Kroger’s comparable sales climb 30% in March on Coronavirus driven panic buying

Kroger (NYSE:KR) said on Wednesday that it recorded a 30% increase in comparable sales in March as consumers continued panic buying amidst the Coronavirus pandemic that is pushing governments into nationwide lockdowns and restricting people to their homes. The grocer also highlighted that it borrowed £810 million to expand its cash reserve to withstand the economic blow of COVID-19.

Due
to the rising Coronavirus uncertainty, several of Kroger’s competitors have
withdrawn guidance or slashed forecasts. But Kroger
maintained its financial outlook on Wednesday that pushed its stock more
than 5% up later in the day.

Kroger
Says It’s Early To Predict The Impact Of COVID-19

The
Cincinnati-based company, however, highlighted that its expectations remain
conservative owing to the fluid environment due to the ongoing health
emergency. According to Kroger:

“It
is too early to speculate what will emerge as the new normal in food
consumption at home or what the impact on sales will be in future periods.”

CEO
Rodney McMullen of Kroger also reiterated that sales were unusually uplifted in
March. While a decline was observed towards the end of the month, sales remained
much higher than normal.

Kroger
is now expecting its profit in the first quarter to beat its prior forecast.
The U.S grocer also announced its share buyback program suspended for the
quarter on Wednesday.

As
a reward to the workers who continue to serve amidst the rapidly spreading
flu-like virus, Kroger increased the hourly wage for its staff by £1.62 until 18^th
April. Hourly employees at Kroger get an average wage of £12.12 per hour. The
company had recently offered a one-time bonus as well to the frontline
associates that it wishes to pay on 3^rd April.

Kroger’s
Employees Test Positive For Coronavirus

A
few of the Kroger
employees were recently tested positive for Coronavirus in different
locations including Bellevue, Nashville, and Henrico.

At
the time of writing, Kroger is exchanging hands at £24.85 per share in the
stock market that translates to around 10% gain in 2020 so far. Its performance
in 2019 was only slightly positive with an annual gain of around 5%. The stock
opened at £22.23 per share in January 2019 but closed the year slightly higher
at around £23.40 per share in December.

The
U.S grocer currently has a market cap of £19.53 billion and a price to earnings
ratio of 15.69.