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Kroger Beats Wall Street Expectations in Robust Q3 2014 Financial Report

Kroger Beats Wall Street Expectations in Robust Q3 2014 Financial Report



CINCINNATI, OH - Kroger published its Q3 2014 financial report on December 4th, 2014, blowing investors away with a 21% profit increase. Wall Street reacted warmly to this news, driving Kroger's stock up nearly 3% to $60.18/share within the first five minutes of the morning's trading, according to the Cincinnati Business Courier.

Rodney McMullen, CEO

"Our associates continue to execute our Customer 1st strategy, which is building loyalty beyond the weekly ad and showing yet again that focusing on our customers creates value for our shareholders," said Rodney McMullen, CEO. "Our financial results were driven by strong sales and core business performance, and helped by higher fuel margins in the third quarter."

Some key highlights from Kroger's financial report include:

  • Q3 2014 marks the 44th consecutive quarter of positive identical supermarket sales growth, excluding fuel.
  • A 5.6% increase in identical supermarket sales growth.
  • A 11.2% increase in total sales to $25.0 billion, compared to $22.5 billion from the same period from last year. This beat the expectations of analysts who had only anticipated sales of $24.8 billion, according to the Cincinnati Business Courier.
  • A 13.7% increase in total sales, excluding fuel.
  • Net earnings of $326 million ($345 million excluding related tax items), compared to $299 million from the same period from last year.
  • Net earnings per diluted share of $0.73 (excluding benefits from related tax items this figure was $0.69). Analysts had only expected earnings per share performance of $0.61/share.
  • FIFO gross margin of 21.24% of sales for Q3, a 2 basis point decrease from the same period from last year after excluding retail fuel operations.

Looking forward, Kroger has updated its adjusted net earnings per diluted share guidance for fiscal 2014 to $3.32 to $3.36. According to a press release, this was previously $3.22 to $3.28 per diluted share. During this same period, Kroger expects identical supermarket sales growth, excluding fuel, to be 4.0% to 5.0%.

"Kroger continues to deliver consistently remarkable results. We expect to exceed our long-term earnings per share growth rate for fiscal 2014," McMullen shared. "Our associates shine brightest during the holiday season and we intend to continue our positive momentum through the fourth quarter."

Moving into fiscal 2015, Kroger posted long-term net earnings per diluted share growth rate guidance of 8-11%, including a growing dividend.

Congratulations on this very impressive financial report, Kroger!

Kroger