Our customers ‘really enjoy it’

Kroger CEO Rodney McMullen said the epidemic spike in food prices was reducing on Friday, while home cooking continues to prevail even as coronovirus conditions improve.

“As we look forward, we see lower inflation for the last several months. This is one of the reasons why we didn’t go through all the rounds of inflation in the second quarter,” he said. Closing bell. ”

“When you look at meat in particular, and some of those areas, … we don’t see inflation the way it was earlier in the year because the plants come back,” he said. “There is a supply of a lot of raw materials. It’s just a matter of plants being able to process it.”

On the other hand, McMullen said he believed the outbreak of the Kovid-19 had led to an increase in cooking – as the restaurant was forced to close its dining room and lockdown orders forced families to stay home Kept – will end the health crisis.

“When we talk to our customers, what they tell us – and it’s fascinating – is that if they have a young child, they like to cook with their children, and that’s something that they do together Likes to do. If they have older children, it’s good to say, ‘Well, let’s really enjoy the time together,’ “said McMullen, whose comments followed Kroger’s strong earnings report on Friday .

“So everything we can see, it’s something that will be a long-term trend because people, one, learned how to cook and two, they found that they really enjoy it. And the other thing that is special Is, that is when families have food. A family, they live together. Children don’t get into much trouble. Those kinds of things, “he said. “But for us the thing that gives us the most enthusiasm, our customers are telling us that they really enjoy it.”

The Cincinnati-based grocery reported earnings before the bell rang on Friday, which left Wall Street expectations up and down the lines. Analysts checked for $ 30.49 billion, when analysts were looking for $ 29.95 billion. Earnings per share of $ 0.73 beat the forecast of $ 0.55.

A customer walks by the path of frozen food inside a Kroger Company grocery store in Louisville, Kentucky.

Luke Sharrett | Bloomberg Getty Images

Shares of Kröger closed down 1.07% at $ 34.37 on Friday. The stock market has grown widely this year, rising 18.61% so far in 2020. The S&P 500 is slightly over 3% at the time.

Reflecting optimism about the continued demand for groceries, Kroger increased its guidance and indicated that it expects same-store sales, excluding fuel, to increase by more than 13% for the year. It is above its previous forecast of over 2.25%.

Kroger saw its online sales grow 127% in the quarter, building on a 92% increase that was reported in the quarter as the coronovirus epidemic intensified throughout the US.

Earlier this month, Walmart announced that it was launching a paid subscription service, called Walmart +, with grocery delivery being its key component. Walmart is the nation’s largest groceries, while Kroger is the nation’s largest supermarket chain.

McMullen said that Kroger’s digital grocery offering, which he had been investing in before the epidemic, stands apart from its rivals. ‘

“For us, it’s a total total experience … One of the reasons our digital business is strong is personal things. We do incredibly well on fresh. Customers tell us and they expect our fresh really I’m good at, and good relative to our competition, and that’s really with all of those things, “he said.