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MINNEAPOLIS - No. 2 U.S. grocery supplies distributor Supervalu Inc. on Wednesday reported a slight decline in quarterly earnings, as sales growth slowed and business costs rose.
Supervalu, which also operates 1,358 low-priced food stores, said net income for the third quarter ended on Nov. 30 fell to $57.1 million, or 43 cents a share, from $58 million, or 43 cents a share, a year earlier.
Quarterly sales increased to $4.7 billion, but same-store sales fell 2.3 percent from $4.61 billion, Supervalu said.
Retail sales were $2.3 billion, up 3.5 percent from last year's third quarter, primarily reflecting new store growth. Food distribution sales were $2.4 billion, a slight increase from last year's third quarter.
Supervalu CEO Jeff Noddle said besides a highly promotional environment, the company was also hurt by a lack of pricing power in meat, deli and dairy product categories.
"When all these factors were combined with sharply rising employee benefit costs, it offset our progress in a number of areas across the company," Noddle said in a statement. He said the company aims to keep a tight rein on capital spending in the current year.