Kroger raises outlook on strong 1Q results

This Tuesday, June 12, 2012, photo shows a Kroger grocery store in Dearborn, Mich. The Kroger Co. said Thursday, June 14, 2012, its net income edged up slightly in the first quarter as its customer loyalty programs helped drive up revenue. The company also raised its full-year earnings outlook. (AP Photo/Paul Sancya)

This Tuesday, June 12, 2012, photo shows a Kroger grocery store in Dearborn, Mich. The Kroger Co. said Thursday, June 14, 2012, its net income edged up slightly in the first quarter as its customer loyalty programs helped drive up revenue. The company also raised its full-year earnings outlook. (AP Photo/Paul Sancya)

This Tuesday, June 12, 2012, photo shows a Kroger grocery store in Dearborn, Mich. The Kroger Co. said Thursday, June 14, 2012, its net income edged up slightly in the first quarter as its customer loyalty programs helped drive up revenue. The company also raised its full-year earnings outlook. (AP Photo/Paul Sancya)

NEW YORK (AP) ? The Kroger Co. is forecasting a rosier year after the company's customer-loyalty programs helped boost net income in the first quarter.

The nation's largest traditional grocery store chain says it earned $439.4 million, or 78 cents per share, for the three months ended May 19. That compares with $432.3 million, or 70 cents a share, a year ago. The higher per-share figure in the latest quarter was the result of a reduced number of outstanding shares.

Analysts on average expected a profit of 72 cents per share, according to FactSet.

The Cincinnati-based company, which operates Ralphs, Food 4 Less and other grocery stores, also says it authorized a $1 billion share buyback.

For the quarter, Kroger said revenue at stores open at least a year rose 4.2 percent, marking the 34th straight quarter of growth. The figure is a key performance metric because it strips out the effect of newly opened and closed stores.

Total revenue for the quarter was $29.06 billion, up from $27.46 billion but shy of Wall Street expectations of $29.16 billion.

Based on the strong first quarter, the company lifted its outlook for the year to $2.33 to $2.40 per share, up from the previous $2.28 to $2.38 per share. Analysts expected $2.32 per share.

Shares of Kroger were up $1.01, or almost 5 percent, at $22.30, in pre-market trading.

Associated Press

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