In its recent earnings report for FQ4, Albertsons Companies (ACI) surpassed EPS estimates while providing an update on its merger plans with Kroger (KR). Despite flat revenue year-over-year, ACI’s 1.0% increase in identical sales fell short of expectations. Strong growth in pharmacy sales compensated for lower fuel and wholesale revenue. The company’s digital business continued to expand, showing a 24% sales surge. Albertsons improved its gross margin to 28.0% of sales, up from 27.8% the previous year. However, excluding fuel and LIFO, the gross margin rate declined 58 basis points. ACI credited its productivity initiatives for enabling continued targeted price investments for customers. ACI and Kroger announced modifications to their divestiture agreement with C&S Wholesale Grocers, expanding the store count to be sold by 166. Shares of ACI rose 0.69% in premarket trading.