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BOISE, Idaho - Albertsons Inc. today reported a swing to a second-quarter profit from a year-ago loss. A push to cut costs, improve customer service, and increase marketing offset weaker sales and competition fueled by Wal-Mart, according to a Reuters report.
Albertsons forecast third-quarter profit from continuing operations just a penny above the low-end of Wall Street analysts' estimates, which range from 51 cents to 56 cents a share, according to research firm Thomson First Call.
Still, expected third-quarter results would be up from the 44 cents a share the retailer reported a year earlier.
Albertsons, which launched a broad restructuring push, including the closure of some unprofitable stores early last year, added that even though the U.S. economy may not rebound strongly, it reaffirmed its 2002 profit forecast of a $2.31 profit from continuing operations.
Net income in the second-quarter ended Aug. 1 hit $253 million, or 62 cents a share. A year earlier, Albertson's reported a net loss of $151 million or 37 cents a share. Sales slipped 3.2 percent to $8.94 billion from $9.24 billion.
Albertsons' chairman and CEO Larry Johnston said sales were affected in part by store reductions. "Indicative of the weak economic environment, sales deflation, as we measure it, weighed in at 0.5 percent for the quarter, and along with the sluggish economy was an obvious contributor to our same store sales results," he said.