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MONTVALE, N.J. - Great Atlantic & Pacific Tea Co. Inc. on Friday reported a smaller quarterly loss as it curbed expenses to offset weaker sales growth and stiff competition. President and CEO Christian Haub said the company is formulating a new business plan for its U.S. operations to address the challenges that have hampered its performance.
The company said its net loss in the quarter ended Nov. 30 was $29.7 million, or 77 cents a share, down from a loss of $89.6 million, or $2.34 a share, a year earlier.
Quarterly sales fell to $2.47 billion from $2.53 billion a year earlier. Sales at supermarkets open at least a year rose 0.1 percent.
"Our third quarter performance reflected the continued, difficult selling environment that has hampered results throughout our industry," said president and CEO Christian Haub. "With ongoing economic uncertainty dictating generally cautious spending and continued price emphasis by consumers, significant gross margin investments were necessary to protect market share. Results were also impacted by rising labor expenses, driven by the escalating costs of employee benefits. We do not anticipate any abatement of present margin and cost pressures in the near future."
In late October, A&P changed its organization structure and appointed new management to head its U.S. and Canadian business units. Haub said that given the different stages of development of the two units, the company is focusing on distinct strategies appropriate to each of their trading environments. In Canada, emphasis is being placed on the marketing, merchandising, customer service and operating disciplines.
"In the U.S., we are formulating a new business plan to address the internal and external challenges that have hampered our performance," Haub said. "Short-term, our structural and leadership changes are accelerating our efforts to reduce costs and eliminate redundant and unproductive activities, and focus on improving store level execution. In addition, we are evaluating all elements of our U.S. operations, and are prepared to make the tough decisions necessary to return the company to profitability."