On June 26, Kroger
- Management attributed the 6.7% increase in sales to the strengthened relationship-building their associates are forming with their shoppers.
- The company recently initiated a $1 billion dollar stock-repurchase program to increase shareholder value. The buyback will be funded with free cash flow.
- A labor dispute at its Louisville, Ky., distribution center shaved $0.02 off earnings per share.
- A 2% rise in product costs left margins virtually unchanged. Management advised that consumers should expect higher prices from this increase in cost.
(Figures in millions, except per-share data.)
Income Statement Highlights
|
Q1 2007 |
Q1 2006 |
Change |
|
|---|---|---|---|
|
Sales |
$20,725.6 |
$19,415.2 |
6.7% |
|
Net Profit |
$336.6 |
$306.4 |
9.9% |
|
EPS |
$0.47 |
$0.42 |
11.9% |
|
Diluted Shares |
715.0 |
728.8 |
(1.9%) |
Get back to basics with the income statement.
Margin Checkup
|
Q1 2007 |
Q1 2006 |
Change* |
|
|---|---|---|---|
|
Gross Margin |
23.6% |
24.5% |
(0.9) |
|
Operating Margin |
3.3% |
3.3% |
0.0 |
|
Net Margin |
1.6% |
1.6% |
0.0 |
Margins are the earnings engine.
Balance Sheet Highlights
|
Assets |
Q1 2007 |
Q1 2006 |
Change |
|---|---|---|---|
|
Cash + ST Invest. |
$188.5 |
$659.5 |
(71.4%) |
|
Accounts Rec. |
$719.2 |
$696.4 |
3.3% |
|
Inventory |
$4,695.7 |
$4,443.6 |
5.7% |
|
Liabilities |
Q1 2007 |
Q1 2006 |
Change |
|---|---|---|---|
|
Accounts Payable |
$3,863.7 |
$3,563.7 |
8.4% |
|
Long-Term Debt |
$5,176.8 |
$6,443.1 |
(19.7%) |
The balance sheet reflects the company's health.
Cash Flow Highlights
|
YTD 2007 |
YTD 2006 |
Change |
|
|---|---|---|---|
|
Cash From Ops. |
$1,109.0 |
$983.9 |
12.7% |
|
Capital Expenditures |
$607.6 |
$420.0 |
44.7% |
|
Free Cash Flow |
$501.4 |
$563.9 |
(11.1%) |
Free cash flow is a Fool's best friend.
Related Foolishness:
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