2. A Word of Caution
Certain statements contained in this presentation which are not historical facts are forward-looking
statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform
Act of 1995. These forward-looking statements address the Company’s plans, activities or events
which the Company expects will or may occur in the future.
A number of important factors could cause actual results to differ materially from those expressed
in any forward-looking statements. Such factors, risks and uncertainties are set forth under the
headings “Cautionary Statement Regarding Forward-Looking Statements,” or “Risk Factors” or
"Management’s Discussion and Analysis of Financial Condition and Results of Operation" in the
Company’s annual report on Form 10-K and quarterly reports on Form 10-Q filed or to be filed,
respectively, and which are expressly incorporated herein by reference.
You are cautioned not to place undue reliance on these forward-looking statements, which speak
only as of July 10, 2014. The Company does not undertake to update or revise its forward-looking
statements even if experience or future changes make it clear that projected results expressed or
implied in such statements will not be realized, except as may be required by law.
In addition, the amounts and timing of all estimates are subject to change. The actual amounts and
timing may vary materially based on various factors, including the timing of store closings; the
timing and amount of sublease income and other lease expense; factors relating to real estate
including sale proceeds; asset write-downs and other factors affecting inventory value; changes in
management's assumptions; and other factors.
2
3. Agenda
Introduction & Safe Harbor
Kiley Rawlins, CFA
VP – IR & Communications
Opening Remarks
Howard Levine
Chairman & CEO
Financial Review and Outlook
Mary Winston
Chief Financial Officer
Questions & Answers
Howard Levine
Mary Winston
3
7. Price Investments: Return to Value
• $50+ million annualized
price investment on
nearly 1,000 basic SKUs
• More compelling values
for our customers
• Encouraging early
trends
7
8. Driving Profitable Growth
• Refine and enhance key-traffic driving
consumables categories
– Refrigerated and frozen food
– Beer & wine
• Improve merchandise markups
– Global sourcing
– Private Brand
• Driving operational efficiency
– Palletized delivery program
8
9. Delivering Long-term Shareholder Value
• Executing previously announced strategic
actions
• Investing in longer-term strategic initiatives to
improve financial performance and
operational efficiency
• In-depth business review continues with the
goal to unlock further actions to enhance
shareholder value
9
13. Assortment Enhancements
• Food
– 400 new items
– Focus on key national brands
– Improved adjacencies
• Household
– New items and formulations
in both national brands and
private brands
13
16. Workforce Reduction and Store Closures
• Reduced corporate overhead by 10% in third
quarter fiscal 2014 and re-aligned key
organizational functions
• Closing approximately 370 stores in fourth
quarter fiscal 2014
16
Estimated $40 - $45 million in
Annualized Operating Profit Benefit
17. Third Quarter Earnings Results
(in millions except for per share
amounts)
3Q13 3Q14 Change
Net Income* $120.9 $96.5 -20.2%
Diluted Earnings per
Share*
$1.05 $0.85 -19.0%
Weighted average
shares - diluted
115.5 114.2
17*3Q14 results exclude restructuring charges.
21. Returning Capital to Shareholders
58 62 67 78 95
272
513
92 75
125
$0
$100
$200
$300
$400
$500
$600
$700
3Q10 3Q11 3Q12 3Q13 3Q14
(millions)
Dividends Share Repurchases
21
Year to Date
22. Outlook*
4Q14
Comparable Store Sales Flat
Gross Margin Decline
SG&A Expense De-leverage
Diluted Earnings per Share^ $0.75 - $0.85
22
*As provided in earnings press release dated July 10, 2014.
^Excludes $0.37 of earnings per diluted share related to restructuring charges.
23. Outlook*
FY14
Total Sales^ Low-single-digit growth
Comparable Store Sales Low-single-digit decline
Gross Margin Decline
SG&A Expense De-leverage
Tax Rate 34.0% - 34.5%
Diluted Earnings per Share@ $3.07 – $3.17
Capital expenditures $450M - $500M
23
*As provided in earnings press release dated July 10, 2014.
^Excluding impact of the extra week in FY13.
@Excluding $0.51 of earnings per diluted share related to restructuring charges.
