UPDATE: Kroger Co. (KR) Tops Q4 EPS by 1c, SSS Rose 4.9%, Offers Strong FY12 EPS Guidance

March 1, 2012 8:17 AM EST
(Updated - March 1, 2012 8:32 AM EST)

Kroger Co. (NYSE: KR) reported Q4 EPS of $0.50, $0.01 better than the analyst estimate of $0.49. Revenue for the quarter rose 7.7% to $21.4 billion versus the consensus estimate of $21.44 billion and $19.9 billion last year.

SSS rose 4.9% for the quarter, excluding fuel. Total sales rose 5% for the quarter, excluding fuel.

IFO gross margin, as reported, was 21.13% of sales in the quarter. Excluding retail fuel operations, FIFO gross margin decreased 47 basis points from the same period last year.

Kroger recorded a $73.4 million LIFO charge during the quarter compared to $18.8 million in the same quarter last year. Excluding retail fuel sales, the LIFO charge increased 30 basis points as a percentage of sales.

For fiscal year 2011, total sales increased 10.2% to $90.4 billion. Excluding the effect of the UFCW pension plan consolidation, earnings for the year were $1.2 billion, or $2.00 per diluted share. This is versus 2010 net earnings of $1.1 billion, or $1.74 per diluted share.

Looking ahead, Kroger sees FY12 SSS of 3%-3.5% and EPS between $2.28 and $2.38, versus the consensus of $2.26.

During fiscal 2012, Kroger plans to use cash flow from operations to fund capital expenditures, repurchase shares, pay dividends to shareholders and maintain its current debt rating. They expect capital expenditures to be in the $1.9 to $2.2 billion range for the year. Kroger's said its business model is structured to produce annual earnings per share growth averaging 6% to 8%, plus a dividend of 1.5% to 2%, for a total shareholder return of approximately 8% to 10%.

For earnings history and earnings-related data on Kroger Co. (KR) click here.

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