Kroger Posts Higher Profit

Grocery chain Kroger ( KR) posted a rise in first-quarter profit, but adjusted its full-year 2003 estimated earnings, citing competitive pressures.

The company earned $351.5 million, or 46 cents a share, in the quarter ended May 24, compared with $305.2 million, or 38 cents a share, in the year-ago period. Kroger said earnings in the year-ago period, before the cumulative effect of an accounting change, were $321.7 million, or 40 cents a share. These results also included an after-tax charge of $66.4 million.

Total sales were $16.3 billion, up 3.8%. Comparable food-store sales, including relocations and expansions, increased 0.7% for the quarter. Comparable food-store sales, excluding fuel, declined 0.5%.

Kroger said it opened, expanded, relocated or acquired 23 food stores during the quarter.

The Cincinnati-based company said it expects full-year 2003 earnings to be $1.55 to $1.63 a share, within range of analysts expectation of $1.62 a share. Previously, the company had expected to earn $1.63 a share. The company said "competitive conditions, thus far, have prevented us from increasing gross profit margin as anticipated."

Shares of the company were recently up 57 cents to $16.47 on the New York Stock Exchange.

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