Kroger sees rise in 1Q earnings

CINCINNATI Kroger reported net earnings totaled $435.1 million, or 66 cents per diluted share, for the first quarter of fiscal 2009 ended May 23, compared with net earnings of $386 million, or 58 cents per diluted share, in the same period last year.

Total sales, including fuel, in the first quarter were $22.8 billion compared with $23.1 billion for the same period last year. During the quarter, the average retail price for a gallon of gas sold at Kroger's fuel outlets was 41% lower than it was in the first quarter last year. Excluding fuel sales, total sales increased 3.9% over the prior year. Identical-supermarket sales, excluding fuel, increased 3.1% over the same period last year.

"Customers continue to look for value, and Kroger is helping them save money by offering a unique combination of products and services no other competitor can match. By paying close attention to the changing needs of today's shoppers, Kroger continues to refine what it offers customers through lower prices, friendly service and innovative stores that are appealing and convenient. As a result of this approach, we continue to generate solid, consistent results for shareholders," said David Dillon, Kroger chairman and chief executive officer.

Kroger confirmed its expectations for full-year identical supermarket sales growth of 3% to 4%, without fuel, for fiscal 2009. This guidance reflects the company's outlook for product cost inflation of 1% to 2%. Kroger also confirmed its full-year 2009 earnings outlook of $2.00 to $2.05 per diluted share.