Dominick's to Close 12 Stores
Company Calls Decision Difficult but Necessary Step in Rebuilding Strategy
CHICAGO, Jan. 12 /PRNewswire-FirstCall/ -- Dominick's announced today that it will close 12 underperforming grocery stores. The eight suburban and four Chicago locations will close on March 13, 2004. "Today's announcement marks a difficult but necessary step toward a better Dominick's for Chicagoland," said Randall Onstead, President of Dominick's. "Closing these stores will make Dominick's healthier and allow us to focus on growing the business and bringing new products and services to consumers," Onstead said. Safeway Inc., the parent company of Dominick's, will record a $50 million to $55 million pre-tax charge for lease exit costs in its first quarter 2004 financial results related to these store closures. The elimination of operating losses from the closed stores will benefit earnings immediately and was already contemplated in the company's 2004 guidance. Under terms of labor agreements with the United Food and Commercial Workers union locals, most employees will have the opportunity to seek a position at another store. The company anticipates sales transfer from closed stores to other Dominick's locations in the same area thereby creating additional employment opportunities in those stores. Dominick's will be working closely with employees to ease their transition. "We are concerned for the well-being of our employees and we're taking every reasonable step we can to provide them continued employment within Dominick's," said Onstead, adding that most employees are eligible to receive severance pay if they choose to leave the company. To help maintain its customer base and to inform affected consumers, Dominick's is undertaking a comprehensive marketing and information campaign via direct mail, advertising and in-store materials in connection with the closings. Customers in areas affected by store closings will be informed of other Dominick's locations. Customers of Dominick's pharmacies in stores that are closing will be receiving letters providing information on the locations of other nearby Dominick's pharmacies. Addresses of Dominick's stores to close in the Chicagoland area: -- 3250 W. 87th Street Chicago 60652 -- 4014 W. Lawrence Chicago 60630 -- 3649 N. Central Chicago 60634 -- 7050 S. Pulaski Rd. Chicago 60629 -- 250 S. Randall Rd. Elgin 60123 -- 1440 Irving Park Rd. Hanover Park 60103 -- 1919 Skokie Valley Rd. Highland Park 60035 -- 5556 W. 159th St. Oak Forest 60452 -- 11024 S. Cicero Ave. Oak Lawn 60453 -- 1241 Rand Rd. Prospect Hts. 60070 -- 2855 Kirchoff Rd Rolling Meadows 60008 -- 600 W. Liberty Wauconda 60084 This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such statements relate to, among other things, business trends, pre-tax charges, and severance and buyout costs and are indicated by words or phrases such as "expects," "anticipates" and similar words or phrases. These statements are based on Safeway's current plans and expectations and involve risks and uncertainties which are, in many instances, beyond our control, including general business and economic conditions, competitive factors, financial condition or business over time, or unfavorable legislative, regulatory or judicial developments that could cause actual events and results to vary significantly from those included in or contemplated by such statements. The company undertakes no obligation to update forward-looking statements to reflect developments or information obtained after the date hereof and disclaims any obligation to do so. Please refer to Safeway's reports and filings with the Securities and Exchange Commission for a further discussion of these risks and uncertainties.
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