A&P Ramps Up Conversions, Remodels

MONTVALE, NJ–With the integration of Pathmark essentially complete, the Great Atlantic & Pacific Tea Co. will ramp up the conversion of its stores to its Price Impact format, which emphasizes value, and its Fresh format, executives said at the company’s first-quarter conference call.

The price-impact format, which debuted in Irvington, NJ and Edison, NJ ,Pathmark stores, will be rolled out to all Pathmark stores between now and 2009. A&P stores will be continue to be convert to the updated fresh format, which offers boutique-style presentations of produce, chocolates and artisan bread, as well. “We have the potential to grow above the original plan,” said Brenda Galgano, SVP and CFO.

Additional plans for 2008 call for two new “fresh” projects, two fresh enlargements, 10 fresh remodels, two new Food Basics, two Food Basics conversions, several Food Basics remodels, eight Super Fresh conversions to Pathmark, and the addition of Starbucks to a few units. Capital expenditures for 2009 will range from $200 million to $250 million, well above the $180 million to $200 million planned for 2008.

Sales for the quarter were $2.9 billion, up from $1.7 billion last year. Comparable store sales (which exclude Pathmark) increased 3.2%. Pathmark’s comparable-store sales rose 3.1%. Net income from continuing operations was $3.8 million, compared to income of $61.4 million. A&P operates 446 stores in eight states and the District of Columbia under the names A&P, Waldbaum’s, Pathmark, Best Cellars, The Food Emporium, Super Foodmart, Super Fresh and Food Basics.