Grocery retailer Supervalu Inc. (SVU: Quote), Tuesday disclosed plans to cut 2,200 to 2,500 jobs at its subsidiary Albertsons which grapples with declining traffic and sales.
The cuts will occur across all 247 Albertsons stores in California and Nevada, and will begin the week of June 17 and is to be completed by July 1.
Albertsons, which is the largest retail chain for Supervalu, is simplifying its business, especially that its Southern California Division is seeing lower sales, without concomitant store-level adjustments.
"A decision of this nature is never easy, but it is the necessary step for us to take to help improve our business and accelerate our turnaround," said Dan Sanders, president, Albertsons Southern California Division.
Albertsons will work with the union to ensure a smooth transition for those affected.
Albertsons was founded in 1939 and currently operates 445 Albertsons and Lucky supermarkets in Southern California, Southern Nevada, Idaho, Montana, North Dakota, among other regions.
Eden Prairie, Minnesota-based Supervalu, with annual sales of $35 billion, has a total of 4,300 stores, including 1,102 traditional retail stores, 1,332 hard-discount stores, and 1,900 independent stores.
Supervalu is the third-largest food retailing company in the U.S. after Kroger and Safeway. But stiff competition and higher costs have weighed down on earnings, and the company last February announced 800 job cuts in the U.S. It recently reported a fourth quarter loss, hurt by lower food retail sales, as well as goodwill and impairment charges.
SVU closed Wednesday at $4.49, down $0.04 or 0.88%, on a volume of 4.2 million shares on the NYSE.
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by RTT Staff Writer
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