Kroger reports Q4 identical sales growth
CINCINNATI Kroger today reported total sales increased 2.2 percent to $17.2 billion for the fourth quarter ended Feb. 2. Adjusting for the extra week in the fourth quarter of the previous year, total sales increased 10.2 percent.
Identical supermarket sales increased 5.3 percent without fuel, based on the same 12-week period in both years.
“As Kroger’s strong fourth quarter results show, we continue to drive solid identical sales growth by improving service, value, product quality and selection for our customers,” said David Dillon, Kroger chairman and chief operating officer. “During the quarter, we continued to invest in lower prices for our customers, providing meaningful savings for them in this uncertain economic environment.”
Net earnings in the fourth quarter totaled $322.9 million, or 48 cents per diluted share. Net earnings in the same period last year were $384.8 million, or 54 cents per diluted share.
For the full 2007 fiscal year, total sales increased 6.2 percent to $70.2 billion. Adjusting for the extra week in fiscal 2006, total sales increased 8.2 percent. Identical supermarket sales increased 5.3 percent without fuel, based on the same 52-week period in both years.
Net earnings for fiscal 2007 were $1.18 billion, or $1.69 per diluted share. This equates to 15 percent growth after adjusting for the extra week in fiscal 2006.
For fiscal 2008, Kroger anticipates earnings of $1.83 to $1.90 per diluted share. The company said it expects that earnings per share growth will be driven by strong identical sales, a slight improvement in non-fuel operating margins, and fewer shares outstanding. Identical supermarket sales growth is expected to be in the range of 3 percent to 5 percent, excluding fuel sales.
Vasos’ promotion at Longs considered ‘a positive’
NEW YORK A Goldman Sachs analyst said the appointment of Todd Vasos as the new executive vice president and chief operating officer of Longs Drug is a “positive” that should “position the company better” for the future.
In a March 10 report, analyst John Heinbockel said the departure of former chief operating officer Karen Stout last Friday and the promotion of Vasos to replace her is an “important change” that should make Longs stronger.
“We view these changes positively. Mr. Vasos is responsible for many of the most impactful initiatives the company has pursued over the past several years, including the upgrade of the private-label program, the development of a new store remodel prototype and expansion into self-distribution,” Heinbockel said in his report. “Ms. Stout, on the other hand, had primarily a warehouse club and supermarket background.”
In that regard, he added that, “it is more important for the person heading up operations and merchandising to have an intimate understanding of the drug store format.”
In his former position as senior vice president and chief merchandising officer, Vasos played a key role in the rollout of Longs’ store remodels and its front-end re-merchandising.
Larry Gatta will fill Vasos’ position as senior vice president and chief merchandising officer, and Linda Voracek is moving up to the role of vice president of marketing and is responsible for all front-end categories. No reason has been given for Stout’s departure from Longs.
Gift and decor market hit $65 billion in 2007
STEVENS, Pa. The market for gifts and home decor generated $65.2 billion in sales in 2007, according to a new study from Unity Marketing.
Unity said the market grew by 72 percent since its last major study conducted in 2002, when gift and decor accents hit $37.9 billion. The study said giftware sales grew faster than decor in recent years, rising 14.7 percent at an annual rate, compared with a 9.4 percent annual increase in decor.
“The giftware market has completely re-invented itself in the past five years,” said Unity Marketing president Pam Danziger. “The key for success in the giftware market is for companies to continually offer new and distinctly different products for a consumer market that is hungry for concepts that are new and unique.”