Kroger Co. (KR - Get Report) posted weaker-than-expected fourth quarter earnings Thursday, as well as 2019 guidance that disappointed investors, sending shares sharply lower and wiping nearly $3 billion from its market value.
Kroger said adjusted earnings for the three months ending in January came in at 48 cents per share, down 11.1% from the same period last year and 4 cents shy of the Street consensus forecast. Group sales, Kroger said, were also 11% lower at $28.1 billion and again fell short of the consensus forecast of $23.38 billion. Looking into 2019, Kroger said it sees full year earnings in the range of $2.15 to $2.25 per share, lower than the $2.26 estimate from Refinitiv.#
"Kroger solidly delivered on what we set out to do in 2018, which was an investment year that laid the groundwork for us to achieve our 2020 Restock Kroger targets including financials," said CEO Rodney McMullen. "We reached our FIFO operating profit goal and finished the year with sales and business momentum."
"We have a clear path to achieve $400 million in incremental FIFO operating profit growth and $6.5 billion in cumulative Restock cash flow by the end of 2020," he added.
Kroger shares were marked 10.13% lower by mid-afternoon trading Thursday and changing hands at $25.56 each, the lowest in at least 10 months and a move that lops nearly $3 billion from the grocery store chain's market value.