Kroger Sales Slip Again as Grocer Looks for Traction --Update
June 20 2019 - 9:44AM
Dow Jones News
By Micah Maidenberg
Sales at Kroger Co. slipped in the company's latest quarter, as
the supermarket chain races to transform its business amid
heightened competition from a range of food retailers.
Kroger on Thursday reported $37.25 billion in revenue in its
fiscal first quarter, down 1% compared with a year earlier but
better than what analysts had forecast for the period, according to
FactSet. The Cincinnati-based grocer has now reported
year-over-year sales declines for the last three quarters.
The company attributed the most recent decline to the sale of
its convenience-store business. Same-store sales, excluding fuel,
rose but at a slower rate compared with last year.
Kroger, the biggest supermarket company in the U.S., is
grappling with tumult in the grocery sector, as e-commerce changes
how consumers shop for food, making online-ordering and delivery
more common.
Discount-chains have expanded. Meanwhile, Amazon.com Inc. is
working to bring customers into its Whole Foods Market unit and
plans to launch a separate grocery brand, The Wall Street Journal
has reported.
Kroger has been investing in its e-commerce operation and said
on Thursday that delivery or online-order-and-pickup at stores are
now available at 93% of its locations. Digital sales grew 42% in
the quarter that ended May 25.
But that spending has costs. Gross margins fell in the quarter,
primarily due to lower margins in its pharmacy business, according
to the company.
Overall, Kroger reported a profit of $772 million, or 95 cents a
share, compared with $2.03 billion, or $2.37 a share, a year
earlier. After adjustments, Kroger reported a profit of 72 cents a
share for the most recent period, beating Wall Street targets by a
penny.
Shares dropped about 2% in premarket trading. Kroger's stock has
fallen 14% so far this year, through Wednesday.
Kroger has been slimming down its operation and hunting for
investment opportunities. In April, it sold a company that makes
ice cream, ice teas and other products. Kroger said in May it
formed a new venture focused on investments in consumer products
with an investment firm.
Write to Micah Maidenberg at micah.maidenberg@wsj.com
(END) Dow Jones Newswires
June 20, 2019 09:29 ET (13:29 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
Kroger (NYSE:KR)
Historical Stock Chart
From Aug 2024 to Sep 2024
Kroger (NYSE:KR)
Historical Stock Chart
From Sep 2023 to Sep 2024