Safeway (SWY)

Income Tax Expense

Income tax expense was 36.0% of pre-tax income in both the third quarters of 2009 and 2008.

Income Tax Expense

Income tax expense was $45.1 million, or 15.9% of pre-tax income, in the second quarter of 2009. Income tax expense in the second quarter of 2008 was $137.6 million, or 37.0% of pre-tax income. The decline in the tax rate was due primarily to a benefit of $57.8 million from the favorable resolution of a tax matter.

Income Tax Expense

Income tax expense was $60.3 million, or 29.5% of pre-tax income, in the first quarter of 2009. Income tax expense in the first quarter of 2008 was $123.6 million, or 39.0% of pre-tax income. The decline in the tax rate was due primarily to benefits of $16 million from the favorable resolution of tax matters.

Income Tax Expense

Income tax expense was $165.8 million, or 32.9% of pre-tax income, in the fourth quarter of 2008. Income tax expense in the fourth quarter of 2007 was $179.2 million, or 37.3% of pre-tax income. The decline in the tax rate was due primarily to a reduction in a reserve on charitable contribution carryforwards and the favorable resolution of other tax items.

Income Tax Expense

Income tax expense was $112.3 million, or 36.0% of pre-tax income, in the third quarter of 2008. Income tax expense in the third quarter of 2007 was $112.4 million, or 36.6% of pre-tax income.

Income Tax Expense

Income tax expense was $137.6 million, or 37.0% of pre-tax income in the second quarter of 2008. Income tax expense in the second quarter of 2007 was $119.9 million, or 35.5% of pre-tax income.

Income Tax Expense

Income tax expense was $123.6 million, or 39.0% of pre-tax income in the first quarter of 2008. Income tax expense in the first quarter of 2007 was $103.8 million, or 37.3% of pre-tax income.

Income Tax Expense

Income tax expense was $179.2 million, or 37.3% of pre-tax income in the fourth quarter of 2007. Income tax expense in the fourth quarter of 2006 was $127.2 million, or 29.2% of pre-tax income. Income tax expense in the fourth quarter of 2006 included approximately $38.0 million of tax benefits ($0.08 per diluted share) due to the utilization of net operating loss carry forwards and various other favorable items.

Income Tax Expense

Income tax expense was $112.4 million, or 36.6% of pretax income, in the third quarter of 2007. Income tax expense was $101.8 million, or 37.0% of pretax income, in the third quarter of 2006.

Income Tax Expense

Income tax expense was $119.9 million, or 35.5% of pretax income, in the second quarter of 2007.

Income tax expense was $50.9 million, or 17.1% of pretax income, in the second quarter of 2006. Income tax expense in that quarter was reduced by a $58.5 million ($0.13 per diluted share) benefit related to an income tax refund.

Income Tax Expense

Income tax expense was $103.8 million, or 37.3% of pretax income, in the first quarter of 2007.

The company adopted Financial Accounting Standards Board Interpretation No. 48 (“FIN 48”), Accounting for Uncertainty in Income Taxes, as of the beginning of fiscal 2007. The cumulative effect of adopting FIN 48 was an increase to stockholders’ equity of $139.7 million.

Income Tax Expense

Income tax expense was $127.2 million, or 29.2% of pre-tax income in the fourth quarter of 2006 compared to $94.6 million, or 35.3% of pre-tax income, in the fourth quarter of 2005. Income tax expense in the fourth quarter of 2006 included approximately $38.0 million of tax benefits ($0.08 per diluted share) due to the utilization of net operating loss carry forwards and various other favorable items. Income tax expense in the fourth quarter of 2005 included $7.3 million of tax benefits ($0.02 per diluted share) associated with the favorable resolution of certain tax issues.

Income Tax Expense

Income tax expense was $101.8 million, or 37.0% of pre-tax income, in the third quarter of 2006 compared to 19.4% in the third quarter of 2005.

Safeway’s effective tax rate in 2005 was lower due to $17 million of tax benefits associated with the repatriation of earnings from Safeway’s Canadian subsidiary and to the favorable resolution of various tax issues totaling $10 million. The total benefit of these tax items was $0.06 per diluted share.

Income Tax Expense

Income tax expense was $50.9 million, or 17.1% of pretax income, in the second quarter of 2006 compared to 38.1% in the second quarter of 2005. Income tax expense in the second quarter of 2006 was reduced by $58.5 million of accrued interest, net of income tax, on the federal income tax refund described below.

As previously announced, Safeway settled a federal income tax refund claim under which it expects to receive approximately $318 million in the third quarter of 2006. This refund consists of a tax refund of $259.2 million and interest earned on that refund of $58.5 million. The federal income tax refund of $259.2 million has been recorded in the second quarter of 2006 as an increase to additional paid-in capital.

Income Tax Expense

Income tax expense was $89.5 million, or 38.5% of pretax income, in the first quarter of 2006.

As previously announced, Safeway settled a federal income tax refund claim under which Safeway expects to receive approximately $316 million in cash in the second half of 2006. This settlement was not reached until after March 25, 2006 and, therefore, is not reflected in these first-quarter 2006 financial statements.

The expected federal tax refund of approximately $259 million will be recorded in the second quarter of 2006 as an increase to additional paid-in capital and will not be recorded in the income statement.

As of April 26, 2006, accrued interest on the federal tax refund, net of income tax, is approximately $57 million ($0.13 per diluted share). Accrued interest will be recorded in the second quarter of 2006 as a reduction of Safeway’s income tax expense. The final interest amount depends on the date of receipt of the cash.

Income Tax Expense

Income tax expense was $94.6 million, or 35.3% of pretax income, in the fourth quarter of 2005 compared to $101.2 million, or 33.3% of pretax income in the fourth quarter of 2004. Income tax expense in the fourth quarter of 2005 included $7.3 million of tax benefits ($0.02 per diluted share) associated with the favorable resolution of certain tax issues. Income tax expense in the fourth quarter of 2004 included a tax benefit of $8.8 million ($0.02 per diluted share) due to tax law changes and the favorable resolution of certain tax issues.

Income Tax Expense

Income tax expense was $29.4 million, or 19.4% of pretax income, in the third quarter of 2005 compared to 21.1% in the third quarter of 2004.

In the third quarter of 2005, the company finalized its plan to repatriate $500 million of earnings from its Canadian subsidiary to the U.S., to take advantage of the lower effective tax rate allowed by the American Jobs Creation Act of 2004. The Canadian subsidiary will fund approximately half of the repatriated earnings with cash on hand and the remainder with borrowings. The U.S. parent company will use the repatriated earnings to pay down debt in the near term.

Deferred taxes previously provided on Canadian earnings to be repatriated exceeded the tax costs to repatriate the earnings and resulted in a net reduction of $17 million in income tax expense in the third quarter of 2005. In addition, Safeway’s effective tax rate was lower due to the favorable resolution of various tax issues totaling $10.0 million in the third quarter of 2005. The total benefit of these tax items was $0.06 per diluted share.

The total benefit from the resolution of various tax issues in the third quarter of 2004 was $32.4 million ($0.07 per diluted share).

Income Tax Expense

Income tax expense was $82.4 million, or 38.1% of pretax income, in the second quarter of 2005 compared to 31.4% in the second quarter of 2004. Safeway’s effective tax rate was lower in the second quarter of 2004 due to a tax benefit of $12.5 million arising from the favorable resolution of various tax issues.

Income Tax Expense

Income tax expense was $81.5 million, or 38.3% of pretax income, in the first quarter of 2005.

Income Tax Expense

Income tax expense was $101.2 million, or 33.3% of pretax income, in the fourth quarter of 2004. Income tax expense includes a tax benefit of $8.8 million due to tax law changes and the resolution of certain tax issues during the quarter.