Retail

Kroger Company Earnings Lead to Better Outlook

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The Kroger Co. (NYSE: KR) reported first-quarter 2013 results before markets opened this morning. The grocery chain reported quarterly diluted earnings per share (EPS) of $0.92 on revenues of $30 billion. In the same period a year ago, Kroger reported EPS of $0.78 on revenue of $29.1 billion. First-quarter results also compare to the Thomson Reuters consensus estimates for EPS of $0.88 and $30.2 billion in revenue.

Kroger raised its fiscal year EPS guidance from a range of $2.71 to $2.79 to a new range of $2.73 to $2.80. The company projects same-store sales growth, excluding fuel, to rise 2.5% to 3.5% in 2013. Capital spending is set at $2.1 to $2.4 billion. The consensus EPS estimate is currently $2.77.

The company’s CEO said:

Kroger achieved strong sales and record earnings per share for the quarter, and our customers’ positive view of us continues to improve. This is because of our continued focus on the Customer 1st strategy. Our first quarter results give us the confidence to raise our guidance for the year.

The company guided 2013 diluted EPS at $2.71 to $2.79. Kroger also expects same-store sales growth in the range of 2.5% to 3.5%. The EPS estimate is higher than the consensus estimate of $2.64.

Kroger’s shares are up more than 50% in the past 12 months, compared with a share price rise of around 31% for Safeway Inc. (NYSE: SWY) and share price rise of about 40% at SuperValu Inc. (NYSE: SVU).

Kroger’s shares are up about 0.8% in premarket trading this morning, at $35.40, in a 52-week range of $20.98 to $35.64. Thomson Reuters had a consensus analyst price target of around $34.10 before today’s results were announced.

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