(Reuters) -Kroger Co raised its annual same-store sales and profit forecasts on Thursday, riding on steady demand for groceries and household essentials despite higher prices, sending the grocer’s shares up 4.5% in premarket trading.
Grocery retailers have largely been insulated from the impact of decades-high inflation, which has forced consumers to prioritize spending on food and other essentials over discretionary products.
Kroger has also benefited from demand for its store-brand cheese, meats and other groceries as rampant inflation pushes more Americans toward cheaper alternatives.
The U.S. supermarket chain, which is in the process of buying smaller rival Albertsons Cos Inc in a $25 billion deal, forecast adjusted same-store sales growth of 5.1% to 5.3% in fiscal 2022, compared with its prior outlook of a 4% to 4.5% rise.
It forecast annual earnings per share of between $4.05 and $4.15, up from its prior outlook of $3.95 to $4.05.
The company’s same-store sales, excluding fuel, climbed 6.9% in the third quarter, beating estimates of a 4.5% increase, according to IBES data from Refinitiv.
(Reporting by Uday Sampath in Bengaluru; Editing by Shinjini Ganguli)
