Kroger reports strong Q1 2013 results
CINCINNATI — Kroger posted sales of $30 billion and profits of $481 million in first quarter 2013 as it slowly grew its online business and foresaw increased investment in new markets and increased square footage in its stores.
The results reported Thursday compared with first quarter 2012 sales of $29.1 billion and profits of $439 million. Earnings-per-share guidance for fiscal year 2013 was increased from $2.73 to $2.80.
"Kroger achieved strong sales and record earnings per share for the quarter, and our customers’ positive view of us continues to improve," Kroger chairman and CEO David Dillon said. "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."
In a call with Wall Street analysts Thursday morning, Dillon cited Fort Wayne, Ind., as a model for the company’s expansion plans, noting that new stores, remodels and acquisitions have doubled Kroger’s market share in Indiana’s second-largest city over the past five years. "We view this as a successful pilot," Dillon said. The company invested $646 million during the quarter, compared with $557 million during the same period last year, and it continues to forecast that it will invest between $2.1 billion and $2.4 billion throughout the fiscal year.
Dillon also praised the 2,419-store company’s pharmacy business, saying it "continues to deliver strong performance" and growth in scripts amid retention of Express Scripts customers who moved over to Kroger during the pharmacy benefit manager’s dispute with Walgreens last year, as well as the generic wave, which reduces retailers’ pharmacy sales numbers but increases script counts as customers switch over to cheaper versions of more expensive branded drugs. The company expects to launch 75 new items throughout the year as part of its Simple Truth and Simple Truth Organic private-label lines.
Kroger’s online business has been increasing at a modest rate as it continues experimenting with it at King Soopers stores in the Denver market. Dillon said he felt "very good" about the company’s direction in digital, saying it was about more than what is sold online and also about using strengths and insights on digital strategy and needs, as well as testing various omnichannel services. Kroger has been working with customer-experience research and services company Dunnhumby to make its digital program more relevant and is making "huge progress" in connecting with customers, as the number of people downloading and using apps has increased significantly.
Albertsons pulls plug on loyalty card program
BOISE, Idaho — Still fresh from its sale to AB Acquisition LLC, Albertsons has started notifying shoppers that its Preferred Card loyalty program is no longer available.
On its website, Albertsons states: “Our customers are the only reasons that our doors open every day. Because of you, we exist. It’s that simple. We feel it’s our job to give everyone a great shopping experience, and that includes offering great prices to everyone.”
The grocer stated that if a shopper has a uPromise account attached to their Preferred Card they can still have the card scanned when buying groceries and the account activity will be appropriately reflected. Also, if a shopper uses the Preferred Card to earn Fuel Rewards they can still scan it when shopping.
“I know your next question is, ‘will Fuel Rewards be going away soon, too?’ We haven’t yet made a decision on that, but we are reviewing it closely, and if any changes are made, you’ll be the first to know,” the retailer noted on its site.
In March, Supervalu completed the sale of its Albertsons, Acme, Jewel-Osco, Shaw’s and Star Market stores and related Osco and Sav-on in-store pharmacies to AB Acquisition LLC, an affiliate of a Cerberus Capital Management-led investor consortium. The move reunited all Albertsons stores under one operator.
Jamba Juice expands at-home smoothie mix line
PHOENIX — Jamba Juice Co., in collaboration with specialty food manufacturer Inventure Foods, Inc., announced today a new addition to its line of at-home smoothie mixes with Green Fusion, a blend of fruits and vegetables that offers a dose of vitamins and antioxidants.
Green Fusion combines green apple, mango, pineapple, kiwi, banana, broccoli, spinach and spirulina — a dietary supplement — to offer a smoothie appropriate for morning commutes or post-workout recovery, the company stated. Each eight-ounce glass contains 120 calories and provides a full serving of fruit. In addition, each glass provides 100% of the recommended dietary allowance of vitamin C, 40% of the RDA of vitamin A and 25% of the RDA of vitamins D, E, K, B1 and B6.
Each smoothie kit contains whole pieces of frozen fruit and vegetable blocks that, when blended with one cup of apple juice, makes two, eight-ounce servings.
"We’re excited to take our expertise in the frozen berry business and apply it to our first vegetable fusion smoothie," said Steve Sklar, senior vice president marketing for Phoenix-based Inventure Foods, Inc. "The Green Fusion smoothie is on trend with today’s consumer who is looking for a refreshing, great tasting smoothie that provides a substantial boost of vitamins and a full serving of fruit."
Green Fusion is the sixth variety of Jamba smoothies to travel from the retail menu to the grocery store freezer. Additional varieties include Strawberries Wild, Mango-a-Go-Go, Razzmatazz, Caribbean Passion and Orange Dream Machine.
Jamba Green Fusion is available at select retailers nationwide.
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