Loblaw Companies Limited Reports 63% Increase to Net Profits, Expands Online
BRAMPTON, ONTARIO – Loblaw Companies Limited has released its first quarter results, which ended March 24, 2018. The company is expanding pick-up and e-commerce efforts in various regions throughout the country, with intent to have a presence in almost 90 percent of urban areas by the end of the year.
"In the face of external headwinds, we delivered solid results, increased dividends, continued share buybacks, and invested in our digital future," said Galen G Weston, Chairman and Chief Executive Officer for the retailer. "As the retail landscape changes, we are now rapidly scaling our e-commerce pick-up and home delivery services to blanket Canada this year.
2018 is a big year for the company, with plans for a national roll-out of its online grocery business, which includes the fast expansion of PC Express pick-up sites and home delivery options, according to a press release. PC Express, specifically, will see 500 new pick-up sites, which now includes 700 locations and more grocery stores, GO Train commuter stations, and the first Shoppers Drug Mart stores. Home delivery is offered through Instacart in Toronto, Vancouver, and Calgary, among others, but the company plans to venture into five more markets this year, including Montreal, Halifax, and Regina.
By now, about half of Canadians have access to home delivery or PC Express; however, by the end of the year, 70 percent of Canadians will have their choice from both options—with plans to boost coverage in urban markets to 90 percent coverage.
The company’s press release outlines some of 2018’s first quarter highlights, including the following:
- Revenue was $10,367 million, a decrease of $37 million, or 0.4%, compared to the first quarter of 2017.
- Retail segment sales were $10,105 million, a decrease of $61 million, or 0.6%, compared to the first quarter of 2017.
- Retail sales growth, excluding the disposition of gas bar operations, was 2.9%.
- Food retail (Loblaw) same-store sales growth was 1.9%, excluding gas bar operations.
- Drug retail (Shoppers Drug Mart) same-store sales growth was 3.7%, with pharmacy same-store sales growth of 3.5% and front store same-store sales growth of 3.8%.
- Operating income was $480 million, a decrease of $15 million, or 3.0%, compared to the first quarter of 2017.
- Net earnings available to common shareholders of the company were $377 million, an increase of $145 million, or 62.5%, compared to the first quarter of 2017. Diluted net earnings per common share were $0.98, an increase of $0.40, or 69.0%, compared to the first quarter of 2017.
- Adjusted EBITDA was $876 million, an increase of $8 million, or 0.9%, compared to the first quarter of 2017.
- Adjusted net earnings available to common shareholders of the company were $361 million, a decrease of $5 million compared to the first quarter of 2017. Adjusted diluted net earnings per common share were $0.94, an increase of $0.03, or 3.3%, compared to the first quarter of 2017.
- The company repurchased 8.1 million common shares at a cost of $544 million.
- Quarterly common share dividend to be increased by 9.3% from $0.27 per common share to $0.295 per common share.
For more insights into the company’s net earnings, operating income, adjusted gross profit, and more, check out the press release in its entirety here.
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