Safeway sales improve, saw no hit from higher payroll tax

LOS ANGELES Thu Feb 21, 2013 11:53am EST

LOS ANGELES Feb 21 (Reuters) - Supermarket operator Safeway Inc on Thursday said store sales have strengthened from the previous quarter and it has seen no impact from higher payroll taxes, which have cut take-home pay for many shoppers.

If trends hold for the remainder of the week, Safeway's identical-store sales will be up 2 percent for the first eight weeks of the quarter, Steve Burd, Safeway's chairman and chief executive, said on a conference call with analysts.

Safeway's identical-store sales were up 0.8 percent, excluding fuel, for the fourth quarter.

At Safeway, that closely-watched measure includes results from established supermarkets that have not been replaced or significantly renovated.

While some retailers and restaurants have attributed softening sales to the Jan. 1 expiration of a 2 percentage point cut in payroll taxes, Safeway saw no impact, Burd said.

"We can't really see any decline that resulted from the payroll tax going up," Burd said.

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Comments (1)
Kenghis_Khan wrote:
Incredibly ridiculous conclusion to make. People will not change their eating habits. The place that the 2% increase will be felt is in other types of establishments such as restaurants, department stores, auto dealers, clothing outlets etc. where discretionary income is spent on other than necessities. Food is a necessity.

Feb 21, 2013 3:15pm EST  --  Report as abuse
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