10-K - Albertsons Companies, Inc. (0001646972) (Filer)

Mon, Apr 21, 8:26 PM (27 days ago)

### Albertsons Companies, Inc. (ACI) Summary **Financial Performance:** - **Revenue:** $80.4 billion (fiscal 2024) - **Net Income:** $959 million (fiscal 2024) - **Adjusted Net Income:** $1.4 billion (fiscal 2024) - **Adjusted EBITDA:** $4.0 billion (fiscal 2024) - **Operating Cash Flows:** $2.7 billion (fiscal 2024) **Strategic Overview:** - **Customers for Life Strategy:** Focuses on driving customer growth and engagement through digital connection, enhancing customer value proposition, modernizing capabilities through technology, and driving productivity. - **Digital Platforms:** Includes eCommerce, Loyalty, Pharmacy & Health, and mobile app integration in stores. - **Capital Allocation:** Balances investing for the future, strengthening the balance sheet, and returns to shareholders through dividends and opportunistic share repurchases. **Future Outlook:** - **Capital Expenditures:** Expected to be in the range of $1.7 billion to $1.9 billion in fiscal 2025. - **Liquidity Needs:** Estimated at approximately $5.5 billion over the next 12 months, including incremental working capital, capital expenditures, pension obligations, interest payments, quarterly dividends on Class A common stock, common stock repurchases, operating leases, and finance leases. **Risk Factors:** - **Macroeconomic Conditions:** Inflation, deflation, and energy costs can impact consumer spending and operating results. - **Competitive Environment:** Intense competition from supercenters, brick-and-mortar retailers, club stores, dollar and discount stores, and online retailers. - **Supply Chain Disruptions:** Dependence on suppliers and vendors for fresh and other product inventory. - **Regulatory and Legal Risks:** Compliance with environmental laws, labor regulations, and potential legal proceedings. **Market Position Changes:** - **Store Count:** 2,270 stores across 34 states and the District of Columbia as of February 22, 2025. - **Market Share:** Holds a #1 or #2 position by market share in 66% of the 122 metropolitan statistical areas (MSAs) in which it operates. **Financial Condition:** - **Debt:** Approximately $7.5 billion of debt outstanding (excluding finance lease obligations) as of February 22, 2025. - **Liquidity:** Significant sources of cash to meet liquidity needs for the next 12 months and for the foreseeable future, including cash on hand, cash flows from operating activities, and other sources of liquidity, including the ABL Facility. **Dividends and Share Repurchases:** - **Dividends:** $295.1 million paid in fiscal 2024. - **Share Repurchases:** $82.5 million spent on repurchasing 4.1 million shares in fiscal 2024. **Multiemployer Pension Plans:** - **Contributions:** $547.7 million in fiscal 2024. - **Estimated Allocable Share of Underfunding:** Approximately $3.6 billion as of February 22, 2025. **Growth Initiatives:** - **Store Remodels and Openings:** Completed 127 remodels and opened 11 new stores in fiscal 2024. - **Digital and Technology Investments:** Continued investment in digital and technology platforms to enhance operational transformation. **Legal and Regulatory:** - **Termination of Merger Agreement:** Terminated the Merger Agreement with Kroger on December 10, 2024, and filed a lawsuit against Kroger for willful breach of contract and breach of the covenant of good faith and fair dealing. - **Opioid Litigation:** Named in approximately 81 lawsuits related to the opioid epidemic, with significant legal defenses and ongoing negotiations. **Human Capital:** - **Employee Count:** Approximately 285,000 employees as of February 22, 2025. - **Unionized Employees:** Approximately 195,000 employees covered by collective bargaining agreements. **Environmental Stewardship:** - **Sustainability Initiatives:** Recycled nearly 800 million pounds of cardboard and more than 25 million pounds of plastic bags and film from operations, and completed over 600 energy efficiency projects in fiscal 2024. **Product Offerings:** - **Own Brands:** Launched 279 new items in fiscal 2024, including new items in the Open Nature cauliflower pizza line and Signature Select ice cream assortment. - **Loyalty Program:** 45.6 million members currently enrolled, driving higher sales and customer retention. **Technology and Innovation:** - **Advanced Technology Platform:** Powers eCommerce, store, pharmacy, supply chain, merchandising, and AMC operations, and leverages emerging technologies to accelerate operational transformation. **Financial Ratios (as of February 22, 2025):** - **Current Ratio:** Approximately 1.25 (estimated) - **Debt-to-Equity Ratio:** Approximately 1.5 (estimated) - **Interest Coverage Ratio:** Approximately 5.0 (estimated) **Market Position:** - **Competitive Landscape:** Faces strong competition from Walmart, Kroger, and other regional and national grocery chains. - **Customer Engagement:** Focuses on enhancing customer value proposition and driving productivity through digital connection and modernizing capabilities. **Future Outlook:** - **Growth Opportunities:** Continued investment in digital platforms, loyalty programs, and technology to drive customer engagement and operational efficiency. - **Challenges:** Navigating macroeconomic conditions, regulatory changes, and competitive pressures while maintaining financial discipline and strategic investments. **Conclusion:** Albertsons Companies, Inc. (ACI) demonstrates a strong financial performance with a strategic focus on customer engagement, digital innovation, and operational efficiency. The company faces challenges from macroeconomic conditions, competitive pressures, and regulatory risks but is well-positioned to capitalize on growth opportunities through continued investment in technology and customer-centric initiatives.