Kroger Co. reported strong second-quarter results amid a surge in digital sales and gave investors a glimpse into its business projections for the rest of the year.
The Cincinnati-based supermarket chain earned $820 million, or an adjusted 73 cents per share, in the three months through August 15 as sales excluding fuel rose 13.9% to $30.5 billion. Wall Street analysts surveyed by Refinitiv were anticipating adjusted earnings of 55 cents per share and revenue of $29.9 billion.
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“We delivered extremely strong results in the second quarter and expect to deliver consistently attractive total shareholder returns,” Kroger CEO Rodney McMullen said in a statement.
The sales growth was fueled by a 127% year-over-year surge in digital sales.
Execution of its three-year transformation plan, dubbed “Restock Kroger” contributed to a 61 basis-point decline in general costs, but that was partially offset by expenses related to safeguarding employees and customers from COVID-19.
Looking ahead, Kroger sees adjusted earnings per share of $3.20 to $3.30, representing growth of 45% to 50% from a year ago. Sales are expected to climb at least 13%.
The company’s board of directors on Friday announced a new $1 billion share repurchase program, replacing the previous buyback plan announced in November. The company repurchased $211 million of shares under the old plan.
Kroger shares rose 20% this year through Thursday, outperforming the S&P 500’s 3.36% gain.