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VOL. 37 | NO. 24 | Friday, June 14, 2013
Kroger raises outlook on stronger 1Q profit
NEW YORK (AP) — Kroger has raised its outlook for the year after the country's largest traditional supermarket chain reported a stronger fiscal first-quarter profit that beat Wall Street expectations.
The Cincinnati-based company, which also owns Ralphs, Fry's and Food 4 Less, said sales at stores open at least a year rose 3.3 percent during the period, excluding fuel.
The growth comes as Kroger and other traditional supermarket operators are working to adapt to a shifting industry. Shoppers are increasingly getting their groceries at big-box retailers like Target, drugstores and even dollar stores that have expanded their food sections. The intensifying competition has taken its toll on some supermarket operators; SuperValu earlier this year sold off five of its major chains after struggling for years to fix its business.
But Kroger has been trying to keep pace in a variety of ways. To improve the shopping experience, the company worked on shortening wait times at its checkouts, expanded its store-brand lineup and invested in making its loyalty program more sophisticated. The company also is experimenting with different store formats that are more akin to big-box retailers and dollar stores.
For the quarter, The Kroger Co. earned $481 million, or 92 cents per share. That's compared with $439 million, or 78 cents per share, a year earlier.
Total revenue rose 3 percent to $30.04 billion.
Analysts on average expected a profit of 88 cents per share on revenue of $30.1 billion, according to FactSet.
Citing its stronger first-quarter results, Kroger increased its net earnings guidance for the year to a range of $2.73 to $2.80 per share, up from $2.71 to $2.79.
Shares slipped 2 cents to $35.10 in premarket trading.