(Reuters) -Kroger reported a quarterly net loss on Friday as the U.S. retailer took a $1.4 billion charge related to a nationwide opioid settlement, sending its shares down as much as 3% in premarket trading.
The company said it would pay up to $1.2 billion to U.S. states and subdivisions and $36 million to Native American tribes to settle the majority of opioid claims brought against it by the states and Native American Tribes.
Shares of the supermarket chain, which is merging with smaller rival Albertsons in a $25-billion deal, were down 1.8% in premarket trade, after its quarterly same-store sales missed market expectations.
Lower-income shoppers, who have tightened their budgets to adapt to dwindling food-stamp benefits and higher borrowing costs, are now seeking cheaper household items and groceries.
In response, retailers have offered higher discounts on consumer packaged goods, further weighing on margins.
U.S. retailers like Walmart and Target have in recent weeks also warned of the deteriorating purchasing power of less-affluent income groups.
The Cincinnati, Ohio-based company posted a 1% rise in same-store sales for the second quarter. Analysts on average had expected a 1.26% rise, as per LSEG IBES estimates.
(Reporting by Juveria Tabassum and Savyata Mishra; Editing by Pooja Desai)
