US supermarket chain Kroger has recorded a marginal decrease in net earnings attributable to the company for the first quarter (Q1) of the fiscal year 2024 (FY24). $947m was recorded, down from $962m in the same quarter of the previous year.
The retailer’s net earnings attributable to Kroger per diluted common share for the quarter were $1.29, compared with $1.32 in Q1 FY23.
In the quarter ending 25 May 2024, Kroger's total sales reached $45.26bn, a slight increase from $45.16bn in the same period of 2023.
Excluding fuel, the company's sales saw a growth of 0.6% over the quarter.
The retailer's digital sales segment experienced significant growth of 8% in Q1 FY24, with delivery and pickup services achieving double-digit expansion.
Kroger’s operating profit for the quarter stood at $1.29bn, a decrease from $1.47bn reported in Q1 FY23.
Its gross margin was reported at 22.4% of sales, with the first-in-first-out gross margin rate, excluding fuel, experiencing a minor decline of seven basis points compared to that of the previous year.
Kroger's operating, general and administrative rate saw an increase of 22 basis points, excluding fuel and adjustment items, compared to last year.
The retailer's net total debt to adjusted earnings before interest, taxes, depreciation and amortisation ratio improved to 1.25, down from 1.34 a year previously.
Kroger chairman and CEO Rodney McMullen said: "Kroger is off to a solid start in 2024 led by better-than-expected performance of our grocery business. Kroger is delivering exceptional value at a time when many customers need it more than ever, by providing affordable prices with personalised promotions.
“We appreciate our associates who are elevating the customer experience and improving store execution. Together, this is growing households and increasing customer visits. The long-term investments we have made to strengthen and diversify our model enable us to manage economic cycles and give us the confidence to deliver on our full-year outlook. By delivering value for customers and investing in our associates, Kroger remains well-positioned to generate attractive and sustainable returns for our shareholders."
Looking ahead to the full year 2024, Kroger has reaffirmed its guidance, with identical sales without fuel expected to be between 0.25% and 1.75%.
The company also anticipates adjusted net earnings per diluted share to be between $4.30 and $4.50.
In April 2024, Kroger and Albertsons agreed to sell 166 additional stores to C&S Wholesale Grocers as it aims to address antitrust concerns and secure regulatory approval for their proposed $25bn merger.
