"Our emphasis remains on store remodels, and we are very satisfied with their performance," McMullen added. In the past quarter, the company opened 13 new or expanded stores, completed 30 remodels and closed 11 locations. The company still plans to spend $1.9 billion to $2.1 billion on capital expenditures, excluding acquisitions, in 2007.

In addition, the company continues to look at the in-store clinic business, which is now in about 30 units. "The customer seems to like it," McMullen said. "The growth is reasonably slow, but we continue to look at how it will become part of our overall pharmacy strategy."

For the quarter, total sales increased 6.6% to $16.1 billion. Identical supermarket sales increased 5.8% with fuel and 5.1% without fuel. Net earnings totaled $267.3 million, vs. $209.0 million the year before.

At the end of the fiscal quarter, Kroger operated 2,491 supermarkets and multi-department stores in 31 states under the banners Kroger and Kroger Marketplace, Ralphs, Fred Meyer, Food 4 Less, King Soopers, Smith's and Smith's Marketplace, Fry's and Fry's Marketplace, Dillons and Dillons Marketplace, QFC and City Market. Kroger also operated 780 convenience stores, 406 fine jewelry stores, and 664 supermarket fuel centers.