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CINCINNATI - Leading supermarket operator Kroger Co. on Tuesday reported lower quarterly earnings, excluding a number of one-time costs mainly from last year, as it cut prices to attract shoppers. The Cincinnati-based retailer also said it now expects 2003 earnings to be essentially unchanged from 2002 rather than rise 10 to 12 percent as originally estimated several months ago.
For the quarter ended Nov. 9, Kroger said earnings, excluding a number of one-time items, slid 6.6 percent to $263.0 million from $281.6 million the year before. Earnings per share were unchanged at 34 cents because of a reduced number of shares outstanding.
After one-time items that included impairment charges and merger costs both this year and last, Kroger's net income rose to $254.6 million, or 33 cents per share, from $133.1 million, or 16 cents per share.
Looking to the fourth quarter, Kroger said it expects earnings to match or slightly exceed its profit from the year before, which totaled 47 cents per share.
"The combination of a weak economy, rising unemployment, product cost deflation and continued aggressive competition has created a difficult operating environment. It is not clear when consumer confidence will improve. In addition, we anticipate that health care and pension costs will increase substantially in 2003," CEO Joseph Pichler said in a statement.
Kroger's stock fell more than 2.5 percent early on Tuesday on the New York Stock Exchange. Other supermarket stocks took another tumble as well.