$ 198.1 million profit: The piggy bank echoes at Metro

Despite inflationary pressures and labor shortages, Metro’s profits continue to rise. The grocery giant posted net income of $198.1 million (+5.3%) in the second quarter of 2022.

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On Thursday, the Quebec brand presented financial results for its fiscal year ended March 12. The group’s turnover reached 4.27 billion dollars (+ 1.9%) with its supermarkets and pharmacies.

“The industry continues to experience above-average inflationary pressures on raw material, transportation and labor costs,” said President and CEO Eric La Flèche.

The latter doesn’t hide the fact that this pressure could impact the company’s margins in the coming quarters if this pressure continues. In the short term, however, the President does not expect a miracle.

Despite supply difficulties and rising costs, management is working hard to offer “quality products at competitive prices”.

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Metro has also seen in recent months that low-cost retailers like Super C are growing faster than traditional supermarkets, and own-label brands like Selection and Irrésistibles, which are often cheaper, are gaining new followers.

Due to price adjustments, especially for meat, Metro notes that consumers have changed their buying habits.

In the second quarter, comparable grocery and pharmacy sales increased 0.8% and 9.4%, respectively, year over year.

Health care benefited from a surge in retail purchases due to a “heavier cough and cold season.” Last year, it was also forbidden to sell non-essential products during this period.

In addition, many consumers continued to do their grocery shopping online. By 2021, revenue for this service had grown by 240%. In the second quarter, the increase was 6%, pre-management.

impact of the strike

Metro has had to juggle a seven-day industrial dispute at its Toronto distribution centers for the past few months.

Management put the bill for this strike and the impact of the new contract at $10 million. These numbers will be reflected in the third fiscal quarter results.

Due to the pandemic, Metro had decided to offer a new bonus to its 45,000 employees in Quebec and Ontario. This measure has cost workers $8 million in gift cards.

In the second quarter, the company also inaugurated its automated frozen food distribution center in Toronto and continued the rollout of self-checkout at its supermarkets. Management plans to equip 54 more facilities in the coming weeks.

This system is also used in pharmacies.

Since the start of fiscal 2022, Metro has posted earnings of $405.8 million, up 7%. Revenue reached $8.59 million, up 1.4%.

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