(Reuters) - U.S. supermarket chain Kroger Co (KR.N) reported quarterly same-store sales that fell just short of analysts’ estimates on Thursday, hit by disruptions caused by the company revamping stores to give more shelf space to its best-selling products.
The company’s shares fell nearly 3 percent to $27.80 in premarket trading.
Kroger has warned that the remodeling will weigh on sales this year as customers find it harder to locate groceries, but will help drive revenue in the long run.
The company said same-store sales, excluding fuel, rose 1.6 percent. Analysts on average had expected a 1.65 percent increase, according to IBES data from Refinitiv.
Excluding fuel and a charge related to inventory valuation, Kroger’s gross profit margin fell 91 basis points to 21.6 percent due to price cuts and higher transportation costs.
The Cincinnati-based company said net income attributable to Kroger fell to $317 million, or 39 cents per share, in the third quarter ended Nov. 10, from $397 million, or 44 cents per share, a year earlier.
Total sales fell 0.3 percent to $27.67 billion, but came in marginally above average estimate of $27.66 billion.
Reporting by Uday Sampath in Bengaluru; Editing by Bernard Orr and Sriraj Kalluvila