SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: July 17, 1996
THE KROGER CO.
(Exact name of registrant as specified in its charter)
An Ohio Corporation No. 1-303 31-0345740
(State or other jurisdiction (Commission File (IRS Employer
of incorporation) Number) Number)
1014 Vine Street
Cincinnati, OH 45201
(Address of principal
executive offices)
Registrant's telephone number: (513) 762-4000
Item 5. Other Events
- ------- ------------
On July 17, 1996, the Company released its earnings
for the second quarter 1996 in the form attached
hereto as Exhibit 99.1.
Item 7. Financial Statements and Exhibits
- ------- ---------------------------------
(c) Exhibits
99.1 Other Exhibits--Earnings Release for
Second Quarter 1996
<PAGE>
SIGNATURE
---------
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned hereto duly authorized.
THE KROGER CO.
July 17, 1996 By (Paul W. Heldman)
Paul W. Heldman
Vice President,
Secretary and General
Counsel
<PAGE>
EXHIBIT INDEX
-------------
Exhibit
- -------
99.1 Other Exhibits--Earnings Release for Second Quarter
1996
Exhibit 99.1
----------------
CINCINNATI, Ohio, July 17, 1996 --- The Kroger Co. (NYSE:
KR) said today that earnings before an extraordinary charge in
the 1996 second quarter declined to $78.4 million, or 60 cents
per share, from $82.5 million, or 67 cents per fully diluted
share, in the 1995 second quarter. The decline was
attributable to the effect of a 44-day strike during the
quarter at the Company's King Soopers division in Colorado.
Kroger said the strike reduced second quarter earnings by
approximately 13 cents per share before the extraordinary
charge. The Company said operations at King Soopers are
returning to normal. The strike will reduce third quarter
results by a substantially smaller amount than in the second
quarter.
Operating cash flow -- earnings before interest, taxes,
depreciation, and LIFO -- totaled $285.8 million in the 1996
second quarter, compared to $292.1 million for the same period
in 1995. Excluding the effects of the King Soopers strike,
operating cash flow would have been approximately $314.5
million.
After the extraordinary charge for the early retirement
of debt, net earnings in the second quarter were $77.6
million, or 59 cents per share, versus $77 million, or 63
cents per fully diluted share, in the comparable 1995 quarter.
Total sales in the quarter increased 3.4 percent to $5.84
billion from $5.65 billion. Identical store sales, excluding
King Soopers, increased 0.6 percent over the prior year's
second quarter, reflecting the impact of Kroger's aggressive
storing program and increased competition in some markets.
Comparable store sales, which include results from expanded
and relocated stores, increased 3.2 percent, excluding King
Soopers. During the quarter, Kroger opened or expanded 21
stores, compared with 15 openings and expansions in the 1995
second quarter.
Joseph A. Pichler, Chairman and Chief Executive Officer,
said that Kroger's second quarter performance -- excluding the
effect of the King Soopers strike -- compared well with last
year's record results. "Despite increased competition and a
major work stoppage, Kroger's overall results reflect the core
strengths of the Company. "We continue to benefit from
Kroger's leading market share in our major markets, working
capital discipline, the favorable impact of new technologies
on costs, and the strong performance of new stores," Pichler
said.
The King Soopers strike ended in late June when employees
of the 68-store division ratified a new three-year contract.
Pichler noted that the contract, which contains important
improvements in work rules and health care costs, moves King
Soopers toward greater competitive parity in the Denver and
Colorado Springs markets. "We entered negotiations with the
goal of achieving a solid long-term competitive footing in one
of our most important markets. That goal was achieved,"
Pichler said.
Net interest expense declined in the second quarter to
$70.5 million from $74.6 million. Net long-term debt declined
by $148.5 million to $3.5 billion.
<PAGE>
THE KROGER CO.
SALES AND EARNINGS
2nd Qtr 2nd Qtr Percent
1996 1995 Change
6/15/96 6/17/95
_______ _______ _______
Sales $5,844,365,872 $5,652,889,819 3.4
============== ==============
EBITD <F1> $ 285,820,148 $ 292,056,365 -2.1
Non-EBITD
charges <F2> $ (4,000,000) $ (3,461,538)
LIFO $ (3,500,000) $ (3,500,000)
Interest $ (70,522,642) $ (74,638,817)
Depreciation $ (80,354,023) $ (73,405,372)
_______________ _______________
Pre-tax earnings
before extraordinary
loss $ 127,443,483 $ 137,050,638
Tax expense $ (49,065,741) $ (54,586,317)
________________ ________________
Earnings before
extraordinary
loss $ 78,377,742 $ 82,464,321
Extraordinary
loss <F3> $ (765,601) $ (5,451,458)
________________ ________________
Net earnings $ 77,612,141 $ 77,012,863
================= =================
Primary earnings per
common share:
From operations
$ 0.60 $ 0.71
From extraordinary
loss <F3> $ (0.01) $ (0.05)
__________________ __________________
Primary net earnings
per common share
$ 0.59 $ 0.66
================== ===================
Fully diluted earnings
per common share:
From operations
$ 0.60 $ 0.67
From extraordinary
loss <F3> $ (0.01) $ (0.04)
__________________ __________________
Fully diluted net earnings
per common share
$ 0.59 $ 0.63
================== =================
Number of shares
used in primary per share
calculation:
131,144,299 115,390,904
Number of shares
used in fully diluted per share
calculation:
131,144,299 126,637,750
2Qtrs 2Qtrs
1996 1995
6/15/96 6/17/95
Sales $11,628,619,682 $11,117,844,200 4.6
================ ================
EBITD <F1> $ 563,963,236 $ 548,933,855 2.7
Non-EBITD
charges <F2> $ (8,000,000) $ (6,923,076)
LIFO $ (7,000,000) $ (7,000,000)
Interest $ (141,148,561) $ (149,962,768)
Depreciation $ (155,997,159) $ (142,246,336)
________________ ________________
Pre-tax earnings before
cumulative effect adjustment and
extraordinary loss
$ 251,817,516 $ 242,801,675
Tax expense $ (96,949,743) $ (95,860,947)
________________ _________________
Earnings before
cumulative effect adjustment and
extraordinary loss
$ 154,867,773 $ 146,940,728
Extraordinary
loss <F3> $ (1,849,715) $ (10,787,240)
________________ __________________
Net earnings $ 153,018,058 $ 136,153,488
================ ===================
Primary earnings (loss) per
common share:
From operations
$ 1.19 $ 1.28
From extraordinary
loss <F3> $ (0.01) $ (0.09)
________________ ____________________
Primary net earnings
per common share
$ 1.18 $ 1.19
================ ====================
Fully diluted earnings
(loss) per common share
From operations
$ 1.18 $ 1.19
From extraordinary
loss <F3> $ (0.01) $ (0.09)
________________ ___________________
Fully diluted net earnings
per common share
$ 1.17 $ 1.10
================= ====================
Number of shares used in
primary per share
calculations 130,670,428 115,191,270
Number of shares used in
fully diluted per share
calculations 130,877,501 126,458,520
__________________________
[FN]
<F1> EBITD represents pre-tax earnings before interest,
depreciation and LIFO as defined in the Company's Bank
Credit Agreement.
<F2> Represents the additional quarterly charge from the
adoption of FASB 106.
<F3> Represents the after-tax loss from the early retirement
of debt.
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