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SAFEWAY ISSUES THIRD PROFITS WARNING

News, 01 March 1998

NUMBER FOUR in the supermarket league table, Safeway looks increasingly vulnerable to takeover following the issue of its third profits warning in little more than a year. In a dash for sales growth, Safeway's new store start-up costs (particularly in Northern Ireland) have spiralled upward. There is also a £30m charge to cover the closure of unprofitable stores and concomitant redundancies, resulting in a likely fall in current full-year profits to £375m compared with last year's £430m. City analysts had been forecasting profits of between £410-£440m.