EFTA01382330.pdf

Amendment No. 3 to Form S-1 Tabk of Contents The computation of Adjusted EBITDA from Continuing Operations is provided below. Adjusted EBITDA from Continuing Operations should not be considered as an alternative to income from continuing operations, net of tax, or cash flow from operating activities (which are determined in accordance with GAAP). Other companies may define Adjusted EBITDA differently and, as a result, such measures may not be comparable to Safeway's Adjusted EBITDA from Continuing Operations (dollars in millions). Fiscal Fiscal Fiscal 2014 2013 2012 Income from continuing operations, net of tax (1) $ 103.2 $ 217.1 $ 249.2 Noncontrolling interest — — 0.3 Income taxes 61.8 34.5 113.0 Interest expense 198.9 273.0 300.6 Depreciation expense 921.5 922.2 952.8 LIFO (income) / expense (5.0) (14.3) 0.7 Share-based employee compensation 24.7 50.4 48.4 Property impairment charges 56.1 35.6 33.6 Equity in earnings of unconsolidated affiliate (16.2) (17.6) (17.5) Dividend from unconsolidated affiliate 9.0 3.8 0.7 Impairment of notes receivables - 30.0 — Loss on foreign currency translation 131.2 57.4 — Loss on extinguishment of debt 84.4 10.1 — Acquisition and integration costs 48.8 0.5 — Total Adjusted EBITDA from Continuing Operations $1,618.4 $1,602.7 $1,681.8 (1) Excludes discontinued operations of Blackhawk, Dominick's and Canada Safeway. Liquidity and Financial Resources Safeway's net cash flow provided by operating activities was $1,387.7 million in fiscal 2014, $1,071.4 million in fiscal 2013 and $1,226.5 million in fiscal 2012. Net cash flow from operating activities increased in fiscal 2014 compared to fiscal 2013 primarily due to higher income taxes paid in fiscal 2013. The decrease in Safeway's net cash flow provided by operating activities in fiscal 2013 from fiscal 2012 was due primarily to income taxes paid from continuing operations. Safeway's cash contributions to Safeway's pension and post-retirement benefit plans are expected to be $268.0 million in fiscal 2015 and totaled $13.3 million in fiscal 2014, $56.3 million in fiscal 2013 and $110.3 million in fiscal 2012. Safeway's net cash flow used by investing activities, which consists principally of cash paid for property additions, was $115.6 million in fiscal 2014, $442.7 million in fiscal 2013 and $593.2 million in fiscal 2012. Safeway's net cash flow used by investing activities declined in fiscal 2014 compared to fiscal 2013, primarily as a result of proceeds from the sale of PDC in fiscal 2014. Net cash flow used by investing activities declined in fiscal 2013 compared to fiscal 2012, primarily as a result of lower capital expenditures and higher proceeds from Safeway-owned life insurance policies in fiscal 2013. 109 M.mx go% Arclio.e.: edgar data 1646972 000119312515335826'd900395ds Itt.htm110 14'2015 9:03:02 AM1 CONFIDENTIAL - PURSUANT TO FED. R. GRIM. P. 6(e) DB-SDNY-0081648 CONFIDENTIAL SDNY_GM_00227832 EFTA01382330