The Kroger Co. (NYSE:KR) Q2 2019 Earnings Conference Call - Final Transcript
Sep 12, 2019 • 10:00 am ET
W. Rodney McMullen
rich alternative profit businesses. We will also talk about the continued strength in free cash flow since the announcement of Restock Kroger, which enabled us to get back to within our net total debt to adjusted EBITDA range earlier than expected.
In addition, we will share our views on the business as we look further out beyond to 2020, where growth is expected to continue. I've said it many times before, transformation is incredibly difficult and that's the journey we are on with Restock Kroger. As we reflect on this journey, we want to be transparent about what went according to plan and what didn't go as anticipated. Some things are coming to fruition, as we expected, but just later than we thought, such as identical sales momentum. Some things were unanticipated, such as the lower gross profit margins in the pharmacy business that the entire industry is experiencing.
Things we did expect and that are going even better than we thought, include productivity improvements and cost savings. Over the course of a three-year plan in today's retail environment, there are lots of puts and takes. That said, I want to reiterate that Kroger is committed to FIFO operating profit growth in 2020 over 2019 confirmed guidance. The Restock Kroger Transformation journey sets the Company up for long-term growth, looking forward and the benefits we have seen thus far have helped Kroger in our transformation from grocer to growth the Company. We have the right overall strategy and framework for this business and look forward to telling you more about it in November.
Now, Gary and I will take your questions.