Loblaw Companies Limited has announced its unaudited financial results for the second quarter, which ended on June 16.
“Our base businesses continued to perform well in a very competitive marketplace despite significant cost pressures,” said Galen G. Weston, chairman and CEO of Loblaw Companies Limited. “We are executing our strategy, improving processes, reducing cost and expanding our digital presence to deliver the best in food, health and beauty for Canadians.”
The 2018 second quarter highlights
The second quarter of 2018 included the negative impacts of minimum wage increases and incremental healthcare reform. The following highlights also reflect the impact of the consolidation of franchises, the disposition of gas bar operations and the acquisition of Canadian Real Estate Investment Trust (‘CREIT’) by Choice Properties’ Real Estate Investment Trust (‘Choice Properties’).
- Revenue was $10,923 million, a decrease of $157 million, or 1.4 per cent, compared to the second quarter of 2017.
- Normalized for the disposition of the gas bar operations, retail segment sales were $10,600 million, an increase of $105 million, or 1.0 per cent, compared to the second quarter of 2017.
– Food retail (Loblaw) same-store sales growth was 0.8 per cent, excluding gas bar operations.
- Drug retail (Shoppers Drug Mart) same-store sales growth was 1.7 per cent, with pharmacy same-store sales growth of 0.3 per cent and front store same-store sales growth of 3.0 per cent.
- Operating income was $561 million, a decrease of $66 million, or 10.5 per cent, compared to the second quarter of 2017.
- Adjusted EBITDA (2)was $1,027 million, an increase of $41 million, or 4.2 per cent, compared to the second quarter of 2017.
- Net earnings available to common shareholders of the Company were $50 million, a decrease of $309 million, or 86.1 per cent, compared to the second quarter of 2017. Diluted net earnings per common share were $0.13, a decrease of $0.77, or 85.6 per cent, compared to the second quarter of 2017.
– Net earnings available to common shareholders of the company were negatively impacted in the second quarter of 2018 by the change in fair value adjustment to the Trust Unit Liability and costs related to Choice Properties’ acquisition of CREIT.
- Adjusted net earnings available to common shareholders of the company (2)were $421 million, a decrease of $25 million or 5.6 per cent, compared to the second quarter of 2017.
– Normalized for the disposition of gas bar operations, adjusted net earnings available to common shareholders of the company(2) decreased by approximately $12 million, primarily driven by the retail segment.
- Adjusted diluted net earnings per common share (2)were $1.11, flat compared to the second quarter of 2017.
– Normalized for the disposition of gas bar operations, adjusted diluted net earnings per common share (2) increased by approximately 3.7 per cent or $0.04 per common share due to the favourable impact of the repurchase of common shares.
- The company repurchased 4.6 million common shares at a cost of $300 million.
