v3.26.1
EMPLOYEE BENEFIT PLANS AND COLLECTIVE BARGAINING AGREEMENTS
 12 Months Ended
Feb. 28, 2026
Retirement Benefits [Abstract]  
EMPLOYEE BENEFIT PLANS AND COLLECTIVE BARGAINING AGREEMENTS 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.
The following table provides a reconciliation of the changes in the retirement plans' benefit obligation and fair value of assets over the two-year period ended February 28, 2026 and a statement of funded status as of February 28, 2026 and February 22, 2025 (in millions):
PensionOther Post-Retirement Benefits
February 28,
2026		February 22,
2025		February 28,
2026		February 22,
2025
Change in projected benefit obligation:
Beginning balance$1,641.4 $1,691.5 $12.1 $12.0 
Service cost15.9 16.7 — — 
Interest cost70.8 83.4 0.5 0.5 
Actuarial loss (gain)25.7 16.4 (1.2)1.1 
Benefit payments (including settlements)(423.9)(166.7)(1.3)(1.5)
Plan amendments— 0.1 — — 
Ending balance$1,329.9 $1,641.4 $10.1 $12.1 
Change in fair value of plan assets:
Beginning balance$1,483.2 $1,443.7 $— $— 
Actual return on plan assets126.3 116.4 — — 
Employer contributions55.6 89.8 1.3 1.5 
Benefit payments (including settlements)(423.9)(166.7)(1.3)(1.5)
Ending balance$1,241.2 $1,483.2 $— $— 
Components of net amount recognized in financial position:
Other current liabilities $(5.5)$(4.4)$(1.8)$(2.3)
Other long-term liabilities(83.2)(153.8)(8.3)(9.8)
Funded status$(88.7)$(158.2)$(10.1)$(12.1)

The actuarial loss in fiscal 2025 related to the projected benefit obligation was primarily driven by discount rate and mortality assumptions, partially offset by cash balance interest crediting rates. The actuarial loss in fiscal 2024 related to the projected benefit obligation was primarily driven by cash balance interest crediting rates.

Amounts recognized in Accumulated other comprehensive income (loss) consisted of the following (in millions):
PensionOther Post-Retirement
Benefits
February 28,
2026		February 22,
2025		February 28,
2026		February 22,
2025
Net actuarial gain$(101.5)$(116.2)$(10.0)$(9.7)
Prior service cost0.8 1.2 — — 
$(100.7)$(115.0)$(10.0)$(9.7)
Information for the Company's pension plans, all of which have an accumulated benefit obligation in excess of plan assets as of February 28, 2026 and February 22, 2025, is shown below (in millions):
February 28,
2026		February 22,
2025
Projected benefit obligation$1,329.9 $1,641.4 
Accumulated benefit obligation1,329.7 1,637.8 
Fair value of plan assets1,241.2 1,483.2 

The following table provides the components of net pension and post-retirement (income) expense for the retirement plans and other changes in plan assets and benefit obligations recognized in Other comprehensive income (loss) (in millions):
PensionOther Post-Retirement
Benefits
Fiscal
 2025		Fiscal
 2024		Fiscal
 2023		Fiscal
 2025		Fiscal
 2024		Fiscal
 2023
Components of net (income) expense:
Estimated return on plan assets$(83.1)$(91.1)$(98.5)$— $— $— 
Service cost15.9 16.7 17.3 — — — 
Interest cost70.8 83.4 83.6 0.5 0.5 0.6 
Amortization of prior service cost0.4 0.3 0.4 — — — 
Amortization of net actuarial (gain) loss(2.7)(3.9)(5.5)(0.8)(0.7)(1.1)
(Income) loss due to settlement accounting(29.4)3.5 0.3 — — — 
(Income) expense, net(28.1)8.9 (2.4)(0.3)(0.2)(0.5)
Changes in plan assets and benefit obligations recognized in Other comprehensive income (loss):   
Net actuarial (gain) loss(17.4)(8.6)(28.0)(1.2)1.1 0.8 
Amortization of net actuarial gain (loss)2.7 3.9 5.5 0.8 0.7 1.1 
Prior service cost— 0.1 (0.2)— — — 
Amortization of prior service cost(0.4)(0.3)(0.4)— — — 
Income (loss) due to settlement accounting29.4 (3.5)(0.3)— — — 
Total recognized in Other comprehensive income (loss)14.3 (8.4)(23.4)(0.4)1.8 1.9 
Total net expense and changes in plan assets and benefit obligations recognized in Other comprehensive income (loss) $(13.8)$0.5 $(25.8)$(0.7)$1.6 $1.4 

During fiscal 2025, the Company purchased a group annuity policy and transferred $290.0 million of pension plan assets to an insurance company (the "Annuity Purchase"), thereby reducing the Company's defined benefit pension obligations by $295.0 million. As a result of the Annuity Purchase, the Company recorded a settlement gain of $26.8 million during fiscal 2025.

Prior service costs are amortized on a straight-line basis over the average remaining service period of active participants. When the accumulation of actuarial gains and losses exceeds 10% of the greater of the projected benefit obligation and the fair value of plan assets, the excess is amortized over either the average remaining
lifetime of all participants or the average remaining service period of active participants. No significant prior service costs or estimated net actuarial gain or loss is expected to be amortized from Other comprehensive income (loss) into periodic benefit cost during fiscal 2026.

Assumptions

The weighted average actuarial assumptions used to determine year-end projected benefit obligations for pension plans were as follows:
February 28,
2026		February 22,
2025
Discount rate5.29 %5.34 %
Rate of compensation increase3.21 %3.20 %
Cash balance plan interest crediting rate4.64 %4.85 %

The weighted average actuarial assumptions used to determine net periodic benefit costs for pension plans were as follows: 
February 28,
2026		February 22,
2025		February 24,
2024
Discount rate5.45 %5.32 %5.17 %
Expected return on plan assets6.50 %6.67 %7.40 %
Cash balance plan interest crediting rate4.85 %4.25 %3.65 %

Discount Rate Assumption. The discount rate reflects the current rate at which the pension obligations could be settled at each measurement date. In all years presented, the discount rates were determined by matching the expected plan benefit payments against a spot rate yield curve constructed to replicate above median yields of AA-graded corporate bonds.

Asset Return Assumption. Expected return on pension plan assets is based on historical experience of the Company's portfolios and the review of projected returns by asset class on return-seeking assets and liability-hedging assets, as well as target asset allocation.

Retirement and Mortality Rates. The mortality assumptions reflect the applicable current mortality tables and adjusted mortality improvement projection scales as issued by the Society of Actuaries.

Investment Policies and Strategies. During the fourth quarter of fiscal 2023, the Company revised the investment policy for the Safeway Plan and the Shaw's Plan, and these changes to the structure of plan assets were implemented during fiscal 2024. The investment policy for the Safeway VAPP remained unchanged. The defined benefit plan investment policy incorporates a strategic long-term asset allocation mix designed to meet the Company's long-term pension requirements. This asset allocation policy is reviewed annually and, on a regular basis, actual allocations are rebalanced to the prevailing targets. The investment policy for the Safeway Plan and the Shaw's Plan allows for a varying asset allocation dependent on each plan's funded status. The investment policy also emphasizes the following key objectives: (1) maintaining a diversified portfolio among asset classes and investment styles; (2) maintaining an acceptable level of risk in pursuit of long-term economic benefit; (3) maximizing the opportunity for value-added returns from active investment management while establishing investment guidelines and monitoring procedures for the investment manager to ensure the characteristics of the portfolio are consistent with the original investment mandate; and (4) maintaining adequate controls over administrative costs.
The following table summarizes actual allocations for the Safeway Plan which had $1,006.8 million in plan assets as of February 28, 2026: 
Plan Assets
Asset categoryTarget (1)February 28,
2026		February 22,
2025
Return-seeking56%59.1 %63.4 %
Liability-hedging44%40.9 %36.6 %
Total
100%100.0 %100.0 %
(1) In accordance with the Safeway Plan investment policy, the target asset allocation was adjusted in fiscal 2025 based on the funded ratio of the Safeway Plan.

The following table summarizes the actual allocations for the Shaw's Plan which had $187.0 million in plan assets as of February 28, 2026:
Plan Assets
Asset categoryTarget (1)February 28,
2026		February 22,
2025
Return-seeking50%51.1 %58.9 %
Liability-hedging50%48.9 %41.1 %
Total
100%100.0 %100.0 %
(1) In accordance with the Shaw's Plan investment policy, the target asset allocation was adjusted in fiscal 2025 based on the funded ratio of the Shaw's Plan.

The following table summarizes the actual allocations for the Safeway VAPP which had $41.7 million in plan assets as of February 28, 2026:
Plan Assets
Asset categoryTargetFebruary 28,
2026		February 22,
2025
Equity15%16.3 %18.1 %
Fixed income60%57.7 %60.9 %
Other (1)25%19.0 %18.5 %
Cash—%7.0 %2.5 %
Total100%100.0 %100.0 %
(1) Includes real estate, global tactical asset allocation, private equity investments and money market funds.

Additionally, the Company sponsors other defined benefit pension plans which had $5.7 million in plan assets as of February 28, 2026.
Pension Plan Assets

The fair value of the Company's pension plan assets as of February 28, 2026 by asset category are as follows (in millions): 
 Fair Value Measurements
Asset categoryTotalQuoted Prices in Active Markets for Identical Assets
(Level 1)		Significant Observable Inputs
(Level 2)(1)		Significant Unobservable Inputs
(Level 3)		Assets Measured at NAV (1)
Cash and cash equivalents (2)$3.2 $3.2 $— $— $— 
Short-term investment collective trust (3)23.1 — — — 23.1 
Public equity funds (5)365.5 — 365.5 — — 
Return-seeking fixed income funds (6)134.7 — 16.9 — 117.8 
Debt funds (7)504.6 — 504.6 — — 
Hedge funds (8)64.2 — — — 64.2 
Real estate funds (9)132.5 — 37.8 — 94.7 
Other securities (10)13.4 — 13.4 — — 
Total$1,241.2 $3.2 $938.2 $— $299.8 

The fair value of the Company's pension plan assets as of February 22, 2025 by asset category are as follows (in millions): 
 Fair Value Measurements
Asset categoryTotalQuoted Prices in Active Markets for Identical Assets
(Level 1)		Significant Observable Inputs
(Level 2)(1)		Significant Unobservable Inputs
(Level 3)		Assets Measured at NAV (1)
Cash and cash equivalents (2)$1.9 $1.9 $— $— $— 
Short-term investment collective trust (3)53.2 — — — 53.2 
Mutual funds (4)6.7 6.7 — — — 
Public equity funds (5)490.2 — 490.2 — — 
Return-seeking fixed income funds (6)172.2 — 15.5 — 156.7 
Debt funds (7)499.1 — 499.1 — — 
Hedge funds (8)82.4 — — — 82.4 
Real estate funds (9)168.9 — 46.9 — 122.0 
Other securities (10)8.6 — 8.6 — — 
Total$1,483.2 $8.6 $1,060.3 $— $414.3 
(1) Certain of the Company's pension assets are invested in common collective trusts managed and valued by the fund administrator. The fair value of the funds is based on the Net Asset Value ("NAV") of the underlying investments owned by the fund minus its liabilities. Certain of these funds are classified outside of the fair value hierarchy because fair value for those funds is measured using the NAV practical expedient. These specific funds have been determined not to have a readily determinable fair value and the NAV is not the basis for current transactions, as the NAV is only published monthly or quarterly for these funds, and the Company can only redeem these investments monthly or quarterly. The remaining common collective trusts have a daily published NAV, and the Company can redeem those investments daily, therefore these funds are classified within the fair value hierarchy as the Company has determined the funds have a readily determinable fair value that is the basis for current transactions.
(2) The carrying value of these items approximates fair value.
(3) Invested in a fund comprised of high-grade, short term money market instruments. There are no unfunded commitments or redemption restrictions for these funds.
(4) Invested in mutual funds that are registered with the SEC which are valued using the NAV. The NAV of the mutual funds is a published price in an active market. There are no unfunded commitments, or redemption restrictions for these funds, and the funds are required to transact at the published price.
(5) Invested in funds comprised of U.S. and international equity.
(6) Invested in funds comprised of high yield, emerging market debt, leveraged loans and real estate debt.
(7) Invested in funds comprised of intermediate and long duration corporate and private bonds and U.S. government securities.
(8) Invested in hedge funds comprised of a combination of equity, fixed income, private assets and derivatives.
(9) Invested in funds comprised of underlying real estate properties and infrastructure as well as a fund comprised of underlying real estate investment trusts.
(10) These investments primarily consist of foreign government bonds valued based on yields currently available on comparable securities of issuers with similar credit ratings.
Contributions

In fiscal 2025, fiscal 2024 and fiscal 2023, the Company contributed $56.9 million, $91.3 million and $18.3 million, respectively, to its pension and post-retirement plans. The Company's funding policy for the defined benefit pension plan is to contribute the minimum contribution required under the Employee Retirement Income Security Act of 1974, as amended, and other applicable laws as determined by the Company's external actuarial consultant. At the Company's discretion, additional funds may be contributed to the defined benefit pension plans. The Company expects to contribute approximately $50 million to its pension and post-retirement plans in fiscal 2026. The Company will recognize contributions in accordance with applicable regulations, with consideration given to recognition for the earliest plan year permitted.

Estimated Future Benefit Payments

The following benefit payments, which reflect expected future service as appropriate, are expected to be paid to plan participants (in millions):
Pension BenefitsOther Benefits
2026$115.1 $1.9 
2027116.1 1.6 
2028113.2 1.4 
2029112.5 1.2 
2030112.0 1.1 
2031 – 2035528.2 3.4 

Multiemployer Pension Plans

The Company currently contributes to 28 multiemployer pension plans. These multiemployer plans generally provide retirement benefits to participants based on their service to contributing employers. The benefits are paid from assets held in trust for that purpose. Plan trustees typically are responsible for determining the level of benefits to be provided to participants, the investment of the assets and plan administration. Expense is recognized in connection with these plans as contributions are funded.

The risks of participating in these multiemployer plans are different from the risks associated with single-employer plans in the following respects:
•Assets contributed to the multiemployer plan by one employer may be used to provide benefits to employees of other participating employers.
•Though the unfunded obligations of a multiemployer plan are not a liability of the Company, if a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers.
•With respect to some multiemployer plans, if the Company chooses to stop participating, or makes market exits or store closures or otherwise has participation in the plan fall below certain levels, the Company may be required to pay the plan an amount based on the underfunded status of the plan, referred to as withdrawal liability.

The Company's participation in these plans is outlined in the table below. The EIN-Pension Plan Number column provides the Employer Identification Number ("EIN") and the three-digit plan number, if applicable. Unless otherwise noted, the most recent Pension Protection Act of 2006 ("PPA") zone status available for fiscal 2025 and fiscal 2024 is for the plan's year ended December 31, 2024 and December 31, 2023, respectively. The zone status is based on information received from the plans and is certified by each plan's actuary. The FIP/RP Status Pending/Implemented column indicates plans for which a funding improvement plan ("FIP") or a rehabilitation plan ("RP") is either pending or has been implemented by the plan trustees.

The following tables contain information about the Company's multiemployer plans. Certain plans have been aggregated in the Other funds line in the following table, as the contributions to each of these plans are not individually material.
EIN - PNPension Protection Act zone status (1)Company's 5% of total plan contributionsFIP/RP status pending/implemented
Pension fund2025202420242023
UFCW-Northern California Employers Joint Pension Trust Fund946313554 - 001RedRedYesYesImplemented
Western Conference of Teamsters Pension Plan916145047 - 001GreenGreenNoNoNo
Southern California United Food & Commercial Workers Unions and Food Employers Joint Pension Plan (4)951939092 - 001RedRedYesYesImplemented
Sound Retirement Trust (6)916069306 - 001GreenGreenYesYesNo
Bakery and Confectionery Union and Industry International Pension Fund526118572 - 001RedRedYesYesImplemented
UFCW Union and Participating Food Industry Employers Tri-State Pension Fund236396097 - 001RedRedYesYesImplemented
Rocky Mountain UFCW Unions & Employers Pension Plan846045986 - 001GreenGreenYesYesNo
UFCW Local 152 Retail Meat Pension Fund (5)236209656 - 001RedRedYesYesImplemented
Desert States Employers & UFCW Unions Pension Plan846277982 - 001GreenGreenYesYesNo
UFCW Int'l Union- Albertsons Variable Annuity Pension Fund (5)853326342 - 001GreenGreenYesYesNo
Retail Food Employers and UFCW Local 711 Pension Trust Fund516031512 - 001RedRedYesYesImplemented
Oregon Retail Employees Pension Trust936074377 - 001GreenRedYesYesNo
Intermountain Retail Store Employees Pension Trust (7)916187192 - 001RedRedYesYesImplemented
UFCW Local 1245 Labor Management Pension Plan516090661 - 001RedRedYesYesImplemented
Contributions of Company (in millions)
Surcharge imposed (2)
Expiration date of collective bargaining agreementsTotal collective bargaining agreementsMost significant collective bargaining agreement(s)(3)
Pension fund202520242023CountExpiration
UFCW-Northern California Employers Joint Pension Trust Fund$127.0 $130.8 $132.1 No4/15/202884804/15/2028
Western Conference of Teamsters Pension Plan82.3 78.2 75.9 No5/16/2026 to 9/30/20305699/21/2030
Southern California United Food & Commercial Workers Unions and Food Employers Joint Pension Plan (4)132.7 136.6 138.5 No3/6/2026 to 3/5/202840393/5/2028
Sound Retirement Trust (6)74.7 73.7 70.1 No3.21.2026 to 8/3/2029149405/1/2027
Bakery and Confectionery Union and Industry International Pension Fund18.2 18.6 18.7 No6/27/2026 to 6/10/2028122334/17/2027
UFCW Union and Participating Food Industry Employers Tri-State Pension Fund10.5 10.7 10.7 No2/1/2028 to 1/31/2030623/29/2029
Rocky Mountain UFCW Unions & Employers Pension Plan16.3 16.5 16.9 No8/29/2026 to 6/9/202984262/19/2028
UFCW Local 152 Retail Meat Pension Fund (5)10.9 11.1 11.2 No5/2/2028445/2/2028
Desert States Employers & UFCW Unions Pension Plan11.8 11.2 11.0 No3/7/2026 to 11/10/202920183/7/2026
UFCW Int'l Union- Albertsons Variable Annuity Pension Fund (5)9.5 9.6 9.6 No4/3/2027 to 11/10/20292476/9/2029
Retail Food Employers and UFCW Local 711 Pension Trust Fund8.7 8.5 8.6 No4/18/2026 to 5/27/2028743/4/2028
Oregon Retail Employees Pension Trust14.9 13.0 12.8 No8/14/2027 to 11/18/2028125368/14/2027
Intermountain Retail Store Employees Pension Trust (7)8.2 7.8 7.9 No5/1/2027 to 6/24/202854245/1/2027
UFCW Local 1245 Labor Management Pension Plan6.0 6.1 6.0 No11/28/2026 to 4/8/20284311/28/2026
Other funds (8)51.6 15.3 15.5 
Total Company contributions to U.S. multiemployer pension plans$583.3 $547.7 $545.5 
(1) PPA established three categories (or "zones") of plans: (1) "Green Zone" for healthy; (2) "Yellow Zone" for endangered; and (3) "Red Zone" for critical. These categories are based upon multiple factors, including the funding ratio of the plan assets to plan liabilities.
(2) Under the PPA, a surcharge may be imposed when employers make contributions under a collective bargaining agreement that is not in compliance with a rehabilitation plan. As of February 28, 2026, the collective bargaining agreements under which the Company was making contributions were in compliance with rehabilitation plans adopted by the applicable pension fund.
(3) These columns represent the number of most significant collective bargaining agreements aggregated by common expiration dates for each of the pension funds listed above.
(4) The information for this fund was obtained from the Form 5500 filed for the plan's year-end at March 31, 2025 and March 31, 2024.
(5) The information for this fund was obtained from the Form 5500 filed for the plan's year-end at June 30, 2024 and June 30, 2023.
(6) The information for this fund was obtained from the Form 5500 filed for the plan's year-end at September 30, 2024 and September 30, 2023.
(7) The information for this fund was obtained from the Form 5500 filed for the plan's year-end at August 31, 2024 and August 31, 2023.
(8) Fiscal 2025 includes $36.4 million of contributions related to the UFCW Northern California Employers Lifetime Income Security Accrual Fund, which was created during fiscal 2025. As this was a new plan in fiscal 2025, there were no contributions in fiscal 2024 or fiscal 2023.

Collective Bargaining Agreements

As of February 28, 2026, the Company had approximately 280,000 employees, of which approximately 190,000 were covered by collective bargaining agreements. During fiscal 2025, collective bargaining agreements covering
approximately 126,000 employees were successfully renegotiated. As of February 28, 2026, collective bargaining agreements covering approximately 22,000 employees have expired or are scheduled to expire in fiscal 2026.

Multiemployer Health and Welfare Plans

The Company makes contributions to multiemployer health and welfare plans in amounts specified in the applicable collective bargaining agreements. These plans provide medical, dental, pharmacy, vision, and other ancillary benefits to active employees and retirees as determined by the trustees of each plan. The majority of the Company's contributions cover active employees and as such, may not constitute contributions to a postretirement benefit plan. However, the Company is unable to separate contribution amounts to postretirement benefit plans from contribution amounts paid to active employee plans. Total contributions to multiemployer health and welfare plans were $1.3 billion for each of fiscal 2025, fiscal 2024 and fiscal 2023.

Defined Contribution Plans and Supplemental Retirement Plans

Many of the Company's employees are eligible to contribute a percentage of their compensation to defined contribution plans ("401(k) Plans"). Participants in the 401(k) Plans may become eligible to receive a profit-sharing allocation in the form of a discretionary Company contribution based on employee compensation. In addition, the Company may also provide matching contributions based on the amount of eligible compensation contributed by the employee. All Company contributions to the 401(k) Plans are made at the discretion of the Board. The Company provides supplemental retirement benefits through a Company sponsored deferred executive compensation plan, which provides certain key employees with retirement benefits that supplement those provided by the 401(k) Plans. Total contributions accrued for these plans were $82.8 million, $83.5 million and $83.0 million for fiscal 2025, fiscal 2024 and fiscal 2023, respectively.

Merger-Related Retention Benefits

The Merger Agreement provided for the Company to establish a retention program to promote retention and to incentivize efforts to close the Merger and to ensure a successful and efficient integration process. On December 18, 2022, the retention program was approved, with an aggregate amount of up to $100 million, as amended, covering certain executive officers and employees of the Company. With the termination of the Merger Agreement, 50% of the award was paid on December 12, 2024 and 50% was paid on October 16, 2025. Retention bonus expense was $15.5 million for fiscal 2025, $33.6 million for fiscal 2024, and $35.0 million for fiscal 2023, and is included within Selling and administrative expenses.