Cincinnati – The Kroger Co. earned a better-than-expected $422 million in its fourth quarter, down from $462 million in the year-ago period, which included an additional week of sales. The nation’s largest supermarket operator issued a better-than-expected profit for the year ahead.
Kroger’s fourth quarter's results included expenses related to the company's $2.5 billion acquisition of Harris Teeter Supermarkets, which closed on January 28, 2014. The quarter's results also include a LIFO charge of $9.7 million, compared to LIFO credit of $41.2 million in the year-ago period.
Sales for the fourth quarter, ended Feb.1, totaled $23.2 billion, also topping Street estimates, compared to $24.1 billion last year. After adjusting for the extra week, total sales went up by 4.8% (without fuel, total sales increased 4.4%). Same-store sales increased 4.3%, excluding fuel.
The company said its results were enhanced by its response to the harsh winter weather in the fourth quarter.
For the full year, Kroger reported total sales of $98.4 billion, an increase of 3.9% after adjusting for the 53rd week last year. Net earnings for fiscal 2013 totaled $1.52 billion.
Kroger’s full-year net earnings beat Wall Street expectations and were aided by sales from more than 200 Harris Teeter stores acquired in the fourth quarter.
The supermarket operator anticipates same-store sales growth, excluding fuel, of approximately 2.5% to 3.5% for fiscal 2014.
"Our associates' connection with customers fueled another year of market share growth and record earnings per share," said Rodney McMullen, Kroger's CEO. "Kroger's Customer 1st strategy is a powerful foundation on which to continue growing and differentiating our business in 2014."