Loblaw’s says an increase in first-quarter profits was driven by strong PC Optimum performance and impactful promotions.
On Wednesday, the retailer reported net-earnings of $503 million for the quarter ended March 22, up from $459 million in first quarter of 2024.
This year’s revenue increased to $14.1 billion from $13.6 billion, in part helped by a 17.4% rise in ecommerce sales.
Loblaw is the parent company of Loblaws Supermarket, Real Canadian Superstore, No Frills, Zehrs, Provigo, Shoppers Drug Mart, T&T Supermarket, Joe Fresh and President’s Choice Financial.
The company reported that “strong customer response to everyday value offerings, personalized PC Optimum loyalty offers and impactful promotions” helped drive sales momentum and market-share gains underpinned by “positive unit sales and larger baskets in food retail.”
On Wednesday’s earnings call, Loblaw CEO Per Bank said personalized offers and members-only pricing helped drive loyalty engagement.
Hard-discount stores, meanwhile, continue to outperform conventional banners. Loblaw reported that hard-discount growth was “significantly higher” in the first quarter and that the value options resonated “very well with Canadians.” However, conventional stores also drove value through promotions.
Bank says 50 new hard-discount store openings are planned for 2025 to meet consumer demand.
Food retail same-store sales rose by 2.2% year over year and drug retail same-store sales rose 3.8%, helped by strength in beauty, shampoo, skincare and deodorant categories. Pharmacy and health care services same-store sales were up 6.4%, and front store same-store sales increased 0.9%.
Loblaw claims its internal inflation numbers were in line with the consumer price index rise of 2.6%.
The company said that, while coffee prices rose 11% in March, Loblaw is making efforts to mitigate U.S. tariff-related impacts.
Bank said addressing customer needs related to inflationary pressures and tariff uncertainty are a priority and that Loblaw is “committed to supporting Canada” and seeking out local growers and manufacturers.
