Shares of grocer Great Atlantic & Pacific Tea (NYSE:GAP) rose on heavy volume this morning following positive fiscal Q3 (ended Nov. 29) financial results as the company managed to slim year-to-date revenue and same-store sales gains over the year-ago periods.

A casual glance over the press release won't do you much good -- there's a lot going on at the company these days and its announcement is dotted with news of charges, restructurings, and other goings-on at the company, which owns A&P, Waldbaum's, Farmer Jack and other grocer chains. The big picture, however, appears to be one of a company that is finally getting its feet squarely planted beneath it. That may not mean it's ready to leap skyward, but it does appear to have stable footing.

Last month, the company updated its credit pact, which should give it more spending flexibility. It's also recently completed a series of asset sales that have strengthened the balance sheet. Notable was November's sale of its Eight O'Clock Coffee business to a private equity firm, as well as various stores across the U.S.

Michigan-based Farmer Jack, meanwhile, had been in the news lately because of labor problems that were settled in late December. Following that announcement, the company said it would close 15 stores -- news painful to employees, but expected to help the division financially.

The grocery business has grown increasingly tough across the nation in recent years as competition has intensified due to national chains such as Kroger (NYSE:KR) but also the encroachment of heavy discounters like Wal-Mart (NYSE:WMT) and Costco (NASDAQ:COST). Consolidation among suppliers, meanwhile, would also seem to favor the larger players.

But companies such as Great Atlantic & Pacific can benefit from strong local brands and a history of serving their markets. It's a tough battle, but Great Atlantic & Pacific appears to be starting 2004 with a solid foothold under the circumstances.

Do you shop a "local" grocer, or stick with the big boys? Share your thoughts on our Great Atlantic & Pacific Tea discussion board.

Dave Marino-Nachison can be reached at