|
Quotes & Info
|
| KR > SEC Filings for KR > Form 8-K on 15-Sep-2009 | All Recent SEC Filings |
15-Sep-2009
Results of Operations and Financial Condition, Regulation FD Disclosure, Financial Stat
On September 15, 2009, the Company released its earnings for second quarter 2009. Attached hereto as Exhibit 99.1, and filed herewith, is the text of that release.
2009 Guidance:
Identical supermarket sales 3 - 4%, assuming product costs for the
growth (excluding fuel sales) remainder of fiscal 2009 are consistent with
or slightly lower than they were in the
second half of fiscal 2008
Net earnings per diluted share $1.90 - $2.00
Non-fuel operating margin Slightly declining, excluding the benefit of
an expected lower LIFO charge
Capital expenditures $1.9 - $2.1 billion, excluding acquisitions
and purchases of leased facilities. These
capital projects include approximately 45 -
55 major projects covering new stores,
expansions and relocations, and 140 - 170
remodels, and other investments to support
our Customer 1st business strategy.
Supermarket square footage growth 1.5 - 2.0% before acquisitions and
operational closings, with an emphasis on
large, fast-growing markets
Expected tax rate Approximately 36.5%
Fuel margins Our guidance for fiscal 2009 assumes a more
normalized fuel margin of 11¢ per gallon as
well as continued strong growth in gallons
sold.
LIFO $70 million, based on our forecast of 1% to
2% inflation for the year. This particular
inflation forecast is based on cost changes
for products in our inventory and is used
for our LIFO calculation.
Pension Contributions/Expenses Company-sponsored pension plans
We expect 2009 expense to be comparable to
|
2008. We contributed $200 million to these plans in February 2009 and an additional $65 million in September 2009. We do not expect to make additional contributions to these plans during the remainder of 2009.
401(k) plan For 2009, we expect a slight increase in our cash contributions and expense compared to 2008.
Multi-employer plans In 2008, we contributed approximately $220 million to these pension funds. This amount is not expected to grow significantly in 2009, but over the course of the next several years, contributions to pension funds are expected to increase.
Labor:
We have negotiations this year covering store associates in Arizona, Atlanta, Dallas, Denver and Portland. Negotiations this year will be challenging as we must have competitive cost structures in each market while meeting our associates' needs for good wages and affordable health care, and we must address the underfunding of Taft-Hartley pension plans.
Our ability to achieve sales and earnings per share goals may be affected by:
labor disputes, particularly as the Company seeks to manage health care and
pension costs; industry consolidation; pricing and promotional activities of
existing and new competitors, including non-traditional competitors; our
response to these actions; the state of the economy, including interest rates
and the inflationary and deflationary trends in certain commodities; weather
conditions; stock repurchases; the success of our future growth plans; goodwill
impairment; unexpected changes in product costs; and our ability to generate
sales at desirable margins, as well as the success of our programs designed to
increase our identical sales without fuel. In addition, any delays in opening
new stores, or changes in the economic climate, could cause us to fall short of
our sales and earnings targets. Our ability to increase identical supermarket
sales could be adversely affected by increased competition and sales shifts to
other stores that we operate, as well as increases in sales of our corporate
brand products. Our guidance for identical supermarket sales growth excluding
fuel assumes product costs for the remainder of fiscal 2009 are consistent with
or slightly lower than they were in the second half of fiscal 2008. Our guidance
for LIFO is based on our forecast of 1% to 2% inflation for the year, which
inflation forecast is based on cost changes for products in our inventory. Our
estimate of product cost changes could be affected by general economic
conditions, weather, availability of raw materials and ingredients in the
products that we sell and their packaging, and other factors beyond our control.
Our non-fuel operating margin guidance could change if we are unable to pass on
any cost increases, if our strategies fail to deliver the cost savings
contemplated, or if changes in the cost of our inventory and the timing of those
changes differ from our expectations. Our LIFO charge and the timing of our
recognition of LIFO expense will be affected by changes in product costs during
the year. Our fuel margins could fail to normalize at 11¢ per gallon if the
pattern of rapid changes in fuel costs continues. Our capital expenditures, and
the number of projects that we
complete, could vary from our expectations if we are unsuccessful in acquiring suitable sites for new stores; development costs exceed those budgeted; or our logistics and technology or store projects are not completed on budget or in the time frame expected. Square footage growth during the year is dependent upon our ability to acquire desirable sites for construction of new facilities, as well as the timing of completion of projects. Any change in tax laws, the regulations related thereto, the applicable accounting rules or standards, or the interpretation thereof by federal, state or local authorities could affect our expected tax rate. Should asset values in the multi-employer pension funds further deteriorate, or if employers withdraw from these funds without providing for their share of the liability, or should our estimates prove to be understated, our contributions could increase more than we have anticipated. The actual amount of cash contributions to our 401(k) Retirement Savings Account Plan will depend on the number of employees who participate and the level of their participation.
(d) Exhibits.
99.1 Earnings release for second quarter 2009, filed herewith.
|
|