Company on June 1, 2023, reversing lower court rulings in the Proctor and Schutte cases[60] - The District Court set a pretrial conference for the Schutte case on March 4, 2024, with a trial date of April 29, 2024[61] - The Company recorded a liability of $21.5 million for settlements related to opioid litigation in New Mexico and Nevada, which was paid by insurers in Q4 of fiscal 2022[68] - The Company is vigorously defending claims in approximately 81 lawsuits related to the opioid epidemic, with ongoing discovery in some cases[67] Inventory and Cost Management - The Company recorded a LIFO expense of $13.2 million for the 12 weeks ended November 29, 2025, compared to $3.5 million for the same period in 2024, indicating a significant increase in inventory costs[20] - The Company’s inventories consist primarily of finished goods, with LIFO inventory costs based on management's estimates of expected year-end inventory levels and inflation rates[20] Comprehensive Income - Total comprehensive income for the 40 weeks ended November 29, 2025, was impacted by a current-period other comprehensive loss of $15.8 million, compared to a gain of $2.9 million in the prior year[79] - The ending accumulated other comprehensive income (AOCI) balance as of November 29, 2025, was $78.9 million, down from $90.9 million at the end of the same period in 2024[79]