Kroger 2Q profit rises, helped by lower charge

CINCINNATI (AP) — Kroger reported a higher net income for its fiscal second-quarter as the nation’s largest traditional supermarket operator booked lower charges and worked to build shopper loyalty with improved offerings.

The Cincinnati-based company lifted the low end of its fiscal 2013 outlook for a key sales measurement. Shares edged higher in Thursday morning trading.

Kroger Co. said sales rose 3.3 percent at stores open at least a year during the quarter. The rise was helped by an increase in the number of “loyal” households, which Kroger defines using factors such as how much they spend and how often they visit.

Looking ahead, Kroger now expects the sales figure to increase betwee 3 percent and 3.5 percent for fiscal 2013, excluding fuel. Its previous projection was for an increase in 2.5 to 3.5 percent. Wall Street was forecasting a 3.3 percent gain.

The metric is an important gauge because it strips out the impact of newly opened and closed locations.

For the quarter ended Aug. 17, Kroger earned $317 million, or 60 cents per share. That compared with $279 million, or 51 cents per share, in the 2012 second quarter.

The results were just above the 59 cents per share that analysts polled by FactSet expected, on average.

The latest quarter included an accounting-related charge of $13 million, compared with a $35 million charge in the prior-year period.

Revenue rose 5 percent to $22.72 billion from $21.73 billion, topping Wall Street’s estimate of $22.69 billion.

Kroger still expects full-year earnings in a range of $2.73 to $2.80 per share. Analysts predict earnings of $2.80 per share.

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