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: January 23, 1997
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
<PAGE>
Item 5. Other Events
- ------- ------------
On January 23, 1997, the Company released its
earnings for the Fourth Quarter and Fiscal Year 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
Fourth Quarter and Fiscal Year 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.
January 23, 1997 By: (Paul W. Heldman)
------------------
Paul W. Heldman
Vice President,
Secretary and
General Counsel
EXHIBIT INDEX
-------------
Exhibit
- -------
99.1 Other Exhibits--Earnings Release for Fourth Quarter
and Fiscal Year 1996
KROGER 4TH QTR OPER NET PER SHARE:
95 CENTS VS 84 CENTS
CINCINNATI, Ohio, January 23, 1997 --- The Kroger Co.
(NYSE: KR) said today that 1996 fourth quarter net earnings
before an extraordinary item rose 15 percent to $125.5 million
from $109.2 million in the 1995 fourth quarter. On a fully
diluted per share basis, net earnings before the extraordinary
item rose 13 percent to 95 cents from 84 cents.
Kroger's fourth quarter and full-year results set records
for sales, operating cash flow, and earnings per share.
Fourth quarter operating cash flow -- pre-tax earnings
before interest, depreciation, LIFO, and extraordinary items -
- - rose 12 percent to $353.6 million from $314.9 million.
Total Company sales in the quarter increased 5.8 percent
to a record $6.2 billion from $5.9 billion in the 1995 fourth
quarter. Identical food store sales rose 0.5 percent despite
a less favorable holiday calendar. Comparable store sales,
which include relocations and expansions, were up 4 percent in
the quarter.
For 1996, earnings before the extraordinary item were
$352.7 million, or $2.67 per fully diluted share, compared to
$318.9 million, or $2.50 per share, in 1995. Full year
operating cash flow rose to $1.241 billion from $1.163
billion. Total 1996 Company sales were a record $25.2
billion, a 5.2 percent increase.
Kroger Chairman and Chief Executive Officer Joseph A.
Pichler said the Company's fourth quarter and full year
results reflected consistent improvement in sales, earnings
and operating cash flow.
"Competitive new store openings during 1996 were as
strong as we've experienced in recent years," Pichler said.
However, he noted that the Company's broad geographic base
helped offset the impact of increased competitive storing
activity. Kroger's emphasis on expense control was another
positive factor. Operating expenses as a percent of sales
declined in both the fourth quarter and full year.
Kroger's financial structure improved in 1996. The
Company redeemed the entire outstanding balance of $125
million of its 9 percent Senior Subordinated Notes and issued
$240 million of lower cost Senior Notes. Net interest expense
for the fourth quarter was $67 million. Full year interest
costs declined $12.7 million to $299.9 million.
During 1996, capital expenditures totaled approximately
$734 million, about even with prior year expenditures. Kroger
opened, expanded or relocated 116 stores in 1996, increasing
overall food store square footage by 6.7 percent.
For 1997, Kroger said it expects capital expenditures of
approximately $850 million. Over the next three years, the
Company said it expects to expand its store base by
approximately 100 projects per year, resulting in an annual
compounded retail square footage gain of about 6 percent.
<PAGE>
THE KROGER CO.
SALES AND EARNINGS
<TABLE>
<CAPTION>
4TH QUARTER 4TH QUARTER PERCENT
1996 1995 CHANGE
12/28/96 12/30/95
<S> <C> <C> <C>
Sales $6,199,156,375 $5,860,734,188 5.8
EBITD <F1> $ 353,568,567 $ 314,900,516 12.3
Non-EBITD
charges <F2> $ (4,300,000) $ (3,687,550)
LIFO $ 2,173,602 $ 2,397,218
Interest $ (67,006,475) $ (69,292,587)
Depreciation $ (86,580,221) $ (79,601,921)
--------------- ---------------
Pre-tax earnings
before extraordinary
loss $ 197,855,473 $ 164,715,676
Tax expense $ (72,336,735) $ (55,466,559)
_______________ ________________
Earnings before
extraordinary
loss $ 125,518,738 $ 109,249,117 14.9
Extraordinary
loss <F3> $ (84,342) $ (3,750,149)
_______________ ________________
Net earnings $ 125,434,396 $ 105,498,968
=============== ================
Primary earnings (loss)
per common share:
From operations $0.95 $0.84
From extraordinary
loss <F3> ($0.00) ($0.03)
_______________ _____________
Primary net earnings
per common share $0.95 $0.81
=============== =============
Fully diluted earnings
(loss) per common share:
From operations $0.95 $0.84 13.1
From extraordinary
loss <F3> ($0.00) ($0.03)
_______________ _____________
Fully diluted net
earnings per
common share $0.95 $0.81
=============== =============
Number of common shares
used in primary per share
calculation 132,570,923 129,453,609
Number of common shares
used in fully diluted per
share calculation 132,741,340 130,037,648
</TABLE>
[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 in 1996 and 1995 which is excluded
from EBITD as defined by the Company's Bank Credit
Agreement.
<F3> Represents the after-tax loss from the early retirement
of debt.
<TABLE>
<CAPTION>
4 QUARTERS 4 QUARTERS PERCENT
1996 1995 CHANGE
<S> <C> <C> <C>
Sales $25,170,908,953 $23,937,794,794 5.2
EBITD <F1> $ 1,241,093,781 $ 1,162,824,156 6.7
Non-EBITD
charges <F2> $ (17,500,000) $ (15,226,012)
LIFO $ (12,526,398) $ (14,102,782)
Interest $ (299,984,361) $ (312,685,354)
Depreciation $ (343,769,715) $ (311,271,904)
_______________ _________________
Pre-tax earnings before
extraordinary
loss $ 567,313,307 $ 509,538,104
Tax expense $ (214,578,000) $ (190,671,733)
_______________ _________________
Earnings before
extraordinary
loss $ 352,735,307 $ 318,866,371
Extraordinary
loss <F3> $ (2,862,050) $ (16,052,911)
_______________ _________________
Net earnings $ 349,873,257 $ 302,813,460 15.5
=============== =================
Primary earnings (loss)
per common share:
From operations $2.68 $2.65
From extraordinary
loss <F3> ($0.02) ($0.13)
_______________ ________________
Primary net earnings
per common share $2.66 $2.52
=============== ================
Fully diluted earnings (loss)
per common share:
From operations $2.67 $2.50 6.8
From extraordinary
loss <F3> ($0.02) ($0.12)
_______________ __________________
Fully diluted net
earnings per common
share $2.65 $2.38
============== ==================
Number of common shares used in
primary per share
calculation 131,374,914 120,413,169
Number of common shares used in
fully diluted per share
calculation 132,033,148 129,232,375
</TABLE>
[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 charge from the adoption of
FASB 106 in 1996 and 1995, which are excluded from EBITD
as defined by the Company's Bank Credit Agreement.
<F3> Represents the after-tax loss from the early retirement
of debt.
