CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS

(Amounts are in thousands)

See accompanying notes to condensed consolidated financial statements.

2

PUBLIX SUPER MARKETS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(Amounts are in thousands, except per share amounts)

See accompanying notes to condensed consolidated financial statements.

3

PUBLIX SUPER MARKETS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts are in thousands)

34

PUBLIX SUPER MARKETS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

(Amounts are in thousands)

See accompanying notes to condensed consolidated financial statements.

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PUBLIX SUPER MARKETS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The accompanying unaudited condensed consolidated financial statements of Publix Super Markets, Inc. and subsidiaries (the Company) have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) and the rules and regulations of the Securities and Exchange Commission (SEC) for interim financial reporting. Accordingly, the accompanying statements do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, these statements include all adjustments that are of a normal and recurring nature necessary to present fairly the Company’s financial position, results of operations and cash flows. Due to the seasonal nature of the Company’s business, the results of operations for the three and six months ended March 27,June 26, 2010 are not necessarily indicative of the results for the entire 2010 fiscal year. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the year ended December 26, 2009.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Certain 2009 amounts have been reclassified to conform with the 2010 presentation in the condensed consolidated balance sheets primarily due to the adoption of an amendment to the standard of accounting for Variable Interest Entities (VIE).

Recently Adopted Standards

In January 2010, the Financial Accounting Standards Board (FASB) issued an amendment to the standards of accounting for fair value measurements and disclosures. This amendment requiresrequired expanded disclosures about the different classes of assets and liabilities measured at fair value, the transfers between Level 1 and Level 2 fair value measurement categories and the valuation techniques and inputs used to determine the fair value of assets and liabilities classified in Level 2 and Level 3 measurement categories. The adoption of this amendment during the quarter ended March 27, 2010 did not have an effect on the Company’s financial condition, results of operations or cash flows.

In June 2009, the FASB issued a new standard that changeschanged the definition of a VIE, containscontained new criteria for determining the primary beneficiary of a VIE, requiresrequired enhanced disclosures to provide more information about a company’s involvement in a VIE and increasesincreased the frequency of required reassessments to determine whether a company is the primary beneficiary of a VIE. The adoption of this standard during the quarter ended March 27, 2010 resulted in the consolidation of certain joint ventures (JV) in which the Company has a controlling financial interest. The Company is considered to have a controlling financial interest in a JV when it has (1) the power to direct the activities of the JV that most significantly impact the JV’s economic performance and (2) the obligation to absorb losses or the right to receive benefits from the JV that could potentially be significant to such JV. The adoption of this standard during the quarter ended March 27, 2010 did not have a material effect on the Company’s financial condition, results of operations or cash flows (see Note 5).

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PUBLIX SUPER MARKETS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The fair value of certain of the Company’s financial instruments, including cash and cash equivalents, trade receivables and accounts payable, approximate their respective carrying amounts due to their short-term maturity.

The fair value of available-for-sale (AFS) securities are based on market prices using the following measurement categories:

Level 1 – Fair value is determined by using quoted prices in active markets for identical investments. AFS securities that are included in this category are primarily equity securities.

Level 2 – Fair value is determined by using other than quoted prices. By using observable inputs (for example, benchmark yields, interest rates, reported trades and broker dealer quotes), the fair value is determined through processes such as benchmark curves, benchmarking of like securities and matrix pricing of corporate and municipal bonds by using pricing of similar bonds based on coupons, ratings and maturities. In addition, the value of collateralized mortgage obligation securities are determined by use of models to develop prepayment and interest rate scenarios for these securities which have prepayment features. AFS securities that are included in this category are primarily tax exempt and taxable bonds.

Level 3 – Fair value is determined by using other than observable inputs. Fair value is determined by using the best information available in the circumstances and requires significant management judgment or estimation. No AFS securities are currently included in this category.

Following is a summary of fair value measurements for AFS securities as of March 27,June 26, 2010 and December 26, 2009:

All of the Company’s debt and equity investments are classified as AFS and are carried at fair value. The Company evaluates whether AFS securities are other-than-temporarily impaired (OTTI) based on criteria that include the extent to which cost exceeds market value, the duration of the market decline, the credit rating of the issuer or security, the failure of the issuer to make scheduled principal or interest payments and the financial health and prospects of the issuer or security.

Declines in the value of AFS securities determined to be OTTI are recognized in earnings and reported as other-than-temporary impairment losses. Debt securities with unrealized losses are considered OTTI if the Company intends to sell the debt security or if the Company will be required to sell the debt security prior to any anticipated recovery. If the Company determines that a debt security is OTTI under these circumstances, the impairment recognized in earnings is measured as the difference between the amortized cost and the current fair value. A debt security is also determined to be OTTI if the Company does not expect to recover the amortized cost of the security. However, in this circumstance, if the Company does not intend to sell the debt security and will not be required to sell the debt security, the impairment recognized in earnings equals the estimated credit loss as measured by the difference between the present value of expected cash flows and the amortized cost of the debt security. Expected cash flows are discounted using the debt security’s effective interest rate. An equity security is determined to be OTTI if the Company does not expect to recover the cost of the security. Declines in the value of AFS securities determined to be temporary are reported, net of tax, as other comprehensive losses and included as a component of stockholders’ equity.

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PUBLIX SUPER MARKETS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Interest and dividend income, amortization of premiums, accretion of discounts and realized gains and losses on AFS securities are included in investment income. Interest income is accrued as earned. Dividend income is recognized as income on the ex-dividend date of the stock. The cost of securities sold is based on the specific identification method.

Following is a summary of investments as of March 27,June 26, 2010 and December 26, 2009:

Realized gains on sales of AFS securities totaled $8,623,000$7,126,000 and $2,460,000$7,861,000 for the three months ended March 27,June 26, 2010 and March 28,June 27, 2009, respectively, and $15,749,000 and $10,321,000 for the six months ended June 26, 2010 and June 27, 2009, respectively. Realized losses on sales and OTTI of AFS securities totaled $365,000$299,000 and $23,795,000$3,437,000 for the three months ended March 27,June 26, 2010 and March 28,June 27, 2009, and $664,000 and $27,232,000 for the six months ended June 26, 2010 and June 27, 2009, respectively. There were no OTTI losses on equity securities for the three and six months ended March 27,June 26, 2010. The Company recorded OTTI losses on equity securities of $17,440,000$1,843,000 and $19,283,000 for the three and six months ended March 28, 2009.June 27, 2009, respectively. There were no OTTI losses on debt securities for the three and six months ended March 27,June 26, 2010 and March 28,June 27, 2009.

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PUBLIX SUPER MARKETS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The amortized cost and fair value of debt and equity securities classified as AFS as of March 27,June 26, 2010 and December 26, 2009, by expected maturity, are as follows:

Following is a summary of temporarily impaired investments by the time period impaired as of March 27,June 26, 2010 and December 26, 2009:

There are 266333 investment issues contributing to the total unrealized loss of $9,633,000$11,827,000 as of March 27,June 26, 2010. Unrealized losses related to debt securities are primarily driven by market volatility impacting the market value of certain bonds. The Company continues to receive scheduled principal and interest payments on these investments. Unrealized losses related to equity securities are primarily driven by stock market volatility.

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PUBLIX SUPER MARKETS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

From time to time, the Company enters into JVs, in the legal form of limited liability companies, with certain real estate developers to partner in the development of shopping centers with the Company as the anchor tenant. The JVs are financed with capital contributions from the members, loans guaranteed by the members and/or with the cash flows generated by the shopping centers once in operation.

Generally, all major decision making in the Company’s JVs is shared between all members. In particular, the use and sale of JV assets, business plans and budgets are generally required to be approved by all members. Management and other fees paid by the JV to a member are nominal and believed to be at market.

The Company evaluates these JVs using specific criteria to determine whether the Company has a controlling financial interest and is the primary beneficiary of the JV. Factors considered in determining whether the Company is the primary beneficiary include risk and reward sharing, experience and financial condition of the other JV members, voting rights, involvement in day to day capital and operating decisions and each member’s influence over the shopping centers’center’s economic performance.

The consolidation of certain JVs during the quarter ended March 27, 2010 did not have an effect on beginning retained earnings since the earnings and losses of these JVs were previously accounted for under the equity method. The noncash balance sheet effect from the consolidation of these JVs as of the beginning of the quartersix months ended March 27,June 26, 2010 was as follows:

As of March 27,June 26, 2010, the carrying amounts of the assets and liabilities of the consolidated JVs, including previously consolidated JVs, were $232,300,000$235,812,000 and $129,400,000,$131,380,000, respectively. The Company’s debt results primarily from the consolidation of certain JVs. The assets are owned by, and the liabilities are obligations of, the JVs, not the Company, except for a portion of the long-term debt guaranteed by the Company. The long-term debt maturities range from June 2011 through January 2015 and have either (1) fixed interest rates ranging from 4.25%4.85% to 5.28% or (2) variable interest rates based on a LIBOR index plus basis points ranging from 80 basis points to 200250 basis points. Total earnings attributable to noncontrolling interests for the quartersthree and six months ended March 27,June 26, 2010 and March 28,June 27, 2009 were immaterial. The Company’s involvement with these JVs does not have a significant effect on the Company’s financial condition, results of operations or cash flows.

910

Overview

The Company is primarily engaged in the retail food industry, operating supermarkets in Florida, Georgia, South Carolina, Alabama and Tennessee. As of March 27,June 26, 2010, the Company operated 1,0141,019 supermarkets, 11 convenience stores, 109114 liquor stores and 37 Crispers restaurants.

Liquidity and Capital Resources

Cash and cash equivalents, short-term investments and long-term investments totaled $3,385.3$3,116.9 million as of March 27,June 26, 2010, as compared with $2,567.5 million as of December 26, 2009.

Net cash provided by operating activities

Net cash provided by operating activities was $982.9$1,291.6 million for the threesix months ended March 27,June 26, 2010, as compared with $820.1$1,177.6 million for the threesix months ended March 28,June 27, 2009. Any net cash in excess of the amount needed for current operations is invested in short-term and long-term investments.

Net cash used in investing activities

Net cash used in investing activities was $477.8$927.1 million for the threesix months ended March 27,June 26, 2010, as compared with $297.6$509.7 million for the threesix months ended March 28,June 27, 2009. For the threesix months ended March 27,June 26, 2010, the primary use of net cash in investing activities was funding capital expenditures and net increases in investment securities. Capital expenditures totaled $101.9$224.4 million. These expenditures were incurred in connection with the opening of nine19 new supermarkets (including foureight replacement supermarkets) and remodeling 2255 supermarkets. NineFourteen supermarkets were closed during the same period. Replacement supermarkets opened during the threesix months ended March 27,June 26, 2010 replaced fourseven of the nine14 supermarkets closed during the same period.period and one supermarket closed in 2009. The remaining supermarkets closed during the threesix months ended March 27,June 26, 2010 will be replaced on-siteon site in subsequent periods. An additional 0.10.4 million square feet were added in the threesix months ended March 27,June 26, 2010, a 0.2%0.8% increase. Expenditures were also incurred for new or enhanced information technology hardware and applications. For the same period, the payment for investments, net of the proceeds from the sale and maturity of such investments, was $376.6$704.3 million.

For the threesix months ended March 28,June 27, 2009, the primary use of net cash in investing activities was funding capital expenditures and net increases in investment securities. Capital expenditures totaled $212.1$373.9 million. These expenditures were incurred in connection with the opening of 1225 new supermarkets (including twofive replacement supermarkets) and remodeling 2241 supermarkets. ThreeEleven supermarkets were closed during the same period. Replacement supermarkets opened during the threesix months ended March 28,June 27, 2009 replaced twofive of the three11 supermarkets closed during the same period. TheFour of the remaining supermarketsupermarkets closed during the threesix months ended March 28,June 27, 2009 were replaced in subsequent periods and the other two were not replaced. One of the four replacement supermarkets opened in subsequent periods was replaced on-site in a subsequent period.on site. An additional 0.50.7 million square feet were added in the threesix months ended March 28,June 27, 2009, a 1.1%1.6% increase. Expenditures were also incurred for the construction of a second data center, expansion of warehouses and new or enhanced information technology hardware and applications. For the same period, the payment for investments, net of the proceeds from the sale and maturity of such investments, was $86.2$138.4 million.

Capital expenditure projection

Capital expenditures for the remainder of 2010 are expected to be approximately $453$331 million, primarily consisting of new supermarkets, remodeling certain existing supermarkets completion of planned improvements for certain of the supermarket locations acquired from Albertson’s LLC in 2008 and new or enhanced information technology hardware and applications. This capital program is subject to continuing change and review. In the normal course of operations, the Company replaces supermarkets and closes supermarkets that are not meeting performance expectations. The impact of future supermarket closings is not expected to be material.

1011

Net cash used in financing activities

Net cash used in financing activities was $50.4$473.1 million for the threesix months ended March 27,June 26, 2010, as compared with $245.3$660.6 million for the threesix months ended March 28,June 27, 2009. The primary use of net cash in financing activities was funding net common stock repurchases.repurchases and payment of the annual cash dividend. Net common stock repurchases totaled $55.1$115.8 million for the threesix months ended March 27,June 26, 2010, as compared with $247.4$340.4 million for the threesix months ended March 28,June 27, 2009. The Company currently repurchases common stock at the stockholders’ request in accordance with the terms of the Company’s Employee Stock Purchase Plan (ESPP), 401(k) Plan, Employee Stock Ownership Plan (ESOP) and Non-Employee Directors Stock Purchase Plan (Directors Plan). The amount of common stock offered to the Company for repurchase is not within the control of the Company, but is at the discretion of the stockholders. The Company expects to continue to repurchase its common stock, as offered by its stockholders from time to time, at its then current value for amounts similar to those in prior years. However, such purchases are not required and the Company retains the right to discontinue them at any time.

Dividends

On March 3, 2010, theThe Company declaredpaid an annual cash dividend on its common stock of $0.46 per share or approximately $364.1 million, payable on June 1, 2010 to stockholders of record as of the close of business April 30, 2010. In 2009, the Company paid an annual cash dividend on its common stock of $0.41 per share or $325.3 million.

Cash requirements

In 2010, the cash requirements for current operations, capital expenditures and common stock repurchases and payment of the annual cash dividend are expected to be financed by internally generated funds or liquid assets. Based on the Company’s financial position, it is expected that short-term and long-term borrowings would be available to support the Company’s liquidity requirements, if needed.

Results of Operations

Sales

Sales for the three months ended March 27,June 26, 2010 were $6.5$6.2 billion as compared with $6.4$6.0 billion for the three months ended March 28,June 27, 2009, an increase of $133.0$206.8 million or a 2.1%3.4% increase. The Company estimates that its sales increased $75.7$62.6 million or 1.2%1.0% from new supermarkets (excluding replacement supermarkets) and $57.3$144.2 million or 0.9%2.4% from comparable store sales (supermarkets open for the same weeks in both periods, including replacement supermarkets). Sales for the six months ended June 26, 2010 were $12.7 billion as compared with $12.4 billion for the six months ended June 27, 2009, an increase of $339.9 million or a 2.7% increase. The Company estimates that its sales increased $141.9 million or 1.1% from new supermarkets and $198.0 million or 1.6% from comparable store sales. Sales for supermarkets that are replaced on-siteon site are classified as new supermarket sales since the replacement period for the supermarket is generally 9 to 12 months. Comparable store sales for the three and six months ended March 27,June 26, 2010 continuedhave improved but continue to be impacted by the economic downturn and deflationary pressures.

Gross profit

Gross profit (sales less cost of merchandise sold) as a percentage of sales was 27.9%28.7% and 27.7%28.2% for the three months ended March 27,June 26, 2010 and March 28,June 27, 2009, respectively. Gross profit as a percentage of sales was 28.3% and 28.0% for the six months ended June 26, 2010 and June 27, 2009, respectively. The increase in gross profit as a percentage of sales for the three and six months ended MarchJune 26, 2010 and June 27, 2010 remained relatively unchanged compared2009 was primarily due to the three months ended March 28, 2009.improvements in shrink and buying and merchandising practices and decreases in distribution costs.

Operating and administrative expenses

Operating and administrative expenses as a percentage of sales were 20.6%21.4% and 20.8%21.9% for the three months ended March 27,June 26, 2010 and March 28,June 27, 2009, respectively. Operating and administrative expenses as a percentage of sales were 21.0% and 21.3% for the six months ended June 26, 2010 and June 27, 2009, respectively. The decrease in operating and administrative expenses as a percentage of sales for the three and six months ended MarchJune 26, 2010 and June 27, 2010 remained relatively unchanged compared2009 was primarily due to the three months ended March 28, 2009.decreases in facilities costs.

1112

Investment income, net

Investment income, net was $23.6$24.5 million and $0.4$24.4 million for the three months ended March 27,June 26, 2010 and March 28,June 27, 2009, respectively, and $48.2 million and $24.8 million for the six months ended June 26, 2010 and June 27, 2009, respectively. Investment income, net for the three months ended June 26, 2010 remained relatively unchanged compared to the three months ended June 27, 2009. The increase in investment income, net for the threesix months ended March 27,June 26, 2010 is primarily due to the decrease in OTTI losses on AFS securities and an increase in realized gains on the sale of AFS securities, partially offset by a decrease in interest income resulting from lower interest rates.securities. There were no OTTI losses on equity securities for the three and six months ended March 27,June 26, 2010. The Company recorded OTTI losses on equity securities of $17.4$1.8 million and $19.3 million for the three and six months ended March 28, 2009.June 27, 2009, respectively. There were no OTTI losses on debt securities for the three and six months ended March 27,June 26, 2010 and March 28,June 27, 2009.

Income taxes

The effective income tax rates were 34.2% and 34.9%34.6% for the three months ended March 27,June 26, 2010 and March 28,June 27, 2009, respectively. The decreaseeffective income tax rates were 34.2% and 34.8% for the six months ended June 26, 2010 and June 27, 2009, respectively. The decreases in the effective tax rate isrates are primarily due to increases in dividends paid to ESOP participants, tax exempt interest and deductions for manufacturing production costs.

Net earnings

Net earnings were $364.4$348.4 million or $0.47$0.44 per share and $321.5$300.8 million or $0.41$0.38 per share for the three months ended March 27,June 26, 2010 and March 28,June 27, 2009, respectively. This increase in net earnings was primarily due to increases in gross profit and decreases in facilities costs. Net earnings were $712.8 million or $0.91 per share and $622.3 million or $0.79 per share for the six months ended June 26, 2010 and June 27, 2009, respectively. This increase in net earnings was primarily due to increases in gross profit and investment income and decreases in facilities costs.

Forward-Looking Statements

From time to time, certain information provided by the Company, including written or oral statements made by its representatives, may contain forward-looking information as defined in Section 21E of the Securities Exchange Act of 1934. Forward-looking information includes statements about the future performance of the Company, which is based on management’s assumptions and beliefs in light of the information currently available to them. When used, the words “plan,” “estimate,” “project,” “intend,” “believe” and other similar expressions, as they relate to the Company, are intended to identify such forward-looking statements. These forward-looking statements are subject to uncertainties and other factors that could cause actual results to differ materially from those statements including, but not limited to, the following: competitive practices and pricing in the food and drug industries generally and particularly in the Company’s principal markets; results of programs to increase sales, including private-label sales; results of programs to control or reduce costs; changes in buying, pricing and promotional practices; changes in shrink management; changes in the general economy; changes in consumer spending; changes in population, employment and job growth in the Company’s principal markets; and other factors affecting the Company’s business in or beyond the Company’s control. These factors include changes in the rate of inflation, changes in state and federal legislation or regulation, adverse determinations with respect to litigation or other claims, ability to recruit and retain employees, increases in operating costs including, but not limited to, labor costs, credit card fees and utility costs, particularly electric utility costs, ability to construct new supermarkets or complete remodels as rapidly as planned and stability of product costs. Other factors and assumptions not identified above could also cause the actual results to differ materially from those set forth in the forward-looking statements. The Company assumes no obligation to publicly update these forward-looking statements.

1213

The Company does not utilize financial instruments for trading or other speculative purposes, nor does it utilize leveraged financial instruments. There have been no material changes in the market risk factors from those disclosed in the Company’s Form 10-K for the year ended December 26, 2009.

As of the end of the period covered by this quarterly report, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures pursuant to Exchange Act Rule 13a-15. Based upon this evaluation, the Chief Executive Officer and Chief Financial Officer each concluded that the Company’s disclosure controls and procedures are effective to provide reasonable assurance that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified by the SEC’s rules and forms, and that such information has been accumulated and communicated to the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, in a manner that allows timely decisions regarding required disclosure. There have been no changes in the Company’s internal control over financial reporting identified in connection with the evaluation that occurred during the quarter ended March 27,June 26, 2010 that have materially affected, or are reasonably likely to materially affect, the internal control over financial reporting.

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PUBLIX SUPER MARKETS, INC.

PART II. OTHER INFORMATION

As reported in the Company’s Form 10-K for the year ended December 26, 2009, the Company is a party in various legal claims and actions considered in the normal course of business. In the opinion of management, the ultimate resolution of these legal proceedings will not have a material adverse effect on the Company’s financial condition, results of operations or cash flows.

There have been no material changes in the risk factors from those disclosed in the Company’s Form 10-K for the year ended December 26, 2009.

Issuer Purchases of Equity Securities

Shares of common stock repurchased by the Company during the three months ended March 27,June 26, 2010 were as follows (amounts are in thousands, except per share amounts):

The Company’s common stock is not traded on any public stock exchange. The amount of common stock offered to the Company for repurchase is not within the control of the Company, but is at the discretion of the stockholders. The Company does not believe that these repurchases of its common stock are within the scope of a publicly announced plan or program (although the terms of the plans discussed above have been communicated to the participants). Thus, the Company does not believe that it has made any repurchases during the three months ended March 27,June 26, 2010 required to be disclosed in the last two columns of the table.

1415

Not Applicable.

Not Applicable.

1516

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

1617