Kroger profits rise 12 percent

Kroger Co., the nation’s largest supermarket chain, said Tuesday that lower prices and improving customer service helped drive first-quarter earnings up 12 percent against strong competition from Wal-Mart and other grocers.

Kroger shares rose 10 percent, or $1.76, to close at $19.45 Tuesday on the New York Stock Exchange.

Kroger said it earned $294.3 million, or 40 cents per share, in the quarter ended May 21, compared with $262.8 million, or 35 cents per share, a year ago. Sales increased 6 percent to $17.9 billion, compared with $16.9 billion in 2004.

Kroger owns Dillon Stores in Kansas.

“Our emphasis on placing the customer first generated increased customer traffic and higher average transaction size in identical supermarkets in the first quarter,” said Kroger Chairman and CEO David Dillon, a Kansas University graduate.

Automobiles

CarMax earnings accelerate in quarter

Car retailer CarMax Inc. on Monday said its fiscal first-quarter profit grew 13 percent.

The nation’s largest specialty used-car retailer said earnings grew in the quarter ended May 31 to $39.8 million, or 37 cents per share, from $35.3 million, or 33 cents per share, a year earlier. The results included a gain of 3 cents per share from a CarMax Auto Finance valuation adjustment and public securitization.

Excluding the one-time gain, the company earned 34 cents per share. Analysts expected CarMax to earn 36 cents per share.

Sales increased 19 percent to $1.58 billion from $1.33 billion last year, as used-car sales rose 6 percent at stores open at least a year. But the company said its sales were hurt by a weaker market, higher wholesale auction prices and gas prices.

Lodging

Hammons plans N. Carolina center

John Q. Hammons on Tuesday announced plans to develop a Marriott hotel and convention center in Mooresville, N.C.

The property would be owned by Hammons and managed by Springfield, Mo.-based John Q. Hammons Hotels, a builder, developer, owner and manager of upscale, full-service hotels, resorts and suites.

The proposed 12-story property would include more than 250 rooms, plus 45,000 square feet of flexible meeting space in an adjoining convention center. Construction is expected to begin in fourth quarter of 2006.

Last week, Hammons announced that he was in negotiations to build a 200-room hotel and convention center in downtown Lawrence.