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Kroger Co. Q4 net earnings $0.57 per diluted share

Staff writer |
The Kroger Co. reported fourth quarter net earnings of $0.57 per diluted share and identical supermarket sales growth, without fuel, of 3.9%.

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Including six weeks of Roundy's results, identical supermarket sales growth without fuel was 3.7%. Fiscal 2015 net earnings were $2.06 per diluted share and identical supermarket sales growth, without fuel, was 5.0%.

Total sales, excluding fuel, increased 6.5% in the fourth quarter over the same period last year. Excluding Roundy's, total sales without fuel increased 4.4% in the fourth quarter. Total sales including fuel and Roundy's increased 3.8% to $26.2 billion in the fourth quarter compared to $25.2 billion for the same period last year.

Net earnings for the fourth quarter totaled $559 million, or $0.57 per diluted share.

The company recorded a LIFO credit of $30 million in the fourth quarter, compared to a $9 million LIFO charge in the same quarter last year.

FIFO gross margin was 22.7% of sales for the fourth quarter. Excluding retail fuel operations, FIFO gross margin increased 1 basis point from the same period last year.

Total operating expenses – excluding retail fuel operations, Roundy's, a $30 million contribution to the UFCW Consolidated Pension Plan in the fourth quarter of 2015, and a $60 million contribution to The Kroger Co. Foundation and a $55 million contribution to the UFCW Consolidated Pension Plan in the fourth quarter of 2014 – increased 23 basis points as a percent of sales compared to the prior year.

Drivers of this increase included health care and pension costs, as well as chargebacks related to EMV credit card transition during the fourth quarter.

Fiscal 2015 results

Total sales, excluding fuel, increased 6.0% in 2015 compared to 2014. Excluding Roundy's, total sales without fuel increased 5.5% in 2015. Total sales including fuel and Roundy's increased 1.3% to $109.8 billion in 2015 compared to $108.5 billion in 2014.

Net earnings for 2015 totaled $2.04 billion, or $2.06 per diluted share.

Kroger's LIFO charge for 2015 was $28 million, compared to a $147 million LIFO charge in 2014.

FIFO gross margin for 2015, excluding retail fuel operations, declined 4 basis points.

Total operating expenses for 2015 – excluding retail fuel operations, the 2015 and 2014 contributions to the UFCW Consolidated Pension Plan, the 2014 adjustment items, and the 2014 contribution to The Kroger Co. Foundation – decreased 9 basis points as a percent of sales compared to the prior year.

FIFO operating margin for 2015 – excluding retail fuel operations, the 2015 and 2014 contributions to the UFCW Consolidated Pension Plan, the 2014 adjustment items, and the 2014 contribution to The Kroger Co. Foundation – increased 5 basis points compared to the prior year.

On this basis and excluding Roundy's, the increase was 8 basis points compared to the prior year.


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