UPDATE 2-Kroger forecasts better-than-expected full-year profit
March 6 (Reuters) - Kroger Co, the biggest U.S. supermarket operator, forecast a higher-than-expected full-year profit as it benefits from the acquisition of southeast-focused grocer Harris Teeter.
Executives declined to comment on press reports that Kroger may make a bid that would compete with Cerberus Capital Management LP's reported offer to buy rival grocer Safeway Inc .
Kroger, which owns the Ralphs, Smith's and Food 4 Less chains, forecast a full-year profit of $3.14 to $3.25 per share, beating the average analyst estimate of $3.13.
The company is seen as one of the top performers in the hyper-competitive U.S. supermarket industry, which is being squeezed as high-end retailers like Whole Foods Market Inc siphon off well-to-do shoppers while dollar stores, convenience stores and other food sellers chip away at the edges.
Kroger completed the purchase of North Carolina-based Harris Teeter Supermarkets for about $2.5 billion on Jan. 28, adding more than 200 supermarkets to its network.
The deal gave the Cincinnati-based company a bigger presence in the mid-Atlantic region and access to fast-growing markets. Its forecasts for this year include results from Harris Teeter.
Wal-Mart Stores Inc, which sells more food than any other retailer, recently issued a disappointing full-year forecast and blamed food stamp benefit cuts and higher payroll taxes.
Food stamp users have increased their total monthly spending at Kroger stores since the federal government cut food stamp benefits on Nov. 1. Those shoppers are spending more of their own money on food, chief executive Rodney McMullen said on a conference call with analysts. Continued...