BOISE, ID - Will privately-owned Albertsons finally succeed in going public? According to Bob Dimond, CFO, and Vivek Sankaran, President and CEO, the timing might be right soon. This week, the retailer announced its financial results for the first quarter of fiscal 2019, ended June 15, 2019, which included highs from its digital and e-commerce sectors and increased sales overall. This positions the company to tackle its debt and a future IPO, according to a report by the Boise Dev.
“We continue to make very good progress and are delivering very good results,” Sankaran said during an investor call. “We have momentum in sales and have reduced debt by $1 billion since year-end.”
Dimond added, “We think that it does position us well that when the timing is right and everything else lines up for us, an IPO could be in our future.”
The news source noted that Albertsons has tried to go public before—first in 2017—which ultimately was put on the backburner as the retailer navigated the possibility of a merger with Rite Aid.
During the investor call, Sankaran and Dimond also curbed questions regarding Amazon’s move into brick and mortar. Sankaran responded by noting the importance of being an omnichannel grocer with “assets on the ground and stores on the ground.” This year alone, the retailer has done exactly that by opening its largest store to date, joined an IBM food trust network, refreshed its private label brands, and delved further into online grocery delivery.
Additional highlights from the financial report included the following:
- Identical sales increased 1.5%
- Gross profit margin increased to 28.0%
- Adjusted EBITDA increased 7.5% to $877 million compared to last year
- Net income of $49.0 million compared to a net loss of $17.7 million last year
- Own Brands sales penetration reached 25.3%
- Digital and eCommerce sales grew 33%
- Net debt leverage reduced to 3.3x at end of first quarter; loss on extinguishment of debt was $42.7 million during the first quarter of fiscal 2019 compared to no loss on extinguishment of debt during the first quarter of fiscal 2018
"I am pleased with the position of our business at Albertsons Companies," said Sankaran in a press release. "Identical sales were positive for the sixth consecutive quarter, and we continue to expand our e-commerce and digital capabilities. We are focused on our sales momentum and will continue to elevate the end-to-end customer experience as we work to create a next-generation food retailer. We recognize the ever-changing retail consumer and are working swiftly to adapt our business to allow customers to shop with us whenever, wherever and however they want."
To read the financial report in its entirety, click here.
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