Supervalu Inc's quarterly profit beat Wall Street estimates as the supermarket operator cut costs after selling a number of its underperforming chains earlier this year.
The company's second-quarter sales rose 0.2 percent to $3.95 billion, propped up by fees earned under transition agreements with Albertsons LLC and New Albertsons Inc. Sales at all its business units fell during the quarter, but Supervalu said the rate of decline at its discount stores and regional chains slowed.
The company, which like larger rival Safeway is retreating from some highly competitive regional markets, has been losing customers to Kroger Co (KR.N) and Wal-Mart Stores Inc (WMT.N).
The retail food business reported a 1 percent fall in sales to $1.07 billion. Sales in the grocery distribution business fell 1.6 percent, while those at Save-A-Lot discount stores fell 0.1 percent.
Net income in the second quarter was $40 million, or 15 cents per share, in the quarter ended September 7. It lost $111 million, or 52 cents per share, in the same quarter last year.
Minnesota-based Supervalu's shares were down 2.4 percent at $8.19 in mid-day trading on the New York Stock Exchange on Thursday. About 13 percent of the company's outstanding stock is in short positions, according to Thomson Reuters data.
