PLEASANTON, Calif. — Safeway stock plummeted by more than 10% yesterday after the retailer here said quarterly sales were down — and likely to stay down while the retailer adjusts pricing to better compete during the current economic downturn. Steve Burd, Safeway’s chief executive officer, emphasized that earnings per share of 53 cents for the second quarter, which ended June 14, were a penny ahead of analysts’ expectations, citing cost reductions against the headwinds of higher energy costs, higher taxes, an early Easter holiday and property gains. But identical-store sales, excluding fuel, were down by 0.3% — below what analysts and Safeway were expecting, particularly given food price inflation that Burd called the highest he’d seen in 16 years. Burd said Safeway is investing in lower everyday prices and that he is confident the company can regain sales momentum later this year. Overall sales of $10.1 billion were up by 3%, and net earnings improved 7.4% to $234.3 million.
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