Kroger 2010 Annual Report Download - page 7

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5
Best in Class Retailer – Long-Term Goals
Our objective is to create value for Shareholders at industry leadership levels. More specifically, our
goals are to:
•฀ Continue฀to฀grow฀sales฀and฀loyal฀households฀through฀execution฀of฀our฀Customer฀1st฀strategy;
•฀ Expand฀earnings฀through฀steady฀ identical฀sales฀growth฀together฀with฀modest฀growth฀in฀operating฀
margins, without fuel;
•฀ Target฀annual฀earnings฀per฀share฀growth฀averaging฀6฀to฀8฀percent฀over฀a฀rolling฀3-฀to฀5-year฀horizon;
•฀ Achieve฀a฀total฀shareholder฀return฀of฀8฀to฀10฀percent,฀including฀our฀dividend;฀and
•฀ Generate฀an฀average฀annual฀return฀for฀Shareholders฀that฀matches฀or฀exceeds฀the฀S&P฀500,฀with฀less฀
volatility.
These are ambitious long-term goals. When I travel and visit our stores, Kroger Associates tell me they
are inspired by what we can accomplish together. They believe in Customer 1st and see the results.
While we are encouraged by the Company’s recent performance, I do not want to imply that we are
satisfied. We still have significant opportunities for improvement. We need to continue our disciplined cost
reductions and take more costs out of our business so we can invest more in areas that drive profitable
growth.
We also know there are challenges ahead for 2011 and beyond, including, an economic recovery
that is weaker and slower than we hoped; customers who are concerned about rising fuel and food costs;
continued high unemployment that is holding back consumer confidence; and rising pension and healthcare
costs that we all must address together.
Even with these challenges and others, I am confident in Kroger and our future. We have all the
elements of success in place: outstanding Associates who are engaged in serving every Customer; a
convenient and updated store base; passionate and seasoned leaders in stores, offices and facilities at every
level of the company; a strong balance sheet and financial position; and a robust operating strategy that is
working.
It is my privilege to be a part of our dedicated team that I believe is the best in the industry. On behalf
of all of us, thank you for your continued support and interest in Kroger.
David B. Dillon
Chairman of the Board and
Chief Executive Officer