Kroger expanded its market share in fiscal 2020, catching double-digit sales and triple-digit e-commerce sales growth in the fourth quarter and year-round Wall Street in both periods. Earning expectations.
Kroger said Thursday that in the quarter ended Jan. 30, total revenue was $ 30.73 billion, an increase of 6.4% from $ 28.89 billion in the same period last year. Excluding fuel and spare parts, sales increased by 10.7%. The Cincinnati supermarket giant reported that same sales increased 10.6% during the quarter, excluding fuel and parts.
In fiscal year 2020, Kroger’s sales increased by $ 10 billion. The company said total sales were $ 132.5 billion, an increase of 8.4% from $ 122.29 billion in 2019. Excluding fuel sales and disposal, the increase was 14.2%. Excluding natural gas and adjustments, same sales increased 14.1% year-on-year.
ID card sales grew double digits in the fourth quarter and the full year, while revenue for the 2019 fiscal quarters was 2%.
“2020 is the final year of our three-year transformation plan, Restock Kroger. During this time, we made strategic investments and changed the business model to better serve our customers. We focus on expanding and deepening our competitive advantages, including seamless , Personalization, Freshness and Branding. As a result, we have built strong momentum and have managed to change the location of our business to serve our customers in new and exciting ways, ”Kroger President and CEO Rodney McMullen told analysts during a conference call on Thursday.
“Kroger has delivered impressive results in the fourth quarter and in 2020. We continue to gain market share and our annual results exceed expectations we shared with you in the fourth quarter,” said McLaren. As customers continue to improve their travel schedules and spend more on each transaction, annual fuel-free sales are flat at 14.1%. Thanks to the quick and effective adjustments our team made during the first phase of the epidemic to ensure that customers are satisfied, the ability to claim securely and easily, and contactless purchases, we will increase our digital sales by three digits in 2020 . Contact details. Our excellent digital performance also demonstrates our foresight in the network over the years, enabling Kroger to respond flexibly to this crisis and critical moment.
Digital sales grew by 118% in the fourth quarter of 2020 and by 118% for the full year, with online grocery delivery services providing a significant boost. By the end of the year, Kroger had 2,223 pick-up locations and 2,472 delivery locations, accounting for 98% of households in its market area.
“During the quarter, transportation and delivery continued to grow, and we saw more and more new customers join our streamlined ecosystem. According to McMullan, our total digital sales are up 118%, including a 249% increase in revenue in the quarter. ” “ While in-store and online at the same time, we found a retention rate in the ecosystem of 98%, which indicates how strict our obligations to customers are. Over the quarter, we continued to improve cost efficiency and the mix of sales and retail media and also saw further improvements in digital profitability.
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Kroger has also reached a milestone in its multi-channel strategy: the first online order processed through the Customer Happiness Center (CFC) with Ocado support. The first automated CFC facility, located in Monroe, Ohio, covers an area of 335,000 square feet and is expected to be operational in early 2021. So far, as part of its partnership with Ocado, Kroger has announced 10 CFC sites. . United Kingdom. It opened in May 2018, stating that 20 facilities will be opened in the United States.
“Yesterday, we completed our first order with our first Ocado warehouse in Ohio. This marks the smooth opening of the facility and we look forward to the grand opening in early April,” McMullen said by phone. “As we open more facilities, we will bring more experience to customers in the three states and across the country, and we are very excited.”
McKellen stated that our brand is Kroger’s private brand, with sales exceeding $ 26.2 billion and an increase of 13.6% by 2020, marking its “best year ever”. The 5-year-old Simple Truth has sold over $ 1 billion.
He said, “As more and more people continue to cook at home and improve their diets, the brand’s high-end culinary products have grown by 20%.” “Simple Truth launched 53 plant-based platform in 2020. New products One of the major releases for this year is Simple Truth oat milk ice cream. This product line brings new customers into the category, and sales continue to exceed expectations. Like other product portfolios of our brand As a result, 1.4 million new families made purchases on the Simple Truth plant-based platform this year, due to our tastes and experience that we kept at a high level. Our test rate continues to grow, and our restart rate continues to increase. ”
Other highlights for fiscal year 2020 include cost savings of over $ 1 billion for the third year in a row, and $ 150 million in operating profits from alternative companies such as retail media, financial services, CPG data analysis, and partnerships.
“Alternative earnings are still an important growth engine for our model. In addition to the additional profits of $ 100 million in 2019, they also contributed $ 150 million. Additional operating profit,” Chief Financial Officer Gary Millerchip said in a call with an analyst. Retail media has contributed to this growth, and we continue to see great opportunities for further growth in the future.Most importantly, along with cost savings and the growth of retail media, this progress also allows us to increase the profitability of digital models in 2020, We reduce the cost of fulfilling digital demands and increase the company’s media revenue.
In the fourth quarter, the full-year adjusted earnings per share was better than street earnings
In this context, Kroger reported a net loss of $ 77 million (attributable to the company) for the fourth quarter of FY2020, or a loss of 10 cents per share, compared to a net income of $ 327 million a year earlier, representing the diluted earnings. Per share is 40 cents. . The annual net profit (attributable to Kroger) was $ 2.56 billion, or $ 3.27 per diluted share, in contrast, the net profit for the fiscal year 2019 was $ 1.66 billion, or $ 2.04 per diluted share.
Kroger noted that the fourth-quarter and fiscal 2020 earnings results reflect $ 989 million of pre-tax expenses related to Food and Commercial Workers’ Union pension liabilities and other adjustments, which negatively impact earnings. ) The price is 91 cents. And 20 cents. On a revised basis, Kroger announced its fourth-quarter net income of $ 630 million, or 81 cents per diluted share, and its net income for fiscal year 2020 of $ 2.74 billion, or 3.47 diluted earnings per share. The revised result for 2019 is $ 462 million (57 cents per diluted share). Involved). Quarterly revenue was $ 1.79 billion (diluted earnings per share of $ 2.19).
According to data from Refinitiv, analysts expect, on average, Kroger’s adjusted earnings per share for the fourth quarter of fiscal 2020 to be 69 cents, with an estimated range of 62 cents to 73 cents. The consensus forecast for the full year is that the adjusted earnings per share will be $ 3.36, ranging from $ 3.31 to $ 3.40.
For fiscal year 2021, the Kroger Project revised earnings per share from $ 2.75 to $ 2.95, and the same sales (excluding fuel) decreased 3% to 5%, which would deliver huge gains in 2020 due to the coronavirus. the crisis. According to data from Refinitiv, analysts expect adjusted average earnings per share in 2021 to be $ 2.69, which is estimated between $ 2.48 and $ 2.85.
“Looking forward to 2021, we will provide specific guidance to help you better understand how our business is presented today. Given the uncertainty surrounding food and local market trends after the implementation of the COVID vaccine, the range we share is larger than the scope we have is usually shared more broadly, and with As the year progresses, more information will be shared to maintain transparency. ” Melchip told analysts on a conference call. “Our knowledge shows that many changes to consumers have occurred during the pandemic, and these changes will prove to be more structured and enduring. Combined with robust implementation and our flexible financial model, we are confident that we can manage to overcome the current uncertainty.”