KROGER SALES UP DURING PERIOD OF ACQUISITIONS

CINCINNATI -- Kroger Co. here said it "remains comfortable" with its projections to achieve $40 million in synergy savings by the end of the fiscal year.

27, is proceeding smoothly, with "tremendous progress at all levels of the organization."

Signs of that progress include the introduction of Fred Meyer's three-tiered private-label strategy; the conversion of 35 units of Smith's Food & Drug Centers in Phoenix and Tucson, Ariz., to the Fry's Food Stores banner, and the conversion of 14 of the 41 stores in Northern California that Kroger acquired from Albertson's, Boise, Idaho.

For the 13-week second quarter ended Aug. 14, Kroger said sales rose 6.2% to $10.3 billion; for the half ending Aug. 14, sales rose 5.6% to $23.8 billion, excluding sales from divested stores and adjusting for a change in Kroger's fiscal calendar. Comparable sales rose 3.6% for the quarter, excluding stores that changed names during the past year.

Net income fell 53.5% to $46 million for the quarter and totaled $253 million for the half, compared with a loss in 1988. The company said net income included after-tax merger costs of $146.5 million for the quarter and $170 million for the half.