CVS announces light December sales, still on course for top end of guidance
WOONSOCKET, R.I. CVS Caremark announced on Thursday that sales in December were lighter than the company expected due to unfavorable weather, a weak flu season and a wobbly economy.
However, Tom Ryan, chairman, president and chief executive officer, noted that “given favorable operating expenses and improved margins, we expect to report diluted earnings per share on a GAAP basis for the fourth quarter 2007 in the range of 54 cents to 55 cents, and for the full year 2007 in the range of $1.91 to $1.92, at the high end of our previous guidance of $1.89 to $1.92.”
Same-store sales for the five weeks ended Dec. 29 increased 1.8 percent. Pharmacy same-store sales rose 2.4 percent, and were negatively impacted by about 470 basis points due to recent generic introductions. Front-end same-store sales rose 0.6 percent.
Kroger, P&G partner in electronic coupon experiment
CINCINNATI Kroger and Procter & Gamble are testing out a new paperless coupon system, based on consumer loyalty cards and the Internet, according to published reports.
Shoppers visit the retailer’s Web site and choose coupons online from a list of offers. The results are then automatically loaded into their Kroger Plus Card account, and the savings is automatically processed when they purchase the products.
Reviews have been positive, according to reports. “It’s really nice, because I always forget to bring my coupons along … and I don’t have to organize them,” one shopper told the Associated Press. “You don’t have to waste your time going through all those little pieces of paper in your purse,” said another.
Other experts predict that consumers who are less computer savvy will likely prefer the traditional paper coupons. Kroger assures them that option will still be available. “We really are just trying to provide more options, not take things away,” Ken Fenyo, Kroger’s vice president for corporate loyalty, told AP. “We know many of our customers are online heavily anyway. I believe over time, more and more customers will want to use the online option.”
Fenyo said other manufacturers may also join the test, as P&G seems pleased with the results so far. “It’s very early, but we’ve been able to run the water through the pipes and from what we’ve seen, things are looking pretty good,” said Matt Kemme, a P&G marketing manager, the AP reported.
California Safeway workers approve contract
PLEASANTON, Calif. Union employees in the Bay Area and Northern California have approved a four-year contract with the Safeway supermarket chain.
Workers for the United Food and Commercial Workers union approved a contract that—according to a statement—provides “the largest across the board wage increases in the history of Northern California grocery industry contracts.”
The contract affects more than 25,000 union workers employed at 300 Vons and Safeway supermarkets. In a statement, UFCW leaders lauded the new contract for its wage increases and benefits and said that, “it bucks the national trend in which employers are cutting benefits and shifting the costs of healthy care on to employees.”