Albertsons Cos Inc has forecast fiscal 2020 profit above expectations after beating estimates for quarterly results as the grocer benefited from a general shift in eating habits toward food cooked at home due to the COVID-19 pandemic.
Although chain restaurants have reopened their dine-in areas and introduced outdoor dining, most Americans are still preparing their own meals as they continue to work from home during the pandemic.
"I believe that we're going to go through this phase and come out of it with different behaviours ... I think that part of that different behaviour is going to be eating more at home," chief executive officer, Vivek Sankaran said on a post-earnings call.
The Boise, Idaho-based company forecast adjusted earnings per share of $2.75 to $2.85 for fiscal 2020, well above analysts' average estimate of $2.23.
Albertsons, one of the largest food and drug retailers in the United States, also forecast same-store sales to increase at least 15.5% for the period after posting a 13.8% quarterly jump.
"Albertsons will benefit from accelerating restaurant closures and elevated levels of eating/cooking at home for the foreseeable future," RBC Capital Markets analyst Beth Reed said.
Kroger Co, Albertsons' rival, last month forecast 2020 numbers above expectations, also saying 2021 will be even stronger than it anticipated.
Albertsons said net sales and other revenue rose 11.2% to $15.76 billion for the second quarter ended 12 September, beating Wall Street expectations of about $15.60 billion.
Excluding items, Albertsons earned 60 cents per share, crushing estimates of 26 cents per share, according to IBES data from Refinitiv.
The company also reported a threefold rise in its quarterly digital sales.