Kroger 2012 Annual Report Download - page 89

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A-31
•฀ Our฀estimated฀expense฀and฀obligation฀for฀Kroger-sponsored฀pension฀plans฀ and฀ other฀ post-retirement฀
benefits could be affected by changes in the assumptions used in calculating those amounts. These
assumptions include, among others, the discount rate, the expected long-term rate of return on plan
assets, average life expectancy and the rate of increases in compensation and health care costs.
•฀ Adverse฀ weather฀ conditions฀ could฀ increase฀ the฀ cost฀ our฀ suppliers฀ charge฀ for฀ their฀ products,฀ or฀ may฀
decrease customer demand for certain products. Increases in demand for certain commodities could
also increase the cost our suppliers charge for their products. Additionally, increases in the cost of
inputs, such as utility costs or raw material costs, could negatively affect financial ratios and earnings.
•฀ Although฀we฀presently฀operate฀only฀in฀the฀United฀States,฀civil฀unrest฀in฀foreign฀countries฀in฀which฀our฀
suppliers do business may affect the prices we are charged for imported goods. If we are unable to pass
on these increases to our customers, our FIFO gross margin and net earnings would suffer.
•฀ Earnings฀and฀sales฀also฀may฀be฀affected฀by฀natural฀disasters฀or฀adverse฀weather฀conditions,฀particularly฀to฀
the extent that they disrupt our operations or those of our suppliers; create shortages in the availability
or increases in the cost of products that we sell in our stores or materials and ingredients we use in our
manufacturing facilities; or raise the cost of supplying energy to our various operations, including the
cost of transportation.
We cannot fully foresee the effects of changes in economic conditions on Kroger’s business. We have
assumed economic and competitive situations will not change significantly in 2013.
Other factors and assumptions not identified above could also cause actual results to differ materially
from those set forth in the forward-looking information. Accordingly, actual events and results may vary
significantly from those included in, contemplated or implied by forward-looking statements made by us or
our representatives.