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The shares of Albertsons, the grocery retailer (ACI), rose on Wednesday after it reported better earnings for its third quarter than expected. However, sales were just a little short of expectations.
Visible Alpha’s estimates show that Albertsons posted a $400.6-million net profit for the first quarter. That is an increase from $361.18 million at this time last year. The profit on revenues of $18.77 billion was better than $18.56 a year before but still slightly lower than analyst consensus.
Vivek Skaran, CEO of the company said that despite consumers who were not happy with their purchases during this quarter, they delivered a good performance. “remains cautious.”
Albertsons’ outlook also increased slightly for the remainder of fiscal 2024. They expect adjusted earnings-per share (EPS), which will range between $2.25 and $2.31, for the entire fiscal year. This is up from the previous $2.20 to 2.30. Albertsons also decreased the upper end of their projected range of growth in same-store sales to between 1.8% and 2%. This is down from an earlier top end estimate of 2.2%.
The first report since the end of Kroger merger and beginning of lawsuit
This is the first quarter report from the grocery chain since the planned merger of Albertsons with Kroger (KR), which was called off by a judge last month. The Federal Trade Commissions (FTC) sued in early 2013 to block the proposed merger. According to the judges, the merger could lead to higher prices and lower wages as the competition would diminish.
Both companies accuse each other now of breaking their merger agreements. Albertsons, for example, has sued Kroger claiming that it knew the retailer was not doing everything possible, including agreeing with the FTC to solve its concerns by approving the merger.
The two companies also resumed stock-buyback plans after they were temporarily halted in order to concentrate on gaining regulatory approval of the merger.
Albertsons stock was up about 2% by Wednesday.
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