US: Ralphs charges drive Kroger into red
By: just-food.com | 8 December 2009
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Ralphs California charges hit net income
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Sales drop slightly on 2008
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Increased competition expected to continue
US grocer Kroger posted a net loss of the first three quarters of fiscal 2009 due to charges linked to its Ralphs division - although sales were hurt by deflation and cautious spending from consumers.
For the period ended 7 November, the retailer made a net loss of US$185.4m compared to net earnings of $900m in the comparable period of 2008.
Kroger's figures were dented in the third quarter of its fiscal year when the company recorded impairment charges of $1.05bn linked to a goodwill write-down at its Ralphs division in California.
The charges meant Kroger filed a third-quarter net loss of $874.9m; excluding those costs, the retailer would have booked net earnings of $176.7m. A year earlier, Kroger's third-quarter net earnings were $237.7m.
For the first three quarters of 2009, sales amounted to $58.2bn, a slight drop from the $58.9bn recorded in the prior year.
Excluding fuel sales, total sales increased 3.3% over the same period in the prior year. For the same period, identical supermarket sales, excluding fuel, increased 2.4%.
Kroger said it expects deflation, increased competitive activity and cautious spending to continue to affect its business for the remainder of the year. As a result, the grocer expects full-year identical supermarket sales growth of 2% to 2.5%, without fuel, for fiscal 2009.
For the third quarter, total sales, including fuel edged up to $17.7bn, against $17.6bn a year earlier.
Click here for the full release or check back later for further insight into Kroger's year-to-date results.
Sectors: Retail
Companies: Kroger
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