Kroger reports growth, confirms guidance for FY2010

CINCINNATI Second-quarter sales for Kroger jumped 6% to $18.8 billion, compared with the year-ago period, the retail giant announced Tuesday.

While the 6% spike included fuel sales, Kroger's sales excluding fuel rose 3.3% for the quarter ended Aug. 14. Same-store sales, excluding fuel,  increased 2.7% in the second quarter over the same period last year. Net earnings for the second quarter totaled $261.6 million, or 41 cents per diluted share, up from $254.4 million, or 39 cents per diluted share, in second quarter 2009.

Kroger chairman and CEO Dave Dillon said its business momentum is driven by its Customer First strategy, which is implemented across all operating environments. "Kroger's sales have remained solid in the face of competitive and economic challenges because of the strong credibility we have with our shoppers," Dillon said. "Our team understands the importance of finding ways to make each customer visit better than the last one, resulting in consistent positive identical supermarket sales growth."

Kroger also disclosed that its total sales for the first two quarters of fiscal 2010 were $43.6 billion, compared with $40.5 billion for the same period last year. Excluding fuel sales, total sales increased 3.2% over the prior year. For the same period, same-store sales, excluding fuel, increased 2.6%.

Additionally, Kroger updated its same-store sales and earnings guidance for fiscal 2010, expecting a 2% to 3% growth in same-store sales, excluding fuel, as well as $1.60 to $1.80 per diluted share.

"As our results show, we are committed to achieving solid financial results today while we invest in the future growth of Kroger's business," Dillon said. "As we move into the second half of the fiscal year, we are striving to achieve results in the top half of our earnings guidance range, even as the operating environment remains uncertain."

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