`

Kroger shares dive after grocer suffers disappointing quarter

March 7, 2019

Shares of Kroger Co. fell sharply Thursday morning after the grocer's costly modernization plan dragged down profit during the fourth quarter.

The Cincinnati-based chain reported a profit of $259 million, or 48 cents per share, in the quarter. That's down from last year's fourth-quarter profit of $854 million. Per-share earnings were 4 cents short of Wall Street expectations, according to a survey by FactSet.

Kroger shares fell more than 12 percent in the worst day of trading this year.

In 2018, Kroger initiated a three-year plan to increase digital sales, redesign stores and invest in popular store brands.

Kroger invested $3 billion last year and expects to at least match that this year.

But sales dropped 9.5 percent in the final three months of the year, to $28.1 billion, which was also short of analyst projections.

The company operates about 2,800 stores in 35 states and the District of Columbia, serving almost 9 million people daily through two dozen different grocery chains.

Kroger is the biggest grocery player in the Indianapolis-area market, according to 2017 data from Chain Store Guide, with more than 50 stores and a market share approaching 40 percent, well ahead of Walmart's 24 percent share and Meijer's 12 percent share.

The company predicted a full-year profit in a range of $2.15 to $2.25 a share for 2019, below analysts’ average estimate of $2.28.

ADVERTISEMENT

Recent Articles by Associated Press

Comments powered by Disqus