OMNI SWITCH TO FRESH FORMAT DEPRESSES DOMINICK'S SALES

NORTHLAKE, Ill. -- Dominick's Supermarkets here said disruptions at its Omni stores as they were converted to the chain's Fresh format had a negative effect on sales for the third quarter and 40 weeks ended Aug. 8. d it attributed the lower sales to eight months of "substantial construction activity," including eight weeks of the third quarter, at 15 Omni price-impact stores while they were being

NORTHLAKE, Ill. -- Dominick's Supermarkets here said disruptions at its Omni stores as they were converted to the chain's Fresh format had a negative effect on sales for the third quarter and 40 weeks ended Aug. 8.

d it attributed the lower sales to eight months of "substantial construction activity," including eight weeks of the third quarter, at 15 Omni price-impact stores while they were being converted to the Dominick's Fresh format. Those stores reopened under the new banner June 9.

Net income rose 7.6% to $6.1 million for the quarter and 27.9% to $18.8 million for the year to date.

The company said operating cash flow rose 4.9% to $51.9 million, or 7.2% of sales, for the quarter, compared with $49.5 million, or 6.1% of sales, a year ago; for the 40 weeks, operating cash flow was up 9.1% to $132.2 million, or 7.2% of sales, compared with $121.2 million, or 6.1% of sales, a year ago. According to Robert A. Mariano, president and chief executive officer, the store conversions were "a challenging but critically important transition [that] required more than $60 million of capital spending and resulted in nearly eight months of substantial disruption for customers.

"It is the significant strength of the Dominick's Fresh Store, which is the cornerstone of the company, that has enabled us to successfully complete this transition period.

3rd-QUARTER RESULTS

Qtr Ended 8/8/98 8/9/97

Sales $725.9 million $813.7 million

Change - 10.8%

Same-store - 1.9%

Net Income $6.1 million $5.6 million

Change + 7.6%

Inc/Share 25 cents 25 cents

40 Weeks 1998 1997

Sales $1.8 billion $2.0 billion

Change - 7.9%

Same-store - 0.2%

Net Income $18.8 million $14.7 million

Change + 27.9%

Inc/ Share 78 cents 66 cents