A surge in customers ordering groceries over Uber Eats and Instacart helped push sales higher at Metro Inc. in the company’s first fiscal quarter of the year.
The Montreal-based grocer said Tuesday that it saw 105 per cent year-over-year jump in online food sales for the three-months ending Dec. 23.
A spokesperson for Metro told Global News in an emailed statement that its partnerships, specifically with the companies behind Uber Eats and Instacart, helped the grocer to “significantly increase our online sales in a rather stable market.”
Global News asked how much of its quarterly sales were tied to the online channels, but was told that the company does not disclose those breakdowns.
Metro’s sales for the 12-week period totalled $4.97 billion, up 6.5 per cent from $4.67 billion in the year-earlier quarter that ended on Dec. 17, 2022.
Food same-store sales were up 6.1 per cent, helped in part by the timing of the end of the quarter relative to Christmas. Adjusting for the Christmas week shift, Metro says food same-store sales were up 3.4 per cent. Pharmacy same-store sales were up 3.9 per cent.
The company said its food basket inflation rate was 4.0 per cent, down from 5.5 per cent in the previous quarter.
Metro Inc. CEO Eric La Flèche said Tuesday that retail price increases will start coming to grocery stores as soon as next week, as an industry-wide blackout period on supplier price hikes comes to an end.
Speaking at a virtual press conference, La Flèche said the Metro team is negotiating hard with suppliers and delaying price increases as much as possible.
Get the latest Money 123 news.
Sent to your email, every week.
One product that Metro shoppers will notice go up in price is orange juice, said La Flèche, because of problems with orange crops.
However, he offered some hope for future stability, saying the volume of price increase requests from grocery suppliers is starting to cool from last year’s highs.
Grocery inflation in Canada has been moderating in recent months, but is still elevated at 4.7 per cent in December.
Metro meanwhile reported a first-quarter profit of $228.5 million and said it will pay a quarterly dividend of 33.5 cents per share, up from 30.25 cents per share.
The increased payment to shareholders came as Metro says its profit amounted to 99 cents per diluted share for the quarter ended Dec. 23 compared with a profit of $231.1 million or 97 cents per diluted share a year earlier when the company had more shares outstanding.
“We recorded solid results in the first quarter as our teams continued to deliver good value to customers in all our food and pharmacy banners,” La Flèche said in a statement.
“We are confident that our sustained investments in the modernization of our supply chain and our retail networks will continue to create long term value for our shareholders.”
On an adjusted basis, Metro says it earned $1.02 per diluted share, up from an adjusted profit of $1 per share a year earlier.
It is outlook, Metro continued to say it expected significant headwinds in 2024 with the launch of its automated distribution centre in Terrebonne, Que., and the launch of the final phase of its automated fresh produce plant in Toronto next spring.
It says it expects some temporary duplication of costs and learning curve inefficiencies, as well as higher depreciation and lower capitalized interest.
The company maintained its guidance for operating income before depreciation and amortization to grow by less than two per cent and adjusted net earnings per share to be flat to down 10 cents in its 2024 financial year compared with 2023.
Industry Minister François-Philippe Champagne is meanwhile once again insisting that he is reaching out to international grocers in the hopes they will open up shop in Canada.
The minister says he spoke to one foreign grocer just this morning as part of his efforts to court new players to join the Canadian grocery sector — but he’s not naming any names.
Champagne met with Canadian grocers in the fall about food inflation and demanded they create plans to stabilize grocery prices or face consequences including potential tax measures.
He recently expressed disappointment that the grocers have not been more transparent about their plans, but has stayed mum on whether the federal government plans to punish them for it.
The minister sent a letter to the commissioner of the Competition Bureau on Monday asking to discuss a follow-up study on the grocery sector, now that the bureau has new powers to subpoena companies for information.
The Competition Bureau published the findings of its previous study in June, saying that grocers’ co-operation varied and was not fulsome.
— with files from The Canadian Press
© 2024 Global News, a division of Corus Entertainment Inc.