Loblaw
The parent of Loblaw and Shoppers Drug Mart is reporting a Q3 profit hike from $556 million to $621 million, compared to the same quarter a year ago. Revenue for the quarter was $18.27 billion, up from $17.39 billion in the same quarter last year.
Food retail same-stores sales rose by 4.5% and drug retail same-store sales increased by 4.6%. Foot traffic moved higher, while basket size slumped. Online sales for the quarter were up 13.6%.
In this morning’s earnings call, Loblaw CFO Richard Dufresne said its food inflation numbers were lower than those tracked by the consumer price index, claiming it is doing what it can to stabilize food prices for customers. According to Dufresne, however, Loblaw is “concerned” about its suppliers’ commitment to lowering prices.
PC Optimum loyalty program redemption rates have been climbing, while No Frills and Maxi saw double-digit sales growth and discount banners “continue to outperform,” he says.
Home meal replacement offerings saw sales growth in the double digits. Private label sales are outpacing national brands, said the company, citing its new premium PC Black Label frozen pizza as a successful rollout.
Lastly, Dufresne warned of a “surge in organized retail crime,” which is becoming increasingly sophisticated and affecting the grocer’s bottom line.
Metro
Metro is reporting net earnings of $222 million, up from $166 million from the quarter prior. The company is also reporting that, for the first time in its history, sales exceeded $20 billion for the year.
Food retail same-store sales were up 6.8%, while drug retail same-store sales moved up 5.5%.
The company said food basket inflation decelerated from 8% to 5%.
In this morning’s earnings call, however, Metro president and CEO Eric La Flèche warned that it is “still receiving big price increase requests from CPG companies.”
La Flèche noted that the consumer shift to discount banners is continuing and that there’s a “significant” gap between conventional banners and discount performance.
Average basket size increased slightly, while “private label sales outpaced national brands.”
Metro & Moi doubled its loyalty member base to 2.4 million members, with performance improving week over week, according to the retailer. There are “many opportunities to grow customer engagement with more personalized offers,” La Flèche stated.
