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PLEASANTON, CA-With its competitors reducing their growth plans, Safeway Inc. is cutting back its store expansion and remodels this year, executives said at the company’s first quarter conference call.

The company plans to open 10 new units and complete approximately 100 remodels, reducing capital expenditures from $1.2 billion to approximately $1 billion.

“We are seeing the smallest competitive new stores program against us I have seen in 17 years,” said Steve Burd, chairman, president and CEO. “It’s a good thing for us to back off of our capital a bit.”

For the quarter, total sales were $9.2 billion, down 7.6% from the first quarter of 2008, due in large part to a shift in holiday sales, lower fuel prices and a decline in the Canadian exchange rate. Identical-store sales, excluding fuel, declined 0.7%. Net income was $144.2 million, compared to net income of $193.4 million in the prior-year quarter.

Safeway operates 1,737 stores in the United States and Canada.

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