Submitted by Fox First at Ten on March 7th
NEW YORK (AP) - Kroger's fourth-quarter profit handily beat Wall Street expectations as the country's largest traditional supermarket operator saw sales climb.
The Cincinnati-based company, which also owns Ralphs, Fry's and Food 4 Less, said revenue at stores open at least a year rose 3 percent for the quarter, excluding fuel. The metric is a key gauge of health because it strips out revenue from newly opened and closed locations.
The better-than-expected results come as Kroger works to fend off growing competition from big-box retailers, drug stores and dollar stores that are expanding their grocery sections. To build customer loyalty, Kroger has focused on improving the in-store experience, offering discount programs and upgrading and expanding its stable of private-label products.
Looking ahead, the company said net earnings in 2013 are expected to range from $2.71 to $2.79 per share, in line with its long-term growth projection of 8 percent to 11 percent. Sales at established supermarkets are expected to rise between 2.5 percent and 3.5 percent.
Kroger isn't alone in its strategies to attract and hold onto shoppers, however. On Wednesday, Safeway Inc. said it expects sales at established stores to climb between 2 percent and 3 percent, helped by a new customer loyalty program that offers personalized discounts based on past purchases.
For the period ending Feb. 2, The Kroger Co. earned $461.5 million, or 88 cents per share. A year ago, the company reported a loss of $306.9 million, or 54 cents per share, as pension costs dragged down results.
Not including one-time items, such as the benefit of an extra week in the quarter, adjusted earnings for the latest period were 77 cents per share.
Revenue rose 13 percent to $24.2 billion.
Analysts on average expected an adjusted profit of 70 cents per share on revenue of $24 billion.
Kroger's stock was up almost 4 percent at $30.39.
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