Empire reports Q3 profit boost and Voila sales spike

Empire quarterly profits were up 8.5% to $134.2 million, as the company also saw Voilà sales rise 16%.

The parent company of the Sobeys, Safeway, FreshCo and Farm Boy grocery chains is reporting that sales reached approximately $7.49 billion compared with about $7.48 billion the year prior.

The performance was spurred by growth in Empire’s discount and full-service businesses. Same-store sales, excluding fuel, increased by 1.9% compared with the same period ending February 4, 2023.

In an earnings call on Thursday (March 14), Empire president and CEO Michael Medline says it saw some pullback in spending thanks to pressure on people’s wallets.

“We delivered slightly better results than the prior quarter,” Medline says, also conceding that there is low consumer confidence.

The company has higher transaction counts, but smaller baskets which the company says is consistent with the industry.

Empire says it is focusing on digital and data and will continue with e-commerce expansion with Voilà, loyalty through Scene+ personalization, improved space productivity and the continued improvement of promotional optimization.

Since Empire became the co-owner of Scene+ in the summer of 2022, it says it’s gained five million members, hitting more than 15 million total. It is now in 70% of Canadian households, the company says.

In the quarter that ended February 3, Empire reports that Voilà experienced a sales increase of 16% compared to the same quarter in the prior year.

According to third-party market data, Voilà’s national market share within the e-commerce channel continues to be higher versus the same quarter in the prior year. Medline adds that the total number of orders is increasing with strong customer retention rate.

Empire reports that it plans to further grow and enhance the Own Brands portfolio, which includes Compliments, Panache, Best Buy, Eight Treasures and Chalo. The Own Brands program enhancement “will remain a priority through increased distribution, shelf placement and product innovation.”

Since fiscal 2020, Empire reports it’s added more than 1,000 new private label SKUs with plans for around 600 more in the next three years. Empire reports Own Brands sales growth of 19.4% since 2020.

Finally, investing in the store network “will remain a priority,” Empire says, as demonstrated by a sustained emphasis on renovations and continued store expansion in discount. A Calgary “commissary” concept is coming, and Medline says it is “market leading.”

The company opened its 100th FreshCo in Ontario in Q2, and sees additional opportunities for growth in the province. Its FreshCo banner this year, came to market by conspicuously putting bargain hunters in its crosshairs.