Financial Analysis

"COMMITMENTS AND CONTINGENCIES AND OFF BALANCE SHEET ARRANGEMENTS Guarantees Lease Guarantees: The Company may have liability under certain operating leases that were assigned to third parties. If any of these third parties fail to perform their obligations under the leases, the Company could be responsible for the lease obligation. Because of the wide dispersion among third parties and the variety of remedies available, the Company believes that if an assignee became insolvent, it would not have a material effect on the Company's financial condition, results of operations or cash flows. The Company also provides guarantees, indemnifications and assurances to others in the ordinary course of its business. Legal Proceedings The Company is subject from time to time to various claims and lawsuits, including matters involving trade, business and operational practices, personnel and employment issues, lawsuits alleging violations of state and/or federal wage and hour laws, real estate disputes, personal injury, antitrust claims, packaging or product claims, claims related to the sale of drug or pharmacy products, such as opioids, intellectual property claims and other proceedings arising in or outside of the ordinary course of business. The Company is also subject, from time to time, to government investigations, subpoenas, audits, reviews, claims enforcement actions and litigation. These can include routine, regular and special investigations, audits, civil or criminal subpoenas, …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

"LONG-TERM DEBT AND FINANCE LEASE OBLIGATIONS The Company's long-term debt and finance lease obligations as of February 28, 2026 and February 22, 2025, net of unamortized debt discounts of $37.9 million and $28.6 million, respectively, and deferred financing costs of $55.2 million and $31.6 million, respectively, consisted of the following (in millions): February 28, 2026 February 22, 2025 Senior Unsecured Notes due 2028 to 2034, interest rate range of 3.50% to 6.50% $ 7,228.9 $ 6,517.0 New Albertsons L.P. Notes due 2026 to 2031, interest rate range of 6.52% to 8.70% 489.3 484.6 Safeway Inc. Notes due 2027 to 2031, interest rate range of 7.25% to 7.45% 376.5 375.9 ABL Facility 425.0 Other financing obligations 14.0 14.7 Finance lease obligations (see Note 6) 412.9 427.9 Total debt 8,946.6 7,820.1 Less current maturities (534.0) (57.6) Long-term portion $ 8,412.6 $ 7,762.5 As of February 28, 2026, the future maturities of long-term debt, excluding finance lease obligations, debt discounts and deferred financing costs, consisted of the following (in millions): 2026 $ 485.1 2027 906.6 2028 44.0 2029 2,477.9 2030 397.0 Thereafter 4,316.2 Total $ 8,626.8 The Company's amended and restated senior secured asset-based loan facility (as amended, the ""ABL Facility"") and certain of the outstanding notes and debentures have restrictive covenants, subject to the right to cure in certain circumstances, calling for the acceleration of payments due in the event of a breach of a covenant or …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

"EQUITY-BASED COMPENSATION The Company maintains the Albertsons Companies, Inc. 2020 Omnibus Incentive Plan and the Albertsons Companies, Inc. Restricted Stock Unit Plan (the ""Equity Plans""). Under the Equity Plans, subsequent to the IPO, 43.6 million shares of Class A common stock have been authorized for issuance as equity awards. As of February 28, 2026, 22.7 million shares of Class A common stock remained available for future awards. Under the Equity Plans, the Company recognizes equity-based compensation expense for RSUs and RSAs granted to employees and non-employee directors. Upon vesting, RSUs and RSAs will be settled in shares of the Company's Class A common stock. RSUs generally vest over three years from the grant date, based on a service period, or upon a combination of both a service period and achievement of certain performance-based thresholds, and RSAs generally vest over five years from the grant date, with 50% based solely on a service period and 50% upon a service period and achievement of certain performance-based thresholds. For performance-based RSUs (""PBRSUs"") granted in fiscal 2025, the number of shares of the Company's Class A common stock to be received at vesting can be adjusted within a predetermined range based on the Company's achieved performance for fiscal 2025 relative to the fiscal 2025 performance target. In fiscal 2025, fiscal 2024 and fiscal 2023, the Company also had liability classified awards that settled in cash upon vesting. Equit …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

FAIR VALUE MEASUREMENTS The accounting guidance for fair value established a framework for measuring fair value and established a three-level valuation hierarchy for disclosure of fair value measurement. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability at the measurement date. The three levels are defined as follows: Level 1 - Quoted prices in active markets for identical assets or liabilities; Level 2 - Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable; and Level 3 - Unobservable inputs in which little or no market activity exists, requiring an entity to develop its own assumptions that market participants would use to value the asset or liability. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following table presents certain assets which are measured at fair value on a recurring basis as of February 28, 2026 (in millions): Fair Value Measurements Total Quoted prices in active markets for identical assets (Level 1) Significant observable inputs (Level 2) Significant unobservable inputs (Level 3) Assets: Short-term investments (1) $ 13.7 $ 7.8 $ 5.9 $ Non-current investments (2) 111.4 8.7 102.7 Derivative contracts (3) 3.4 3.4 Total $ 128.5 $ 16.5 $ 112.0 $ Liabilities: Derivative contracts (3) $ 0.1 $ $ 0.1 $ Total $ 0.1 …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

INTANGIBLE ASSETS Intangible assets, net consisted of the following (in millions): February 28, 2026 February 22, 2025 Estimated useful lives (Years) Gross carrying amount Accumulated amortization Net Gross carrying amount Accumulated amortization Net Trade names 40 $ 1,935.8 $ (556.3) $ 1,379.5 $ 1,935.8 $ (507.7) $ 1,428.1 Customer prescription files 5 1,446.4 (1,407.0) 39.4 1,441.0 (1,400.2) 40.8 Internally developed software 3 to 5 1,967.7 (1,316.5) 651.2 1,889.2 (1,127.5) 761.7 Other intangible assets (1) 3 to 6 45.2 (44.0) 1.2 44.7 (41.6) 3.1 Total finite-lived intangible assets 5,395.1 (3,323.8) 2,071.3 5,310.7 (3,077.0) 2,233.7 Liquor licenses and restricted covenants Indefinite 84.8 84.8 84.3 84.3 Total intangible assets, net $ 5,479.9 $ (3,323.8) $ 2,156.1 $ 5,395.0 $ (3,077.0) $ 2,318.0 (1) Other intangible assets includes covenants not to compete, specialty accreditation and licenses and patents. Amortization expense for intangible assets was $340.6 million, $337.7 million and $312.7 million for fiscal 2025, fiscal 2024 and fiscal 2023, respectively. Estimated future amortization expense associated with the net carrying amount of intangibles with finite lives is as follows (in millions): Fiscal Year Amortization Expected 2026 $ 349.9 2027 243.7 2028 130.7 2029 75.0 2030 56.8 Thereafter 1,215.2 Total $ 2,071.3 In fiscal 2025, fiscal 2024 and fiscal 2023, there were $14.2 million, $13.6 million and $39.9 million, respectively, of intangible asset impairment and disp …

GoodwillAndIntangibleAssetsDisclosureTextBlock · excerpt; the full note is in the filing

"INCOME TAXES The components of income tax expense consisted of the following (in millions): Fiscal 2025 Fiscal 2024 Fiscal 2023 Current Federal (1) $ 206.4 $ 228.9 $ 348.2 State (2) 51.3 46.0 56.4 Foreign 1.4 1.3 1.0 Total Current 259.1 276.2 405.6 Deferred Federal (174.2) (11.8) (83.1) State (34.0) (92.9) 31.7 Foreign (0.5) (0.4) (61.2) Total Deferred (208.7) (105.1) (112.6) Income tax expense $ 50.4 $ 171.1 $ 293.0 (1) Federal current tax expense is net of $0.3 million, $0.3 million and $0.3 million tax benefit of net operating losses (""NOL"") in fiscal 2025, fiscal 2024 and fiscal 2023, respectively. (2) There were no state tax benefits of NOLs in fiscal 2025 and fiscal 2023. In fiscal 2024, state current tax expense is net of $1.0 million tax benefit of NOLs. The difference between the actual tax provision and the tax provision computed by applying the statutory federal income tax rate of 21.0% to Income before income taxes was attributable to the following (in millions): Fiscal 2025 Fiscal 2024 Fiscal 2023 Amount Percent Amount Percent Amount Percent U.S. federal tax at statutory rate $ 56.2 21.0 % $ 237.3 21.0 % $ 333.7 21.0 % State and local income taxes, net of federal income tax effect (1) 10.4 3.9 51.9 4.6 66.3 4.2 Tax credits Research and development credit (11.9) (4.4) (12.9) (1.1) (20.6) (1.3) Employee tax credits (8.5) (3.2) (12.3) (1.1) (20.6) (1.3) Other credits (0.5) (0.2) (0.6) (0.1) (0.6) Changes in federal valuation allowances 2.2 0.8 2.7 0.2 Non-taxable …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

LEASES The components of total lease cost, net consisted of the following (in millions): Classification Fiscal 2025 Fiscal 2024 Fiscal 2023 Operating lease cost (1) Cost of sales and Selling and administrative expenses (3) $ 1,167.1 $ 1,111.5 $ 1,082.8 Finance lease cost Amortization of lease assets Cost of sales and Selling and administrative expenses (3) 40.6 45.8 51.7 Interest on lease liabilities Interest expense, net 34.4 38.8 45.5 Variable lease cost (2) Cost of sales and Selling and administrative expenses (3) 483.1 465.8 456.3 Sublease income Net sales and other revenue (72.3) (76.0) (78.6) Total lease cost, net $ 1,652.9 $ 1,585.9 $ 1,557.7 (1) Includes short-term lease cost, which is immaterial. (2) Represents variable lease costs for both operating and finance leases. Includes contingent rent expense and other non-fixed lease-related costs, including property taxes, common area maintenance and property insurance. (3) Supply chain-related amounts are included in Cost of sales. Balance sheet information related to leases as of February 28, 2026 and February 22, 2025 consisted of the following (in millions): Classification February 28, 2026 February 22, 2025 Assets Operating Operating lease right-of-use assets $ 6,102.4 $ 6,153.4 Finance Property and equipment, net 287.9 288.0 Total lease assets $ 6,390.3 $ 6,441.4 Liabilities Current Operating Current operating lease obligations $ 736.7 $ 705.5 Finance Current maturities of long-term debt and finance lease obligation …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

"Recently adopted accounting standards: In December 2023, the Financial Accounting Standards Board (""FASB"") issued Accounting Standards Update (""ASU"") 2023-09, "" Income Taxes (Topic 740): Improvements to Income Tax Disclosures ."" The ASU enhances disclosures within the income tax rate reconciliation and information disclosed related to income taxes paid. The Company adopted this ASU in fiscal 2025 on a retrospective basis for all periods presented. The adoption of this ASU resulted in additional required disclosures, which are included in Note 9 - Income Taxes. Recently issued accounting standards: In November 2024, the FASB issued ASU 2024-03, "" Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses ."" The ASU requires disclosures about specific types of expenses, including purchases of inventory, employee compensation, depreciation and amortization. The amendments in this ASU are effective for fiscal years beginning after December 15, 2026, and for interim periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the impact of this ASU on its Consolidated Financial Statements and related disclosures. In September 2025, the FASB issued ASU 2025-06, "" Intangible - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software ."" …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

"EMPLOYEE BENEFIT PLANS AND COLLECTIVE BARGAINING AGREEMENTS Employer Sponsored Pension Plans The Company sponsors a defined benefit pension plan (the ""Safeway Plan"") for certain employees not participating in multiemployer pension plans. The Safeway Plan is frozen to non-union employees but continues to remain fully open to union employees, and past service benefits, including future interest credits, for non-union employees continue to be accrued under the Safeway Plan. The Company also sponsors a defined benefit pension plan (the ""Shaw's Plan"") covering union employees under the Shaw's banner. Under the United banner, the Company sponsors a frozen plan (the ""United Plan"") covering certain United employees and an unfunded Retirement Restoration Plan that provides death benefits and supplemental income payments for certain executives after retirement. On December 21, 2023, the Company initiated the process of terminating the United Plan which is expected to be finalized during fiscal 2026. The Company also contributes to the Safeway Variable Annuity Pension Plan (the ""Safeway VAPP"") that provides benefits to participants for future services. Other Post-Retirement Benefits In addition to the Company's pension plans, the Company provides post-retirement medical and life insurance benefits to certain employees. Retirees share a portion of the cost of the post-retirement medical plans. The Company pays all the cost of the life insurance plans. These plans are unfunded. T …

PensionAndOtherPostretirementBenefitsDisclosureTextBlock · excerpt; the full note is in the filing

"RELATED PARTIES The Company paid Cerberus Technology Solutions, an affiliate of Cerberus Capital Management, L.P. (""Cerberus""), fees totaling approximately $2.7 million, $4.0 million and $5.5 million for fiscal 2025, fiscal 2024 and fiscal 2023, respectively, for information technology advisory and implementation services in connection with modernizing the Company's information systems. The Company's payments to Cerberus Operations and Advisory Company, LLC, an affiliate of Cerberus, were immaterial for fiscal 2025, fiscal 2024 and fiscal 2023, for consulting services provided in connection with improving the Company's operations."

RelatedPartyTransactionsDisclosureTextBlock

"SEGMENT INFORMATION The Company and its subsidiaries offer grocery products, general merchandise, health and beauty care products, pharmacy, fuel and other items and services in its stores or through digital channels. The Company's retail operating divisions are geographically based, have similar economic characteristics and similar expected long-term financial performance. The Company's operating segments and reporting units are its operating divisions, which are reported in one reportable segment. Each reporting unit constitutes a business for which discrete financial information is available and for which the Chief Operating Decision Maker (""CODM""), the Company's Chief Executive Officer, regularly reviews the operating results and makes key operating decisions on how to allocate resources. Across all operating segments, the Company operates primarily one store format. Each division offers, through its stores and digital channels, the same general mix of products with similar pricing to similar categories of customers, has similar distribution methods, operates in similar regulatory environments and purchases merchandise from similar or the same vendors. The CODM evaluates performance and allocates resources using Retail segment EBITDA, defined as earnings (net loss) before interest, income taxes, depreciation and amortization, adjusted to eliminate the effects of items management does not consider in assessing segment performance. The CODM uses Retail segment EBITDA as …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

"STOCKHOLDERS' EQUITY AND CONVERTIBLE PREFERRED STOCK Common Stock On June 8, 2020, the Company amended and restated its certificate of incorporation to authorize 1,150,000,000 shares of common stock, par value $0.01 per share, of which 1,000,000,000 shares were classified as Class A common stock (""Class A common stock"") and 150,000,000 shares were classified as Class A-1 convertible common stock (""Class A-1 common stock""). As of February 28, 2026, there were 600,734,693 and 499,542,902 shares of Class A common stock issued and outstanding, respectively, and no shares of Class A-1 common stock issued or outstanding. As of February 22, 2025, there were 597,964,926 and 575,441,992 shares of Class A common stock issued and outstanding, respectively, and no shares of Class A-1 common stock issued or outstanding. The terms of the Class A common stock are substantially identical to the terms of the Class A-1 common stock, except that the Class A-1 common stock does not have voting rights. Each holder of Class A common stock is entitled to one vote for each share owned of record on all matters voted upon by stockholders. A majority vote is required for all action to be taken by stockholders, except as otherwise provided for in the Company's amended and restated certificate of incorporation and amended and restated bylaws or as required by law. Subject to preferences that may be applicable to any then outstanding preferred stock, holders of the Company's Class A common stock and …

StockholdersEquityNoteDisclosureTextBlock · excerpt; the full note is in the filing

"COMMITMENTS AND CONTINGENCIES AND OFF BALANCE SHEET ARRANGEMENTS Guarantees Lease Guarantees: The Company may have liability under certain operating leases that were assigned to third parties. If any of these third parties fail to perform their obligations under the leases, the Company could be responsible for the lease obligation. Because of the wide dispersion among third parties and the variety of remedies available, the Company believes that if an assignee became insolvent, it would not have a material effect on the Company's financial condition, results of operations or cash flows. The Company also provides guarantees, indemnifications and assurances to others in the ordinary course of its business. Legal Proceedings The Company is subject from time to time to various claims and lawsuits, including matters involving trade, business and operational practices, personnel and employment issues, lawsuits alleging violations of state and/or federal wage and hour laws, real estate disputes, personal injury, antitrust claims, packaging or product claims, claims related to the sale of drug or pharmacy products, such as opioids, intellectual property claims and other proceedings arising in or outside of the ordinary course of business. The Company is also subject, from time to time, to government investigations, subpoenas, audits, reviews, claims enforcement actions and litigation. These can include routine, regular and special investigations, audits, civil or criminal subpoenas, …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

"LONG-TERM DEBT AND FINANCE LEASE OBLIGATIONS The Company's long-term debt and finance lease obligations as of June 20, 2026 and February 28, 2026, net of unamortized debt discounts of $35.4 million and $37.9 million, respectively, and deferred financing costs of $52.1 million and $55.2 million, respectively, consisted of the following (in millions): June 20, 2026 February 28, 2026 Senior Unsecured Notes due 2028 to 2034, interest rate range of 3.50% to 6.50% $ 7,232.7 $ 7,228.9 New Albertsons L.P. Notes due 2027 to 2031, interest rate range of 6.52% to 8.70% 434.4 489.3 Safeway Inc. Notes due 2027 to 2031, interest rate range of 7.25% to 7.45% 376.6 376.5 ABL Facility 700.0 425.0 Other financing obligations 11.0 14.0 Finance lease obligations 408.1 412.9 Total debt 9,162.8 8,946.6 Less current maturities (746.1) (534.0) Long-term portion $ 8,416.7 $ 8,412.6 ABL Facility As of June 20, 2026, there was $700.0 million outstanding under the asset-based loan facility (the ""ABL Facility""), and letters of credit (""LOC"") issued under the LOC sub-facility were $12.6 million. As of February 28, 2026, there was $425.0 million outstanding under the ABL Facility, and LOC issued under the LOC sub-facility were $12.7 million. New Albertsons L.P. Notes The Company repaid the remaining $56.5 million in aggregate principal amount outstanding of New Albertsons L.P.'s 7.75% Notes due 2026 on their maturity date, June 15, 2026."

DebtDisclosureTextBlock

FAIR VALUE MEASUREMENTS The accounting guidance for fair value established a framework for measuring fair value and established a three-level valuation hierarchy for disclosure of fair value measurement. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability at the measurement date. The three levels are defined as follows: Level 1 - Quoted prices in active markets for identical assets or liabilities; Level 2 - Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable; and Level 3 - Unobservable inputs in which little or no market activity exists, requiring an entity to develop its own assumptions that market participants would use to value the asset or liability. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following table presents certain assets which were measured at fair value on a recurring basis as of June 20, 2026 (in millions): Fair Value Measurements Total Quoted prices in active markets for identical assets (Level 1) Significant observable inputs (Level 2) Significant unobservable inputs (Level 3) Assets: Short-term investments (1) $ 14.5 $ 8.5 $ 6.0 $ Non-current investments (2) 113.0 9.2 103.8 Derivative contracts (3) 5.1 5.1 Total $ 132.6 $ 17.7 $ 114.9 $ (1) Primarily relates to Mutual Funds (Level 1) and Certificates of D …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

"Recently issued accounting standards : In November 2024, the Financial Accounting Standards Board (""FASB"") issued Accounting Standards Update (""ASU"") 2024-03, "" Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. "" The ASU requires disclosures about specific types of expenses, including purchases of inventory, employee compensation, depreciation and amortization. The amendments in this ASU are effective for fiscal years beginning after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the impact of this ASU on its Consolidated Financial Statements and related disclosures. In September 2025, the FASB issued ASU 2025-06, "" Intangible - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software."" The ASU removes all references to prescriptive and sequential software development stages. The ASU requires entities to begin capitalizing software costs when management authorizes and commits to funding the software project, and it is probable that the project will be completed and the software will be used for its intended purpose. The amendments in this ASU are effective for fiscal years beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the impact of …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

EMPLOYEE BENEFIT PLANS Pension and Other Post-Retirement Benefits The following table provides the components of net pension and post-retirement expense (income) (in millions): 16 weeks ended Pension Other post-retirement benefits June 20, 2026 June 14, 2025 June 20, 2026 June 14, 2025 Estimated return on plan assets $ (24.3) $ (28.3) $ $ Service cost 4.9 4.9 Interest cost 18.4 24.2 0.1 0.1 Amortization of prior service cost 0.1 0.1 Amortization of net actuarial gain (0.4) (0.9) (0.2) (0.2) Income, net $ (1.3) $ $ (0.1) $ (0.1) The Company contributed $31.7 million and $42.9 million to its defined pension plans and post-retirement benefit plans during the 16 weeks ended June 20, 2026 and June 14, 2025, respectively. At the Company's discretion, additional funds may be contributed to the defined benefit pension plans that are determined to be beneficial to the Company. The Company currently anticipates contributing an additional $18.5 million to these plans for the remainder of fiscal 2026. …

PensionAndOtherPostretirementBenefitsDisclosureTextBlock · excerpt; the full note is in the filing

"SEGMENT INFORMATION The Company and its subsidiaries offer grocery products, general merchandise, health and beauty care products, pharmacy, fuel and other items and services in its stores or through digital channels. The Company's retail operating divisions are geographically based, have similar economic characteristics and similar expected long-term financial performance. The Company's operating segments and reporting units are its operating divisions, which are reported in one reportable segment. Each reporting unit constitutes a business for which discrete financial information is available and for which the Chief Operating Decision Maker (""CODM""), the Company's Chief Executive Officer, regularly reviews the operating results and makes key operating decisions on how to allocate resources. Across all operating segments, the Company operates primarily one store format. Each division offers, through its stores and digital channels, the same general mix of products with similar pricing to similar categories of customers, has similar distribution methods, operates in similar regulatory environments and purchases merchandise from similar or the same vendors. The CODM evaluates performance and allocates resources using Retail segment EBITDA, defined as earnings (net loss) before interest, income taxes, depreciation and amortization, adjusted to eliminate the effects of items management does not consider in assessing segment performance. The CODM uses Retail segment EBITDA as …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing