Safeway Stores, Inc., yesterday reported a 7.2 per cent gain in sales for the third quarter to $2.62 billion, but a drop in net income to $16.7 million (64 cents a share) from $25.1 million (97 cents) a year ago.
Its nine-month results for the period ended Sept. 10 showed a 6.7 per cent increase in sales to $7.64 billion, but a decline in earnings to $68.6 million $2.64) from $72.1 million ($2.78) a year earlier.
Safeway said its nine-month pretax earnings reflect a $27 million charge as the result of using the LIFO inventory method. The application of LIFO during the same period in 1976 would have cut those earnings by $10.8 million, the company said.
During the first 36 weeks of this year, the supermaket chain opened 79 new stores and closed 86. As of Sept. 10 it operated 2.431 stores, compared to 2,438 a year ago.
The high cost of closing marginal stores and reduced tax credits cut sharply into profit of the Great Atlantic & Pacific Tea Co. in the first half of its fiscal year despite a rise in gross sales to $3.6 billion from $3.52 billion, the company said yesterday.
Profits fell to $7.95 million 32 cents a share) from $16.98 million (68 cents). The tax credit this year was $3.4 million against $7 million a year ago.
Profits in the second quarter ended Aug. 27 was $1.27 million 5 cents) on sales of $1.82 billion compared with $10.68 million (43 cents) on sales of $1.79 billion a year ago.
Chairman Johathan L. Scott said A&P closed 110 stores this year and opened only 12. But he said 48 more stores will be opened in the second half. The company presently operated 1,931 gorcery stores, virtually all supermarkets.