Cincinnati The Kroger Co. said it lost $875 million in its third quarter, blaming tough price competition and the struggling California economy's hit on its grocery business. The company also cut its profit and sales forecast for the full year.
The grocery retailer took a $1.05 billion writedown on the Ralphs division it acquired a decade ago, saying stores in California have been hurt by the state's economic woes. Without the Ralphs writedown, profit would have been $176.7 million.
Sales rose less than 1% to $17.7 billion. Same-store sales rose 1.3%, excluding fuel sales.
"The operating environment we saw during the third quarter was more challenging than we anticipated," David B. Dillon, Kroger's chairman and CEO, said in a statement. "In the near term, our financial results are being pressured by factors including persistent deflation, unusually intense competition, and the cautious mindset of customers."