RNDY

By Chelsey Dulaney 

Kroger Co. on Thursday lifted its earnings outlook for the year again as third-quarter profit grew more than expected on controlled expenses and strong core sales growth.

Shares added 3% to $39.25 in premarket trading.

The country's second-largest U.S. food retailer by sales after Wal-Mart Stores Inc. operates around 2,620 supermarkets under banners including its namesake, City Market and Harris Teeter.

Kroger's sales of natural and organic products have been soaring as it makes greater inroads into markets traditionally dominated by specialty grocers such as Whole Foods Market Inc. The company recently agreed to buy Wisconsin-based supermarket chain Roundy's, which includes a Chicago-centered unit with highly regarded perishables operations.

In the latest quarter, sales at supermarkets open at least a year rose 5.4%. That is off slightly from last year's 5.6% growth, but above the 4.5% increase analysts polled by FactSet expected.

Overall, Kroger reported a profit of $428 million, or 43 cents a share, up from $362 million, or 36 cents a share, a year earlier.

Revenue edged up to $25.1 billion from $25 billion a year earlier.

Analysts anticipated 39 cents in earnings per share and $25.2 billion in sales, according to Thomson Reuters.

Excluding fuel sales, which were impacted by lower prices, sales were up 5.5% over the prior year.

For the year ending in January, Kroger is now expecting earnings of $2.02 to $2.04 per share, up from its previously raised guidance of $1.92 to $1.98 a share.

For its current quarter, Kroger forecast same-store sales growth, excluding fuel, of 4% to 4.5%.

Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com

Subscribe to WSJ: http://online.wsj.com?mod=djnwires

(END) Dow Jones Newswires

December 03, 2015 09:37 ET (14:37 GMT)

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