The Great Atlantic & Pacific Tea Company, Inc. Announces Results for the Fourth Quarter and Full Year Ended February 25, 2006

The Great Atlantic & Pacific Tea Company, Inc. (A&P, NYSE: GAP)today announced its financial results for the fiscal 2005 fourthquarter and full year ended February 25, 2006.

U.S. sales for the 12 week fourth quarter were $1.6 billion,compared with $1.7 billion in the fourth quarter of fiscal 2004.Fiscal 2004 fourth quarter total sales of $2.6 billion include $853million related to A&P Canada which was sold in August 2005. U.S.total comparable store sales increased 1.4% vs. year-ago. Net loss forthe quarter was $39.1 million or $.95 per diluted share this yearversus a loss of $5.7 million or $.15 per diluted share last year.

The results for the fourth quarter of fiscal years 2005 and 2004include items the Company considers non-operating in nature thatmanagement excludes when evaluating the results of the U.S. ongoingbusiness. These items are listed on Schedule 3 of the press release.Excluding these items, adjusted U.S. income from operations was $1.7million in the fourth quarter of fiscal 2005 versus a loss of $18million in last year's fourth quarter. Adjusted U.S. ongoing operatingEBITDA, which is reconciled to net cash from operating activities onSchedule 4, was $41 million in the fourth quarter of fiscal 2005versus $28 million in last year's fourth quarter.

U.S. sales for the 52 weeks of fiscal 2005 were $7.0 billionversus $7.3 billion in fiscal 2004. Total sales of $8.7 billion forthis year and $10.8 billion for last year include sales of $1.7billion and $3.5 billion, respectively, related to A&P Canada whichwas sold in August 2005. U.S. total comparable store sales increased0.5%. Net income for the year was $393 million or $9.64 per dilutedshare which included the gain on the sale of Canada, compared with aloss of $188 million or $4.88 per diluted share for fiscal 2004.

Fiscal 2005 and fiscal 2004 results include the non-operatingitems listed on Schedule 3 of the press release. Excluding theseitems, adjusted U.S. loss from operations was $65 million in fiscal2005 versus a loss of $89 million in fiscal 2004. Adjusted U.S.ongoing operating EBITDA, which is reconciled to net cash fromoperating activities on Schedule 4, was $127 million in fiscal 2005versus $113 million in fiscal 2004.

Christian Haub, Executive Chairman of The Board of Directors,said, "Our successful strategic divestiture and reorganizationinitiatives in Fiscal 2005 strengthened our financial position,reduced operating costs and facilitated the launch of dynamic retailstrategies to restore profitability and stimulate growth. The sale ofA&P Canada transformed our balance sheet and provided a significantfinancial stake in Metro, Inc., an already successful entity that wasfurther strengthened by the addition of our Canadian store operations.

"In the U.S., our reduction of overheads and improved operatingand merchandising execution positively impacted fourth quarterresults, and combined with exciting store development plans, set thestage for continuing financial progress through this fiscal year andbeyond. In addition, our improved performance and financial resourcesalso present the opportunity to participate in the expectedconsolidation of our industry," Mr. Haub said.

Eric Claus, President & Chief Executive Officer, said "Thededicated efforts of our new leadership team and hard-workingassociates generated positive operating trends in the second half ofFiscal 2005. Our mid-year headquarters and field reorganizationlowered costs and upgraded retail execution, producing solidimprovements in identical store sales and ongoing operating EBITDA inthe fourth quarter.

"In executing our new strategic plan, we will acceleratedevelopment of the outstanding Fresh and Discount store prototypes werecently launched successfully in the Northeast, and introduce asignificantly improved Gourmet format in New York City. In theMidwest, our improving Farmer Jack operations will be furtherrevitalized with a quality and value emphasis refreshing its greattradition in the marketplace; while in New Orleans, our Sav-A-Centerteam goes forward after its remarkable and successful rebuildingeffort in the wake of Hurricane Katrina - an accomplishment that hasbeen a tremendous inspiration to our entire A&P family.

Mr. Claus concluded, "In Fiscal 2006, our team will maintain anunwavering focus on profitable store operations, including bothdevelopment and strict cost management, as we further intensify thedrive toward our goal of profitability in Fiscal 2007, and dynamicgrowth thereafter."

Founded in 1859, A&P is one of the nation's first supermarketchains. The Company operates 405 stores in 9 states and the Districtof Columbia under the following trade names: A&P, Waldbaum's, The FoodEmporium, Super Foodmart, Super Fresh, Farmer Jack, Sav-A-Center andFood Basics.

The Company invites investors and other interested parties tolisten to a live audio Webcast to be held at 11:00 AM Eastern Timetoday, at which members of the Company's senior management team willdiscuss the Company's fourth quarter and full year financial results.The Webcast may be accessed through a link on the "Investors" page ofthe Company's Website, www.aptea.com. Listeners who cannot participatein the live broadcast will be able to hear a recorded replay of thebroadcast beginning this afternoon and available until June 6, 2006.

Effective March 28, 2003, the Securities and Exchange Commission("SEC") adopted new rules related to disclosure of certain financialmeasures not calculated in accordance with Generally AcceptedAccounting Principles ("GAAP"). Such new rules require all publiccompanies to provide certain disclosures in press release and SECfilings related to non-GAAP financial measures. We use the non-GAAPmeasure "EBITDA" to evaluate the Company's liquidity and it is amongthe primary measures used by management for planning and forecastingof future periods. EBITDA is defined as earnings before interest,taxes, depreciation, amortization, minority interest, equity inearnings of Metro, Inc., discontinued operations and the gain on thesale of A&P Canada. Ongoing, operating EBITDA is defined as EBITDAadjusted for items the Company considers non-operating in nature thatmanagement excludes when evaluating the results of the U.S. ongoingbusiness. The Company believes the presentation of these measures isrelevant and useful for investors because it allows investors to viewresults in a manner similar to the method used by the Company'smanagement and makes it easier to compare the Company's results withother companies that have different financing and capital structuresor tax rates. In addition, these measures are also among the primarymeasures used externally by the Company's investors, analysts andpeers in its industry for purposes of valuation and comparing theresults of the Company to other companies in its industry. Ongoing,operating EBITDA is reconciled to Net Cash provided by OperatingActivities on Schedule 4 of this release.

This release contains forward-looking statements about the futureperformance of the Company, which are based on Management'sassumptions and beliefs in light of the information currentlyavailable to it. The Company assumes no obligation to update theinformation contained herein. These forward-looking statements aresubject to uncertainties and other factors that could cause actualresults to differ materially from such statements including, but notlimited to: competitive practices and pricing in the food industrygenerally and particularly in the Company's principal markets; theCompany's relationships with its employees and the terms of futurecollective bargaining agreements; the costs and other effects of legaland administrative cases and proceedings; the nature and extent ofcontinued consolidation in the food industry; changes in the financialmarkets which may affect the Company's cost of capital and the abilityof the Company to access capital; supply or quality control problemswith the Company's vendors; and changes in economic conditions whichaffect the buying patterns of the Company's customers.
The Great Atlantic & Pacific Tea Company, Inc.
Schedule 1 - GAAP Earnings for the 12 and 52 weeks ended
February 25, 2006 and February 26, 2005
(Unaudited)
(In thousands, except share amounts and store data)


12 Weeks Ended 52 Weeks Ended
------------------------- -------------------------
February 25, February 26, February 25, February 26,
2006 2005 2006 2005
------------ ------------ ------------ ------------

Sales $ 1,607,523 $ 2,560,294 $ 8,740,347 $10,854,911
Cost of merchandise
sold (1,121,616) (1,831,201) (6,235,275) (7,813,771)
------------ ------------ ------------ ------------
Gross margin 485,907 729,093 2,505,072 3,041,140
Store operating,
general and
administrative
expense (541,802) (715,832) (2,825,730) (3,114,062)
------------ ------------ ------------ ------------
(Loss) income from
operations (55,895) 13,261 (320,658) (72,922)
(Loss) gain on sale
of Canadian
operations (339) - 912,129 -
Interest expense (15,465) (27,107) (92,248) (114,107)
Interest income 4,311 682 13,457 2,776
Minority interest
in earnings of
consolidated
franchisees - (325) (1,131) 772
Equity in earnings
of Metro, Inc. 4,404 - 7,801 -
------------ ------------ ------------ ------------
(Loss) income from
continuing
operations before
income taxes (62,984) (13,489) 519,350 (183,481)
Benefit from
(provision for)
income taxes 23,958 8,240 (128,927) (528)
------------ ------------ ------------ ------------
(Loss) income from
continuing
operations (39,026) (5,249) 390,423 (184,009)
Discontinued
operations:
(Loss) income from
operations of
discontinued
businesses, net of
tax (78) (458) 1,626 (1,387)
Gain (loss) on
disposal of
discontinued
operations, net of
tax 4 - 581 (2,702)
------------ ------------ ------------ ------------
(Loss) income from
discontinued
operations (74) (458) 2,207 (4,089)
------------ ------------ ------------ ------------
Net (loss) income $ (39,100) $ (5,707) $ 392,630 $ (188,098)
============ ============ ============ ============

Net (loss) income
per share - basic:
Continuing
operations $ (0.95) $ (0.14) $ 9.69 $ (4.77)
Discontinued
operations (0.00) (0.01) 0.05 (0.11)
------------ ------------ ------------ ------------
Net (loss) income
per share - basic $ (0.95) $ (0.15) $ 9.74 $ (4.88)
============ ============ ============ ============

Net (loss) income
per share - diluted:
Continuing
operations $ (0.95) $ (0.14) $ 9.59 $ (4.77)
Discontinued
operations (0.00) (0.01) 0.05 (0.11)
------------ ------------ ------------ ------------
Net (loss) income
per share -
diluted $ (0.95) $ (0.15) $ 9.64 $ (4.88)
============ ============ ============ ============


Weighted average
common shares
outstanding -
basic 41,042,838 38,651,664 40,301,132 38,558,598
============ ============ ============ ============
Weighted average
common shares
outstanding -
diluted 41,042,838 38,651,664 40,725,942 38,558,598
============ ============ ============ ============


Gross margin rate 30.23% 28.48% 28.67% 28.02%
Store operating,
general and
administrative
expense rate 33.70% 27.96% 32.33% 28.69%


United States
depreciation and
amortization $ 43,287 $ 46,057 $ 196,387 $ 201,987
Canada depreciation
and amortization - 16,365 10,942 66,118
------------ ------------ ------------ ------------
Total A&P
depreciation and
amortization $ 43,287 $ 62,422 $ 207,329 $ 268,105
============ ============ ============ ============


Number of stores
operated at end of
quarter 405 647 405 647
============ ============ ============ ============

Number of
franchised stores
served at end of
quarter - 42 - 42
============ ============ ============ ============

The Great Atlantic & Pacific Tea Company, Inc.
Schedule 2 - Condensed Balance Sheet Data
(Unaudited)
(In millions, except per share and store data)

February 25, February 26,
2006 2005
------------ ------------

Cash and short-term investments $ 230 $ 258

Other current assets 980 907
--------- ----------

Total current assets 1,210 1,165

Property-net 898 1,516

Equity investment in Metro, Inc. 339 -

Other assets 52 121
--------- ----------

Total assets $ 2,499 $ 2,802
========= ==========

Total current liabilities $ 610 $ 1,078

Total non-current liabilities 1,217 1,490

Stockholders' equity 672 234
--------- ----------

Total liabilities and stockholders' equity $ 2,499 $ 2,802
========= ==========

Other Statistical Data
----------------------

Total Debt and Capital Leases $ 282 $ 697
Total Long Term Real Estate Liabilities 297 328
Restricted Cash, Temporary Investments and
Marketable Securities (465) (104)
--------- ----------
Net Debt $ 114 $ 921

Total Retail Square Footage (in thousands) 16,509 25,583

Book Value Per Share $ 16.32 $ 6.03


For the 52 For the 52
weeks ended weeks ended
February 25, February 26,
2006 2005
------------ ------------
Capital Expenditures $ 191 $ 216

The Great Atlantic & Pacific Tea Company, Inc.
Schedule 3 - Reconciliation of GAAP (Loss) Income from Operations to
Adjusted (Loss) Income from Operations for the 12 and 52 weeks ended
February 25, 2006 and February 26, 2005
(Unaudited)
(In thousands, except share amounts and store data)

12 Weeks Ended 52 Weeks Ended
----------------------------------------
February February February February
25, 2006 26, 2005 25, 2006 26, 2005
--------- --------- ---------- ---------

As reported (loss) income from
operations $(55,895) $ 13,261 $(320,658) $(72,922)
--------- --------- ---------- ---------
Adjustments:
Midwest exit costs 10,375 - 115,271 -
Net restructuring costs,
primarily related to the
sale of the U.S.
distribution operations to
C&S 29,241 7,856 118,648 9,959
Long-lived asset impairment - - 17,728 34,688
Early extinguishment of debt
and write-off of deferred
financing fees - - 33,031 (764)
Impact of Hurricane Katrina 867 - 19,034 -
Workers compensation state
assessment charges 9,689 - 9,689 -
Self-Insurance reserve
adjustment - 27,256 - 27,256
Employee benefit costs - - - (8,600)
Real estate related activity 7,410 (23,798) (14,863) (22,536)
Visa / Mastercard lawsuit
settlement - - (1,547) -
Canadian Dollar hedge - - 15,446 -
Canada income from
operations - (42,194) (57,224) (56,321)
--------- --------- ---------- ---------
Total adjustments 57,582 (30,880) 255,213 (16,318)
--------- --------- ---------- ---------
Adjusted United States income
(loss) from operations $ 1,687 $(17,619) $ (65,445) $(89,240)
========= ========= ========== =========

As reported United States
depreciation and amortization $ 43,287 $ 46,057 $ 196,387 $201,987
--------- --------- ---------- ---------
Adjustments:
Accelerated depreciation on
leasehold improvements (4,250) - (4,250) -
--------- --------- ---------- ---------
Adjusted United States
depreciation and amortization $39,037 $ 46,057 $ 192,137 $201,987
========= ========= ========== =========

The Great Atlantic & Pacific Tea Company, Inc.
Schedule 4 - Reconciliation of GAAP Net Cash (Used In) Provided By
Operating Activities to Adjusted EBITDA for the 12 and 52 weeks
ended February 25, 2006 and February 26, 2005
(Unaudited)
(In thousands, except share amounts and store data)

12 Weeks Ended 52 Weeks Ended
-----------------------------------------
February February February February
25, 2006 26, 2005 25, 2006 26, 2005
--------- --------- ---------- ----------
Net cash (used in) provided
by operating activities $ 79,808 $125,565 $ (80,715) $ 114,458
Adjustments to calculate
EBITDA:
Net interest expense 11,154 26,425 78,791 111,331
Asset disposition initiatives (7,696) (261) (108,068) 1,448
Restructuring charge (14,318) - (77,054) -
Long lived asset impairment
charges (5,067) (5,111) (34,175) (43,317)
Loss on extinguishment of debt - - (28,623) -
Loss on derivatives - - (15,446) -
(Loss) gain on disposal of
owned property (1,049) 32,085 24,787 28,704
(Benefit from) provision for
income taxes (23,958) (8,240) 128,927 528
Decrease (increase) in income
tax reserve 21,564 1,801 (98,079) 1,370
Other share based awards (2,008) - (8,978) -
Working capital changes
-----------------------
Accounts receivable 30,360 10,304 56,130 (29,223)
Inventories (76,089) (85,723) (109,521) 12,614
Prepaid expenses and other
current assets (16,475) (20,386) (585) 6,024
Accounts payable 11,625 33,094 101,342 (46,295)
Accrued salaries, wages,
benefits and taxes (4,738) 4,913 31,414 24,170
Other accruals (40,373) 8,286 (48,931) 34,121
Other assets 7,300 (1,638) 7,344 19,041
Other non-current liabilities 16,588 (49,431) 76,309 (42,591)
Other, net 764 4,000 (8,198) 2,800
--------- --------- ---------- ----------
Total A&P EBITDA (12,608) 75,683 (113,329) 195,183
--------- --------- ---------- ----------
Adjustments:
Midwest exit costs 10,375 - 115,271 -
Net restructuring costs,
primarily related to the
sale of the U.S.
distribution operations to
C&S 24,991 7,856 114,398 9,959
Long-lived asset impairment - - 17,728 34,688
Early extinguishment of debt
and write-off of deferred
financing fees - - 33,031 (764)
Impact of Hurricane Katrina 867 - 19,034 -
Workers compensation state
assessment charges 9,689 - 9,689 -
Self-Insurance reserve
adjustment - 27,256 - 27,256
Employee benefit costs - - - (8,600)
Real estate related activity 7,410 (23,798) (14,863) (22,536)
Visa / Mastercard lawsuit
settlement - - (1,547) -
Canadian dollar hedge - - 15,446 -
Canada EBITDA - (58,559) (68,166) (122,439)
--------- --------- ---------- ----------
Total adjustments 53,332 (47,245) 240,021 (82,436)
--------- --------- ---------- ----------
Adjusted United States
ongoing operating EBITDA $ 40,724 $ 28,438 $ 126,692 $ 112,747
========= ========= ========== ==========