Metro Canada’s sales for the second quarter of 2018 fell 0.1 per cent to $2.9 B, while same-store sales fell 1.2 per cent, according to the company’s latest results announcement. The figures were impacted by a year-over-year shift in the timing of the all-important Christmas week, which fell in Q1 this year and in Q2 last year, said Stewart Samuel, program director, IGD Canada and a regular columnist for Grocery Business.
Read Stewart Samuel’s commentary here.
Metro said its operating costs were affected by changes in employment law, notably the recent minimum wage hike in Ontario, which has led to a greater focus on cost control through automation.
At the same time, strong economies in Quebec and Ontario, combined with low unemployment, have boosted the appeal of full service grocery stores and dampened the pressure to offer promotions.
- taking into account the change in the Christmas week, same store sales were actually up 1.1 per cent
- net earnings were $106.9 M, down 19.3 per cent
- adjusted net earnings fell 5.1 per cent to $108.1 M
Metro’s food basket experienced an inflation of about 0.8 per cent, continuing the trend established in Q4 2017.
"Against a challenging backdrop marked by intense competition, same-store sales continued to increase in the second quarter, while our results were impacted by the shift of the Christmas week to the first quarter,” said president and CEO Eric La Flèche. “We are confident in our ability to deliver long-term growth although changes in employment laws will put pressure on our operating costs."
Metro also announced Competition Bureau approval for its acquisition of the Jean Coutu Group drugstore chain.