Grocery giant Kroger Co. had signaled that its third-quarter 2020 report would deliver excellent earnings. And when the company released its Q3 results on Thursday (Dec. 3), it did highlight that its online sales shot up 108 percent. The company also raised its full-year guidance on how it expects to perform.
In late October, Cincinnati-based Kroger said its “Restock Kroger” plan would generate consistent shareholder returns. Restock Kroger is the company’s program that aims to improve shipping, distribution and the links between its online and offline businesses.
In the earnings announcement, Chairman and CEO Rodney McMullen said the company had continued to execute on its “Restock transformation.” He pointed to total company sales, which hit $29.7 billion in the third quarter, up from $28 billion for the same period last year.
Earnings per share (EPS) reached $.80, up from $.32. Q3 operating profit hit $792 million, up from $254 million the previous year.
The company added that it has made “continued investments to support and safeguard associates, customers and communities, nearly $1.3 billion since March.”
The announcement also pointed to the company’s stock buyback program: “During the quarter, Kroger repurchased $304 million of shares under its $1 billion board authorization announced on Sept. 11, 2020. Year-to-date, Kroger has repurchased $989 million of shares.”
“As a result of our continued strong performance, market share growth and the expectation of sustained trends in food-at-home consumption for the remainder of our fiscal year, we are raising our full-year 2020 guidance,” said Kroger’s CFO Gary Millerchip. “For the full year 2020, we expect total identical sales without fuel to be around 14 percent and adjusted EPS growth of 50 percent to 53 percent.”
In the third quarter, excluding fuel and dispositions, sales grew 11.3 percent.
One year ago, McMullen said the Restock Kroger program was focusing on a number of different areas. For example, it involves redefining the grocery environment and enhancing the customer connection by creating an experience that is easy and intuitive.
In the great turn toward eCommerce, McMullen said the company’s stores hold a competitive advantage. He added that the company is “using our data to drive personalization,” and that Kroger has generated more than $1 billion in cost savings in each of the last two years.
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