Kroger Q4 Sales Flat
Fourth quarter sales at Kroger were flat year-over-year as the grocer continues to take steps to help consumers navigate a challenging economic environment.
Total company sales in the quarter were $37.1 billion in the fourth quarter, including $2.7 billion from the 53rd week, compared to $34.8 billion for the same period last year. Excluding fuel and the 53rd week, sales decreased 0.5% compared to the same period last year.
Gross margin in the fourth quarter was 22.7% of sales. Excluding fuel and the 53rd week, gross margin increased 13 basis points compared to the same period in the previous year. Company officials said the improvement in gross margin was primarily attributable to Kroger’s Our Brands performance, sourcing benefits and lower supply chain costs, partially offset by increased price investments and higher shrink.
“As customers manage macroeconomic pressures, we are lowering prices and offering even more ways to save with personalized promotions and rewards,” said Rodney McMullen, chairman and CEO of Kroger. “Our unique seamless shopping experience provides customers the products they want, when and how they want them, with zero compromise on quality, convenience and selection.”
Full year company-wide sales were $150 billion, which included $2.7 billion from the 53rd week, compared to $148.3 billion for the prior fiscal year. Excluding fuel and the 53rd week, sales increased 1.1% compared to the same period last year.
Gross margin was 22.2% of sales for 2023. The gross margin rate, excluding fuel and the 53rd week, increased 18 basis points compared to the same period last year. This improvement in rate was primarily attributable to strong Our Brands performance, sourcing benefits, lower supply chain costs and the effect of our terminated agreement with Express Scripts, partially offset by increased price investments and higher shrink.
"Kroger achieved strong 2023 results, in line with our long-term growth model and built upon three consecutive years of historic growth,” McMullen said. “We are increasing customer visits and growing loyal households through the strength of our retail business, which positions Kroger for more ways to drive sustainable future growth.”
For fiscal year 2024, the grocer expects identical sales without fuel to grow between 0.25% and 1.75% with adjusted net earnings per diluted share of between $4.30 and $4.50. Capital expenditures will be between $3.4 billion and $3.6 billion.
