Kroger(US:KR) ZACKS·2025-03-06 18:20Core Insights - Kroger Co. reported fourth-quarter fiscal 2024 results with top-line sales missing estimates while bottom-line earnings exceeded expectations, although both metrics declined year over year [1][3][4] Financial Performance - Adjusted earnings per share were $1.14, beating the Zacks Consensus Estimate of $1.12, but down from $1.34 in the previous year [3] - Total sales were $34,308 million, a decrease from $37,064 million in the year-ago period, impacted by a $2.7 billion effect from the 53rd week in 2023 and a $737 million decline from Kroger Specialty Pharmacy sales [4] - Excluding fuel, Kroger Specialty Pharmacy, and the extra week in 2023, sales grew by 2.6% year over year, with identical sales without fuel rising by 2.4% [5] Margin and Profitability - Gross margin was 22.7% of sales, influenced by the sale of Kroger Specialty Pharmacy and lower shrink, partially offset by lower pharmacy margins [6] - Adjusted FIFO operating profit was $1,174 million, down from $1,307 million reported in the year-ago period [7] Balance Sheet and Cash Flow - Kroger ended the quarter with cash of $216 million, total debt of $17,905 million, and shareholders' equity of $8,281 million, with net total debt increasing by $3,584 million over the last four quarters [8] - The company guided capital expenditures between $3.6 billion and $3.8 billion and expects to generate adjusted free cash flow of $2.8 billion to $3 billion in fiscal 2025 [8] Future Outlook - For fiscal 2025, Kroger anticipates identical sales without fuel to increase between 2% and 3%, with adjusted earnings projected to be between $4.60 and $4.80 per share compared to $4.47 in fiscal 2024 [9] - Management expects an adjusted FIFO operating profit of $4.7 billion to $4.9 billion for fiscal 2025, consistent with the $4.7 billion reported in fiscal 2024 [9] Stock Performance - Kroger's shares have risen by 12.5% over the past three months, outperforming the industry growth of 2.6% [10]