克羅格 (KR) 2023 Q3 法說會逐字稿

Good morning, and welcome to the Kroger Co. Third Quarter Earnings Conference Call. (Operator Instructions) Please note, this event is being recorded.

早安，歡迎參加克羅格公司第三季財報電話會議。 （操作員說明）請注意，正在記錄此事件。

I would now like to turn the conference over to Rob Quast, Senior Director, Investor Relations. Please go ahead.

我現在想將會議交給投資者關係高級總監 Rob Quast。請繼續。

Good morning. Thank you for joining us for Kroger's Third Quarter 2023 Earnings Call. I am joined today by Kroger's Chairman and Chief Executive Officer, Rodney McMullen; and Chief Financial Officer, Gary Millerchip.

早安.感謝您參加克羅格 2023 年第三季財報電話會議。今天，克羅格董事長兼執行長羅德尼·麥克穆倫 (Rodney McMullen) 也加入了我的行列。和財務長加里·米勒奇普。

Before we begin, I want to remind you that today's discussions will include forward-looking statements. We want to caution you that such statements are predictions and actual events or results can differ materially. A detailed discussion of the many factors that we believe may have a material effect on our business on an ongoing basis is contained in our SEC filings. The Kroger Company assumes no obligation to update that information. After our prepared remarks, we look forward to taking your questions. (Operator Instructions)

在我們開始之前，我想提醒您，今天的討論將包括前瞻性陳述。我們想提醒您，此類陳述只是預測，實際事件或結果可能會有重大差異。我們向 SEC 提交的文件中詳細討論了我們認為可能對我們的業務持續產生重大影響的許多因素。克羅格公司不承擔更新該資訊的義務。在我們準備好發言後，我們期待回答您的問題。 （操作員說明）

I will now turn the call over to Rodney.

我現在將把電話轉給羅德尼。

Thank you, Rob. Good morning, everyone, and thank you for joining us today. Before we begin, I'd like to take a moment to outline our discussion topics this morning. I will begin by covering the current retail environment and how the strength of Kroger's value creation model is supporting earnings growth and generating strong free cash flow. Then Gary will cover our financial results and guidance for the remainder of the year. Finally, I will conclude with an update on our proposed merger with Albertsons before we open it up for questions.

謝謝你，羅布。大家早安，感謝您今天加入我們。在我們開始之前，我想花點時間概述我們今天早上的討論主題。我將首先介紹當前的零售環境以及克羅格價值創造模式的優勢如何支持獲利成長並產生強勁的自由現金流。然後加里將介紹我們今年剩餘時間的財務表現和指導。最後，在我們提出問題之前，我將首先介紹我們與艾伯森 (Albertsons) 擬議合併的最新情況。

Now turning to our third quarter. Kroger's third quarter results highlight the strength and diversity of our business model in a challenged operating environment, as strong fuel performance and growth in our alternative profit businesses supported continued adjusted net earnings per diluted share growth. As consumer spending tightens, we are focused on providing customers with exceptional value by maintaining our long-term commitment to lower prices, personalized promotions and rewards. We are growing households and increasing loyalty, positioning Kroger for sustainable future growth.

現在轉向我們的第三季。克羅格第三季業績突顯了我們在充滿挑戰的營運環境中業務模式的優勢和多樣性，強勁的燃料業績和替代利潤業務的增長支持了調整後每股攤薄淨利潤的持續增長。隨著消費者支出收緊，我們致力於透過維持對較低價格、個人化促銷和獎勵的長期承諾，為客戶提供卓越的價值。我們正在增加家庭數量並提高忠誠度，為克羅格未來的永續成長做好準備。

Customers are managing many economic factors that are pressuring their spending, including higher interest rates, reduced savings and fewer government benefits, including SNAP. Although inflation is decelerating, customers are still adjusting to the impacts from 8 consecutive quarters of broad and significant inflation.

客戶正在管理許多給他們的支出帶來壓力的經濟因素，包括利率上升、儲蓄減少和政府福利（包括 SNAP）減少。儘管通膨正在放緩，但客戶仍在適應連續 8 個季度廣泛且嚴重通膨的影響。

During the quarter, Kroger grew higher-income households once again as our attractive mix of quality, value and convenience continues to drive engagement. By buying larger packs, more fresh items and more premium Our Brand products, these households are more profitable.

在本季度，由於我們有吸引力的品質、價值和便利性組合繼續推動參與度，克羅格再次增加了高收入家庭。透過購買更大包裝、更多新鮮商品和更優質的我們品牌產品，這些家庭可以獲得更多利潤。

As we've seen over recent quarters, our customers are actively looking for value, and our budget-conscious customers are under more significant spending pressure. We are also looking for ways to support customers with additional value, including in-store displays with everyday staples at low price points. We've seen a great response from all customers to these offers. But engagement from our budget-conscious households has been especially strong. Customers purchasing these offer items are making more trips and buying more units, not only recognizing the value with these displays but the value across the entire store.

正如我們最近幾季所看到的，我們的客戶正在積極尋找價值，而我們精打細算的客戶面臨更大的支出壓力。我們也正在尋找為顧客提供附加價值的方法，包括在店內以低價展示日常必需品。我們看到所有客戶對這些優惠反應熱烈。但注重預算的家庭的參與尤其強烈。購買這些優惠商品的顧客會進行更多的旅行併購買更多的商品，不僅認識到這些展示的價值，而且認識到整個商店的價值。

To help more customers manage their budget, we are only deepening our commitment to deliver exceptional value for our customers. Our personalized promotions are an increasingly critical way for customers to save on items that matter most to them. We are applying analytics to Kroger's unmatched purchase data to strike the right balance between the depth and breadth of promotions. To ensure customers were able to enjoy a memorable Thanksgiving, for example, we created a meal bundle that served a group of 10 for less than $5 per person, which represents a lower price than last year.

為了幫助更多客戶管理預算，我們不斷深化為客戶提供卓越價值的承諾。我們的個人化促銷是顧客節省購買對他們來說最重要的商品的越來越重要的方式。我們正在對克羅格無與倫比的購買數據進行分析，以在促銷的深度和廣度之間取得適當的平衡。例如，為了確保顧客能夠享受難忘的感恩節，我們推出了 10 人套餐，每人不到 5 美元，比去年的價格要低。

We have a long history of delivering value to our customers by providing a broad assortment of fresh foods at low prices. Through our unique omnichannel shopping experience, we've achieved our 10th consecutive quarter of total household growth and increased loyal households even faster, positioning Kroger for sustainable future growth.

長期以來，我們一直致力於以低廉的價格提供種類繁多的新鮮食品，為客戶創造價值。透過我們獨特的全通路購物體驗，我們實現了家庭總數連續第十個季度成長，忠誠家庭的成長速度更快，為克羅格未來的永續成長奠定了基礎。

Now I'll provide more details about how our go-to-market strategy is delivering for our customers. Starting with Seamless. Our digital business delivered a strong third quarter with double-digit growth in both our pickup and delivery businesses. Multiple tailwinds are driving our sales momentum, including growth in both households and visits. Our new 2-hour pickup service available in more than 1/3 of our stores also contributed to our success in the quarter. To become the online food retailer of choice, we are focused on delivering best-in-class fulfillment.

現在，我將提供有關我們的上市策略如何為客戶提供服務的更多詳細資訊。從無縫開始。我們的數位業務在第三季表現強勁，取貨和送貨業務均達到兩位數成長。多重有利因素正在推動我們的銷售勢頭，包括家庭和訪問量的成長。我們超過 1/3 的商店提供新的 2 小時取貨服務，這也為我們在本季度的成功做出了貢獻。為了成為首選的線上食品零售商，我們致力於提供一流的履行服務。

Our teams improved key customer experience metrics in pickup, increasing fill rates and reducing wait times during the quarter. This resulted in improved net promoter scores. Our customer fulfillment centers again led our delivery growth, where we continue to rapidly increase households. Our delivery customers enjoy the convenience of on-time refrigerated delivery directly to their doorstep with zero compromise on freshness, quality and value.

我們的團隊在本季度改進了提貨方面的關鍵客戶體驗指標，提高了填充率並減少了等待時間。這導致了淨推薦值的提高。我們的客戶履行中心再次引領了我們的交付成長，我們的家庭數量繼續快速增加。我們的送貨客戶享受直接按時冷藏送貨上門的便利，在新鮮度、品質和價值上零妥協。

Turning to personalization. Investments in our personalized capabilities ensure we are meeting elevated customer demand for savings and enables us to deploy promotional dollars more effectively. Digital offers have increased compared to last year, and our personalization capabilities have resulted in an even more significant increase in redemptions, driving loyalty and increasing digitally engaged households this quarter by 13%. Digitally engaged households are incredibly valuable to our model as they are more loyal, spend nearly 3x more with us and accelerate growth in our alternative profit businesses.

轉向個性化。對個人化能力的投資可確保我們滿足客戶日益增長的節省需求，並使我們能夠更有效地部署促銷資金。與去年相比，數位優惠有所增加，而且我們的個人化功能使兌換量有了更顯著的增長，從而提高了忠誠度，並使本季度參與數位化的家庭數量增加了 13%。參與數位化的家庭對我們的模式非常有價值，因為他們更加忠誠，在我們身上的花費增加了近 3 倍，並加速了我們另類利潤業務的成長。

Now I'd like to share more about how our diversified business model supported earnings growth this quarter and gives us confidence in our ability to navigate the environment ahead. Starting with our alternative profit businesses. Growth in alternative profit businesses remained strong in the third quarter with balanced growth across the portfolio. The strength of our Seamless ecosystem and elevated digital engagement is having a flywheel effect, creating the traffic and the data needed to drive growth in Kroger Precision Marketing, a higher margin profit stream.

現在，我想更多地分享我們的多元化業務模式如何支持本季的獲利成長，並讓我們對應對未來環境的能力充滿信心。從我們的另類利潤業務開始。第三季另類獲利業務的成長依然強勁，整個投資組合成長均衡。我們無縫生態系統的優勢和更高的數位參與度正在產生飛輪效應，創造推動克羅格精準行銷（更高利潤的利潤流）成長所需的流量和數據。

Recently, we celebrated the sixth anniversary of KPM. This quarter, KPM made an important step in its journey to become the most trusted and transparent media company. By activating ad buying platforms, we are offering more self-service solutions to meet clients where they are today, providing advertisers more direct access to custom Kroger audiences. This first iteration has already launched and KPM expects to expand to other buying platforms in the future. These new innovative features will help accelerate KPM's impressive growth by allowing advertisers to reduce waste and enhance measurement tools.

最近，我們慶祝了 KPM 六週年。本季度，KPM 在成為最值得信賴、最透明的媒體公司的道路上邁出了重要一步。透過啟動廣告購買平台，我們提供更多自助服務解決方案來滿足客戶當前的需求，讓廣告主更直接地接觸克羅格客製化受眾。第一個版本已經推出，KPM 預計將來會擴展到其他購買平台。這些新的創新功能將有助於廣告主減少浪費並增強衡量工具，從而加速 KPM 的驚人成長。

Kroger Health had a strong quarter that exceeded our internal expectations and helped drive sales and profit growth. Our decision to terminate our agreement with Express Scripts reflects our commitment to making decisions that we believe are in the best long-term interest of our customers and shareholders. Our teams have done an excellent job retaining patients and utilizing our pharmacists' extra capacity to devote more time to patient care, including growing our number of vaccinations. Gary will provide more on the financial impact of this later.

克羅格健康 (Kroger Health) 的季度表現強勁，超出了我們的內部預期，有助於推動銷售和利潤成長。我們終止與 Express Scripts 協議的決定反映了我們致力於做出我們認為符合客戶和股東最佳長期利益的決策。我們的團隊在留住患者方面做得非常出色，並利用藥劑師的額外能力投入更多時間來照顧患者，包括增加疫苗接種數量。加里稍後將提供更多關於此事的財務影響的資訊。

During the quarter, we continued to see rapid growth in GLP-1 drugs in our retail pharmacies. While the long-term impacts of these drugs on customer buying habits are unknown, Kroger's food-as-medicine philosophy positions us well to support our customers' health and wellness goals. Our comprehensive approach includes health care services, professional dietitians, and proprietary tools like our nutrition rating app, OptUp, which are all designed to support healthy living and to do so holistically.

本季度，我們零售藥局的 GLP-1 藥物持續快速成長。雖然這些藥物對客戶購買習慣的長期影響尚不清楚，但克羅格的食品即藥物概念使我們能夠很好地支持客戶的健康和保健目標。我們的綜合方法包括醫療保健服務、專業營養師和專有工具（例如我們的營養評級應用程式 OptUp），所有這些都旨在支持健康生活並全面實現這一目標。

While we pride ourselves on data and insights, the patient data in our pharmacy operations is separate from our customer loyalty data and is protected by privacy laws. We are committed to using our data in an appropriate manner while not jeopardizing customers' trust. For now, we have not seen any major macro shifts in customer eating habits or spending behaviors.

雖然我們對數據和見解感到自豪，但我們藥房營運中的患者資料與我們的客戶忠誠度資料是分開的，並受到隱私法的保護。我們致力於以適當的方式使用我們的數據，同時不損害客戶的信任。目前，我們尚未看到客戶飲食習慣或消費行為有任何重大宏觀變化。

Food trends are constantly evolving, and we are committed to offering products that meet our customers' needs. For customers looking to adopt healthier habits with or without the help of these drugs, we are well positioned to provide important health care services and healthy food options.

食品趨勢不斷發展，我們致力於提供滿足客戶需求的產品。對於希望在使用或不使用這些藥物的幫助下養成更健康習慣的客戶，我們有能力提供重要的醫療保健服務和健康食品選擇。

At Kroger, our purpose is to feed the human spirit. And I'm so impressed by the many ways our associates bring this to life every day and the ways they support our customers and each other. We know when associates are connected to our purpose, they feel connected to Kroger.

在克羅格，我們的目標是滋養人類精神。我們的員工每天將這一理念變為現實的多種方式以及他們支持我們的客戶和彼此的方式給我留下了深刻的印象。我們知道，當員工認同我們的目標時，他們就會覺得自己與克羅格有連結。

Our annual Kroger Wellness Festival is just one example of living our purpose. This festival is one of the nation's largest health and wellness events, showcasing more than 150 experiences and food offerings. Sponsors and celebrities joined Kroger and hundreds of thousands of visitors to share our vision for better physical, mental and emotional health for families. It was wonderful to see the level of support and participation in this important mission.

我們一年一度的克羅格健康節只是實現我們目標的一個例子。該節日是美國最大的健康和保健活動之一，展示 150 多種體驗和美食。贊助商和名人與克羅格和數十萬名參觀者一起分享我們為家庭提供更好的身體、心理和情感健康的願景。很高興看到這項重要使命的支持和參與程度。

Also this quarter, we released our annual ESG report, which highlighted Kroger's significant progress on our Zero Hunger | Zero Waste journey, to expand access to affordable, fresh and healthy food and to reduce waste, especially food waste, across our footprint. Since we launched Zero Hunger | Zero Waste in 2017, Kroger has donated more than 3 billion meals to feed hungry families, including more than [1.3 billion] to fight food insecurity and nearly 600 million pounds of surplus food to our food bank partners. I am so proud of our teams and their efforts to reach these incredible milestones.

同樣在本季度，我們發布了年度 ESG 報告，其中強調了克羅格在「零飢餓」方面取得的重大進展 |零浪費之旅，擴大獲得負擔得起的、新鮮和健康食品的機會，並減少我們足跡中的浪費，特別是食物浪費。自從我們推出“零飢餓”以來2017 年，克羅格零浪費已捐贈了超過30 億份餐點來養活飢餓家庭，其中包括超過[13 億] 份用於應對糧食不安全問題，並向我們的食品銀行合作夥伴捐贈了近6億磅剩餘食物。我為我們的團隊以及他們為實現這些令人難以置信的里程碑所做的努力感到自豪。

Our associates are the driving force behind our success by delivering an outstanding customer experience and helping make the holidays even more special for our customers. We facilitate this through our long-standing commitment to invest in associate wages and benefits and training tools to advance their career growth.

我們的員工是我們成功背後的驅動力，他們提供卓越的客戶體驗並幫助我們的客戶打造更特別的假期。我們透過長期承諾投資於員工的薪資和福利以及培訓工具來促進他們的職業發展，從而促進這一目標。

Feed Your Future, our continuing education benefit, is one of the important ways we make Kroger a place where associates come for a job and discover a career. This benefit provides up to $21,000 lifetime and has helped almost 6,000 associates this year alone, with approximately 90% of these participants being hourly. Our focus on development is contributing to strong improvements in retention, which includes associate continuity and a more consistent customer experience.

「餵養你的未來」是我們的持續教育福利，它是我們使克羅格成為員工前來求職和發現職業的重要途徑之一。這項福利提供高達 21,000 美元的終身福利，光是今年就幫助了近 6,000 名員工，其中約 90% 的參與者是小時工。我們對發展的關注有助於大力提高留任率，其中包括員工連續性和更一致的客戶體驗。

With that, I'll turn it over to Gary to take you through our financial results. Gary?

接下來，我將把它交給加里，讓您了解我們的財務表現。加里？

Thank you, Rodney, and good morning, everyone. Kroger's third quarter results demonstrate the resilience of our value creation model. The investments we have made over recent years to strengthen and diversify our business are allowing Kroger to navigate a challenged environment characterized by tightening consumer spending and food-at-home disinflation. We achieved adjusted earnings per share growth of 8% this quarter while also providing greater value for our customers, higher wages for our associates and investing in strategic initiatives that will support future growth. This was made possible by our teams delivering strong performances across our margin expansion initiatives, fuel, alternative profit businesses and health and wellness. Our year-to-date results keep us on track to achieve adjusted earnings per share growth in 2023, building on record results over the prior 3 years.

謝謝羅德尼，大家早安。克羅格第三季的業績證明了我們價值創造模式的彈性。近年來，我們為加強業務並使業務多元化而進行的投資使克羅格能夠應對以消費者支出緊縮和家庭食品通貨緊縮為特徵的充滿挑戰的環境。本季度我們實現了 8% 的調整後每股收益成長，同時為我們的客戶提供了更大的價值，為我們的員工提供了更高的工資，並投資於支持未來成長的策略舉措。我們的團隊在利潤擴張計劃、燃料、替代利潤業務以及健康和保健方面取得了強勁的業績，使這一目標成為可能。我們今年迄今的業績使我們預計在過去 3 年創紀錄的業績基礎上，在 2023 年實現調整後每股收益的成長。

I'll now provide more detail on our third quarter. Identical sales without fuel decreased 0.6%. Underlying growth would have been positive 1%, adjusting for the effect of our terminated agreement with Express Scripts. Similar to the first 2 quarters of the year, the terminated agreement with Express Scripts had a positive effect on our FIFO gross margin rate, excluding fuel, and a negative effect on the OG&A rate, excluding fuel and adjustment items. The overall net effect on operating profit was slightly positive. As a reminder, we will begin to cycle the impact of Express Scripts at the start of the new calendar year.

我現在將提供有關第三季的更多詳細資訊。不含燃料的相同銷量下降了 0.6%。根據我們與 Express Scripts 終止協議的影響進行調整後，基本成長率將為 1%。與今年前兩個季度類似，終止與 Express Scripts 的協議對我們的 FIFO 毛利率（不包括燃料）產生了積極影響，並對 OG&A 毛利率（不包括燃料和調整項目）產生了負面影響。對營業利潤的整體淨影響略有正面。提醒一下，我們將在新日曆年開始時開始循環查看 Express Scripts 的影響。

Turning back to identical sales without fuel. As Rodney shared earlier, our Seamless ecosystem is a critical component of our growth strategy, building customer loyalty and fueling our alternative profit businesses. Digital sales were a highlight in the quarter, growing 11%. Our overall sales continue to be affected by industry-wide disinflation. Inflation ended quarter 3 in the low single digits, approximately 270 basis points lower than the second quarter. Towards the end of the quarter, we saw inflation decline at a slower pace. We would expect this trend to continue in the fourth quarter with inflation remaining positive at the year-end.

回到不加燃料的相同銷售情況。正如羅德尼之前分享的那樣，我們的無縫生態系統是我們成長策略的重要組成部分，可以建立客戶忠誠度並推動我們的替代利潤業務。數位銷售是本季的一大亮點，成長了 11%。我們的整體銷售持續受到全行業通貨緊縮的影響。第三季末通膨率處於低個位數，比第二季低約 270 個基點。到本季末，我們看到通膨下降速度放緩。我們預計這一趨勢將在第四季持續，年底通膨仍為正值。

Encouragingly, units have shown signs of improvement as inflation has decelerated, and we have sequentially improved units for 4 straight quarters. However, unit growth rates have lagged the rate of inflation decline and have not improved at the pace we would have expected. As a team, we are laser-focused on returning to unit growth and expect improvement in volumes to continue for the balance of the year. Gross margin was 22% of sales, and our FIFO gross margin rate, excluding fuel, increased 3 basis points compared to the same quarter last year.

令人鼓舞的是，隨著通貨膨脹的放緩，單位數量已顯示出改善的跡象，我們已連續四個季度連續改善單位數量。然而，單位成長率落後於通膨下降速度，並且沒有以我們預期的速度改善。作為一個團隊，我們專注於恢復單位成長，並預計今年剩餘時間銷售將繼續改善。毛利率佔銷售額的22%，我們的先進先出毛利率（不含燃料）比去年同期成長了3個基點。

During the quarter, we increased investments in pricing and promotions to deliver greater value for customers, and we were able to successfully fund these investments by continuing to execute our long-term margin improvement plan, including Our Brands optimization, sourcing efficiencies and supply chain improvements.

本季度，我們增加了定價和促銷方面的投資，以為客戶提供更大的價值，並且透過繼續執行長期利潤改善計劃（包括我們的品牌優化、採購效率和供應鏈改進），我們能夠成功地為這些投資提供資金。

Shrink was a headwind to gross margin during the quarter, primarily due to the continued rise in industry-wide theft and organized retail crime. We are investing in initiatives to mitigate shrink and protect our associates and customers in our stores. Looking ahead, we would expect these same factors that influenced gross margin in quarter 3 will drive a similar outcome for gross margin rate in the fourth quarter.

收縮是本季毛利率的不利因素，主要是由於全行業盜竊和有組織零售犯罪的持續增加。我們正在投資各種舉措，以減輕損失並保護商店中的員工和顧客。展望未來，我們預期影響第三季毛利率的這些相同因素將推動第四季毛利率出現類似的結果。

During quarter 3, we recorded a LIFO charge of $29 million compared to a charge of $152 million for the same quarter last year. This reduction was due to inflation returning to low single digits compared to double-digit growth experienced last year.

在第三季度，我們記錄的 LIFO 費用為 2,900 萬美元，而去年同期的費用為 1.52 億美元。這一下降是由於與去年的兩位數增長相比，通貨膨脹率回到了較低的個位數。

Kroger's OG&A rate increased 32 basis points, excluding fuel and adjustment items. The increase in OG&A rate was driven by planned investments in associate wages and benefits and the effect of our terminated agreement with Express Scripts.

克羅格的 OG&A 利率增加了 32 個基點，不包括燃料和調整項目。 OG&A 率的成長是由於計劃對員工薪資和福利的投資以及我們與 Express Scripts 終止協議的影響所推動的。

During the quarter, we also made the decision to invest in a number of strategic initiatives that are expected to drive growth in 2024 and beyond. Investments were partially offset by execution of cost saving initiatives and lower incentive plan costs. We are confident in our ability to effectively manage costs and continue to deliver savings by eliminating waste in areas that do not affect the customer experience.

在本季度，我們也決定投資多項策略舉措，這些舉措預計將推動 2024 年及以後的成長。執行成本節約措施和降低激勵計畫成本部分抵銷了投資。我們對有效管理成本的能力充滿信心，並透過消除不影響客戶體驗的領域的浪費來繼續節省成本。

We continue to identify incremental cost saving opportunities across the business and remain on track to deliver our sixth consecutive year of $1 billion in cost savings. In the fourth quarter, we would expect our OG&A rate to be relatively flat compared to last year.

我們繼續在整個企業中尋找增量成本節約機會，並繼續努力實現連續第六年實現 10 億美元的成本節約。在第四季度，我們預計 OG&A 率與去年相比相對持平。

Kroger Health is an important component of our value creation model and is delivering profitable growth in 2023. During the quarter, the team exceeded our internal goal for the number of vaccinations administered, and the higher profit margins associated with these vaccines helped offset the negative impact on margin rate from growth in GLP-1 drugs. As Rodney shared earlier, we are excited about the momentum in health and wellness and see significant potential for future profitable growth in this area of our business.

Kroger Health 是我們價值創造模式的重要組成部分，並將在2023 年實現盈利增長。在本季度，該團隊超出了我們在接種疫苗數量方面的內部目標，與這些疫苗相關的較高利潤率有助於於抵銷負面影響GLP-1 藥物成長的利潤率。正如羅德尼早些時候分享的那樣，我們對健康和保健領域的發展勢頭感到興奮，並看到我們這一業務領域未來盈利增長的巨大潛力。

Fuel is also a key part of our strategy and through our rewards program is another way that we deliver value for customers and increase loyalty. Our fuel team did an outstanding job delivering results that were ahead of expectations in the third quarter. Our customers saved 14% more in rewards per fuel purchased compared to last year, which led to gallon sales outpacing the industry. The average retail price of fuel was $3.77 this quarter versus $3.84 last year. And our cents per gallon fuel margin was $0.57 this quarter versus $0.50 last year.

燃料也是我們策略的關鍵部分，透過我們的獎勵計劃是我們為客戶提供價值和提高忠誠度的另一種方式。我們的燃料團隊表現出色，第三季的業績超出了預期。與去年相比，我們的客戶購買每種燃料節省的獎勵增加了 14%，這導致加侖銷售超過了該行業。本季燃油平均零售價為 3.77 美元，去年為 3.84 美元。本季每加侖燃油利潤為 0.57 美分，去年為 0.50 美元。

I'd now like to provide a brief update on labor relations. Kroger has made substantial investments over the last 5 years in our associates, raising the average hourly wage by more than 33%. We remain committed to supporting our associates with sustainable investments in wages and comprehensive benefits that will, at the same time, allow us to continue to keep products affordable for the communities that we serve.

現在我想簡單介紹一下勞資關係的最新情況。克羅格在過去 5 年裡對我們的員工進行了大量投資，使平均時薪提高了 33% 以上。我們仍然致力於透過薪資和綜合福利方面的可持續投資來支持我們的員工，同時使我們能夠繼續為我們所服務的社區提供負擔得起的產品。

During the third quarter, we ratified new labor agreements with the UFCW for Fry's Food and Drug, Dallas Meat and 4 stores in Roundy's, in total covering more than 19,000 associates. We have now ratified all agreements that were scheduled for negotiation in 2023.

第三季度，我們為 Fry's Food and Drug、Dallas Meat 和 Roundy's 的 4 家商店批准了與 UFCW 的新勞工協議，總共覆蓋了 19,000 多名員工。我們現已批准原定於 2023 年談判的所有協議。

Turning to liquidity and free cash flow. Kroger continues to generate strong free cash flow through consistent operating results and a disciplined approach to deploying capital, prioritizing the highest return opportunities that support our growth strategy and TSR model.

轉向流動性和自由現金流。克羅格透過一致的經營業績和嚴格的資本部署方法，繼續產生強勁的自由現金流，優先考慮支持我們的成長策略和股東總回報率模型的最高回報機會。

At the end of the third quarter, Kroger's net total debt to adjusted EBITDA ratio was 1.4, which remains well below our net total debt to adjusted EBITDA ratio target range of 2.3 to 2.5. This positions us well to execute our financing strategy to close the proposed merger with Albertsons early in 2024 and then quickly return to within our target leverage range post-merger.

截至第三季末，克羅格的淨總負債與調整後 EBITDA 比率為 1.4，仍遠低於我們的淨總負債與調整後 EBITDA 比率目標範圍 2.3 至 2.5。這使我們能夠很好地執行我們的融資策略，以在 2024 年初完成與 Albertsons 的擬議合併，然後在合併後迅速恢復到我們的目標槓桿範圍內。

As I wrap up my comments on the quarter, let me provide additional color on our outlook for the remainder of the year. Today, we updated our full year guidance to reflect the impact of near-term economic pressures and food-at-home disinflation. We now expect full year identical sales without fuel to be in the range of 0.6% to 1% and adjusted FIFO net operating profit to be within a range of $4.9 billion to $5 billion. As a reminder, our sales guidance reflects the effect of Express Scripts, which is reducing our reported identical sales without fuel by approximately 150 basis points in 2023.

在我結束對本季度的評論時，讓我對我們今年剩餘時間的展望提供更多資訊。今天，我們更新了全年指引，以反映近期經濟壓力和家庭食品通貨緊縮的影響。我們現在預計全年不含燃料的相同銷售額將在 0.6% 至 1% 之間，調整後的 FIFO 淨利潤將在 49 億美元至 50 億美元之間。提醒一下，我們的銷售指引反映了 Express Scripts 的影響，該藥物使我們報告的不含燃料的相同銷售額在 2023 年減少了約 150 個基點。

Our latest sales trends would put us on track to achieve the midpoint of our updated annual sales guidance range. Importantly, we would expect to exit quarter 4 with a stronger sales trend than our overall results for the quarter as we start to cycle the effect of Express Scripts in January.

我們最新的銷售趨勢將使我們有望實現更新的年度銷售指導範圍的中點。重要的是，隨著我們從 1 月開始循環 Express Scripts 的效果，我們預計第四季度的銷售趨勢將強於本季的整體業績。

We believe we are well positioned to navigate near-term headwinds, and the strength we are seeing in our alternative profit businesses, health and wellness, and fuel, combined with a lower expected LIFO charge, gives us the confidence to raise the lower end of our full year adjusted net earnings per diluted share guidance range. We now expect adjusted EPS to be between $4.50 to $4.60. And looking forward, Kroger remains committed to delivering attractive and sustainable returns for our shareholders.

我們相信，我們有能力應對近期的逆風，而且我們在替代利潤業務、健康和保健以及燃料方面看到的實力，加上預期後進先出費用較低，使我們有信心提高我們的全年調整後每股攤薄淨利指引範圍。我們現在預計調整後每股收益將在 4.50 美元至 4.60 美元之間。展望未來，克羅格仍致力於為我們的股東提供有吸引力且可持續的回報。

I'll now turn the call back to Rodney.

我現在將電話轉回給羅德尼。

Thanks, Gary. Before we open the floor to your questions, let me provide an update on our pending merger with Albertsons Companies. As of November 15, 2023, Kroger certified substantial compliance with the second request issued by the FTC. We continue to work cooperatively with the FTC in its review of the transaction. This step keeps us on track to close our proposed merger with Albertsons in early 2024. We are confident that we have fulfilled all the commitments we set out in the original merger agreement, including the comprehensive divestiture plan announced with C&S Wholesale Grocers. C&S is a well-qualified buyer who meets all the criteria necessary to complete our transaction and will ensure no stores will close as a result of the merger. Frontline associates will remain employed and existing collective bargaining agreements will continue.

謝謝，加里。在我們開始回答大家的問題之前，讓我先介紹一下我們即將與艾伯森公司合併的最新情況。截至 2023 年 11 月 15 日，克羅格證明基本上遵守了聯邦貿易委員會 (FTC) 發出的第二項要求。我們將繼續與聯邦貿易委員會合作審查該交易。這一步驟使我們預計在 2024 年初完成與 Albertsons 的擬議合併。我們有信心履行我們在原始合併協議中規定的所有承諾，包括與 C&S Wholesale Grocers 宣布的全面剝離計劃。 C&S 是一位合格的買家，符合完成我們交易所需的所有標準，並將確保不會有任何商店因合併而關閉。第一線員工將繼續受僱，現有的集體談判協議將繼續有效。

We have made a compelling case to both Kroger and Albertsons stakeholders. Our proposed merger with Albertsons creates meaningful and measurable benefits for our customers by lowering prices beginning on day 1, extends our commitment to associates by increasing wages and benefits and deepens trust with our communities by keeping stores open to assure America has access to fresh and affordable food.

我們向克羅格和艾伯森的利害關係人提出了令人信服的案例。我們提議與Albertsons 合併，透過從第一天開始就降低價格，為我們的客戶創造有意義且可衡量的利益，透過增加工資和福利來擴大我們對員工的承諾，並透過保持商店營業以確保美國能夠獲得新鮮且價格實惠的產品來加深與我們社區的信任食物。

In terms of integration planning, we are progressing well. Our integration teams have made significant progress toward our first goal, which is to ensure continuity for associates and customers at closing. It is exciting to see the complementary strengths of both organizations and how we'll be able to learn from each other to provide customers with an even stronger food retail experience and compete even more effectively against larger nonunion operators in the future.

在整合規劃方面，我們進展順利。我們的整合團隊在實現我們的第一個目標方面取得了重大進展，即確保交易結束時員工和客戶的連續性。令人興奮的是看到兩個組織的優勢互補，以及我們如何能夠相互學習，為客戶提供更強大的食品零售體驗，並在未來與更大的非工會經營者進行更有效的競爭。

In closing, Kroger delivered another quarter of solid results. We are demonstrating our ability to manage through a more challenged environment and remain committed to balancing our investments in our associates and in lower prices for our customers while continuing to generate attractive and sustainable returns for our shareholders.

最後，克羅格又交付了一個季度的穩健業績。我們正在展示我們在更具挑戰性的環境中進行管理的能力，並繼續致力於平衡我們對員工的投資和為客戶提供更低的價格，同時繼續為我們的股東創造有吸引力和可持續的回報。

With that, Gary and I look forward to taking your questions.

因此，加里和我期待著回答您的問題。

(Operator Instructions) Our first question goes to Dean Rosenblum of Bernstein.

（操作員說明）我們的第一個問題向伯恩斯坦公司的 Dean Rosenblum 提出。

My question is really about a debate regarding the gross profit and operating profit impact of increasing digital sales. I mean, online was -- digital sales were up 11% this quarter on a total comp. Express Scripts of [1], which says it's growing share. Can you help us understand -- I know you think about it in terms of the whole digital ecosystem, including the alternative revenues. But in terms of the actual operating profit contribution from digital relative to the stores, can you help us understand how to think about that as that mix continues to increase?

我的問題實際上是關於數位銷售增加對毛利和營業利潤影響的爭論。我的意思是，本季線上數位銷售額整體成長了 11%。 [1] 的 Express Scripts 表示其份額正在成長。你能否幫助我們理解——我知道你從整個數位生態系統的角度來思考這個問題，包括替代收入。但就數字相對於商店的實際營業利潤貢獻而言，您能否幫助我們了解隨著這種組合的不斷增加，如何考慮這一點？

If you look currently, digital would not be as profitable as stores. We do believe, over time, that will change, and we think that will change by multiple things, the overall ecosystem. If you look at pickup, we continue to make significant progress on reducing the cost to serve a customer on pickup. If you look at our sheds, we continue to make progress on our sheds to get them to where the profitability of the shed would be the same as a store.

如果你目前來看，數位通路的獲利能力將不如實體店。我們確實相信，隨著時間的推移，這種情況將會改變，我們認為這會因多種因素、整個生態系統而改變。如果您看看取貨，我們將繼續在降低取貨客戶服務成本方面取得重大進展。如果你看看我們的棚屋，我們會繼續在棚屋方面取得進展，使棚屋的盈利能力與商店相同。

So if you just step back, kind of we view job one is make sure we don't lose the customer. And what we find is that customer, over time, will spend more with us when they're engaged with us through pickup, delivery and in-store. And then obviously, if you look at the incremental profitability, that is making meaningful progress. And we also, when you include media as well, that's making progress. So if you look initially, it is not as profitable but we have every expectations over time that it will be.

因此，如果您退後一步，我們認為第一項工作是確保我們不會失去客戶。我們發現，隨著時間的推移，當客戶透過取貨、送貨和店內與我們互動時，他們會在我們這裡花費更多。顯然，如果你看看增量獲利能力，你會發現正在取得有意義的進展。我們也，當你也包括媒體時，這正在取得進展。因此，如果你一開始看，它並沒有那麼有利可圖，但隨著時間的推移，我們完全期望它會有利可圖。

Yes, Rodney, maybe just to add, Dean, a couple of specific data points. Can you hear me, okay?

是的，羅德尼，迪恩，也許只是補充幾個具體的數據點。你聽得到我說話嗎？

Yes, please.

是的，請。

Dean -- I think we talked, Dean, before about we sort of bucket our digital business into 2 areas, the sort of the business prior to launching our CFCs, which will be pickup and delivery through our third-party providers and then our customer fulfillment centers powered by Ocado. We've talked before about the pickup and delivery business sort of having a pass-through profitability rate on incremental sales of around 5% or mid-single-digit percent and the store being sort of north of 15%.

Dean——Dean，我想我們之前談過，我們將數位業務分為兩個領域，即推出 CFC 之前的業務，這些業務將透過我們的第三方供應商以及我們的客戶進行提貨和交付由Ocado 提供支持的履行中心。我們之前討論過提貨和送貨業務的增量銷售的傳遞利潤率約為 5% 或中個位數，而商店的利潤率則在 15% 以上。

And we talked a couple of years ago about being on a journey to improving that pass-through rate through some of the things that Rodney mentioned around improving mix, around improving media revenue per transaction and then also lowering the cost to fill a digital order. We've made good progress on all 3 of those areas, and we would certainly see now sort of the digital pass-through profitability heading towards that double-digit rate sort of on that journey towards getting towards parity in terms of overall profitability.

幾年前，我們談到了透過羅德尼提到的一些改進組合、提高每筆交易的媒體收入以及降低填寫數位訂單的成本來提高傳遞率的旅程。我們在所有這三個領域都取得了良好的進展，我們現在肯定會看到數位傳遞盈利能力朝著兩位數的水平邁進，在整體盈利能力方面實現平價的過程中。

And then the Ocado CFCs, we're really still very much in the early stage of that journey where the total investment is sort of starting to peak, and we're starting to see tailwinds in that profitability as we start to achieve more scale in those facilities.

然後是 Ocado CFC，我們確實還處於這一旅程的早期階段，總投資開始達到頂峰，隨著我們開始實現更大的規模，我們開始看到盈利能力的順風車。那些設施。

That's great. My follow-up question is, you mentioned certifying the second request substantial completion on November 15. That would suggest that the FTC now has 30 days to either make a decision or to extend the period. Do you have any sense right now as to whether we might expect some sort of an FTC decision or that the FTC is more likely to extend the time for that decision?

那太棒了。我的後續問題是，您提到在 11 月 15 日確認第二項請求基本完成。這意味著 FTC 現在有 30 天的時間做出決定或延長期限。您現在是否知道我們是否會期待聯邦貿易委員會做出某種決定，或者聯邦貿易委員會更有可能延長該決定的時間？

Dean, it's a great question. And if you look as you -- in our prepared comments, we expect to close in early 2024, as we have all along. We continue to have a cooperative relationship with the FTC and other interested parties, and it's still too early in terms of specific dates.

迪恩，這是一個很好的問題。如果你像我們準備好的評論中那樣看，我們預計將在 2024 年初關閉，正如我們一直以來所做的那樣。我們繼續與聯邦貿易委員會和其他相關方保持合作關係，但就具體日期而言還為時過早。

The next question goes to Simeon Gutman of Morgan Stanley.

下一個問題將問摩根士丹利的西蒙古特曼。

This is Michael Kessler on for Simeon. Maybe starting with the question on your inflation or deflation outlook for 2024, what your current expectation is. And what would need to happen in the backdrop for us to see either deflation or a return to more modest inflation. And in the event that we see deflation, is there a scenario in which you can hold or still expand margins even in that kind of backdrop?

我是西蒙的麥可凱斯勒。也許從您對 2024 年通膨或通貨緊縮前景的問題開始，您目前的預期是什麼。以及在我們看到通貨緊縮或回歸更溫和的通膨的背景下需要發生什麼。如果我們看到通貨緊縮，即使在這種背景下，是否有一種情況可以維持或仍然擴大利潤？

Yes, thanks for the question. As you know, we'll certainly provide a lot more specific details of our outlook for 2024 when we get to our quarter 4 earnings in March. And we're continuing, as I'm sure many are in the market, to look at all the data points we see both internally and externally. And we're probably looking at some of the same data sources that you are from the top likes of USDA and other published sources.

是的，謝謝你的提問。如您所知，當我們在 3 月公佈第四季度收益時，我們肯定會提供有關 2024 年前景的更多具體細節。正如我確信市場上的許多人一樣，我們正在繼續研究我們在內部和外部看到的所有數據點。我們可能正在查看一些與您來自美國農業部和其他已發布來源的頂級資料來源相同的資料來源。

I think our view right now, we recognize we don't have the perfect crystal ball and we'll continue to watch and evaluate how we see the outlook for next year. But overall, most of the data that we're seeing would tend to point towards more of a typical year next year for food-at-home with food-at-home inflation being in the low single-digit range. We certainly think there are different scenarios that can play out. And of course, we'll look to adapt our model as we would need to, if those were the case, but that would be the data that we're watching. And we'll certainly provide more color when we get to the March earnings and talk specifically about our 2024 views.

我認為我們現在的觀點是，我們認識到我們沒有完美的水晶球，我們將繼續觀察和評估我們如何看待明年的前景。但總體而言，我們看到的大多數數據往往表明明年的家庭食品通膨將處於較低的個位數範圍內，這將是典型的一年。我們當然認為可能會出現不同的情況。當然，如果是這種情況，我們將根據需要調整我們的模型，但這將是我們正在觀察的數據。當我們公佈 3 月份的財報時，我們肯定會提供更多信息，並具體討論我們對 2024 年的看法。

And one of the things that Gary always reminds me of, if you look over the last 50 years, there's only been 2 years out of the last 50 where it's been negative, where there's been actual deflation in a year. And as you know, we've been able to maintain and create strong business results in all environments, whether it's inflationary or deflationary, and you just manage accordingly.

蓋瑞總是提醒我的一件事是，如果你回顧過去 50 年，你會發現過去 50 年中只有 2 年是負值，也就是一年內出現實際通貨緊縮。如您所知，我們能夠在所有環境下維持並創造強勁的業務成果，無論是通貨膨脹還是通貨緊縮，您只需進行相應的管理即可。

Okay, great. And then a quick follow-up on the fuel business, which had higher-than-expected profitability. Can you talk about what drove that? And is there any interplay, I guess, between that business and the core supermarket business, if there's any balancing of the profitability dynamics and what you're able to earn to kind of manage the P&L? Or this is being managed separately and it just happened to come in a little stronger in Q3?

好的，太好了。然後是燃料業務的快速跟進，該業務的盈利能力高於預期。您能談談是什麼推動了這一點嗎？我想，該業務與核心超市業務之間是否存在任何相互作用，是否存在盈利動態與您能夠賺取的收入以管理損益之間的任何平衡？或者這是單獨管理的，只是碰巧在第三季表現得更強？

Yes. Gary mentioned it, but we're super proud of our fuel team and the partnership with all the divisions. We had a significant increase in the amount of fuel rewards that were issued, so we really look at leveraging both of the businesses to support each other. The other thing that the fuel team has done a nice job on is making sure from an efficiency standpoint on deliveries, on procurement and all the ingredients as well. So really proud of what they've done, but it really is we leverage both sides of the business to support each other and feel really good about where that business turned out.

是的。加里提到過，但我們對我們的燃料團隊以及與所有部門的合作夥伴關係感到非常自豪。我們發放的燃料獎勵數量大幅增加，因此我們確實考慮利用兩家公司的優勢相互支持。燃料團隊做得很好的另一件事是從效率的角度確保交付、採購和所有原料的效率。我們對他們所做的事情感到非常自豪，但實際上我們利用業務雙方相互支持，並對業務的結果感到非常滿意。

The next question goes to Michael Montani of Evercore ISI.

下一個問題將詢問 Evercore ISI 的 Michael Montani。

Wanted to ask on 2 fronts. One was just if you could discuss the overall competitive backdrop? And then secondly, we've heard a fair amount of promotions could uptick into next year. And I guess the question on that would be, what do you see in terms of vendor support versus you all having to fund that yourselves? And then the follow-up was just OG&A dollar growth. Is there still potential for $1 billion cost-out into '24? And what kind of dollar growth should we look for underlying in the fourth quarter?

想問兩個方面。一是您能否討論一下整體競爭背景？其次，我們聽說明年可能會有相當多的促銷活動。我想問題是，與您自己資助相比，您對供應商支援有何看法？接下來就是 OG&A 美元的成長。 24 世紀還有 10 億美元成本支出的潛力嗎？我們應該在第四季度尋找什麼樣的潛在美元成長？

Yes. I'll answer the competitive backdrop and promotions, and if Gary wants to add anything, he can. And then I'll let Gary ask about or answer the OG&A. If you look at overall, from a competitive standpoint, the market feels very similar than what it has been for a long time. If you look at the promotional activity, CPGs are increasing their funding on promotional.

是的。我會回答競爭背景和促銷活動，如果加里想補充什麼，他可以。然後我會讓 Gary 詢問或回答 OG&A。如果你從整體來看，從競爭的角度來看，市場感覺與很長一段時間以來非常相似。如果你看看促銷活動，你會發現消費品公司正在增加促銷資金。

And I think there's 2 things driving that. One is CPG is not being satisfied with their tonnage so they're increasing the amount of support. The other thing for everyone is the supply chain constraints that would have been in place a year ago and 2 years ago is real getting back to normal. So people are beginning to feel comfortable on promoting again, where the worst thing that could have happened is for us or for a CPG to promote something and then not have adequate supply.

我認為有兩件事推動了這一點。一是 CPG 對他們的噸位不滿意，所以他們正在增加支持量。對每個人來說另一件事是一年前和兩年前就存在的供應鏈限制真正恢復正常。因此，人們開始對再次促銷感到放心，而對於我們或快速消費品公司來說，可能發生的最糟糕的事情就是促銷某些東西，然後卻沒有足夠的供應。

So it really is behaviors getting back to pre-COVID. And even if you look at shopping during Thanksgiving, it was really more last minute, which really reflected -- if you go back and look at pre-COVID, it's kind of what it was and people getting comfortable there will be products there when they go to buy it. So both great questions, but that's really what we're seeing right now and Gary on the OG&A.

所以這確實是回到了新冠疫情之前的行為。即使你看看感恩節期間的購物，你也會發現，這實際上更多是在最後一刻，這確實反映出——如果你回顧一下新冠疫情之前的情況，那就是這樣的，人們感到舒服的是，當他們購買時，就會有產品出現。去買吧。這都是很好的問題，但這確實是我們現在所看到的以及加里在 OG&A 上看到的情況。

Yes. Thanks, Rodney. So in OG&A, I'll just maybe take a step back as well and just mention a couple of points that I talked about in the third quarter. As we looked at the third quarter going into it, we would have expected OG&A to be a little bit lower as a rate. The things that were in the plan would have been the investments in average hourly rates and increasing wages for our associates in our stores and supply chain network and also the impact of ESI and they were very much in line with what we expected.

是的。謝謝，羅德尼。因此，在 OG&A 中，我可能也會退後一步，只提及我在第三季談到的幾點。當我們回顧第三季時，我們預計 OG&A 的比率會稍微低一些。該計劃中的內容包括對平均時薪的投資以及我們商店和供應鏈網路中員工薪資的增加，以及 ESI 的影響，它們與我們的預期非常一致。

The real differences in the third quarter were that we did make some decisions during the quarter to make some strategic investments that we believe will help set up 2024 and beyond in terms of continued revenue growth but also additional cost savings.

第三季的真正區別在於，我們確實在本季做出了一些決定，進行了一些策略性投資，我們相信這些投資將有助於實現2024 年及以後的收入持續成長，同時還可以節省額外的成本。

So as we look at the fourth quarter, we actually believe that the trends in average hourly rate will continue, and of course, Express Scripts will continue to be a factor. But outside of that, we'd expect OG&A to be relatively flat during the fourth quarter.

因此，當我們展望第四季時，我們實際上相信平均小時費率的趨勢將持續下去，當然 Express Scripts 將繼續成為一個因素。但除此之外，我們預計第四季的 OG&A 將相對持平。

As we look at 2024, as I mentioned in my prepared remarks, we still see both a sort of tailwind from initiatives that we've launched this year that will have a run rate benefit into next year. And we still see good line of sight to continued cost savings by leveraging technology and improving efficiency, driving continued improvement in cost to serve in digital and a number of areas of the business.

當我們展望 2024 年時，正如我在準備好的發言中提到的那樣，我們仍然看到今年推出的舉措帶來的某種推動力，這些舉措將在明年帶來運行率優勢。我們仍然認為，透過利用技術和提高效率來持續節省成本，推動數位化和許多業務領域的服務成本持續改善。

So we would remain confident that we see a good line of sight to continue to find that sort of 3% to 5% productivity improvements that we target to make sure we can continue to invest in our customers and continue to invest in our associates.

因此，我們仍然充滿信心，我們看到了良好的視野，繼續尋求 3% 到 5% 的生產力改進，我們的目標是確保我們能夠繼續投資於我們的客戶並繼續投資於我們的員工。

The next question goes to John Heinbockel of Guggenheim Partners.

下一個問題交給古根漢合夥人公司的約翰·海因博克爾。

So Rodney, I want to start with, can you talk to -- if you think about the promotional basket, proactive versus reactive on your end, right? And kind of is it -- would you say, I don't know, 80% proactive, 20% reactive, I don't know how you think about that. And then on the reactive side, it would seem that those without a loyalty program would be at a disadvantage to you and that you can see what's going on in the market and possibly respond where yours is more stealth. Is that even remotely how you run the business, right, where you can respond to others based on what you see out there?

所以羅德尼，我想首先，如果你考慮促銷籃子，主動與被動，你能談談嗎？是這樣的——你會說，我不知道，80% 是主動的，20% 是被動的，我不知道你怎麼看待這個問題。然後在反應方面，那些沒有忠誠度計劃的人似乎對你處於不利地位，你可以看到市場上正在發生的事情，並可能在你的計劃更隱密的地方做出反應。這是否是您遠距經營業務的方式，您可以根據您所看到的情況對其他人做出回應？

Thanks, John, for the question. By far, the majority, and when I say majority would be almost all would be proactive versus reactive. Now all our teams will check prices every single week and there'll be adjustments based on that. But by far, the majority of our discounts are proactive. And some of that is what you can see in an ad. A lot of that is the things that you've mentioned in terms of direct to individual household offers.

謝謝約翰提出這個問題。到目前為止，大多數（當我說大多數是幾乎所有）都是主動的而不是被動的。現在我們所有的團隊每週都會檢查價格，並據此進行調整。但到目前為止，我們的折扣大多是主動的。其中一些是您可以在廣告中看到的。其中很多是您提到的直接面向個人家庭的優惠。

It's one of the things that we believe the reason why our loyal households continue to grow and some of those aspects is once you become a Kroger shopper, you're getting those loyal customer mailings, which will allow you to stretch your budget more. And there's also personalized offers that even go to look at coupons and download those, and there's significant increase in those.

這是我們相信我們的忠誠家庭持續增長的原因之一，其中一些方面是一旦您成為克羅格購物者，您就會收到那些忠實的客戶郵件，這將使您能夠更多地擴展預算。還有個人化優惠，甚至可以查看優惠券並下載優惠券，而且這些優惠數量顯著增加。

So when you look at -- when you shop with us, obviously, we are a promotional merchant. But when you look at the rewards that we offer between fuel rewards and other rewards and our loyal customer mailings, our basket price overall is within less than cents of our biggest competitor. It's just we go to market and offer a little different way. But it is the reason why loyal shoppers are so important to us because that's the shopper that really gets the full value equation from us.

因此，當您在我們這裡購物時，很明顯，我們是一家促銷商家。但是，當您查看我們在燃料獎勵和其他獎勵之間提供的獎勵以及我們忠實的客戶郵件時，我們的籃子價格總體上與我們最大的競爭對手相差不到美分。只是我們進入市場並提供了一些不同的方式。但這就是為什麼忠誠的購物者對我們如此重要的原因，因為他們真正從我們身上獲得了全部價值。

Rodney, maybe the one thing I would add to John's question, too, the second part would be, I think, John, it's one of the reasons why we do have additional confidence in how we can navigate through the environment is that I think as a combination of our reward program and more customers engaging digitally post-COVID, it really does create the ability to channel the dollars in a way that give the customer the most impact and most value while also being able to target it rather than having to sort of peanut butter spread it across in different directions. And I think it's a different dynamic now compared to maybe 5, 10 years ago in the way that we're able to personalize that value and go to market.

羅德尼，也許我還要對約翰的問題補充一件事，第二部分是，我認為，約翰，這是我們對如何在環境中航行更有信心的原因之一，我認為結合我們的獎勵計劃和更多客戶在新冠疫情後參與數位化活動，它確實創造了一種能力，以一種給客戶帶來最大影響和最大價值的方式引導資金，同時也能夠瞄準目標，而不必進行排序花生醬將其分散到不同的方向。我認為，與 5、10 年前相比，現在的動態有所不同，我們能夠個性化該價值並進入市場。

You've been -- you've followed us for a long time and you would have heard us use the word cherry-pickers and really what it is trying to make sure we do is to give value to customers that are loyal to us as opposed to somebody that's just shopping a discounted item that we're not making any money on.

您已經關注我們很長時間了，您會聽到我們使用“櫻桃採摘者”這個詞，實際上，我們試圖確保我們所做的是為忠誠於我們的客戶提供價值。反對那些只是購買我們不賺錢的打折商品的人。

And then maybe as a follow-up, so it sounds like volume is slightly -- is negative, right? I don't know if it's negative 1% or a little more than that but volume is negative. Is that fair, low single-digit? When do you think that returns to positive territory? And is that solely driven, if you looked at the budget-conscious customers, because I know a couple of quarters ago, you broke that out. Is that negativity largely driven by that cohort?

然後也許作為後續行動，聽起來音量有點小——是負數，對吧？我不知道它是負 1% 還是稍微多一點，但成交量是負的。這是公平的低個位數嗎？您認為什麼時候會恢復到正值？如果你看看那些注重預算的客戶，這是否完全是驅動因素，因為我知道幾個季度前，你就打破了這一點。這種消極情緒很大程度上是由那群人造成的嗎？

Yes. If you look, volume would be slightly negative. If you look, we -- our trends have improved for 4 quarters in a row from a trend standpoint. That would be largely driven by the value shopper or customers on a budget. And the half full and half empty, the half empty is obviously that's being driven by that customer. Some of that's driven because of the impact from inflation. Part of it's -- or SNAP is down about 30%. The full part is the customers that are loyal, we're continuing to grow with that customer and that customer's profitability is meaningfully better than the value shopper.

是的。如果你看的話，成交量會稍微為負。如果你看一下，從趨勢的角度來看，我們的趨勢已經連續四個季度有所改善。這很大程度上是由價值購物者或預算有限的客戶所推動的。半滿半空，半空顯然是由那位顧客驅動的。其中一些是由於通貨膨脹的影響所致。其中一部分——即 SNAP 下降了約 30%。完整的部分是忠誠的客戶，我們將繼續與該客戶一起成長，並且該客戶的盈利能力明顯優於價值購物者。

The next question goes to Krisztina Katai of Deutsche Bank.

下一個問題是德意志銀行的克里斯蒂娜·卡泰 (Krisztina Katai)。

So Rodney, I wanted to ask you just a conceptual question on grocery sector and the level of competition, right? Because if we're thinking about it, why wouldn't the sector be more competitive as we head into 2024? The consumer remains under pressure. Some of the low end is under increased pressure. CPGs are raising their support, volumes continue to lag. So that is question one, just conceptually, why wouldn't that be the case? And secondly, how is Kroger positioned in a potentially no inflation to even deflationary backdrop relative to the base case of a normal food-at-home year of low single-digit inflation?

羅德尼，我想問你一個關於雜貨業和競爭水平的概念性問題，對吧？因為如果我們思考一下，為什麼在進入 2024 年時該行業不會更具競爭力？消費者仍然面臨壓力。一些低端產品面臨越來越大的壓力。消費品公司正在提高他們的支持，但銷量持續落後。這是第一個問題，從概念上講，為什麼情況不是這樣？其次，相對於正常家庭食品年低個位數通膨的基本情況，克羅格在可能沒有通膨甚至通貨緊縮的背景下如何定位？

Yes. If you look at, one of the things that makes this industry a lot of fun is we always assume that the business will continue to be more competitive. And if you look at our fundamental business model over the last 5 years or 10 years or 15 years, every year, we assume that it's going to be more competitive. We worked really hard to identify process changes and cost reductions so that we can continue to fund wage increases and invest in lowering prices for the customer.

是的。如果你仔細觀察，你會發現這個行業充滿樂趣的原因之一是我們始終認為該業務將繼續更具競爭力。如果你看看我們過去 5 年、10 年或 15 年的基本商業模式，每年，我們都會認為它會更具競爭力。我們非常努力地確定流程變化和成本降低，以便我們能夠繼續為工資成長提供資金並投資於降低客戶的價格。

So when we look at 2024, and obviously, we'll go into a lot more detail like early next year when we give guidance, but right now, we don't see that environment any different than what we would have felt for the last 5 years or 10 years or 15 years. And the positive is customers get a better value every year and they get a better experience every year. And when you look at for us, one of the things that we think is important for the customers, the customer doesn't have to compromise. So they get amazing fresh product that will last a long time when they get at home, with amazing friendly associates, with the smile and support that everything in their basket plus a little bit -- an extra piece of cheese or something they've engaged with Murray. So -- and not have to compromise from a pricing standpoint. So when you look overall, we feel very good in terms of how we're positioned with the customers that really appreciate what we offer.

因此，當我們展望 2024 年時，顯然，我們會像明年初一樣提供更多指導，但現在我們認為這種環境與我們去年的感受沒有任何不同5年、10年、15年。正面的一面是，客戶每年都會獲得更好的價值，每年都會獲得更好的體驗。當你考慮我們時，我們認為對客戶來說重要的事情之一，客戶不必妥協。因此，他們會得到令人驚嘆的新鮮產品，當他們回到家時，這些產品會持續很長時間，還有令人驚嘆的友好同事，他們的微笑和支持，他們籃子裡的所有東西都加上一點——一塊額外的起司或他們訂的東西與穆雷。因此，從定價的角度來看，不必妥協。因此，從整體上看，我們對與真正欣賞我們所提供產品的客戶的定位感覺非常好。

Maybe, Rodney, one thing I would just add, too, Krisztina, specific to 2024, a couple of things for Kroger that we think are helpful as we look into next year. One is, of course, that we're cycling the impact of Express Scripts when we get to January and we'll start to see that flow through in the early periods of the year. And then secondly, one of the things that we've seen as we look at 2023, many states, as you know, reduced the amount of SNAP dollars that were available in the market, and those happen sort of around the middle part of our Q1 last year or this year, I should say.

也許，羅德尼，我還要補充一件事，克里斯蒂娜，具體到 2024 年，我們認為對克羅格來說，在我們展望明年時有一些幫助。當然，其中一個問題是，到了 1 月份，我們就會循環了解 Express Scripts 的影響，而我們將在今年稍早開始看到這種影響。其次，我們在展望 2023 年時看到的一件事是，正如你所知，許多州減少了市場上可用的 SNAP 美元數量，而這些發生在我們的中期。我應該說是去年或今年的第一季。

What we've seen in 1 or 2 markets where we're cycling those earlier markets where they reduced the SNAP dollars, it certainly starts to create a bit of a different trend in the growth in those markets, too. So we do think there's -- for the industry and specifically for the markets that we operate in, as you start to cycle the impact of those SNAP dollars, which perhaps had a bit more of an impact than we were originally thinking they might across the industry, that starts to create some, I think, tailwind in the industry towards next year's growth as well.

我們在 1 或 2 個市場中看到，我們正在循環那些早期市場，他們減少了 SNAP 美元，這肯定也開始在這些市場的成長中創造一些不同的趨勢。因此，我們確實認為，對於這個行業，特別是對於我們經營的市場，當你開始循環這些 SNAP 資金的影響時，這可能比我們最初認為的對整個行業的影響要大一些。我認為，這也開始為該行業明年的成長帶來一些推動力。

The next question goes to Ed Kelly of Wells Fargo.

下一個問題將問富國銀行的艾德凱利。

Gary, I wanted to ask you about the gross margin. I think you said that the Q4 gross margin, you expect to be flattish. If you could just confirm that. And then looking out, is the base case for '24 that, that flattish trend that would continue? And then within that context, I'm curious about shrink. And maybe just educate us a little bit on when you do your accounts, the visibility you have on where you stand in shrink and do you believe it's peaked?

蓋瑞，我想問你毛利率的問題。我認為你說第四季的毛利率預計將持平。如果你能證實這一點就好了。然後展望 24 年的基本情況，這種扁平趨勢是否會持續下去？然後在這種背景下，我對收縮感到好奇。也許只是告訴我們一些關於你做賬時的信息，你對自己在收縮中的立場的可見性，你相信它已經達到頂峰了嗎？

Sure. Thanks, Ed. So the first part of the question, yes, you're essentially right that we -- I said in my prepared comments that we would expect Q4 to look very similar to Q3. The way that I sort of would break that down is that we've been equally as pleased with the progress that we've seen in the margin improvement plan initiatives that we saw in the earlier part of the year as well. So we continue to see strong benefits from Our Brands, strong benefits from sourcing, health and wellness, of course, with Express Scripts is a tailwind this year to gross margin and supply chain and alternative profits. All those areas continue to generate tailwinds in our gross margin rate.

當然。謝謝，艾德。所以問題的第一部分，是的，你基本上是對的，我在準備好的評論中說過，我們預計第四季看起來與第三季非常相似。我要分解的方式是，我們對今年稍早看到的利潤改善計畫舉措所取得的進展同樣感到滿意。因此，我們繼續看到我們的品牌帶來的巨大利益，來自採購、健康和保健的巨大利益，當然，快捷藥方是今年毛利率、供應鏈和替代利潤的推動力。所有這些領域都繼續為我們的毛利率帶來推動力。

What we did in the third quarter is we did invest more in gross margin to balance those benefits, partly in increased pricing and promotion, as Rodney mentioned earlier. And we did also increase advertising costs during the quarter as well. So those would have been the differences quarter-over-quarter in terms of what we saw and what we would expect to continue to be a similar pattern as we think about the fourth quarter.

正如羅德尼之前提到的，我們在第三季所做的是，我們確實在毛利率上進行了更多投資，以平衡這些收益，部分是在增加定價和促銷方面。我們在本季也確實增加了廣告成本。因此，就我們所看到的情況以及我們預計第四季度將繼續保持類似模式而言，這些將是季度與季度之間的差異。

I'd say as we look into beyond 2023, we certainly still see a lot of potential for the tailwinds that I mentioned around Our Brands sourcing, these areas where we believe that we are on a multiyear path to continue to drive improvement and drive growth. And of course, alternative profit streams continues to grow at a double-digit pace off a bigger base as well. So I think we still have a lot of confidence in those levers. And what we're doing is making sure we're balancing the business to set ourselves up for continued sustained growth in the future.

我想說的是，當我們展望2023 年以後時，我們當然仍然看到我在我們的品牌採購方面提到的順風車的巨大潛力，我們相信我們在這些領域將走上多年的道路，繼續推動改進和推動成長。當然，替代利潤流也在更大的基礎上繼續以兩位數的速度成長。所以我認為我們對這些槓桿仍然充滿信心。我們正在做的是確保平衡業務，為未來的持續成長做好準備。

From a shrink perspective, we would still see shrink as a headwind, as I mentioned in the prepared comments. I would say it's probably somewhat less dramatic for us than maybe some of our peer group because while we have a general merchandise business that's impacted, it's less impacted than probably some of the big-box retailers, but it would still be a headwind to our gross margin rate that would have impacted the third quarter on a year-over-year basis. That headwind actually would have been less than it was in the second quarter, not dramatically but it would have eased somewhat.

從收縮的角度來看，我們仍然將收縮視為一種逆風，正如我在準備好的評論中提到的那樣。我想說，這對我們來說可能比我們的一些同行群體要小一些，因為雖然我們的百貨業務受到了影響，但它比一些大型零售商受到的影響要小，但這仍然是我們的逆風。毛利率將影響第三季的年比情況。這種逆風實際上會比第二季小，雖然不是很大，但會有所緩解。

So it's still something that we have to work through and continue to offset, but we are seeing at least the trend in terms of year-over-year growth decelerate, but it would still be a headwind today because of the crime and organized retail crime factors I mentioned earlier.

因此，這仍然是我們必須解決並繼續抵消的問題，但我們至少看到同比增長放緩的趨勢，但由於犯罪和有組織的零售犯罪，這仍然是今天的逆風我之前提到的因素。

The other thing I think is important to remember is a lot of our shrink is in our fresh departments. And our fresh departments, actually, a lot of that is, you can manage it by changing processes and using technology. And our teams have done a great job actually on improving shrink in the fresh departments because of our store teams partnering with warehouse teams on processes and leveraging technology as well. And I think as a big chunk of the trend -- slight trend improvements that Gary mentioned.

我認為要記住的另一件事是，我們的許多心理醫生都在新鮮部門。事實上，我們的新部門，其中很多，你可以透過改變流程和使用科技來管理它。由於我們的商店團隊與倉庫團隊在流程上進行合作並利用技術，我們的團隊實際上在改善生鮮部門的損耗方面做得非常出色。我認為，作為這一趨勢的重要組成部分——加里提到的趨勢略有改善。

The next question goes to Chuck Cerankosky of Northcoast Research.

下一個問題將由北海岸研究中心的查克·塞蘭科斯基 (Chuck Cerankosky) 提出。

Rodney, could you talk a little bit about the economy's effect on inflation on your digital business. And I'm thinking particularly about customers' willingness to spend money on any delivery fees or membership fees, and also how the economy might be impacting delivery volumes and digital order volumes.

羅德尼，您能談談經濟對通貨膨脹對您的數位業務的影響嗎？我特別考慮客戶願意花錢支付任何送貨費或會員費，以及經濟可能如何影響送貨量和數位訂單量。

If you look at over -- thanks, Chuck. If you look at overall inflation is definitely stabilizing overall. And it's -- from a customer standpoint, they appreciate the stabilization but they also know the fact that if you look at over the last 2 years, they've had to endure a lot of inflation. And if you look at some of the fresh departments, some of that has actually returned back to normal. But if you look at on the process side, you wouldn't see that.

如果你看過去——謝謝，查克。如果你看一下整體通膨肯定是整體穩定的。從客戶的角度來看，他們讚賞這種穩定，但他們也知道這樣一個事實，如果你看看過去兩年，他們必須忍受嚴重的通貨膨脹。如果你看看一些新部門，其中一些實際上已經恢復正常。但如果你從流程的角度來看，你就不會看到這一點。

So if you look at like eggs, for an example, eggs are significantly deflationary. And we'll all be happy when we get to the point where we're cycling that early next year or next year. If you look at customer behavior, it's fascinating, customers do a lot of work to save where they want to save or feel like they need to save.

例如，如果你看一下雞蛋，你會發現雞蛋具有明顯的通縮作用。當我們明年初或明年開始騎自行車時，我們都會很高興。如果你觀察客戶的行為，你會發現很有趣，客戶做了很多工作來保存他們想要保存或感覺需要保存的地方。

So in pack size, if you look at moving to Our Brands versus some of the national brands. But if you look at membership fees and delivery fees and things like that, that business continues to grow strongly. And in fact, it was up double digits and that's what drove the 11%. I'm sure part of that, and any time I talk to a politician, I always remind them, if you look at customers on a budget, they're under a lot of strain and they're doing a lot of behavior changes.

因此，就包裝尺寸而言，如果您考慮轉向我們的品牌與一些全國性品牌。但如果你看看會員費和送貨費以及類似的費用，你會發現該業務繼續強勁增長。事實上，它增長了兩位數，這就是推動 11% 成長的原因。我確信這是其中的一部分，每次我與政治家交談時，我總是提醒他們，如果你看看預算上的客戶，他們承受著很大的壓力，並且正在做出很多行為改變。

If you look at customers that are not as focused on price because inflation hasn't affected them as much, that customer's behavior is still very strong, and they're still continuing to buy big packs, continuing to buy nicer wines, Murray's Cheese, Starbucks, things like that. So we over-index with our membership program on customers that are more mainstream and upscale, so I'm sure that's part of the reason why we're not seeing the behavior change.

如果你看看那些不那麼關注價格的顧客，因為通貨膨脹對他們的影響還沒有那麼大，那麼顧客的行為仍然非常強烈，他們仍然繼續購買大包裝，繼續購買更好的葡萄酒，穆雷奶酪，星巴克之類的。因此，我們對更主流和更高檔的客戶的會員計劃過度索引，所以我確信這就是我們沒有看到行為改變的部分原因。

Okay. And just real quick, you're exiting the ghost kitchen business. Any particular reason for that?

好的。很快，你就退出了幽靈廚房事業。有什麼特別的原因嗎？

Yes, great question. Appreciate it. We test a lot of different things, and we'll move on to the next version of it. We still think food away from home is a huge growth opportunity for us and we'll continue to focus on it. The ghost kitchen, the few customers that used it loved it but it just wasn't enough. So it's one of those things where you move on. So thanks, Chuck.

是的，很好的問題。欣賞它。我們測試了很多不同的東西，然後我們將繼續使用它的下一個版本。我們仍然認為外出用餐對我們來說是一個巨大的成長機會，我們將繼續關注它。幽靈廚房，使用它的少數顧客喜歡它，但這還不夠。所以這是你繼續前進的事情之一。所以謝謝，查克。

The next question goes to Rupesh Parikh of Oppenheimer.

下一個問題將由奧本海默的魯佩什·帕里克 (Rupesh Parikh) 提出。

Just going back to Kroger's digital performance, another quarter of double-digit growth. Did anything surprise you on the digital front? And just any more color in terms of what you guys are seeing delivery versus pickup?

回到克羅格的數位業績，又一個季度實現兩位數成長。數字方面有什麼讓您感到驚訝的嗎？就你們所看到的送貨與取貨而言，還有更多的色彩嗎？

Yes, I'll start and let Gary finish. I wouldn't call it a surprise, but it's great to see that the NPS scores, both in terms of our year-on-year from a pickup standpoint and a delivery standpoint is very strong. If you look at our shed delivery business, the repeat rate continues to be strong. So it really is the customers really appreciate that white-glove experience. So I don't want to make it sound like we're surprised by it but it's nice to see what we thought play out. Gary, I'll let you...

是的，我先開始，然後讓加里說完。我並不感到意外，但很高興看到 NPS 得分，無論是從提貨角度還是從交貨角度來看，與去年同期相比都非常強勁。如果你看看我們的棚屋配送業務，你會發現重複率仍然很高。因此，客戶確實非常欣賞這種白手套體驗。所以我不想讓這聽起來像是我們對此感到驚訝，但很高興看到我們的想法實現。加里，我會讓你...

Yes, I think you said it well, Rodney. I think the only thing I would add, Rupesh, is that we've said before, we believe that digital is a growth engine for the company. And I think everything we continue to see gives us that belief it will continue to be an opportunity to drive deeper customer engagement and growth. And I mentioned in a comment earlier, but the thing we didn't talk about in the script was we are seeing continued improvement in profitability. So it's helping profitable growth as well as we're lowering the cost to fill and all that driving more efficiency through technology and continuing to see media revenue growth. So that's the only piece I think that I would reinforce.

是的，我認為你說得很好，羅德尼。 Rupesh，我想我唯一要補充的是，我們之前說過，我們相信數位化是公司的成長引擎。我認為我們繼續看到的一切讓我們相信它將繼續成為推動更深層的客戶參與和成長的機會。我在之前的評論中提到過，但我們在劇本中沒有談論的是我們看到盈利能力持續改善。因此，它有助於獲利成長，我們也降低了填充成本，所有這些都透過科技提高了效率，並繼續看到媒體收入成長。所以這是我認為我要加強的唯一部分。

The next question goes to Kenneth Goldman of JPMorgan.

下一個問題是向摩根大通的肯尼斯·戈德曼提出的。

I'll take a shot here on next year. I know you're not in a position to really give numbers and I wouldn't ask about that now, but you did talk about hopefully having low single-digit sort of normal inflation next year. You highlighted a healthy amount of productivity you expected or expecting. But you also mentioned that maybe your unit growth right now is a little bit disappointing, and you'll surely be lapping some challenging fuel margins that I imagine you won't assume will recur.

明年我會在這裡拍一拍。我知道你無法真正給出數字，我現在也不會問這個問題，但你確實談到了希望明年的正常通膨率保持在個位數的低水平。您強調了您期望或期望的健康生產力。但您也提到，也許您現在的單位成長有點令人失望，而且您肯定會遇到一些具有挑戰性的燃料利潤率，我想您不會認為這種情況會再次發生。

So I'm just trying to get a sense if you have maybe sluggish units, fuel comps are tough, to get to your earnings growth algo for next year, do you theoretically have to find other drivers that are better than their algo to offset those headwinds? I just want to kind of get a sense of how to think about at least some initial headwinds and tailwinds into next year, if that all makes sense.

因此，我只是想了解一下，如果您的單位可能疲軟，燃油補償很困難，為了實現明年的盈利增長演算法，理論上您是否必須找到比其演算法更好的其他驅動因素來抵消這些影響逆風？我只是想了解如何思考明年的一些最初的逆風和順風，如果這一切都有意義的話。

Yes. Thanks, Ken. As you mentioned, we'll definitely share a lot more color, as you might expect, when we get to March. I think as we think about the model and just taking a bigger picture step back, we certainly believe that we've, over the last few years, built a more diverse ecosystem as a company. So of course, food-at-home is an important part of the sort of -- it drives the flywheel. But as you know, we've been continuing to grow -- our fuel business, continue to grow health and wellness this year even with the impact of Express Groups, and continuing to grow alternative profit streams.

是的。謝謝，肯。正如您所提到的，正如您所期望的那樣，當我們到了三月時，我們肯定會分享更多的顏色。我認為，當我們思考這個模型並從更大的角度回顧時，我們當然相信，在過去的幾年裡，我們作為一家公司建立了一個更加多元化的生態系統。當然，家庭食物是其中一個重要的部分——它驅動飛輪。但如您所知，我們的燃料業務一直在持續成長，即使受到 Express Groups 的影響，今年我們的健康和保健業務仍將繼續成長，並繼續成長替代利潤流。

So we look at it more as a journey and we do believe that as we're building the strength in that ecosystem, it creates the -- a new way to generate value for our shareholders over time as we've talked about at previous investor meetings. I mean, I think some of the points you've raised would certainly be the areas where we'll be focusing on. I don't think it's a different strategy for Kroger. It's how do we continue to drive that flywheel as we think about taking cost out of our business so that we can invest more in customers and associates, continuing to drive traffic so we can continue to grow the alternative profit businesses. And we do think there's opportunity for margin improvement to continue beyond 2023 because of the initiatives we're driving around sourcing, supply chain, alternative profit streams, et cetera.

因此，我們更多地將其視為一次旅程，我們確實相信，當我們在該生態系統中增強實力時，它會創造一種隨著時間的推移為我們的股東創造價值的新方式，正如我們在之前的投資者中談到的那樣會議。我的意思是，我認為您提出的一些觀點肯定是我們將重點關注的領域。我不認為這對克羅格來說是一個不同的策略。當我們考慮降低業務成本時，我們如何繼續驅動飛輪，以便我們可以對客戶和員工進行更多投資，繼續增加流量，以便我們可以繼續發展替代利潤業務。我們確實認為，由於我們圍繞採購、供應鏈、替代利潤流等採取的舉措，2023 年後利潤率仍有機會持續改善。

So I think from our perspective, certainly, if you were in a period where you weren't seeing sales growth for a sustained period of time because our model is built on sales growth, we have to look at our cost base and would look at our cost base in certain areas to be more productive. But we still believe that food-at-home is -- will normalize in the typical pattern that we see of that sort of 1% to 2% inflation over time and sort of 2% to 3% food-at-home growth. And we think our model is really well set up to be able to drive growth within that framework.

因此，我認為從我們的角度來看，當然，如果您處於一個持續一段時間沒有看到銷售成長的時期，因為我們的模型是建立在銷售成長的基礎上的，那麼我們必須考慮我們的成本基礎，並且會考慮我們在某些​​領域的成本基礎變得更有效率。但我們仍然相信，家庭食品將按照我們所看到的典型模式正常化，即隨著時間的推移，通貨膨脹率為 1% 至 2%，家庭食品增長為 2% 至 3%。我們認為我們的模型確實非常完善，能夠在該框架內推動成長。

Thanks, Ken. The only other thing I would add to Gary's comment is if you look at our Seamless business, we would expect that to continue to make progress as well, as I mentioned earlier.

謝謝，肯。我要對加里的評論補充的唯一另一件事是，如果您看看我們的無縫業務，我們預計它也會繼續取得進展，正如我之前提到的。

The next question goes to Michael Lasser of UBS.

下一個問題將問瑞銀集團的麥可·拉塞爾。

As you talk to your processed food and CPG partners, what are they telling you about their desire to further raise prices into next year, given your expectation that there could be typical inflation across the assortment that would necessitate that center of the sort of prices go up? And this is against the backdrop where volumes continue to go down, you're providing more support. Why are they not rolling back prices to try and drive volume? And as part of that, given that you used your P&L to fund promotions a bit more in the third quarter, is that a sign that you are running into the limitation of the vendors willing to provide support for you -- to these promotions?

當您與加工食品和快速消費品合作夥伴交談時，考慮到您預計該品種可能會出現典型的通貨膨脹，因此有必要將價格中心調低，他們會告訴您明年進一步提高價格的願望嗎？向上？在交易量持續下降的背景下，您提供了更多支持。他們為什麼不降低價格來嘗試增加銷售？作為其中的一部分，考慮到您在第三季度使用損益表為促銷活動提供了更多資金，這是否表明您遇到了願意為您提供支持的供應商的限制 - 這些促銷活動？

Thanks, Michael. If you look at overall, they say in economics, all short statements are wrong. And you have CPGs that are all over the board in terms of their approach. Some CPGs are very willing to give up tonnage. And if they are, Our Brands will stay -- will be there for a customer to give them incredible value. And what we find is when a customer tries Our Brands, our repeat rate is incredibly high because of the quality and the value for the money.

謝謝，麥可。他們在經濟學中說，如果你從整體來看，所有簡短的陳述都是錯的。而且 CPG 的方法都是全面性的。一些快速消費品公司非常願意放棄噸位。如果是的話，我們的品牌將留下來，為客戶提供令人難以置信的價值。我們發現，當客戶嘗試我們的品牌時，由於品質和物有所值，我們的重複率非常高。

If you look in the quarter, in terms of funding, it was really done by CPGs and us. And as I mentioned earlier, CPGs were more aggressive in funding some of the promotions in the third quarter than the second quarter and would expect that to continue. We are seeing more CPGs worrying about their tonnage growth, and I think that's part of what's driving that willingness, too. So I appreciate the question, and thanks, Michael.

如果你看一下本季的情況，就資金而言，這確實是由消費品公司和我們完成的。正如我之前提到的，消費品公司在第三季比第二季更積極地為一些促銷活動提供資金，並預計這種情況將持續下去。我們看到越來越多的快速消費品公司擔心其噸位成長，我認為這也是推動這種意願的部分原因。所以我很欣賞這個問題，謝謝邁克爾。

Our last question goes to Kelly Bania of BMO.

我們的最後一個問題是問 BMO 的凱利·巴尼亞 (Kelly Bania)。

I wanted to go back to the comment about building a more diverse ecosystem and talk a little bit more about alternative profit growth. I think there was a comment that, that is still growing double digits, which I think would mean around $150 million to $200 million in incremental year-over-year profit. But maybe just wanted to give you the opportunity to comment on that if that's the right ballpark. And how many more years can this business continue to grow at double-digit rate into the coming years?

我想回到關於建立更加多元化的生態系統的評論，並更多地談論替代利潤增長。我認為有評論稱，該數字仍在以兩位數增長，我認為這意味著同比利潤增量約為 1.5 億至 2 億美元。但也許只是想讓你有機會對此發表評論（如果這是正確的）。未來幾年，這項業務還能繼續以兩位數的速度成長多少年？

Yes. I don't know that Gary and I will want to give the specifics for '24 on the all profit since we're still going through the process. But we would expect all profit to be a meaningful contributor of growth next year. And that's really driven by 2 things. One is our continued growth in our digital business, which is supporting our media business growth. And we think we're just getting started on that.

是的。我不知道加里和我是否願意提供 24 年所有利潤的具體細節，因為我們仍在經歷這個過程。但我們預計所有利潤都將為明年的成長做出有意義的貢獻。這實際上是由兩件事驅動的。一是我們數位業務的持續成長，這支持了我們媒體業務的成長。我們認為我們才剛開始。

If you look in the media world, your competitors are Google and Amazon and Meta and Walmart and then a lot of other players. And one of the things that we think transparency is so important in being able to give people good data is we think that is incredibly helpful relative to the Googles and Metas and others. So we see a long-term opportunity to continue to grow the business there. And the specifics, I don't know that we want to get there either.

如果你看看媒體世界，你的競爭對手是Google、亞馬遜、Meta 和沃爾瑪，還有很多其他參與者。我們認為透明度對於能夠為人們提供良好數據非常重要的一件事是，我們認為相對於Google、Metas 和其他公司來說，透明度非常有幫助。因此，我們看到了繼續發展那裡業務的長期機會。至於具體細節，我也不知道我們是否想要實現這個目標。

And if you look at some of the other alternative profit businesses, some of those, we have wide variance of performance within the company. So part of that growth is just driven by taking best-in-class within our own company and growing that as well. So Kelly, I appreciate the question.

如果你看看其他一些替代利潤業務，其中一些業務，我們公司內部的業績差異很大。因此，這種成長的部分原因是透過在我們自己的公司內採用一流的技術並不斷發展來推動這一成長。凱利，我很欣賞這個問題。

And thanks, everyone, for all the questions. And as always, I'd like to take a few moments to share some comments with our associates listening in. To start, I'd like to say a huge thank you for all the hard work that you've done to make the holidays be so memorable for our customers and what you will do for the -- following the rest of the holiday season to make it equally as memorable for customers.

謝謝大家提出的所有問題。像往常一樣，我想花一些時間與我們的同事分享一些意見。首先，我要對你們為慶祝節日所做的辛勤工作表示衷心的感謝讓我們的客戶如此難忘，以及您將在假期結束後做些什麼，讓客戶同樣難忘。

As you know, food plays an important part in any celebration, and it provides an opportunity for people to connect and people that we love, especially with them and sharing special moments.

如您所知，食物在任何慶祝活動中都起著重要作用，它為人們提供了與我們所愛的人聯繫的機會，尤其是與他們分享特殊時刻的機會。

If you had a chance to see our holiday film, you saw that idea come to life. And if you haven't seen our holiday film, you can go to YouTube to look at the full film. And it really does recognize that food connects us all. And whether that's honoring family traditions or creating new family ones, I've just been so inspired to see how our associates and our customers on sharing their videos and the unique ways they celebrate the holidays.

如果您有機會觀看我們的假日電影，您會看到這個想法變成了現實。如果您還沒有看過我們的節日影片，您可以前往 YouTube 觀看完整影片。它確實認識到食物將我們所有人聯繫在一起。無論是尊重家庭傳統還是創造新的家庭傳統，看到我們的員工和客戶如何分享他們的影片以及他們慶祝節日的獨特方式，我都深受啟發。

As I said before, thank you for everything you do to create special memories for our customers every single day. And thank you, everyone, for joining us. We wish everyone a happy holiday season. Merry Christmas and Happy New Year.

正如我之前所說，感謝你們每天為給我們的顧客創造特殊回憶所做的一切。感謝大家加入我們。我們祝大家節日快樂。聖誕快樂和新年快樂。

Thank you. This now concludes today's call. Thank you all for joining. You may now disconnect your lines.

謝謝。今天的電話會議到此結束。感謝大家的加入。現在您可以斷開線路。