1
EXHIBIT 99.1
THE KROGER CO. AND SUBSIDIARIES
PRELIMINARY CONSOLIDATED STATEMENTS OF EARNINGS-AS RESTATED
WITHOUT ONE-TIME ITEMS
(in millions, except per share amounts)
(unaudited)
First Quarter Ended
-----------------------
May 20, May 22,
2000 1999
------- -------
Sales ........................................................................ $14,329 $13,493
Merchandise costs, including advertising, warehousing, and transportation..... 10,485 9,951
Operating, general and administrative ........................................ 2,676 2,468
Rent ......................................................................... 208 199
Depreciation and amortization ................................................ 307 281
------- -------
Operating profit ........................................................ 653 594
Interest expense ............................................................. 206 199
------- -------
Earnings before income tax expense ...................................... 447 395
Income tax expense ........................................................... 177 160
------- -------
Net earnings ............................................................ $ 270 $ 235
======= =======
Basic earnings per common share:
Net earnings ....................................................... $ 0.33 $ 0.28
------- -------
Average number of common shares used in basic calculation .................... 831 827
Diluted earnings per common share:
Net earnings ....................................................... $ 0.32 $ 0.27
------- -------
Average number of common shares used in diluted calculation .................. 850 863
OTHER INCOME STATEMENT INFORMATION
One-time items excluded from merchandise costs ............................... $ 15 $ 6
One-time items excluded from operating, general and administrative costs ..... $ 66 $ --
LIFO charge .................................................................. $ 12 $ 12
Gross profit rate excluding LIFO charge ...................................... 26.91% 26.34%
Operating, general and administrative costs as a % to sales .................. 18.68% 18.29%
2
THE KROGER CO. AND SUBSIDIARIES
PRELIMINARY CONSOLIDATED STATEMENT OF EARNINGS-AS RESTATED
WITH ONE-TIME ITEMS
(in millions, except per share amounts)
(unaudited)
First Quarter Ended
------------------------
May 20, May 22,
2000 1999
-------- -------
Sales ............................................................... $14,329 $13,493
------- -------
Merchandise costs, including advertising, warehousing, and
transportation .................................................... 10,500 9,957
Operating, general and administrative ............................... 2,742 2,468
Rent ................................................................ 208 199
Depreciation and amortization ....................................... 307 281
Asset impairment charges ............................................ 191 --
Merger related costs ................................................ 9 35
------- -------
Operating profit .................................................. 372 553
Interest expense .................................................... 206 199
------- -------
Earnings before income tax expense ................................ 166 354
Income tax expense .................................................. 67 143
------- -------
Net Earnings ...................................................... $ 99 $ 211
------- -------
Earnings per basic common share:
Net earnings ................................................... $ 0.12 $ 0.26
------- -------
Average number of common shares used in basic calculation ........... 831 827
Earnings per diluted common share:
Net earnings ................................................... $ 0.12 $ 0.25
------- -------
Average number of common shares used in diluted calculation ......... 850 863
OTHER INCOME STATEMENT INFORMATION
Gross profit rate excluding LIFO charge ................................... 26.81% 26.29%
Operating, general and administrative costs as a % to sales ............... 19.14% 18.29%
3
THE KROGER CO. AND SUBSIDIARIES
PRELIMINARY CONSOLIDATED BALANCE SHEET-AS RESTATED
(in millions, except per share amounts)
(unaudited)
May 20, January 29,
2000 2000
-------- -----------
ASSETS
Current assets
Cash ........................................................ $ 163 $ 281
Receivables ................................................. 622 636
Inventories ................................................. 3,903 3,938
Prepaid and other current assets ............................ 435 690
------- -------
Total current assets .................................... 5,123 5,545
Property, plant and equipment, net ............................. 8,351 8,266
Goodwill, net .................................................. 3,682 3,718
Other assets ................................................... 430 403
------- -------
Total Assets ............................................ $17,586 $17,932
======= =======
LIABILITIES
Current liabilities
Current portion of long-term debt ........................... $ 536 $ 536
Accounts payable ............................................ 2,994 2,773
Salaries and wages .......................................... 657 695
Other current liabilities ................................... 1,577 1,660
------- -------
Total current liabilities ............................... 5,764 5,664
Long-term debt ................................................. 7,619 8,045
Other long-term liabilities .................................... 1,607 1,542
------- -------
Total Liabilities ....................................... 14,990 15,251
------- -------
Commitments and contingent liabilities ......................... -- --
SHAREOWNERS' EQUITY
Preferred stock, $100 par, 5 shares authorized
and unissued ................................................ -- --
Common stock, $1 par, 1,000 shares authorized: 888 shares issued
in 2000 and 885 shares issued in 1999 ....................... 888 885
Additional paid-in capital ..................................... 2,044 2,023
Retained earnings .............................................. 330 230
Common stock in treasury, at cost, 61 shares in 2000 and
50 shares in 1999 ........................................... (666) (457)
------- -------
Total Shareowners' Equity ............................... 2,596 2,681
------- -------
Total Liabilities and Shareowners' Equity ............... $17,586 $17,932
======= =======
4
THE KROGER CO. AND SUBSIDIARIES
PRELIMINARY CONSOLIDATED STATEMENTS OF EARNINGS-AS RESTATED
WITHOUT ONE-TIME ITEMS
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
Second Quarter Ended Two Quarters Ended
----------------------- -----------------------
August 12, August 14, August 12, August 14,
2000 1999 2000 1999
---------- ---------- ---------- ----------
Sales .......................................................................... $11,017 $10,289 $25,346 $23,782
Merchandise costs, including advertising, warehousing, and transportation ...... 8,047 7,576 18,532 17,527
Operating, general and administrative .......................................... 2,062 1,888 4,738 4,356
Rent ........................................................................... 148 137 356 336
Depreciation and amortization .................................................. 234 216 541 497
------- ------- ------- -------
Operating profit .......................................................... 526 472 1,179 1,066
Interest expense ............................................................... 155 143 361 342
------- ------- ------- -------
Earnings before income tax expense and extraordinary loss ................. 371 329 818 724
Income tax expense ............................................................. 145 131 322 291
------- ------- ------- -------
Earnings before extraordinary loss ........................................ 226 198 496 433
Extraordinary loss, net of income tax benefit .................................. (2) (10) (2) (10)
------- ------- ------- -------
Net earnings .............................................................. $ 224 $ 188 $ 494 $ 423
======= ======= ======= =======
Basic earnings per common share:
Earnings before extraordinary loss ........................................ $ 0.27 $ 0.24 $ 0.60 $ 0.52
Extraordinary loss ........................................................ -- (0.01) -- (0.01)
------- ------- ------- -------
Net earnings .......................................................... $ 0.27 $ 0.23 $ 0.60 $ 0.51
======= ======= ======= =======
Average number of common shares used in basic calculation ...................... 824 829 828 828
Diluted earnings per common share:
Earnings before extraordinary loss ........................................ $ 0.27 $ 0.23 $ 0.58 $ 0.50
Extraordinary loss ........................................................ -- (0.01) -- (0.01)
------- ------- ------- -------
Net earnings .......................................................... $ 0.27 $ 0.22 $ 0.58 $ 0.49
======= ======= ======= =======
Average number of common shares used in diluted calculation .................... 847 860 849 861
OTHER INCOME STATEMENT INFORMATION
One-time items excluded from merchandise costs ................................. $ 4 $ 12 $ 19 $ 18
One-time items excluded from operating, general and administrative costs........ $ 4 $ 17 $ 70 $ 17
LIFO charge .................................................................... $ 4 $ -- $ 16 $ 12
Gross profit rate excluding LIFO charge ........................................ 26.99% 26.37% 26.94% 26.35%
Operating, general and administrative costs as a % to sales .................... 18.72% 18.34% 18.70% 18.31%
5
THE KROGER CO. AND SUBSIDIARIES
PRELIMINARY CONSOLIDATED STATEMENT OF EARNINGS-AS RESTATED
WITH ONE-TIME ITEMS
(in millions, except per share amounts)
(unaudited)
Second Quarter Ended Two Quarters Ended
------------------------- --------------------------
August 12, August 14, August 12, August 14,
2000 1999 2000 1999
---------- ---------- ---------- ----------
Sales ..................................................... $11,017 $10,289 $25,346 $23,782
------- ------- ------- -------
Merchandise costs, including advertising, warehousing,
and transportation ...................................... 8,051 7,588 18,551 17,545
Operating, general and administrative ..................... 2,066 1,905 4,808 4,373
Rent ...................................................... 148 137 356 336
Depreciation and amortization ............................. 234 216 541 497
Asset impairment charges .................................. -- -- 191 --
Merger related costs ...................................... 2 200 11 235
------- ------- ------- -------
Operating profit ........................................ 516 243 888 796
Interest expense .......................................... 155 143 361 342
------- ------- ------- -------
Earnings before income tax expense and extraordinary loss 361 100 527 454
Income tax expense ........................................ 151 47 218 190
------- ------- ------- -------
Earnings before extraordinary loss ...................... $ 210 $ 53 $ 309 $ 264
Extraordinary loss, net of income tax benefit ............. (2) (10) (2) (10)
------- ------- ------- -------
Net earnings ............................................ $ 208 $ 43 $ 307 $ 254
======= ======= ======= =======
Earnings per basic common share:
Earnings before extraordinary loss ...................... $ 0.25 $ 0.06 $ 0.37 $ 0.32
Extraordinary loss ...................................... -- (0.01) -- (0.01)
------- ------- ------- -------
Net earnings ......................................... $ 0.25 $ 0.05 $ 0.37 $ 0.31
======= ======= ======= =======
Average number of common shares used in basic calculation.. 824 829 828 828
Earnings per diluted common share:
Earnings before extraordinary loss ...................... $ 0.25 $ 0.06 $ 0.36 $ 0.31
Extraordinary loss ...................................... -- (0.01) -- (0.01)
------- ------- ------- -------
Net earnings ......................................... $ 0.25 $ 0.05 $ 0.36 $ 0.30
======= ======= ======= =======
Average number of common shares used in diluted calculation 847 860 849 861
OTHER INCOME STATEMENT INFORMATION
Gross profit rate excluding LIFO charge ................... 26.96% 26.25% 26.87% 26.27%
Operating, general and administrative costs
as a % to sales ......................................... 18.75% 18.51% 18.97% 18.39%
6
THE KROGER CO. AND SUBSIDIARIES
PRELIMINARY CONSOLIDATED BALANCE SHEET-AS RESTATED
(in millions, except per share amounts)
(unaudited)
August 12, January 29,
2000 2000
---------- -----------
ASSETS
Current assets
Cash.................................................................. $ 155 $ 281
Receivables........................................................... 583 636
Inventories........................................................... 3,795 3,938
Prepaid and other current assets...................................... 261 690
------- -------
Total current assets.............................................. 4,794 5,545
Property, plant and equipment, net....................................... 8,525 8,266
Goodwill, net............................................................ 3,683 3,718
Other assets............................................................. 312 403
------- -------
Total assets...................................................... $17,314 $17,932
======= =======
LIABILITIES
Current liabilities
Current portion of long-term debt..................................... $ 586 $ 536
Accounts payable...................................................... 2,908 2,773
Accrued salaries and wages............................................ 638 695
Other current liabilities............................................. 1,675 1,660
------- -------
Total current liabilities......................................... 5,807 5,664
Long-term debt........................................................... 7,222 8,045
Other long-term liabilities.............................................. 1,564 1,542
------- -------
Total liabilities................................................. 14,593 15,251
------- -------
Commitments and contingent liabilities -- --
SHAREOWNERS' EQUITY
Preferred stock, $100 par, 5 shares authorized
and unissued.......................................................... -- --
Common stock, $1 par, 1,000 shares authorized: 888 shares issued
in 2000 and 885 shares issued in 1999................................. 888 885
Additional paid-in capital............................................... 2,063 2,023
Retained earnings........................................................ 538 230
Common stock in treasury, at cost, 66 shares in 2000 and
50 shares in 1999..................................................... (768) (457)
------- -------
Total shareowners' equity......................................... 2,721 2,681
------- -------
Total liabilities and shareowners' equity......................... $17,314 $17,932
======= =======
7
THE KROGER CO. AND SUBSIDIARIES
PRELIMINARY CONSOLIDATED STATEMENTS OF EARNINGS-AS RESTATED
WITHOUT ONE-TIME ITEMS
(in millions, except per share amounts)
(unaudited)
Third Quarter Ended Three Quarters Ended
------------------------- -------------------------
November 4, November 6, November 4, November 6,
2000 1999 2000 1999
----------- ----------- ----------- -----------
Sales ........................................................................ $10,962 $10,329 $36,308 $34,111
Merchandise costs, including advertising, warehousing, and transportation..... 8,039 7,585 26,571 25,112
Operating, general and administrative ........................................ 2,013 1,902 6,751 6,258
Rent ......................................................................... 147 153 503 489
Depreciation and amortization ................................................ 234 217 775 714
------- ------- ------- -------
Operating profit ........................................................ 529 472 1,708 1,538
Interest expense ............................................................. 146 143 508 485
------- ------- ------- -------
Earnings before income tax expense and extraordinary loss ............... 383 329 1,200 1,053
Income tax expense ........................................................... 150 129 472 420
------- ------- ------- -------
Earnings before extraordinary loss ...................................... 233 200 728 633
Extraordinary loss, net of income tax benefit ................................ (2) -- (3) (10)
------- ------- ------- -------
Net earnings ............................................................ $ 231 $ 200 $ 725 $ 623
======= ======= ======= =======
Basic earnings per common share:
Earnings before extraordinary loss ...................................... $ 0.28 $ 0.24 $ 0.88 $ 0.76
Extraordinary loss ...................................................... -- -- -- (0.01)
------- ------- ------- -------
Net earnings ........................................................ $ 0.28 $ 0.24 $ 0.88 $ 0.75
======= ======= ======= =======
Average number of common shares used in basic calculation .................... 821 832 825 829
Diluted earnings per common share:
Earnings before extraordinary loss ...................................... $ 0.28 $ 0.23 $ 0.86 $ 0.74
Extraordinary loss ...................................................... -- -- -- (0.01)
------- ------- ------- -------
Net earnings ........................................................ $ 0.28 $ 0.23 $ 0.86 $ 0.73
======= ======= ======= =======
Average number of common shares used in diluted calculation .................. 845 857 848 860
OTHER INCOME STATEMENT INFORMATION
One-time items excluded from merchandise costs ............................... $ 8 $ 18 $ 27 $ 36
One-time items excluded from operating, general and administrative costs ..... $ 24 $ 6 $ 94 $ 23
LIFO (credit)/charge ......................................................... $ (6) $ (6) $ 10 $ 6
Gross profit rate excluding LIFO (credit)/charge ............................. 26.61% 26.51% 26.84% 26.40%
Operating, general and administrative costs as a % to sales .................. 18.36% 18.42% 18.60% 18.34%
8
THE KROGER CO. AND SUBSIDIARIES
PRELIMINARY CONSOLIDATED STATEMENT OF EARNINGS-AS RESTATED
WITH ONE-TIME ITEMS
(in millions, except per share amounts)
(unaudited)
Third Quarter Ended Three Quarters Ended
------------------------ --------------------------
November 4, November 6, November 4, November 6,
2000 1999 2000 1999
----------- ---------- ----------- -----------
Sales......................................................................... $10,962 $10,329 $36,308 $34,111
------- ------- ------- -------
Merchandise costs, including advertising, warehousing, and transportation..... 8,047 7,603 26,598 25,148
Operating, general and administrative......................................... 2,037 1,908 6,846 6,281
Rent.......................................................................... 147 153 503 489
Depreciation and amortization................................................. 234 217 775 714
Asset impairment charges...................................................... -- -- 191 --
Merger related costs.......................................................... 2 69 13 304
------- ------- ------- -------
Operating profit............................................................ 495 379 1,382 1,175
Interest expense.............................................................. 146 143 508 485
------- ------- ------- -------
Earnings before income tax expense and extraordinary loss................... 348 236 874 690
Income tax expense............................................................ 146 109 364 299
------- ------- ------- -------
Earnings before extraordinary loss.......................................... $ 203 $ 127 $ 510 $ 391
Extraordinary loss, net of income tax benefit................................. (2) -- (3) (10)
------- ------- ------- -------
Net earnings ............................................................... $ 201 $ 127 $ 507 $ 381
======= ======= ======= =======
Earnings per basic common share:
Earnings before extraordinary loss.......................................... $ 0.25 $ 0.15 $ 0.62 $ 0.47
Extraordinary loss.......................................................... -- -- (0.01)
------- ------- ------- -------
Net earnings ............................................................ $ 0.25 $ 0.15 $ 0.62 $ 0.46
======= ======= ======= =======
Average number of common shares used in basic calculation..................... 821 832 825 829
Earnings per diluted common share:
Earnings before extraordinary loss.......................................... $ 0.24 $ 0.15 $ 0.60 $ 0.45
Extraordinary loss ......................................................... -- -- -- (0.01)
------- ------- ------- -------
Net earnings............................................................. $ 0.24 $ 0.15 $ 0.60 $ 0.44
======= ======= ======= =======
Average number of common shares used in diluted calculation................... 845 857 848 860
OTHER INCOME STATEMENT INFORMATION
Gross profit rate excluding LIFO (credit)/charge ............................. $ 26.54% $ 26.33% $ 26.77% $ 26.29%
Operating, general and administrative costs as a % to sales .................. 18.59% 18.47% 18.85% 18.41%
9
THE KROGER CO. AND SUBSIDIARIES
PRELIMINARY CONSOLIDATED BALANCE SHEET-AS RESTATED
(in millions, except per share amounts)
(unaudited)
November 4, January 29,
2000 2000
----------- -----------
ASSETS
Current assets
Cash ............................................................. $ 131 $ 281
Receivables ...................................................... 629 636
Inventories ...................................................... 4,412 3,938
Prepaid and other current assets ................................. 197 690
------- -------
Total current assets ......................................... 5,369 5,545
Property, plant and equipment, net .................................. 8,689 8,266
Goodwill, net ....................................................... 3,664 3,718
Other assets ........................................................ 344 403
------- -------
Total assets ................................................. $18,066 $17,932
======= =======
LIABILITIES
Current liabilities
Current portion of long-term debt ................................ $ 309 $ 536
Accounts payable ................................................. 3,272 2,773
Accrued salaries and wages ....................................... 651 695
Other current liabilities ........................................ 1,731 1,660
------- -------
Total current liabilities .................................... 5,963 5,664
Long-term debt ...................................................... 7,746 8,045
Other long-term liabilities ......................................... 1,528 1,542
------- -------
Total liabilities ............................................ 15,237 15,251
------- -------
Commitments and contingent liabilities .............................. -- --
SHAREOWNERS' EQUITY
Preferred stock, $100 par, 5 million shares authorized
and unissued ..................................................... -- --
Common stock, $1 par, 1 billion shares authorized: 889 million shares
issued in 2000 and 885 million shares issued in 1999 ............. 889 885
Additional paid-in capital .......................................... 2,073 2,023
Retained earnings ................................................... 738 230
Common stock in treasury, at cost, 71 million shares in 2000 and
50 million shares in 1999 ........................................ (871) (457)
------- -------
Total shareowners' equity .................................... 2,829 2,681
------- -------
Total liabilities and shareowners' equity .................... $18,066 $17,932
======= =======