Kroger Sales Soften In Q3
Kroger has lowered its sales forecast for the remainder of 2023 as the grocer reported a slight decline in sales for the third quarter.
For the period ended November 4, total sales were $34.0 billion, down 0.5% from sales of $34.2 billion in the comparable quarter the previous year. Identical sales were down 0.6% and earnings per share were $0.88, up from earnings per share of $0.55 in the third quarter of 2022.
"Kroger's third quarter results highlight the strength and diversity of our business model in a challenged operating environment, as strong fuel performance and growth in our alternative profit businesses supported continued adjusted net earnings per diluted share growth,” said Rodney McMullen, chairman and CEO of Kroger. “As consumer spending tightens, we are focused on providing customers with exceptional value. By maintaining our long-term commitment to lower prices, personalized promotions and rewards, we are growing households and increasing loyalty, positioning Kroger for sustainable future growth.”
During the quarter, the retailer expanded its Fresh Produce initiative to 2,053 stores. Additionally, the grocer also launched Mercado, a Hispanic-inspired brand that was added to its Our Brands portfolio.
Company officials reported delivery sales increased by 20% year-over-year, led by Kroger Boost and Customer Fulfillment Centers, and increased digitally engaged households by 13% when compared to the previous year.
Going forward, Kroger now expects fiscal 2023 identical sales, excluding fuel, to grow 0.6% to 1%, down from its prior forecast of an increase of between 1% and 2%. Adjusted net earnings per diluted share are now expected to fall between $4.50 – $4.60, including an estimated benefit from the 53rd week of approximately $0.15.
“We are updating our full-year guidance to reflect the impact of near-term economic pressures and food-at-home disinflation,” said Gary Millerchip, Kroger’s chief financial officer. “We are confident in our ability to navigate these near-term headwinds.”
