MONTVALE, NJ – July 25, 2003 – The Great Atlantic & Pacific Tea Company, Inc. (A&P, NYSE Symbol:GAP) announced unaudited fiscal 2003 first quarter results for the 16 weeks ended June 14, 2003.

Sales for the first quarter were $3.2 billion, compared with $3.1 billion in the first quarter of fiscal 2002. Comparable store sales decreased 0.1% vs. year-ago. Earnings per share were $.52 for the quarter, compared with $.05 in the prior year.

During the first quarter of fiscal 2003, the Company classified three businesses, northern New England, Kohl’s and Eight O’Clock Coffee, as discontinued operations since they are being divested. Excluding discontinued operations, ongoing operating loss per share in the quarter was $.53, compared with ongoing operating earnings of $.11 per share for first quarter last year.

EBITDA for the first quarter of fiscal 2003, based on ongoing operating earnings as shown on Schedule 3 of this release, was $72 million compared to $104 million in the prior year's first quarter.

Christian Haub, Chairman of the Board, President & Chief Executive Officer, said, “We have maintained our focus on strengthening our financial position, lowering costs, stabilizing our U.S. business and continuing our success in Canada. Our program to divest non-strategic assets moved forward in the first quarter, with the sale of our retail operations in northern New England and Madison, Wisconsin.

“Clearly, the economic and operating environment continues to challenge top and bottom line progress. However, I am confident that the operating and merchandising disciplines as well as cost management being implemented in our U.S. operations and strengthened in our Canadian operations will provide the foundation for better performance in the future.”

Founded in 1859, A&P was one of the nation’s first supermarket chains, and is today among North America’s largest. In the first quarter, the Company opened 7 new stores and remodeled or expanded 2 stores. The Company operates 667 stores in 12 states, the District of Columbia and Ontario, Canada under the following trade names: A&P, Waldbaum’s, The Food Emporium, Super Foodmart, Super Fresh, Farmer Jack, Kohl’s, Sav-A-Center, Dominion, The Barn Markets, Food Basics and Ultra Food & Drug. The Company also manufactures and distributes the Eight O’Clock line of whole bean coffees. The Company invites investors to listen to an audio Webcast of its quarterly discussion of earnings by accessing a link on the “Investor Relations” page of its Website, www.aptea.com. The live broadcast is on Friday, July 25, 2003 at 11 AM Eastern Time, with replays available from the afternoon of July 25 through August 25.

Effective March 28, 2003, the Securities and Exchange Commission (“SEC”) adopted new rules related to disclosure of certain financial measures not calculated in accordance with generally accepted accounting principles (GAAP). Such new rules require all public companies to provide certain disclosures in press release and SEC filings related to non-GAAP financial measures. We use the non-GAAP measures “ongoing operating earnings” and “ongoing operating loss” to reflect what the Company’s earnings would have been excluding certain identified major items, which we believe are of a non-operating or one-time nature. These items are reconciled to reported earnings on Schedules 2 and 3 of this release. We use the non-GAAP measure “EBITDA” to reflect a measure that we believe is of interest to investors. EBITDA is reconciled to Net Cash provided by Operating Activities on Schedule 3 of this release.

This release contains forward-looking statements about the future performance of the Company, which are based on Management’s assumptions and beliefs in light of the information currently available to it. The Company assumes no obligation to update the information contained herein. These forward-looking statements are subject to uncertainties and other factors that could cause actual results to differ materially from such statements including, but not limited to: competitive practices and pricing in the food industry generally and particularly in the Company’s principal markets; the Company’s relationships with its employees and the terms of future collective bargaining agreements; the costs and other effects of legal and administrative cases and proceedings; the nature and extent of continued consolidation in the food industry; changes in the financial markets which may affect the Company’s cost of capital and the ability of the Company to access capital; supply or quality control problems with the Company’s vendors; and changes in economic conditions which affect the buying patterns of the Company’s customers.

For financial questions, call William J. Moss
Vice President, Treasurer
(201) 571-4019

For non-financial questions, call Richard P. De Santa
Vice President, Corporate Affairs
(201) 571-4495

pr_2003/2003-1Q-schedules.pdf - PDF - 85k
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