Safeway Inc. reported another great quarter but shares still fell 4 percent.

The grocery store chain reported fourth quarter net income of $308 million (69 cents per share), a 78 percent leap from $174 million (39 cents) for the same period a year earlier thanks to a sizable tax gain, which added 8 cents per share, the company said. Analysts polled by Thomson Financial were expecting earnings of 60 cents per share.

Sales for the Pleasanton-based grocer, which operates the Vons and Pavilions chains, rose 4 percent to $12.5 billion, boosted by improved sales from its Lifestyle stores, which offer more upscale items like prepared meats and imported cheeses, as well as strong performance from both perishable and nonperishable merchandise. The chain reported a 30 percent jump in net income during the third quarter and a 5 percent jump in sales.

Safeway added that its same-store sales grew 3.7 percent for the quarter.

For the year, net income climbed 55 percent to $870.6 million ($1.94 per share), while sales rose 5 percent to $40.2 billion.

However, investors seemed unimpressed by the strong numbers and sent shares in Safeway down 4 percent ($1.48) to $35.48 in afternoon trading Thursday.