Safeway Inc

Safeway — Safeway Investor Conference 2012

21 slides from Safeway's conference presentation, Mar 6, 2012

  1. Slide 1: Reconciliations and Financial Slides from the Safeway Investor Conference

    Reconciliations and Financial Slides from the Safeway Investor Conference March 6, 2012 Safe Harbor Language This presentation may contain forward-looking statements. Such statements may relate to topics such as sales, margins, earnings estimates, guidance, free cash flow, capital spending, and othe

  2. Slide 2: Reconciliation of Diluted EPS

    Reconciliation of Diluted EPS 2011G Low High Diluted earnings per share $ 1.49 $ 1.45 $ 1.65 Tax effect of Canadian dividend 0.29 0.22 0.22 Diluted earnings per share, before Canadian dividend $ 1.78 $ 1.67 $ 1.87

  3. Slide 3: Reconciliation of GAAP Cash Flow Measure to Free Cash Flow

    Reconciliation of GAAP Cash Flow Measure to Free Cash Flow * (In Millions) 2011 Original Guidance Low High Net cash flow from operating activities $ 1,750 $ 1,850 $ 2,024 $ 1,850 $ 2,549 $ 2,251 $ 2,190 $ 2,175 $ 1,881 (Increase) decrease in payables related to third-party gift cards, net of receiva

  4. Slide 4: Reconciliation of GAAP Cash Flow Measure to Free Cash Flow

    Reconciliation of GAAP Cash Flow Measure to Free Cash Flow (In Millions) 2012F 2013F 2014F 2015F 2016F Low High Low High Low High Low High Low High Net cash flow from operating activities $ 1,700 $ 1,800 $ 1,900 $ 2,000 $ 2,000 $ 2,100 $ 2,100 $ 2,200 $ 2,200 $ 2,300 Net cash used by investing activ

  5. Slide 5: Operating Profit Margin BP Change

    Reconciliation of Operating Profit Margin BP Change Excluding Fuel, Gross Presentation of Gift Card Commissions, Unusual Items and LIFO charge for 2011 Basis point (decrease) increase over prior year: 2012G Original Guidance Low High Low High * Basis point change in operating profit margin (12 ) (2

  6. Slide 6: Net Cash Flow from Operating Activities to Adjusted EBITDA

    Reconciliation of Net Cash Flow from Operating Activities to Adjusted EBITDA (dollars in millions) Net cash flow from operating activities $ 2,023.6 $ 1,849.7 $ 2,549.7 $ 2,250.9 $ 2,190.5 $ 2,175.0 $ 1,881.0 $ 2,226.4 $ 1,609.6 Add (subtract): Income taxes 363.9 290.6 144.2 539.3 515.2 369.4 287.9

  7. Slide 7: Net Income Attributable to Safeway Inc. to Adjusted EBITDA (Interest Coverage)

    Reconciliation of Net Income (Loss) Attributable to Safeway Inc. to Adjusted EBITDA (Interest Coverage) (dollars in millions) Net income (loss) attributable to Safeway Inc. $ 516.7 $ 589.8 $ (1,097.5 ) $ 965.3 $ 888.4 $ 870.6 $ 561.1 $ 560.2 $ (169.8 ) Add (subtract): Income taxes 363.9 290.6 144.2

  8. Slide 8: Gross Margin BP Change

    Reconciliation of Gross Margin BP Change Excluding Fuel, Gross Presentation of Gift Card Commissions and LIFO Basis point (decrease) increase over prior year: Basis point change in gross margin (125 ) (34 ) (36 ) (8 ) (11 ) Fuel (59 ) Impact from gross presentation of gift card commissions — — — — —

  9. Slide 9: Operating & Administrative Expense BP Change

    Reconciliation of Operating & Administrative Expense BP Change Excluding Fuel, Gross Presentation of Gift Card Commissions and Unusual Items Basis point (decrease) increase over prior year: Basis point change in operating & administrative expense (102 ) (38 ) (29 ) (93 ) (53 ) Unusual items: Texas s

  10. Slide 10: Slide 10

  11. Slide 11: 2012 Guidance

    2012 Guidance = Earnings per Share’ $1.90 — $2.10 = ID Sales? 1% —- 2% = Operating Profit Margin Change2? +/- 5 bps = Cash Capital Expenditures ~$0.9B = Free Cash Flow? $0.85 — $0.95B "From continuing operations 2X-Fu 3 ite f ila See website for reconciliation SAFEWAY) investor 2012 2

  12. Slide 12: Slide 12

  13. Slide 13: 2011 Results

    2011 Results Original Guidance Actual ID Sales X-Fuel 1.0% - 1.5% 1.0% Inflation 1.0% 3.2% Operating Profit Margin Change flat to slightly (8) bps (X-Fuel) positive P Capital Expenditures ~ $1.0B $1.1B Free Cash Flow $0.75 - $0.85B $0.75B Earnings Per Share $1.67 - $1.87 $1.78 (X-Tax on Canadian Div

  14. Slide 14: Slide 14

  15. Slide 15: Adjusted Operating Profit - Calendar Year

    Adjusted Operating Profit - Calendar Year $ Millions 2011 2010 $A SA Operating Profit $1,135 $1,159 ($24) — (2.1)% Popular Adjustments Property Gains 66 28 38 Property Impairment (44) (72) 28 LIFO Credit/(Charge) (35) 28 (63) Interest Rate — Workers’ Comp* (21) - (21) Adjusted Operating Profit $1,17

  16. Slide 16: Slide 16

  17. Slide 17: Capital Spending as a % of Sales

    Capital Spending as a % of Sales 4.2% 4.2% 13 year average = 2.8% 2.1% me 2.3% 2-4% 2.3% 0 904,9.99%2-3% 04 ‘05 ‘06 ‘07 ‘08 ‘09 '10 ‘11 '12F '13F '14F '15F 16F '11- $1.2 $1.4 $1.7 $1.8 $1.6 $0.9 $0.8 $1.1 $0.9 $1.1 $1.1 $1.1 $1.1 ] $ Billions ‘SAFEWAY (9, investor 20]2 InvestorContorence 2012

  18. Slide 18: Slide 18

  19. Slide 19: Free Cash Flow

    Free Cash Flow $ Billions 2005 2006 2007 2008 2009 2010 2011 2012F 2013F 2014F 2015F 2016F 14 #17 18 16 09 08 11°09 #44 °¢44 #144 =°144 Capital Spending “Includes tax on Canada dividend ‘See website for reconciliation ‘SAFEWAY (9, investor 20]2 conerence a InvestorContorence 2012

  20. Slide 20: Slide 20

  21. Slide 21: Slide 21

Safeway — Safeway Investor Conference 2012 on 6ix