Loblaw Companies Limited Focuses on Cutting Costs in New Strategy
BRAMPTON, ON – With big changes potentially coming to the buy-side sector for North America, Loblaw Companies Limited is ramping up its competitive edge. The company reported an increase to its revenue and retail segment sales in its Q2 report, and stated it would focus on cost reductions in a new strategy.
"In a quarter characterized by continued price deflation, we delivered solid sales metrics and are pleased with our financial performance," said Galen G. Weston, Chairman and Chief Executive Officer. "We plan to intensify our focus on cost reductions in this highly competitive market given incremental external pressures on our industry."
This strategy comes off the company’s reported Q2, where Reuters noted that Loblaws’ Q2 profit exceeded analysts expectations. The compamy stated in a press release that its revenue for this quarter was roughly $11.079 billion, up 3.2 percent or $348 million, compared to the second quarter of last year.
Loblaw also saw a boost to its retail segment sales, noting that its same store sales were positively impacted by the timing of the Easter holiday. The company reported retail sales were up $333 million from 2016’s Q2 with an increase of 3.2 percent to roughly $10.827 billion.
Other notable aspects of the company’s 2017 Q2 were as follows, as compared to the year previous:
- Food retail same-store sales growth was 1.0 percent, excluding gas bar
- Operating income increased $109 million by 21.1 percent to $626 million
- Adjusted EBITDA was $985 million, an increase of $61 million or 6.6 percent
Loblaw also stated that during Q2 it opened 32 new retail stores, and closed 18 food and drug stores. The company’s net increase in retail square footage was 0.7 percent, or 0.5 million-square-feet.
While no word has yet been released as to how the company will enact its cost-cutting strategy, and which items will be affected, AndNowUKnow will keep a close eye on the matter as Loblaw looks to solidify its place in the buy-side.