Kroger Profit Boosted By Higher Sales

Kroger Co.'s recent expansion of online ordering services and other services has been rewarded in higher sales leading to a fiscal first-quarter profit rise of 9.8%.

Thursday's report has led to shares rising by almost 3% during morning trading.

Wall Street expectations for the supermarket chain have been exceeded with earnings reaching $680 million - equating to 70 cents per share. Zacks Investment Research had predicted 69 per cents per share according to a mean estimate based on 13 analysts.

Meanwhile, while Zacks predicted revenue of $34.66 billion (based on 8 analysts), revenue for the period actually rose to $34.6 billion - an increase of 4.7%.

At the same time, there was a same-store sales rise of only 0.4%, or 2.4% excluding fuel centers.

Full-year earnings are predicted by Kroger to be in the region of $2.19 - $2.28 per share.

Expansion over the last year has been helped by the purchase of the Midwest grocer Roundy's for around $178 million. The Cincinnati-based retailer now operates 1.387 fuel centers as well as 2,778 food stores such as Fred Meyer, Ralphs, King Soopers, Ralph and other brands.

There has been a 15% decrease in Kroger shares this year to date despite an increase of more than 1% on the Standard & Poor's 500 index.