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BRAMPTON, Ont. Loblaw Companies Ltd. exceeded expectations with quarterly financial results released Thursday as Canadians continue to spend more on spending during the COVID-19 pandemic.
The grocery and grocery retailer posted higher profits and sales for the 16 weeks ending Oct.3, with same-store grocery retail sales up 6.9% in the quarter while drug retail sales were up 6.9% in the quarter. increased by 6.1%.
The company increased its third-quarter dividend by two cents to 33.5 cents per share, from 31.5 cents per share.
Loblaw president Sarah Davis said the retailer’s conventional grocery division “continued its winning streak in 2020” with same-store sales up 9.7%.
The company’s discount division recorded growth of 4.7%.
Looking ahead, he said the company was happy with sales prior to Thanksgiving and Halloween.
“We haven’t seen a significant change in our performance,” Davis said during an investor conference call. “I would say it has been distributed a little more and I would say that people are still gathering and celebrating only in smaller groups.”
He said Loblaw expects a similar trend over the holidays, although he admitted it is “difficult to predict exactly during these unstable times.”
“We expect this, that there will still be rallies, people will continue to eat meals in smaller groups, probably won’t go out to many restaurants and parties, and therefore will eat at home in small groups that we are anticipating for the holiday season.” Davis said.
Meanwhile, Shoppers Drug Mart and Pharmaprix have administered more flu shots to date than all last year, though beauty, cough and cold products remain soft.
The increase in dividend payments occurred when Loblaw reported a common shareholder profit of $ 342 million or 96 cents per diluted share for the quarter ended October 3, from $ 331 million or 90 cents per diluted share in same quarter last year.
Revenue for what was a 16-week period was $ 15.67 billion, up from nearly $ 14.66 billion in the same quarter a year earlier.
On an adjusted basis, Loblaw claims to have earned $ 464 million or $ 1.30 per diluted share, compared to an adjusted profit of $ 458 million or $ 1.25 per diluted share a year ago.
According to financial data firm Refinitiv, analysts on average had expected adjusted profit of $ 1.26 per share and $ 15.6 billion in revenue.
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