(RTTNews) - Tuesday, Kroger Co. (KR: News ), one of the nation's largest retail grocery chains, posted lower profit and sales for the second quarter, amid increasing rate of out-of-work professionals and deteriorating economic conditions. Per share earnings fell from last year and missed the Street view. Further, the company slashed its earnings forecast for fiscal 2009, while confirming projections for identical supermarket sales growth.

Q2 Results

For the second quarter, the supermarket chain posted net income attributable to Kroger of $254.4 million or $0.39 per share, compared with $276.5 million or $0.42 per share in the year-ago quarter.

On average, 16 analysts polled by Thomson Reuters expected the company to post earnings of $0.44 per share. Analysts' estimates typically exclude special items.

Quarterly sales, including fuel, decreased to $17.7 billion from the previous year's $18.1 billion, and fell shy of thirteen Wall Street analysts' consensus revenue estimate of $18.16 billion. Excluding fuel sales, total sales grew 3.5% over last year.

Other Metrics

Operating profit for the second quarter dropped to $499.1 million, or 2.81% of total sales, from $546.3 million, or 3.02% of total sales, in the prior-year quarter. Operating, general and administrative expenses were $3.09 billion or 17.41% of total sales, up from $3.00 billion or 16.60% of total sales, in the year-earlier quarter.
The Cincinnati, Ohio-based Kroger, which also operates the Ralphs, Fred Meyer, Food 4 Less, Fry's, King Soopers, Smith's, and Dillons brands, said identical supermarket sales advanced 2.6% without fuel in the latest quarter. Including fuel centers, identical supermarket sales declined 1.6% from the previous year.

Comparable supermarket sales, excluding fuel centers, improved 3.0%, while comparable supermarket sales, including fuel centers, edged down 1.3% from last year.

Kroger defines a supermarket as identical when it has been open without expansion or relocation for five full quarters, and defines a supermarket as comparable when it has been open for five full quarters, including expansions and relocations.

During the quarter, the company's First-In First-Out or FIFO gross margin rose 59 basis points to 23.11% from last year. Excluding retail fuel operations, FIFO gross margin decreased 60 basis points and supermarket selling gross margin on non-fuel sales fell 88 basis points.

The company recorded a $14.7 million Last-In First-Out or LIFO charge during the first quarter, down $31.5 million from last year. Excluding retail fuel sales, the LIFO charge declined 21 basis points as a percent of sales compared to the prior year.

To receive FREE breaking news email alerts for Kroger Co. and others in your portfolio

 1   2   3   Next Page