Safeway chairman, president and CEO Steve Burd, commenting in a conference call with financial analysts, noted that some skeptics wondered if the Lifestyle stores would be able to hold their sales gains in their second and third years of operations. The Lifestyle format has not only held its gains, it has built on them, Burd said, crediting the new format with helping to increase sales at the chain as part of the chain's overall "re-energizing strategy."

Safeway operates 1,755 stores in the US and Canada. In addition to its plans to open more Lifestyle stores, the company plans to continue remodeling existing stores into the Lifestyle format. For this fiscal year, it expects to complete approximately 275 Lifestyle remodels. The company invested $385.9 million in capital expenditures in the first quarter as part of a plan to spend approximately $1.7 billion in capital expenditures for the new openings and remodelings this fiscal year.

Safeway's net income for the first quarter totaled $174.4 million and 39 cents per diluted share, compared with $142.9 million and 32 cents per diluted share for the first quarter of last year. Total sales and other revenue increased 4.8% to $9.3 billion in the first quarter, compared to $8.9 billion in the first quarter of 2006. Identical-store sales increased 4.8% for the quarter and "were strong in both perishable and non-perishable products," Burd pointed out.