The Kroger Co. (NYSE:KR) Q1 2016 Earnings Conference Call - Final Transcript

Jun 16, 2016 • 10:00 am ET

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The Kroger Co. (NYSE:KR) Q1 2016 Earnings Conference Call - Final Transcript

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Q & A
Executive
Rodney McMullen

some customers find it incredibly helpful. Definitely, from everything that we see, we find it's an and and not a or, and the Click List customer continues to come into the store and it really is just one more way of making their life a little bit easier.

Analyst
John Heinbockel

And then, I guess just as a follow-up, do you think there's any difference in how you will run Click List or customer behavior in a marketplace versus a traditional food retail store, given size differences and so forth?

Executive
Rodney McMullen

We have it in both types of stores and we really find the behavior isn't that much different. But we do not have the marketplace product on the website. So if somebody wants to buy something from the marketplace side, they have to put it in a comment section, can you get me that? And obviously, we will.

But we don't see differences in behavior between one type and other. One of the things that's always part of the consideration is do we have space to do it in a store and that's driven as much the decision on a size of store -- there are some marketplace stores we don't have it in that we would like to have it in because we just really don't have the space to do it.

Analyst
operator

Shane Higgins, Deutsche Bank.

Analyst
Shane Higgins

How would you guys characterize the macro environment in the quarter and any color you have on just the consumer sentiment overall? I think you guys mentioned that units per transaction were down slightly. Is that any kind of indication that the consumer might be a bit softer or any color there would be great?

Executive
Mike Schlotman

Yes, when you look at the units per basket, they were down slightly. But that was overcome by more trips, making more trips to drive more units during the quarter. So if you just looked at those two metrics, it would have been a slight increase in the tonnage. And then, the new households pushed the tonnage to be nicely positive. There's clearly a lot going on out there. The macro environment, there is the inflation-deflation, there is gas retails were rising during the quarter. It was an interesting quarter because there is so many unusual things out there.

Our own comparisons to a lot of -- like what Rodney said, the Super Bowl this year, then no weather and then Memorial Day moving. As Rodney said, the cadence of ID sales was really a little bit all over the board depending on the week you're looking at.But our fundamental approach is focused on the customer, make sure we're delivering on the value propositions that they want but just based on how they're shopping with us, it sure seems like we're hitting the mark on that.

Executive
Rodney McMullen

On the economy -- to me, Mike and I've talked about this -- it's really hard to describe and it's very mixed and how much of that is driven because of the election and everything