Safeway Inc

Safeway — December 14, 2005 Investor Conference

9 slides from Safeway's conference presentation, Dec 14, 2005

  1. Slide 1: Certain Slides Presented at December 14, 2005 Investor Conference

    Certain Slides Presented at December 14, 2005 Investor Conference Exhibit 99.2

  2. Slide 2: Reconciliation of Net Income to Adjusted EBITDA

    2 InvConfDec05 Net income (169.8) 560.2 590.3 Income taxes 310.9 233.7 294.5 Interest expense 442.4 411.2 401.3 Depreciation 863.6 894.6 916.3 LIFO (income) expense (1.3) (15.2) (15.2) Stock option expense - 42.9 Property impairment - 84.8 Equity in (earnings) or loss of Unconsolidated Affiliates, n

  3. Slide 3: Reconciliation of Gross Margin Basis Point Change to Gross Margin Excluding Fuel

    7 InvConfDec05 36 weeks Annual Annual Annual Ended 2005 2005 2006 September 10, Guidance Expectation Guidance 2005 High Low High Low High Low Basis point increase (decrease) over prior year: Gross margin, as reported -79 -35 -25 -63 -58 -5 -15 Fuel 43 35 35 43 43 5 5 Gross margin, excluding fuel -36

  4. Slide 4: Reconciliation of O&A Expense Margin Changes to Adjusted for One-Time Items Excluding Fuel

    9 InvConfDec05 2005 Guideline 2005 Expected 2006 Guideline Basis point increase (decrease) over prior year L H L H L H As Reported (53) (63) (38) (48) (76) (86) One-time items: Dominick’s impairment (2004) (12) (12) 12 12 - - NorCal H&W (2004) (10) (10) 10 10 - - Stock option expense (2005 & 2006) -

  5. Slide 5: Reconciliation of Operating Cash Flow to Adjusted EBITDA and Adjusted Debt

    10 InvConfDec05 September 10, 2003 2004 2005 Net cash flow from operating activities $ 1,609.6 $ 2,226.4 $ 1,987.8 Add (subtract): Income taxes 310.9 233.7 294.5 Interest expense 442.4 411.2 401.3 Property impairment charges other than Dominick's (33.5) (39.4) - Deferred income taxes 77.9 29.2 96.2

  6. Slide 6: 2005 Guidance vs. 2005 Expectations

    12 InvConfDec05 Non-Fuel ID Sales 1.2% - 1.5% 2.5% - 2.8% Gross Margin (Ex Fuel) 0 - 10 BPs (20) - (15) BPs² O&A (Ex Fuel) 50 - 60 BPs 50 - 60 BPs² Free Cash Flow ($ Million) $500 - $700 $500 Adjusted EPS $1.41 - $1.51 $1.44³ ³Represents First Call consensus estimates as of 10/18/05; excluding Texas

  7. Slide 7: Financial Guidance For 2006

    13 InvConfDec05 EPS $1.55 – $1.65 Non-fuel ID sales 3.0% Non-fuel Gross margin change (10) - 0 BPs* Non-fuel O&A change 25 - 35 BPs* Cash Capital Spending $1.55 -$1.65 Bil Free cash flow $400 - $600 Mil* *See website for reconciliation Financial Guidance For 2006

  8. Slide 8: Debt Ratios

    14 InvConfDec05 3.0 3.2 2.7 0.0 1.0 2.0 3.0 4.0 5.0 6.0 '03 '04 3Q05LTM 5.8 5.0 5.7 0.0 1.0 2.0 3.0 4.0 5.0 6.0 '03 '04 3Q05LTM Interest Coverage* Leverage** *Adjusted EBITDA/interest per bank covenants **Debt/Adjusted EBITDA per bank covenants See website for reconciliation Debt Ratios

  9. Slide 9: Long Range Outlook

    15 InvConfDec05 Non-Fuel Sales ID’s 3% - 4% Operating Profit Margin 4.50% - 5.50% Depreciation 2.50% Annual EPS Growth 12% - 15% Long Range Outlook

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