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Kroger’s First Quarter ID Sales Down

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Last updated on June 16th, 2017 at 03:33 pm

The Kroger Co. on Thursday reported net earnings of $303 million, or $0.32 per diluted share, and identical supermarket sales growth, without fuel, of -0.2 percent in the first quarter of 2017.

The company’s record 52 consecutive quarters of positive identical supermarket sales, excluding fuel, ended in the fourth quarter of 2016, which ended Jan. 28. Those results, which included a 0.7 percent drop in ID sales, without fuel, were reported in March.

Kroger’s adjusted net earnings for the first quarter of 2017 were $546 million, or $0.58 per diluted share. Kroger’s net earnings for the first quarter last year were $696 million, or $0.71 per diluted share. Total sales increased 4.9 percent to $36.3 billion in the first quarter compared to $34.6 billion for the same period last year. Total sales, excluding fuel, increased 2.9 percent in the first quarter compared to the same period last year. The recent merger with ModernHEALTH contributed to sales growth, according to the company.

“We remain focused on our strategy. This will make a difference for our customers and create value for our shareholders. We are running the business with an eye toward where the customer is going,” said Chairman & CEO Rodney McMullen. “Customers tell us they want to connect with us in multiple ways with the help of friendly associates to easily provide meals to their families at prices that enable them to stretch their budgets. We are committed to providing that experience, and we will not lose on price.

“We are driving our strategy of lowering costs to reinvest in ways that provide the right value to our customers. We’re pleased that identical supermarket sales in the last nine weeks of the first quarter were positive, and that has continued in the second quarter to date.”

Kroger lowered its 2017 GAAP net earnings guidance for 53 weeks to $1.74-$1.79 per diluted share. Kroger’s adjusted net earnings guidance range is $2.00-$2.05 per diluted share.

Kroger continues to expect identical supermarket sales growth, excluding fuel, of flat to 1 percent growth for 2017.

The company continues to expect capital investments, excluding mergers, acquisitions and purchases of leased facilities, to be in the $3.2-$3.5 billion range for 2017.

Over the long term, Kroger says it is committed to achieving a net earnings per diluted share growth rate of 8-11 percent, plus a growing dividend.

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