Albertsons Companies Annual Report 2021 Form 10-K (NYSE:ACI) Published: April 28th, 2021 PDF generated by stocklight.com UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended February 27, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____ to _____ Commission File Number: 001-39350 aci-20210227_g1.jpg Albertsons Companies, Inc. (Exact name of registrant as specified in its charter) Delaware 47-4376911 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) 250 Parkcenter Blvd. Boise, Idaho, 83706 (Address of principal executive offices and zip code) (208) 395-6200 (Registrant's telephone number, including area code) Not applicable (Former name, former address and former fiscal year, if changed since last report) Securities registered under Section 12(b) of the Exchange Act: Title of each class Trading Symbol(s) Name of each exchange on which registered Class A common stock, $0.01 par value ACI New York Stock Exchange Securities registered under Section 12(g) of the Exchange Act: None Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐N o ☒ Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐N o ☒ Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐ Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐ Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act. Large accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☒ Smaller reporting company ☐ Emerging growth company ☐ If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐ Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒ As of September 11, 2020, the last business day of the registrant's most recently completed second fiscal quarter, the aggregate market value of the registrant's common stock held by non-affiliates was approximately $1.4 billion. As of April 27, 2021, the registrant had 466,514,113 shares of Class A common stock, par value $0.01 per share, outstanding. DOCUMENTS INCORPORATED BY REFERENCE Items 10, 11, 12, 13 and 14 of Part III incorporate information by reference from the registrant's definitive proxy statement related to its 2021 Annual Meeting of Stockholders, to be filed with the Securities and Exchange Commission within 120 days after the end of the fiscal year ended February 27, 2021 (the "Proxy Statement"). Except as expressly incorporated by reference, the Proxy Statement shall not be deemed to be part of this Annual Report on Form 10-K. Albertsons Companies, Inc. and Subsidiaries Page PART I 4 Item 1 - Business 8 Item 1A - Risk Factors 15 Item 1B - Unresolved Staff Comments 39 Item 2 - Properties 40 Item 3 - Legal Proceedings 40 Item 4 - Mine Safety 41 PART II 42 Item 5 - Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 42 Item 6 - Selected Financial Data 44 Item 7 - Management's Discussion and Analysis of Financial Condition and Results of Operations 45 Item 7A - Quantitative and Qualitative Disclosures About Market Risk 62 Item 8 - Financial Statements and Supplementary Data 64 Item 9 - Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 119 Item 9A - Controls and Procedures 120 Item 9B - Other Information 120 PART III 121 Item 10 - Directors, Executive Officers and Corporate Governance 121 Item 11 - Executive Compensation 121 Item 12 - Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 121 Item 13 - Certain Relationships and Related Transactions, and Director Independence 121 Item 14 - Principal Accountant Fees and Services 121 PART IV 122 Item 15 - Exhibits, Financial Statement Schedules 122 Item 16 - Summary 127 SIGNATURES 128 As used in this Form 10-K, unless the context otherwise requires, references to "Albertsons," the "Company," "ACI," "we," "us" and "our" refer to Albertsons Companies, Inc. and, where appropriate, its subsidiaries. Our last three fiscal years consisted of the 52 weeks ended February 27, 2021 ("fiscal 2020"), the 53 weeks ended February 29, 2020 ("fiscal 2019") and the 52 weeks ended February 23, 2019 ("fiscal 2018"). Our next three fiscal years consist of the 52 weeks ending February 26, 2022 ("fiscal 2021"), February 25, 2023 ("fiscal 2022") and February 24, 2024 ("fiscal 2023"). PART I SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS The information contained in this Annual Report on Form 10-K includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). All statements other than statements of historical facts contained in this Annual Report on Form 10-K, including statements regarding our future operating results and financial position, business strategy, and plans and objectives of management for future operations, are forward-looking statements. Words such as "believes," "plans," "anticipates," "estimates," "expects," "intends," "aims," "potential," "will," "would," "could," "considered," "likely," "estimate" and the negatives or variations of these words and similar future or conditional expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. Statements regarding productivity initiatives and revenue opportunities (and in each case, the components, amounts and/or percentages thereof) are forward-looking statements. While we believe these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond our control. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend upon future circumstances that may or may not occur. These risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward-looking statements include those related to the COVID-19 pandemic, about which there are still many unknowns, including the duration of the pandemic and the extent of its impact. These factors include, but are not limited to, risks and uncertainties discussed in the section of this Annual Report on Form 10-K entitled "Risk Factors." Consequently, all of the forward-looking statements we make in this Annual Report on Form 10-K are qualified by the information contained in this section and the information discussed under "Part I—Item 1A. Risk Factors." Persons reading this Annual Report on Form 10-K are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof and only to events as of the date of this Annual Report on Form 10-K. We are not under any obligation, and we expressly disclaim any obligation, to update, alter, or otherwise revise any forward-looking statements, whether written or oral, that may be made from time to time, whether as a result of new information, future events, or otherwise, except as required by law. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments we may make. SUMMARY RISK FACTORS The following is a summary of the principal factors that create risk in investing in our securities: Risks Related to Our Business and Operations Risks related to: • various operating factors and economic conditions affecting the food retail industry that may affect our business and operating results; • the impact of the COVID-19 pandemic; and • the prices and availability of energy and fuel to manufacture, store, transport and sell products. Risks Related to Our Future Initiatives Risks related to: • being unable to consummate acquisitions in the future on acceptable terms; and • failing to realize anticipated benefits from our productivity initiatives. Risks Related to Our Industry Risks related to: • the intensity of the competition in our industry; • our ability to timely identify or effectively respond to consumer trends; • consolidation in the healthcare industry; and • the adequacy of our insurance to cover any claims against us.