Compared with pre-pandemic levels, online sales are up 234% at Albertsons. The number of households that use the retailer’s omnichannel services has increased four-fold since Q3 2019.

Online sales at grocery chain operator Albertsons Cos. Inc. kept growing during the third quarter of its fiscal 2021, building on a triple-digit increase during 2020.

Albertsons reported digital sales increased 9% year over year for its fiscal Q3 2021 quarter ended Dec. 4, 2021. On a two-year stacked basis—which compares online sales to the comparable, pre-pandemic quarter in 2019—digital sales growth was 234%, the retailer says.

During a Jan. 11 earnings conference call, Albertsons CEO Vivek Sankaran said the number of households that use the retailer’s omnichannel services—such as buy online, pickup in store, or curbside pickup of on-demand delivery—increased fourfold since 2019. That’s been good for the bottom line, he says, because omnichannel households spend three times more than in-store-only shoppers, Sankaran said without sharing details.

Total revenue (online and offline) for the quarter was $16.73 billion, up 8.6% from $15.41 billion for the comparable quarter a year earlier. For the 40 weeks ended Dec. 4, total revenue was $54.50 billion, up about 1% compared with $53.92% for the year-ago period.

Net income for the quarter was $424.5 million, up 243.2% from $123.7 million for the comparable quarter a year earlier. For the 40 weeks ended Dec. 4, net income was $1.165 billion, up 17.1% from $994.4 million for the year-ago period. Adjusted net income was $457.2 million, up 18% compared to $386.6 million in Q3 2020.

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Albertsons does not break out online sales or reveal what percentage of total revenue online sales represent.

Bolstering its online capabilities

“Our next priority is the acceleration of our digital and omnichannel capabilities,” Sankaran said. “This digital transformation is designed to fuel our growth as we aim to drive increasing customer engagement, customer satisfaction and customer retention through an area of convenient shopping experiences.”

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During Q3, Albertsons expanded the number of stores offering its Drive Up & Go curbside pickup service, Sankaran said, without providing numbers. As of now, it’s available to 96% of the households Albertsons serves, Sankaran said. 80% of served households can pick up their Drive Up & Go orders in two hours, he said.

In August, Albertsons introduced a new mobile app that combines online shopping capabilities with functions for using the retailer’s Albertsons for U loyalty program and its FreshPass delivery subscription service. FreshPass, which costs $99 a year or $12.99 per month, offers unlimited free delivery on orders $30 or more. FreshPass also includes free two-hour grocery delivery and Drive Up & Go services in some markets.

To bolster online marketing opportunities for brands, Albertsons launched the Albertsons Media Collective, a digital media network, in November. The goal is to help brands connect with shoppers by opening native display and sponsored product inventory throughout the company’s websites.

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Marketing opportunities on Albertsons’ websites will include advertising placements on Albertsons-owned properties such as its homepages, department, category, sub-category, email, search, app, pharmacy and on Albertsons’ off-site targeted ad placements. Brand campaigns will begin on Feb. 27, the retailer says.

Albertsons’ new full-year guidance

Albertsons updated its fiscal 2021 outlook and now expects:

  • Identical sales in fiscal 2021 in the range of -0.8% to -1.2%, representing two-year stacked growth of 15.7% to 16.1%. Previously, the forecast -2.5% to -3.5%, representing two-year stacked growth of 13.4% to 14.4%.
  • Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) in the range of $4.25 billion to $4.30 billion (previously $3.95 billion to $4.05 billion).

Albertsons is a food and drug retailer that operates stores in 34 states and the District of Columbia. The retailer operates under more than 20 banners including Albertsons, Safeway, Vons, Jewel-Osco, Shaw’s, Acme, Tom Thumb, Randalls, United Supermarkets, Pavilions, Star Market, Haggen, Carrs, Kings Food Markets and Balducci’s Food Lovers Market.

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As of Dec. 4, 2021, Albertsons operated 2,278 retail food and drug stores with 1,722 pharmacies, 399 associated fuel centers, 22 dedicated distribution centers and 20 manufacturing facilities.

For the quarter ended Dec. 4, 2021, Albertsons reported: 

  • Total revenue (online and offline) of $16.73 billion, up 8.6% from $15.41 billion for the comparable quarter a year earlier.
  • Net income of $424.5 million up 243.2% from $123.7 million for the comparable quarter a year earlier.
  • Adjusted net income of $457.2 million, up 18.3% compared with $386.6 million during the third quarter of fiscal 2020.
  • A 5.2% increase in identical sales. On a two-year stacked basis, identical sales grew by 17.5%.
  • Adjusted EBITDA of $1.05 billion, or 6.3% of sales, compared to $967.7 million, or 6.3% of sales, during the third quarter of fiscal 2020.

For the 40 weeks ended Dec. 4, 2021, Albertsons reported: 

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  • Total (online and offline) revenue of $54.50 billion, up about 1% compared with $53.92 billion a year earlier.
  • Net income of $1.165 billion, up 17.1% from $994.4 million for the year-ago period
  • Adjusted EBITDA of $3.32 billion down 7.8% compared to $3.61 billion for the year-ago period.

Percentage changes may not align exactly with dollar figures due to rounding.

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