Kroger same-store sales jump 5.8%, raises full-year guidance

Shoppers sticking to at-home dining trends led to a big jump in Kroger's private-label brand sales, up 10.2%, as well as a 5.8% increase in same-store sales overall during the second quarter, the Cincinnati-based grocer reported Friday. 

Sales for the second quarter, which ended Aug. 13, were $34.6 billion, compared to $31.7 billion for the same period last year, Kroger said. Excluding fuel, sales increased 5.2% compared to the same period last year.

As a result of the grocer’s strong quarter, Kroger raised its full-year guidance, saying it now expects same-store sales growth without fuel to be in the range of 4.0% to 4.5%, and adjusted net earnings per diluted share to be in the range of $3.95 to $4.05, which is higher than its prior outlook of $3.85 to $3.95. 

“Our second quarter results provide another proof point that Kroger has the right go-to-market strategy. Our consistent execution of this strategy is building momentum in our business which, combined with sustained food at home trends, gives us the confidence to raise our full-year guidance,” CFO Gary Millerchip said in a statement.

Kroger’s initiatives focusing on fresh food and digital growth continue to position the grocer for long-term sustainable growth as digital sales grew 8% during the second quarter and delivery sales were up 34% over last year, the company said. The delivery increase was due to strong performance of the retailer's Kroger Boost membership program and the expansion of its customer fulfillment centers, the company said. 

The grocer during the second quarter opened new fulfillment centers near Denver and in Romulus, Michigan, along with seven new "spoke" facilities, which serve as last-mile cross-dock locations. Spokes opened in Louisville, Nashville and Chicago, as well as in new markets of Austin; Birmingham, Alabama; Oklahoma City and San Antonio, Kroger said.

“We will continue to focus on providing affordable, fresh food to our customers, investing in wages and the associate experience, and creating zero-hunger, zero-waste communities because when we do those things well, we deliver attractive and sustainable shareholder returns," Chairman and CEO Rodney McMullen said in a statement.