Giant Food Inc. has rebounded from its worst loss in history to its most profitable 12 months ever, executives of Washington's biggest supermarket chain told shareholders at their annual meeting yesterday.

Not only have profits jumped to record levels, but Giant stock has soared from 16 5/8 a share to $40 since last year's stockholder session, said David B. Sykes, Giant's vice president for finance.

The picture of Giant's finances painted by Sykes and Chairman Israel Cohen was far different from what stockholders saw at last year's annual meeting, when Cohen disclosed the chain was losing money because of a food price war.

After suffering a loss of $2.4 million during the summer of 1981, Giant declared a truce in the discount-food fight with Safeway and in the next six months made more money than it had ever before earned in a whole year--$19 million.

"We spoke of a turnaround, and a turnaround we got," Sykes said. The profit pace set in the second half of 1981 continued in the first two quarters of this year and has produced the four most profitable quarters in the company's history.

Since last summer's loss, Giant's profits for the 12-month period, ending Aug. 14, have added up to $35.5 million ($7.21 a share), Sykes said. (The profit figure covers parts of two fiscal years.) The sale of Giant's stores in Richmond added 19 cents a share to the earnings for the 12 months, he noted.

Without that one-time profit, earnings for the past year would amount to $7.01 a share, compared with the $3.74 a share Giant earned in its best fiscal year ever, 1981.

Sykes and Cohen attributed the surge in earnings to the new business Giant picked up during last year's food-price war and to a cost-control program instituted during the costly battle with Safeway.

Giant's profit margin has averaged almost 2 percent of sales over the past year, far above the industry average of 1 to 1.5 percent. Part of the reason for the chain's higher margins, Sykes said, is that it is earning added profits by processing several of its own products, including ice cream and dairy products, baked goods, fish and flowers. The company even makes money recycling cardboard boxes, he noted.

The Giant executives told a shareholder the chain has no plans to expand outside its present market area -- Washington, Baltimore and their suburbs -- but they reported two innovations to broaden the chain's business. Next month a Giant gourmet store will open in McLean, and by the end of the year, the first separate Giant pharmacy will debut in Montgomery County. Giant Food Bounces Back From Big Loss By Jerry Knight Washington Post Staff Writer

Giant Food Inc. has rebounded from its worst loss in history to its most profitable 12 months ever, executives of Washington's biggest supermarket chain told shareholders at their annual meeting yesterday.

Not only have profits jumped to record levels, but Giant stock has soared from 16 5/8 a share to $40 since last year's stockholder session, said David B. Sykes, Giant's vice president for finance.

The picture of Giant's finances painted by Sykes and Chairman Israel Cohen was far different from what stockholders saw at last year's annual meeting, when Cohen disclosed the chain was losing money because of a food price war.

After suffering a loss of $2.4 million during the summer of 1981, Giant declared a truce in the discount-food fight with Safeway and in the next six months made more money than it had ever before earned in a whole year -- $19 million.

"We spoke of a turnaround, and a turnaround we got," Sykes said. The profit pace set in the second half of 1981 continued in the first two quarters of this year and has produced the four most profitable quarters in the company's history.

Since last summer's loss, Giant's profits for the 12-month period, ending Aug. 14, have added up to $35.5 million ($7.21 a share), Sykes said. (The profit figure covers parts of two fiscal years.) The sale of Giant's stores in Richmond added 19 cents a share to the earnings for the 12 months, he noted.

Without that one-time profit, earnings for the past year would amount to $7.01 a share, compared with the $3.74 a share Giant earned in its best fiscal year ever, 1981.

Sykes and Cohen attributed the surge in earnings to the new business Giant picked up during last year's food-price war and to a cost-control program instituted during the costly battle with Safeway.

Giant's profit margin has averaged almost 2 percent of sales over the past year, far above the industry average of 1 to 1.5 percent. Part of the reason for the chain's higher margins, Sykes said, is that it is earning added profits by processing several of its own products, including ice cream and dairy products, baked goods, fish and flowers. The company even makes money recycling cardboard boxes, he noted.

The Giant executives told a shareholder the chain has no plans to expand outside its present market area -- Washington, Baltimore and their suburbs -- but they reported two innovations to broaden the chain's business. Next month a Giant gourmet store will open in McLean, and by the end of the year, the first separate Giant pharmacy will debut in Montgomery County.