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Stacie Scott/Bloomberg
Kroger stock climbed early Thursday on the heels of mixed fourth-quarter results, as its bottom line and full-year outlook came in easily ahead of expectations.
Kroger (ticker: KR) said it lost $77 million, or a dime a share, compared with earnings of 40 cents a share in the year-ago period. On an adjusted basis, which excludes one-time items including adjustments for pension plan withdrawal liabilities and investments, earnings per share were 81 cents. Revenue rose more than 6% to $30.74 billion. Consensus called for per-share earnings of 69 cents on revenue of $30.83 billion.
The company said same-store sales excluding fuel climbed 10.6%, ahead of the 10.2% analysts were forecasting, boosted by a 118% jump in online sales.
For the full year, Kroger expects to earn between $2.75 and $2.95 a share, ahead of the $2.69 consensus estimate.
Kroger stock rose 1.1% to $33.63 in recent trading. The shares are off 0.7% in the past 12 months but have risen 4.7% year to date.
Kroger and other traditional supermarkets have seen rising competition from big box retailers and e-commerce, but the Covid-19 pandemic was a boon for the group. More people stocked their pantries to eat at home and, in many cases, preferred to shop at grocery stores, given their wider selection and bevy of trusted brand names.
However, like all pandemic winners, Kroger faces questions about how it will keep its momentum going once mass vaccination eases the crisis and allows for an economic reopening and safer indoor dining.
The quarter did a good job in allaying some of those fears by providing full-year guidance when many other companies have hesitated to do so, citing the pandemic. Kroger’s confidence that it will be able to handily beat expectations for the year are a promising sign that could help overshadow very difficult year-over-year comparisons ahead.
In addition, company said it continued to gain market share in the quarter, while fixed costs declined. Kroger expanded its pick-up and delivery locations to cover some 98% of customer households, and said that its private-label brands had their “best year ever” with $26.2 billion in sales.
Write to Teresa Rivas at [email protected]
