As its acquisition by The Kroger Co. proceeds, Albertsons Cos. beat Wall Street second-quarter sales and earnings estimates despite a net income decline.
Net income for the quarter was $266.9 million, or 46 cents per diluted share, versus $342.7 million, or 59 cents per diluted share, in the year-prior period, the company reported. Adjusted for one-time charges, net income was $367.7 million, or 63 cents per diluted share, versus $418.3 million, or 72 cents per diluted share, in the year-earlier period.
Adjusted diluted earnings per share beat a Yahoo Finance published analyst consensus earnings estimate of 56 cents and a revenue estimate of $18.28 billion.
Identical sales increased 2.9% as revenues came in at $18.29 billion versus $17.92 billion in the year-before quarter, the company noted. Digital sales gained 19% in the period year over year. The digital sales advance and retail price inflation across most categories were primary contributors to the identical growth, Albertsons pointed out. Loyalty members increased 17% to 37.4 million year over year, according to Albertsons.
Operating income was $454.4 million versus $531 million in the year-previous quarter.
In October 2022, Albertsons entered into an agreement and plan of merger with The Kroger Co. and Kettle Merger Sub. Under the agreement, Kroger through Kettle Merger Sub will acquire all of the outstanding shares of Albertsons’ common stock for $34.10 per share, reduced by the special cash dividend of $6.85 per share paid on January 20. On September 8, Albertsons and Kroger announced that the parties had entered into a definitive agreement with C&S Wholesale Grocers for the sale of select stores, banners, distribution centers, offices and private-label brands.
Vivek Sankaran, Albertsons CEO sad, “During the second quarter, we continued to execute against our ‘Customers for Life’ transformation strategy and drive solid operating results despite increasing macroeconomic headwinds. As we look ahead to the balance of the year, our focus remains the same, advancing operational excellence in our stores, driving growth in our digital and pharmacy operations, and deepening our relationships with our customers. We are also mindful of a more challenging economic backdrop, including declining federal and state government assistance and higher interest rates, and their effects on consumer spending and our business. We also expect slowing food inflation, ongoing labor investment, broad inflationary cost increases and significant declines in COVID-19 vaccination and test kit revenue. We continue to partially offset these headwinds with the benefits of our productivity initiatives.”
