Kroger's (KR) Q4 Earnings Surpass Estimates, Increase Y/Y
Zacks Investment Research | Mar 04, 2020 10:40PM ET
After witnessing a negative earnings surprise in the third quarter of fiscal 2019, The Kroger Co. (NYSE:KR) has reported a beat in the fourth quarter. The company has posted adjusted earnings of 57 cents a share that surpassed the Zacks Consensus Estimate by a penny and increased 18.8% from the prior-year quarter.
This Cincinnati, OH-based company continues to envision fiscal 2020 earnings between $2.30 and $2.40 per share, which indicates an increase from adjusted earnings of $2.19 reported in fiscal 2019. The Zacks Consensus Estimate for earnings for fiscal 2020 currently stands at $2.34.
Total sales of $28.89 billion almost came in line with the Zacks Consensus Estimate, following a miss in the preceding two quarters. The metric increased 2.1% from the prior-year quarter. Excluding fuel and dispositions, the top line improved 2.3% from the year-ago period. The company’s digital sales rose 22%, while identical sales, excluding fuel, grew 2%. Management forecast identical sales, excluding fuel, to be above 2.25% in fiscal 2020.
We note that gross margin contracted 30 basis points to 22.1%. FIFO gross margin, excluding fuel, expanded 6 basis points from the year-ago period on account of improvement in costs of goods and accelerating alternative profit streams, partly offset by investments in price and personalization, and continued industry-wide lower gross margin rates in pharmacy. Adjusted FIFO operating profit increased 20.7% to $758 million. Kroger anticipates adjusted operating profit of $3-$3.1 billion for 2020.
The Kroger Co. Price, Consensus and EPS Surprise
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