Kroger’s Q1 Led By Better-Than-Expected Grocery Performance
Kroger has reaffirmed its FY2024 guidance, expecting identical sales growth without fuel of 0.25% to 1.75%, adjusted FIFO operating profit of $4.6 to $4.8 billion, and adjusted net earnings per diluted share of $4.30 to $4.50.
While the grocer did not offer an update on its proposed merger with Albertsons Cos., it did recently address concerns that arose during a Health Care Market Oversight (HCMO) Review Board meeting on the merger and divestiture plan with C&S LLC, after the community review board voted to recommend that the Oregon Health Authority (OHA) reject the Kroger-Albertsons merger.
“Fred Meyer and Safeway play a critical role in providing necessary health care services, medicine and healthy food options across the state,” wrote Kroger Health President Colleen Lindholz in the June 12 letter to Dr. Sejal Hathi, of the OHA, in Salem. “We take great pride in having done so for 100 years, fueled by our work force of more than 13,000 associates. As the operator of these beloved banners, we have a responsibility to the communities we serve and take this, along with your concern for the health and well-being of Oregon’s citizens, very seriously.”
Added Lindholz: “We are certain that C&S’ considerable resources and regional expertise, along with the resources it will gain as part of the divestiture package, will position it to successfully operate stores and pharmacies following the merger close.”
Since it was first revealed in October 2022, the proposed merger of two of America’s biggest grocers has been beset by regulatory and legal obstacles, as well as heated opposition from many labor representatives. A hearing date of Aug. 26 has been set by Judge Adrienne Nelson of the U.S. District Court for the District of Oregon regarding the FTC’s request for a preliminary injunction against the deal. Kroger and Albertsons have also taken new steps to get the deal approved, adding 166 more stores to the list of locations to be sold off to C&S, for a total of 579, including the Haggen banner.
Cincinnati-based Kroger is No. 4 on The PG 100, Progressive Grocer’s 2024 list of the top food and consumables retailers in North America. Boise, Idaho-based Albertsons is No. 9 on The PG 100. PG also named Kroger and Albertsons among the Retailers of the Century. Keene, N.H.-based C&S is No. 18 on PG’s list.