FOOD LION BEGINNING TO CLOSE 88 UNDERPERFORMING STORES

SALISBURY, N.C. -- Food Lion has begun closing the first of 88 stores it expects to close this year.The chain closed 29 stores on March 12, most of which were in the Southeast states of Florida, Georgia, North Carolina and South Carolina. Three units were scheduled to close Saturday, March 19, and another 10 Food Lion stores are expected to close this week. Six of this week's store closings are in

SALISBURY, N.C. -- Food Lion has begun closing the first of 88 stores it expects to close this year.

The chain closed 29 stores on March 12, most of which were in the Southeast states of Florida, Georgia, North Carolina and South Carolina. Three units were scheduled to close Saturday, March 19, and another 10 Food Lion stores are expected to close this week. Six of this week's store closings are in Florida.

According to securities analysts who follow Food Lion, the chain's sales have remained weak in Florida and the Southwest since the November 1992 "PrimeTime Live" television broadcast. That ABC television report was critical of Food Lion's meat and deli departments.

As reported, Food Lion said the decision to close 88 stores, or about 8% of the company's store base, followed a companywide review of individual store performance. At that time the chain said it wanted to focus its resources on the most productive units.

As part of its 1994 business plan, Food Lion also expects to open between 40 and 50 new stores this year.

The decision to close underperforming stores came slightly more than a year after the

"PrimeTime Live" report. Following that report, the chain's same-store sales results showed quarterly declines until 1993's fourth-quarter same-store improvement of 2.9%.

In its 1994 business plan Food Lion said 18 Food Lions in Florida and 37 in Texas would close this year. To date, two of Food Lion's 37 Texas stores scheduled to close have been shut down. The bulk of the Texas closings are scheduled for May and June.

According to local observers, as of mid-March Food Lion had not found tenants or buyers for any of the 24 stores in the Dallas-Forth Worth metroplex area that are scheduled to close this year. Food Lion operates about 50 stores in the metroplex.