Safeway 2013 Annual Report Download - page 28
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Table of Contents
Impact of fuel sales
$46.5 million gain from legal settlements in 2012
Write-off of $30 million of notes receivable
Decline in self-insurance expense
Higher revenue from Blackhawk
Lower depreciation expense
Lower pension expense
Other individually immaterial items
Self-insurance expense declined $50.6 million to $98.6 million in 2013 from $149.2 million in 2012. A 100 basis-point increase in the
discount rate used to measure the present value of the self-insurance liability accounted for approximately $24 million of the decline in
expense. The remaining decline was due primarily to Company programs to reduce workers' compensation expense.
Operating and administrative expense margin decreased 51 basis points to 24.27% of sales in 2012 from 24.78% of sales in 2011 primarily
for the following reasons:
Basis-point
decrease
(increase)
Impact of fuel sales (17)
$46.5 million gain from legal settlements in 2012 (15)
Lower labor (12)
Reduced store occupancy (10)
Higher revenue from Blackhawk (9)
Higher pension expense 10
Other individually immaterial items 2
(51)
Gain on Property Dispositions Operating and administrative expense included a net gain on property dispositions of $51.2 million in
2013, a net gain of $48.3 million in 2012 and a net gain of $16.2 million in 2011.
Interest Expense Interest expense was $273.0 million in 2013, compared to $300.7 million in 2012 and $268.1 million in 2011. The
decrease in interest expense in 2013 was due to lower average borrowing in 2013 compared to 2012, partly offset by slightly higher interest
rates. The increase in 2012 was due to higher average borrowings, partly offset by lower average interest rates.
Average borrowings from continuing operations were $5,623.9 million, $6,378.9 million and $5,037.1 million in 2013, 2012 and 2011,
respectively. Average interest rates were 4.92%, 4.71% and 5.32% in 2013, 2012 and 2011, respectively.
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