Albertsons : 2024 RFC Report

Recipe for Change™

2024 REPORT

Table of Contents

Letter from Our CEO	04
Company Overview	05
Recipe for Change	07
Planet	08
People	12
Product	17
Community	22
Appendices	28

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Report Overview

Report Scope

The 2024 Recipe for Change Report covers Albertsons Companies' 2023 Fiscal Year (February 26, 2023 through February 24, 2024), unless otherwise noted. It includes details about strategies, practices and events within the company's value chain, sourcing decisions, internal distribution and warehousing, manufacturing facilities, retail operations and offices. The report highlights information about Recipe for Change's key ingredients (Climate Action; Diversity, Equity, Inclusion & Belonging; Waste Reduction & Circularity; and Community Stewardship) within four reporting pillars (Planet, People, Product and Community). Other material topics are included throughout the report.

Report Frameworks

Reporting is divided into four pillars: Planet, People, Product and Community. The Appendices include links from this report to the United Nations Sustainable Development Goals and Sustainability Accounting Standards Board (SASB).

ALBERTSONS COMPANIES

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Letter from Our CEO

Two years ago, Albertsons Companies launched Recipe for Change. We set ambitious goals and challenged ourselves to be deliberate and creative in how we run our business while making a positive difference in our communities and for the planet.

Recipe for Change brings together four key areas that are integral to driving our business-our planet, our people, our products and our communities-and in 2023, we continued to further embed this framework into everything we do.

Our Planet

A healthy planet is key to bringing our customers the best fresh products, and we are continuing to reduce the impact of our operations on the environment. We reduced our carbon emissions by 22% between 2019 and 2023, and in 2023 we completed more than 500 energy efficiency projects and converted more than 90 stores to lower climate-impact refrigerants.

Our People

It is a privilege knowing that more than 44,000 associates have completed over 20 years of service with Albertsons Companies. Our people are our greatest asset, and we will continue to do everything we can to ensure our company is a place where they can thrive and develop their careers.

Our Products

Reducing food waste has always been a priority across our operations. It is good for the planet and helps drive

an efficient business. Our associates' commitment to this effort is clear, and by the end of 2023, more than 97% of our stores were donating food to local food banks and pantries on a weekly basis from departments across our stores, including meat, dairy, service deli and more.

Our Communities

One in seven American households face food insecurity, meaning they don't know where their next meal will come from. Between 2019 and 2023, we enabled more than 1.15 billion meals by donating food from our stores and funds from our Nourishing Neighbors program.

I am incredibly proud of our progress to date, and our work doesn't stop here. Looking ahead, we must continue to deliver on our commitments through existing and new initiatives, such as:

• Driving new solutions to enhance our food donation program, reduce food waste and fund innovative programs to end the cycle of hunger in our neighborhoods.
• Expanding the testing and use of new technologies that improve our efficiency and reduce our carbon footprint.
• Pioneering programs with our vendor partners that drive customer engagement in our Recipe for Change.

Recipe for Change is still in its early days. Our progress so far is a tribute to the entire team at Albertsons Companies. While we still have much to do to reach our goals, I'd like to take a moment to thank our associates and recognize their hard work and dedication. Their passion for the communities they serve has made and will continue to make a lasting and positive impact.

Vivek Sankaran

CEO

ALBERTSONS COMPANIES	4

Albertsons Companies 2023 Overview

Albertsons Companies is a leading food and drug retailer in the United States. As of February 24, 2024, the company operated 2,269 retail stores with 1,725 pharmacies, 402 associated fuel centers, 22 dedicated distribution centers and 19 manufacturing facilities. The company operates stores across 34 states and the District of Columbia with

more than 20 banners including Albertsons, Safeway, Vons, Jewel-Osco, Shaw's, ACME, Tom Thumb, Randalls, United Supermarkets, Pavilions, Star Market, Haggen, Carrs, Kings Food Markets and Balducci's Food Lovers Market. The company is committed to helping people across the country live better lives by making a meaningful difference, neighborhood by neighborhood. In 2023, along with the Albertsons Companies Foundation, the company contributed more than $350 million in food and financial support, including more than $35 million through our Nourishing Neighbors program, to ensure those living in our communities and those impacted by disasters have enough to eat.

2,269	$79.2 billion
retail stores	in sales
22 distribution	19 manufacturing
centers	facilities

20+ well-known	Four exclusive
billion-dollar
banners
Own Brands

402

fuel stations

35+ million customers

per week

One of the largest retail employers, providing

~285,000 jobs

1,725 in-store pharmacies

~40 million

loyalty members

(at the end of Q4 2023)

With our Foundation, donated more than

$350 million

in food and financial support

ALBERTSONS COMPANIES

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Our Purpose

To bring people together around the joys of food and to inspire well-being.

Albertsons Companies has a rich history, bringing together more than 20 well-known banners with unique local identities that have deep roots in our communities and a strong heritage of service. We empower our associates to live our purpose in pursuit of earning customers for life. Our values guide our associates in creating effortless, inspiring, affordable and personal experiences that build long-lasting relationships with our customers.

We put people first.

Our associates are the connection to our customers and communities. We care for their well-being and invest in their personal and professional growth.

We raise the bar.

We stay curious and challenge the status quo to continually innovate and improve how we serve our customers and communities.

We are customer-driven.

We care about our customers and make decisions based on what's best for them. We are empowered to make a positive impact-big and small-in our customers' lives.

We act as owners.

We act with integrity, pride and passion. We hold ourselves accountable, anticipate customer needs and engage others constructively to deliver results that matter.

We value different perspectives.

We encourage open dialogue and healthy debate. We make better decisions when everyone's voice is heard.

We are one team.

We value teamwork and camaraderie. We build relationships and recognize each other's contributions.

We build belonging.

We know a diverse and inclusive workforce is built on a foundation of courtesy, dignity and respect.

ALBERTSONS COMPANIES

We are committed to a healthy future.

We work together and build partnerships to support our communities and the planet we share.

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Recipe for Change™ 2023 Overview

At Albertsons Companies, we're working to make a real difference in the communities we serve and the planet we share. Our Recipe for Change is the embodiment of this commitment, combining the key ingredients to realize our ambitious vision.

Our Recipe for Change framework was developed in collaboration with leaders and associates across the company to ensure that our goals are grounded in our operations and aim to create meaningful change. This cross-functional approach helps to drive progress in our Recipe for Change focus areas and supports our company's purpose and values. We report quarterly to the Governance, Compliance and ESG Committee of our Board of Directors. In fiscal year 2023, our senior leadership had a portion of their annual bonus tied to goals supporting Recipe for Change initiatives.

Through our Recipe for Change, we are bringing together the ingredients for a better world-our planet, our people, our products and our communities-to make change a reality.

"We're committed to bettering the communities we serve and the planet we share, and the proof is in the year-over-year progress we've made since announcing Recipe for Change. We're keen to leverage and explore innovative practices to meet the challenges of today and continue to drive progress into the future. Thank you to the associates across our company who continue to raise the bar in their commitment to creating a healthy future."

• Suzanne Long,
  Chief Sustainability and Transformation Officer

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Great food isn't possible without a healthy planet.

We're committed to reducing our carbon footprint and nurturing the environment.

INCLUDED IN THIS SECTION

• KEY INGREDIENT: CLIMATE ACTION
• OPERATIONAL WASTE
• ELECTRIC VEHICLE CHARGING
• WATER STEWARDSHIP

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Climate Action

A Better Tomorrow Starts at

the Source

As part of our Recipe for Change, we're reducing carbon emissions across our operations and value chain.

Planet Highlights:

• Reduced carbon emissions by 22% in our own operations between 2019 and 2023.1
• Completed more than 500 energy efficiency projects.
• Converted more than 90 stores to lower climate-impact refrigerants.
• Provided more than 818,000 charging sessions at our electric vehicle chargers.

As part of our focus on Climate Action, we're working to achieve Science Based Targets initiative (SBTi)-approved emissions reduction goals by 2030. These goals include reducing emissions in our own operations by 47% and in our downstream emissions from the use of sold goods by 27% by 2030, as well as engaging our top suppliers to set science-based targets by 2026.

Albertsons Companies' 2030 emissions reduction goal not only addresses emissions from our own operations (Scopes 1 and 2), but also material emissions from our value chain (Scope 3). Our emissions reduction goals are based on a 2019 baseline, and we annually report carbon emissions through CDP.

Looking beyond our 2030 goals, we're striving to achieve net zero emissions in our own operations by 2040.

Our Strategy to Reduce our Carbon Footprint

As part of our 2030 carbon reduction goal, Albertsons Companies created a comprehensive strategy to reduce emissions and engage our larger value chain. Our focus areas are as follows:

• Scope 1: Reduce emissions from our refrigeration systems.
• Scope 2: Reduce and optimize our energy demand and increase procurement of renewable energy.
• Scope 3: Engage our top suppliers to set science- based carbon reduction goals and create innovative opportunities to reduce the emissions from the fuel that customers buy and use.

The sections below provide examples of projects and strategies we are leveraging to reduce our carbon footprint.

Our 2023 progress against our baseline year was as follows:

Carbon Footprint

EMISSIONS	2019	2023
CATEGORY	BASELINE YEAR
SCOPE 1	3,039,002	2,651,176
SCOPE 2 :	1,998,819	1,515,619
LOCATION BASED
SCOPE 2 :	2,130,132	1,353,188
MARKET BASED
SCOPE 1 & 2 :	5,169,134	4,004,364
MARKET BASED TOTAL

In 2023, we updated our calculation methodology to incorporate AR6 emissions factors and better align with the Greenhouse Gas Protocol and IPCC AR6. This updated methodology was also used to recalculate our historic emissions (2019-2022).

Carbon Footprint - Own Operations

Dioxide	6
5		-22%
e)
2	4
of Metric TonsCarbonof Equivalent (MTCO
3
2
1
Millions	0
2019	2020	2021	2022	2023

Scope 1

Scope 2 (Market Based)

Refrigerants

As part of our Climate Action strategy, we have developed a roadmap to reduce our refrigerant leak rate and convert to lower climate-impact refrigerants in company operations. In 2023, we converted more than 90 stores to lower climate- impact refrigerants, and our 22 distribution centers and 19 manufacturing facilities primarily use ammonia refrigeration systems. We also expanded our use of automated leak detection systems to enhance our leak detection capabilities and maintain system efficiency.

We leverage strategic partnerships to continue to make progress in this space. We are members of the North American Sustainable Refrigeration Council which aims to provide recruitment, training and retention programs to combat the critical shortage of refrigeration technicians. We are also a customer collaborator in The Clean Fight, an accelerator program focused on decarbonizing the food service supply chain in New York state, including the storage, distribution and retail sale of food.2

1. Our carbon emissions are calculated using the industry-standard Greenhouse Gas Protocol, which focuses on greenhouse gases covered by the Kyoto Protocol.
2. The Clean Fight Customer Collaborators.

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Energy Efficiency Projects

We completed more than 500 energy efficiency projects across Albertsons Companies' operations in 2023 to reduce our energy demand. Projects included installing LED lighting retrofits, doors on refrigerated cases and building management systems.

Our Massachusetts Shaw's stores were named a 2023 Mass Save Climate Leader for their efforts to reduce energy use.3 The program recognizes leaders that have implemented changes to increase energy efficiency and demonstrated a long-term commitment to reducing their carbon footprint.

Renewable Energy

We partner with third-party companies to generate renewable energy, where feasible. The United States Environmental Protection Agency's (US EPA) Green Power Partnership ranked Albertsons Companies number 17 in their Top 30 Retail Partner for calendar year 2023.4

We have two utility-grade wind turbines at our Tracy, California distribution center, and at the end of 2023, we had more than 50 locations with on-site solar generation.

We work with energy providers in our operating areas to purchase utility-scale and community renewable energy and renewable energy credits to meet our operational and Recipe for Change goals. Through these arrangements, we have purchased energy from several renewable energy sources.

In 2022, we began purchasing renewable energy in California from the Edwards Sanborn Solar Storage Project, which is currently the largest project in the United States to simultaneously combine solar photovoltaic energy generation and battery storage systems.5

ALBERTSONS COMPANIES

Transportation

We continue to explore opportunities to reduce the environmental impact of our fleet, including utilizing zero- emission electric vehicles to supplement our existing distribution operations. At the end of 2023, the Albertsons Companies fleet had 23 electric-terminal tractors, nine battery-electric refrigerated trailers and two battery-electric class 8 day cab tractors in operation. In our distribution operations, more than 99% of our forklifts are electric.

Our entire private truck fleet is certified by the US EPA's SmartWay program to advance supply chain sustainability and freight transportation efficiency. Additionally, we purchased two drive-over tire reader devices for use in our Tracy, California and Salt Lake City, Utah distribution centers to improve fuel economy, reduce tire wear and minimize roadside service calls.

Value Chain Emissions

When calculating our 2019 baseline carbon footprint, we found that approximately 90% of our total carbon footprint is associated with emissions from our value chain (Scope 3). Within our value chain, two categories of emissions are considered most important-or material-per the Science Based Targets initiative and Greenhouse Gas Protocol: Purchased Goods and Services (Category 1) and Use of Sold Goods (Category 11).

Purchased Goods and Services, which make up the majority of the carbon footprint of our value chain, includes the tens of thousands of product offerings across our stores, as well as the items we buy and sell to operate our stores, distribution centers, manufacturing facilities and offices. To address these emissions, we are engaging our top suppliers by emissions to set their own science-basedcarbon reduction targets, aiming to have them set, commit to set and/or track their progress against existing targets. At the end of 2023, more than 80 of our top suppliers met these requirements. Throughout the year, we engaged with the vendor community through conferences and leadership meetings to educate suppliers on our goals and explore partnership opportunities to work toward collectively delivering on this commitment.

The Use of Sold Goods category includes the emissions associated with the use of the fuels we sell to our customers through our fuel stations and propane offerings. We continue to evaluate innovative opportunities, such as expanding electric vehicle charging operations at our stores, as well as monitoring regulatory requirements and fuel purchasing trends, to better understand the availability and adoption of alternative energy vehicles to best prioritize where to install electric vehicle charging.

Learn more about our current electric vehicle charging offerings in the Electric Vehicle Chargingsection.

1. 2023 Mass Save Climate Leader - Shaws Supermarkets.
2. Green Power Partnership Top 30 Retail | US EPA.
3. Edwards & Sanborn Solar and Energy Storage | Mortenson.

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