Kroger 2013 Annual Report Download - page 4

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2
We are using free cash flow to reward shareholders.฀ Since฀ January฀ 2000,฀ Kroger฀ has฀ returned฀
nearly฀$10฀billion฀to฀shareholders฀through฀share฀repurchases.฀Since฀2006,฀Kroger฀has฀paid฀nearly฀$1.9฀billion฀
in฀dividends฀to฀shareholders,฀while฀maintaining฀our฀investment-grade฀credit฀rating.฀In฀2013,฀we฀increased฀our฀
annual dividend for the seventh consecutive year and returned more than $928 million to shareholders through
dividends฀and฀stock฀buybacks.฀If฀you฀had฀invested฀$100฀in฀Kroger฀stock฀on฀January฀31,฀2000,฀and฀reinvested฀
all฀dividends฀issued,฀your฀investment฀would฀have฀been฀worth฀$235฀on฀January฀31,฀2014,฀and฀Kroger’s฀Total฀
Shareholder฀Return฀in฀that฀same฀period฀is฀125.8%.฀In฀March฀2014,฀Kroger’s฀Board฀of฀Directors฀approved฀a฀$1฀
billion฀share฀repurchase฀program,฀underscoring฀our฀commitment฀to฀deliver฀cash฀to฀shareholders.
Welcoming Harris Teeter to the Kroger family
One฀of฀our฀platforms฀for฀growth฀is฀expanding฀into฀new฀markets.฀We฀are฀proud฀and฀excited฀to฀warmly
welcome Harris Teeter to the Kroger family of stores.฀We฀completed฀our฀merger฀in฀January฀2014฀and฀
integration฀is฀well฀underway.฀This฀exceptional฀54-year-old฀regional฀chain฀receives฀very฀high฀marks฀from฀their฀
customers฀for฀service,฀selection,฀meal-time฀solutions,฀and฀freshness.฀The฀230฀Harris฀Teeter฀stores฀are฀located฀
in฀the฀highly฀attractive฀mid-Atlantic฀markets฀and฀expand฀Kroger’s฀national฀footprint.฀We฀have฀long฀respected฀
the฀Harris฀Teeter฀management฀team฀and฀their฀operations,฀and฀we฀look฀forward฀to฀bringing฀the฀best฀of฀Harris฀
Teeter and Kroger to our customers and shareholders.
Deeply loyal customers, creating strong market share
We have the privilege of serving eight million customers each day.฀Every฀one฀of฀them฀has฀unique฀
interests฀and฀comes฀to฀our฀stores฀with฀the฀belief฀we฀will฀both฀meet฀their฀needs฀–฀their฀tastes,฀budget,฀and฀
lifestyle฀–฀and delight them with the unexpected.
We฀continue฀to฀create฀innovative฀ways฀that฀allow฀us฀to฀know฀our฀customers฀better฀than฀anyone฀else฀and฀
to฀personalize฀their฀experience฀with฀us.฀We’ve฀been฀mining฀“big฀data”฀for฀a฀long฀time,฀always฀with฀the฀single฀
focus on Customer 1st฀–฀bringing฀to฀each฀customer฀what฀is฀most฀relevant฀to฀them.
We฀have฀invested฀in฀price฀every฀year฀for฀ten฀consecutive฀years,฀saving฀our฀customers฀more฀than฀$3฀billion฀
annually in the process.
We have rewarded customers with fuel savings through our popular fuel rewards program at more than
1,240฀ convenient฀ supermarket฀ fuel฀ center฀ locations฀ in฀ 2013.฀ And,฀ customers฀ with฀ a฀ Kroger฀ Rewards฀ Visa฀
credit card earned more than $33 million in free groceries last year.
We฀ have฀ partnered฀ with฀ customers฀ to฀ support฀ the฀ community฀ organizations฀ they฀ care฀ about฀ most,฀
returning฀$46฀million฀annually฀to฀local฀organizations฀that฀customers฀select฀through฀our฀Community฀Rewards฀
program.
Our฀approach฀has฀resulted฀in฀growing฀both฀market฀share฀and฀share฀of฀loyalty.฀
And we are not done!
Customer 1st innovation is giving us new and varied ways of connecting with and deepening our
relationship with our customers. We are growing our digital offering to deliver value to our customers
through the communication channels they prefer, and customers are responding. In fact, our customers have
downloaded฀more฀than฀1฀billion฀digital฀coupons฀since฀we฀began฀offering฀them฀in฀late฀2009.฀
We฀are฀innovating฀up฀and฀down฀our฀supply฀chain฀so฀that฀Kroger฀milk฀stays฀fresher,฀longer฀in฀customers’฀
refrigerators.฀Through฀process฀improvements,฀our฀dairy฀suppliers,฀milk฀plants,฀logistics฀operation,฀and฀stores฀
worked฀together฀so฀that฀we฀can฀promise฀our฀customers฀that฀Kroger’s milk is among the freshest in the
industry.
And฀we฀continue฀to฀build฀our฀best-in-class Corporate Brands portfolio฀by฀providing฀choices฀to฀our฀
customers฀through฀a฀multi-tier฀offering฀of฀price฀points฀and฀product฀experiences.฀We฀expect฀Simple Truth
and Simple Truth Organic฀to฀join฀our฀premium฀tier,฀Private Selection,฀as฀a฀“Billion฀Dollar฀Brand”฀by฀the฀end฀
of฀fiscal฀2014฀as฀those฀brands฀are฀increasingly฀sought฀by฀shoppers฀focused฀on฀natural฀and฀organic฀foods.฀Our฀
Banner Brand continues฀to฀provide฀great฀quality฀with฀a฀wide฀breadth฀of฀products,฀and฀our฀Value฀brand฀offers฀
customers฀the฀choice฀of฀quality฀products฀that฀are฀priced฀to฀fit฀their฀budget.