US: Pension costs lead Kroger to Q4 loss
Kroger's loss was a result of pension-related costs announced in December
Pension-related costs led Kroger to make a loss in the fourth quarter of its financial year, offsetting an increase in sales.
For the three months to 28 January, the US retail giant reported net losses of US$306.9m, or a loss of $0.54 per share, compared to a profit of $278.8m, or $0.44 per share, in the prior-year period. The loss was a result of pension-related costs announced in December, when Kroger said its four union pension funds were merging into a new fund, to which it contributed $650m in January.
The company recorded operating losses in the quarter of $425.2m, compared to an operating profit of $559m last year.
Total sales, including fuel, increased 7.7% to $21.4bn, and excluding fuel, increased 5% over the same period last year. Identical supermarket sales, without fuel, increased 4.9%.
For the full year, Kroger saw its net profit slide to $602.1m, or $1.01 per share, from $1.12bn last year, or $1.75 per share, taking into account the pensions-related costs. Excluding the costs, net profit rose 9% to $1.2bn.
Operating profit slumped 41% to $1.28bn.
Sales in the period, however, amounted to $90.4bn, a 10.2% increase on 2010. Identical-store sales, without fuel, increased 4.9%.
"We are very pleased with Kroger's outstanding performance in fiscal year 2011 and strong fourth-quarter financial results," said Kroger chairman and CEO David Dillon.
Looking ahead to 2012, Kroger said it expects net earnings of $2.28 to $2.38 per share, taking into account the benefit of an extra week in the year, "lower-than-expected" accounting charges and "aggressive" stock buybacks during 2011.
- M&A Watch: Raisio should sell to private equity
- Infographic: Snapshot of Japan's food sector
- Analysis: Market bets on higher Chiquita offer
- Briefing: Expansion agenda of Japan's food majors
- On the money: Solid Lindt outpaces chocolate peers
- Kerry cools claim spreads move could hit jobs
- Pork Farms buys Kerry Group's pastry plants
- Profits up at chocolate group Lindt
- Japan's Sanyo takes stake in Olam's food biz
- Arla confirms extent of job cuts after Russia ban