American Stores Co., the only Utah-based Fortune 500 company, Wednesday reported first quarter earnings of 24 cents per share, double the income of the same period last year.
The first quarter 1997 earnings included one-time charges of 14 cents per share related to the secondary offering of shares owned by former chairman Sam Skaggs and his family, and the sale of part of the company's communications subsidiary.Sales increased 2.6 percent to $4.9 billion in the first quarter of this year over last while comparable store sales increased 0.9 percent.
Gross profit margin in the first quarter decreased 0.3 percent to 26 percent. The company cited "aggressive promotional spending in response to increased competition" for the decline.
"I am pleased with our increase in both total and comparable store sales for the quarter," said Victor L. Lund, chairman and CEO of the Salt Lake-based chain of grocery and drug stores.
"We are sharpening our focus on our customers through our new marketing structure, improvement in our loyalty card programs and store development plans. We believe our continued execution of this strategy will serve to offset low food inflation and the effects of increased competition, which are pressuring our sales and margins."
Lund added that the company made progress in reducing operating expenses as a percent of sales during the quarter.
American Stores opened or acquired 13 new stores, completed 6 remodels and closed 12 stores during the first quarter.