(Reuters) - Kroger Co (N:KR), the biggest U.S. supermarket chain, lowered the higher end of its full-year adjusted profit forecast amid falling food prices and increasing competition from rivals such Wal-Mart (N:WMT) and Sprouts Farmers Market Inc (O:SFM).
Kroger's shares fell 4 percent in premarket trading.
Food prices in the United States have been falling due to low oil and grain prices, and intense competition among retailers as big grocery sellers such as Wal-Mart Stores Inc (N:WMT) aggressively cut prices to attract customers.
Kroger is operating in a difficult environment and deflation persisted as expected during the third quarter, Kroger Chief Executive Rodney McMullen said in a statement.
The company said it expects the current operating environment to continue in the first half of 2017.
Cincinnati, Ohio-based Kroger said it expects an adjusted profit of $2.10-$2.15 per share for the year ended Jan. 30, 2017, compared with its previous forecast of $2.10-$2.20 per share.
Net income attributable to the company fell to $391 million, or 41 cents per share, in the third quarter ended Nov. 5, from $428 million, or 43 cents per share, a year earlier.
Excluding certain items, the company earned 41 cents per share, in line with the average analyst estimate, according to Thomson Reuters I/B/E/S.
Net sales rose 5.9 percent to $26.56 billion. Analysts on average had expected $26.34 billion.
